Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2016

Schedule of carrying amount and estimated fair value of financial instruments

The fair value estimates presented herein are based on pertinent information available to management as of the periods indicated.



	At September 30, 2016
	Carrying Amount		Level 1		Level 2		Level 3		Estimated Fair Value
	(in thousands)
Assets:
Cash and cash equivalents	$	103,904	$	103,904	$	—	$	—	$	103,904
Interest-bearing time deposits with financial institutions	3,944		3,944		—		—		3,944
Investments held to maturity	8,900		—		9,004		—		9,004
Investment securities available for sale	313,200		—		313,200		—		313,200
FHLB, FRB, and other stock	29,966		N/A		N/A		N/A		N/A
Loans held for sale	9,009		—		10,090		—		10,090
Loans held for investment, net	3,068,996		—		—		3,100,814		3,100,814
Accrued interest receivable	11,642		11,642		—		—		11,642

Liabilities:
Deposit accounts	3,059,752		2,343,554		572,175		—		2,915,729
FHLB advances	90,000		—		89,971		—		89,971
Other borrowings	46,213		—		46,247		—		46,247
Subordinated debentures	69,353		—		69,206		—		69,206
Accrued interest payable	238		238		—		—		238



	At December 31, 2015
	Carrying Amount		Level 1		Level 2		Level 3		Estimated Fair Value
	(in thousands)
Assets:
Cash and cash equivalents	$	78,417	$	78,417	$	—	$	—	$	78,417
Interest-bearing time deposits with financial institutions	1,972		1,972		—		—		1,972
Investments held to maturity	9,642		—		9,572		—		9,572
Investment securities available for sale	280,273		—		280,273		—		280,273
FHLB, FRB, and other stock	22,292		N/A		N/A		N/A		N/A
Loans held for sale	8,565		—		9,507		—		9,507
Loans held for investment, net	2,236,998		—		—		2,244,936		2,244,936
Accrued interest receivable	9,315		9,315		—		—		9,315

Liabilities:
Deposit accounts	2,195,123		1,674,148		521,291		—		2,195,439
FHLB advances	148,000		—		148,036		—		148,036
Other borrowings	48,125		—		49,156		—		49,156
Subordinated debentures	70,310		—		68,675		—		68,675
Accrued interest payable	206		206		—		—		206

Schedule of Company's financial instruments measured at fair value on a recurring basis

The following fair value hierarchy table presents information about the Company’s financial instruments measured at fair value on a recurring basis at the dates indicated:



	September 30, 2016
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Securities at Fair Value
	(in thousands)
Available for sale:
Corporate	$	—	$	23,330	$	—	$	23,330
Municipal bonds	—		116,838		—		116,838
Collateralized mortgage obligation	—		33,866		—		33,866
Mortgage-backed securities	—		139,166		—		139,166
Total securities available for sale	$	—	$	313,200	$	—	$	313,200



	December 31, 2015
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Securities at Fair Value
	(in thousands)
Available for sale:
Municipal bonds	$	—	$	130,245	$	—	130,245
Collateralized mortgage obligation	$	—	$	24,543	$	—	24,543
Mortgage-backed securities	—		125,485		—		125,485
Total securities available for sale	$	—	$	280,273	$	—	$	280,273

Schedule of Company's assets measured at fair value on a non-recurring basis

The following table provides a summary of the financial instruments the Company measures at fair value on a non-recurring basis as of the periods indicated:



	September 30, 2016
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Assets at Fair Value
	(in thousands)
Assets
Collateral dependent impaired loans
Business loans:
Commercial and industrial	$	—	$	—	$	1,990	$	1,990
Commercial owner occupied	—		—		606		606
SBA	—		—		503		503
Real estate loans:
Commercial non-owner occupied	—		—		2,487		2,487
One-to-four family	—		—		131		131
Land	—		—		17		17
Total collateral dependent impaired loans	$	—	$	—	$	5,734	$	5,734
Other real estate owned
Land	—		—		711		711
Total other real estate owned	—		—		711		711
Total assets	$	—	$	—	$	6,445	$	6,445



	December 31, 2015
	Fair Value Measurement Using
	Level 1		Level 2		Level 3		Assets at Fair Value
	(in thousands)
Assets
Collateral dependent impaired loans
Business loans:
Commercial and industrial	$	—	$	—	$	313	$	313
Franchise	—		—		168		168
Commercial owner occupied	—		—		536		536
Real estate loans:							—
Commercial non-owner occupied	—		—		214		214
One-to-four family	—		—		70		70
Land	—		—		21		21
Total collateral dependent impaired loans	$	—	$	—	$	1,322	$	1,322
Other real estate owned
Land	—		—		1,161		1,161
Total other real estate owned	—		—		1,161		1,161
Total assets	$	—	$	—	$	2,483	$	2,483

Schedule of quantitative information about level 3 of fair value measurements for financial instruments measured at fair value on a non-recurring basis

The following table presents quantitative information about Level 3 of fair value measurements for financial instruments measured at fair value on a non-recurring basis for the periods indicated:



	September 30, 2016
					Range
	Fair Value		Valuation Techniques	Unobservable Inputs	Rate	Maturity (years)	Unobservable Inputs
	(dollars in thousands)
Collateral dependent impaired loans:
Business loans:
Commercial and industrial	$	1,990	Collateral valuation	Management adjustment to reflect current conditions and selling costs	9.00%	1	0 - 10%
Commercial owner occupied	606		Collateral valuation	Management adjustment to reflect current conditions and selling costs	6.50 - 7.75%	10	0 - 10%
SBA	503		Collateral valuation	Management adjustment to reflect current conditions and selling costs	6.00 - 6.25%	8-23	0 - 10%
Real estate loans:
Commercial non-owner occupied	2,487		Collateral valuation	Management adjustment to reflect current conditions and selling costs	11.75%	1	0 - 15%
One-to-four family	131		Collateral valuation	Management adjustment to reflect current conditions and selling costs	9.00 - 15.00%	1 - 14	0 - 10%
Land	17		Collateral valuation	Management adjustment to reflect current conditions and selling costs	13.00%	15	0 - 10%
Total collateral dependent impaired loans	$	5,734

Other real estate owned
Land	$	711	Collateral valuation	Management adjustment to reflect current conditions and selling costs	—%	0	0 - 10%
Total other real estate owned	$	711



	December 31, 2015
					Range
	Fair Value		Valuation Techniques	Unobservable Inputs	Rate	Maturity (years)	Unobservable Inputs
	(dollars in thousands)
Collateral dependent impaired loans:
Business loans:
Commercial and industrial	$	313	Collateral valuation	Management adjustment to reflect current conditions and selling costs	7.50%	6	0 - 10%
Franchise	$	168	Collateral valuation	Management adjustment to reflect current conditions and selling costs	5.70% - 6.70%	7-8	0 - 10%
Commercial owner occupied	536		Collateral valuation	Management adjustment to reflect current conditions and selling costs	7.75%	7	0 - 10%
Real estate loans:
Commercial non-owner occupied	214		Collateral valuation	Management adjustment to reflect current conditions and selling costs	6.75%	2-12	0 - 15%
One-to-four family	$	70	Collateral valuation	Management adjustment to reflect current conditions and selling costs	9.00% - 15.00%	5 - 16	0 - 10%
Land	$	21	Collateral valuation	Management adjustment to reflect current conditions and selling costs	13.00%	15	0 - 10%
Total collateral dependent impaired loans	$	1,322

Other real estate owned
Land	$	1,161	Collateral valuation	Management adjustment to reflect current conditions and selling costs	—%	0	0-10%
Total other real estate owned	$	1,161