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FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Summary of assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis are summarized below (in thousands):

												Fair Value Measurement at June 30, 2020 Using
Financial Assets:			Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)
Mortgage-backed securities, residential			$	251,307					$	—					$	251,307					$	—
Obligations of states and political subdivisions			43,305						—						43,305						—
Corporate bonds and notes			2,250						—						2,250						—
SBA loan pools			20,199						—						20,199						—
Total available for sale securities			$	317,061					$	—					$	317,061					$	—
Equity investments, at fair value			$	2,169					$	1,507					$	—					$	662
Derivative assets			17,893						—						17,893						—
Financial Liabilities:
Derivative liabilities			$	18,104					$	—					$	17,893					$	211

There were no transfers between Level 1 and Level 2 during the three and six month periods ended June 30, 2020.

												Fair Value Measurement at December 31, 2019 Using
Financial Assets:			Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)
Mortgage-backed securities, residential			$	225,234					$	—					$	225,234					$	—
Obligations of states and political subdivisions			42,845						—						42,845						—
Corporate bonds and notes			250						—						250						—
SBA loan pools			15,761						—						15,761						—
Total available for sale securities			$	284,090					$	—					$	284,090					$	—
Equity investments, at fair value			$	1,442					$	1,442					$	—					$	—
Derivative assets			6,466						—						6,466						—
Financial Liabilities:
Derivative liabilities			$	6,831					$	—					$	6,466					$	365

Reconciliation of all assets measured at fair value

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three month periods ended June 30, 2020 and 2019 (in thousands):

																		Assets (Liabilities)
																		Derivative Liabilities
																		June 30, 2020						June 30, 2019
Balance of recurring Level 3 assets at April 1																		$	(430)					$	(230)
Derivative instruments entered into																		(6)						(11)
Total gains or losses for the period:
Included in earnings - other non-interest income																		225						(124)
Included in other comprehensive income																		—						—
Transfers out of Level 3																		—						—
Balance of recurring Level 3 assets at June 30,																		$	(211)					$	(365)

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six month periods ended June 30, 2020 and June 30, 2019 (in thousands):

																		Assets (Liabilities)
																		Derivative Liabilities
																		June 30, 2020						June 30, 2019
Balance of recurring Level 3 assets at January 1																		$	(365)					$	(140)
Derivative instruments entered into																		(15)						(35)
Total gains or losses for the period:
Included in earnings - other non-interest income																		169						(190)
Included in other comprehensive income																		—						—
Transfers out of Level 3																		—						—
Balance of recurring Level 3 assets at June 30,																		$	(211)					$	(365)

Reconciliation of liabilities measured at fair value

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three month periods ended June 30, 2020 and 2019 (in thousands):

																		Assets (Liabilities)
																		Derivative Liabilities
																		June 30, 2020						June 30, 2019
Balance of recurring Level 3 assets at April 1																		$	(430)					$	(230)
Derivative instruments entered into																		(6)						(11)
Total gains or losses for the period:
Included in earnings - other non-interest income																		225						(124)
Included in other comprehensive income																		—						—
Transfers out of Level 3																		—						—
Balance of recurring Level 3 assets at June 30,																		$	(211)					$	(365)

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six month periods ended June 30, 2020 and June 30, 2019 (in thousands):

																		Assets (Liabilities)
																		Derivative Liabilities
																		June 30, 2020						June 30, 2019
Balance of recurring Level 3 assets at January 1																		$	(365)					$	(140)
Derivative instruments entered into																		(15)						(35)
Total gains or losses for the period:
Included in earnings - other non-interest income																		169						(190)
Included in other comprehensive income																		—						—
Transfers out of Level 3																		—						—
Balance of recurring Level 3 assets at June 30,																		$	(211)					$	(365)

Nonrecurring fair value measurement, valuation techniques

The following table presents information related to Level 3 recurring fair value measurements at June 30, 2020 and December 31, 2019 (in thousands):

Description

Fair Value at June 30, 2020

Valuation Technique

Unobservable Inputs

Range [Weighted Average] at June 30, 2020

Derivative liabilities

$

211

Historical trend

Credit default rate

0.10% - 5.50% [1.11%]

Description

Fair Value at December 31, 2019

Valuation Technique

Unobservable Inputs

Range [Weighted Average] at December 31, 2019

Derivative liabilities

$

365

Historical trend

Credit default rate

7.30% - 7.30% [7.30%]

The following tables present information related to Level 3 non-recurring fair value measurement at June 30, 2020 and December 31, 2019 (in thousands):

Description

Fair Value at June 30, 2020

Valuation Technique

Unobservable Inputs

Range [Weighted Average] at June 30, 2020

Impaired loans:

Commercial mortgages:

Commercial mortgages

$

516

Sales comparison

Discount to appraised value

5.84% - 5.84% [5.84%]

$

516

OREO:

Commercial mortgages:

Commercial mortgages

$

111

Sales comparison

Discount to appraised value

20.80% - 20.80% [20.80%]

Residential mortgages

115

Sales comparison

Discount to appraised value

20.80% - 20.80% [20.80%]

Consumer loans:

Home equity lines and loans

55

Sales comparison

Discount to appraised value

31.25% - 31.25% [31.25%]

$

281

Description

Fair Value at December 31, 2019

Valuation Technique

Unobservable Inputs

Range [Weighted Average] at December 31, 2019

Impaired loans:

Commercial mortgages:

Commercial mortgages

1,554

Sales comparison

Discount to appraised value

10.00% - 10.00% [10.00%]

$

1,554

OREO:

Commercial mortgages:

Commercial mortgages

$

111

Sales comparison

Discount to appraised value

20.80% - 20.80% [20.80%]

Residential mortgages

284

Sales comparison

Discount to appraised value

20.80% - 35.29% [24.09%]

Consumer loans:

Home equity lines and loans

122

Sales comparison

Discount to appraised value

20.80% - 20.80% [20.80%]

$

517

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

Assets and liabilities measured at fair value on a non-recurring basis are summarized below (in thousands):

									Fair Value Measurement at June 30, 2020 Using
Financial Assets:			Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Total Gains (Losses)
Impaired Loans:
Commercial mortgages:
Commercial mortgages			$	516					$	—					$	—					$	516					$	232
Total impaired loans			$	516					$	—					$	—					$	516					$	232
Other real estate owned:
Commercial mortgages:
Commercial mortgages			$	111					$	—					$	—					$	111					$	—
Residential mortgages			115						—						—						115						—
Consumer loans:
Home equity lines and loans			55						—						—						55						—
Total other real estate owned, net			$	281					$	—					$	—					$	281					$	—

									Fair Value Measurement at December 31, 2019 Using
Financial Assets:			Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Total Gains (Losses)
Impaired Loans:
Commercial mortgages:
Commercial mortgages			$	1,554					$	—					$	—					$	1,554					$	(1,597)
Total impaired loans			$	1,554					$	—					$	—					$	1,554					$	(1,597)
Other real estate owned:
Commercial mortgages:
Commercial mortgages			$	111					$	—					$	—					$	111					$	—
Residential mortgages			284						—						—						284						(12)
Consumer loans:
Home equity lines and loans			122						—						—						122						—
Total other real estate owned, net			$	517					$	—					$	—					$	517					$	(12)

Carrying value and estimated fair value of financial instruments

The carrying amounts and estimated fair values of other financial instruments, at June 30, 2020 and December 31, 2019, are as follows (in thousands):

			June 30, 2020
Financial assets:			Carrying Amount						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Estimated Fair Value (1)
Cash and due from financial institutions			$	28,689					$	28,689					$	—					$	—					$	28,689
Interest-earning deposits in other financial institutions			126,473						126,473						—						—						126,473
Equity investments			2,169						1,507						—						662						2,169
Securities held to maturity			3,597						—						2,892						754						3,646
FHLBNY and FRBNY stock			3,150						—						—						—						N/A
Loans, net and loans held for sale			1,475,359						—						—						1,489,509						1,489,509
Accrued interest receivable			5,611						1						862						4,748						5,611
Derivative Assets			17,893						—						17,893						—						17,893
Financial liabilities:
Deposits:
Demand, savings, and insured money market accounts			$	1,640,546					$	1,640,546					$	—					$	—					$	1,640,546
Time deposits			170,710						—						174,034						—						174,034
Accrued interest payable			254						9						245						—						254
Derivative Liabilities			18,104						—						17,893						211						18,104

(1) Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument.  These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.  Changes in assumptions could significantly affect the estimates.

			December 31, 2019
Financial assets:			Carrying Amount						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Estimated Fair Value (1)
Cash and due from financial institutions			$	25,203					$	25,203					$	—					$	—					$	25,203
Interest-earning deposits in other financial institutions			96,701						96,701						—						—						96,701
Equity investments			2,174						2,174						—						—						2,174
Securities available for sale			284,090						—						284,090						—						284,090
Securities held to maturity			3,115						—						2,094						1,045						3,139
FHLBNY and FRBNY stock			3,099						—						—						—						N/A
Loans, net and loans held for sale			1,286,926						—						—						1,285,215						1,285,215
Accrued interest receivable			4,633						63						885						3,685						4,633
Derivative Asset			6,466						—						6,466						—						6,466
Financial liabilities:
Deposits:
Demand, savings, and insured money market accounts			$	1,410,962					$	1,410,962					$	—					$	—					$	1,410,962
Time deposits			161,176						—						163,761						—						163,761
Accrued interest payable			299						27						272						—						299
Derivative Liabilities			6,831						—						6,466						365						6,831

(1) Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument.  These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.  Changes in assumptions could significantly affect the estimates.

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- Definition

Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis.

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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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