Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2018

Schedule of Balances of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table presents the balances of financial assets and liabilities measured at fair value on a recurring basis as of the dates stated.

			Fair Value Measurements as of September 30, 2018 Using
	Balance as of September 30, 2018		Level 1		Level 2		Level 3
Available-for-sale securities:
U. S. Government agencies and mortgage backed securities	$	50,136	$	—	$	50,136	$	—
State and municipal obligations		19,938		—		19,938		—
Corporate bonds		11,141		—		—		11,141
Total available-for-sale securities	$	81,215	$	—	$	70,074	$	11,141
Mortgage servicing rights	$	981	$	—	$	—	$	981

			Fair Value Measurements as of December 31, 2017 Using
	Balance as of December 31, 2017		Level 1		Level 2		Level 3
Available-for-sale securities:
U. S. Government agencies and mortgage backed securities	$	49,283	$	—	$	49,283	$	—
State and municipal obligations		21,153		—		21,153		—
Corporate bonds		6,717		—		—		6,717
Total available-for-sale securities	$	77,153	$	—	$	70,436	$	6,717
Mortgage servicing rights	$	999	$	—	$	—	$	999

Reconciliation of Items Using Level Three Inputs

The reconciliation of items using Level 3 inputs is as follows.

	MSR			Corporate Bonds
Balance as of December 31, 2017	$	999		$	6,717
Purchases		—			4,400
Fair value adjustments		(18	)		24
Sales		—			—
Balance as of September 30, 2018	$	981		$	11,141

Summary of Assets Measured at Fair Value on Nonrecurring Basis

The following table summarizes the Company’s assets that were measured at fair value on a non-recurring basis as of the dates stated.

			Fair Value Measurements as of September 30, 2018 Using
	Balance as of September 30, 2018		Level 1		Level 2		Level 3
Impaired loans	$	3,500	$	—	$	—	$	3,500
Other real estate owned, net		3,663		—		—		3,663

			Fair Value Measurements as of December 31, 2017 Using
	Balance as of December 31, 2017		Level 1		Level 2		Level 3
Impaired loans	$	3,491	$	—	$	—	$	3,491
Other real estate owned, net		4,284		—		—		4,284

Summary of Quantitative Fair Value Measurements for Level 3

The following tables display quantitative information about Level 3 Fair Value Measurements as of the dates stated.

	Balance as of September 30, 2018		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans	$	3,500	Discounted appraised value	Selling Cost Lack of Marketability	0%-30% (15%) 50%-100% (83%)
			Discounted cash flows	Discount rate	5%-7% (6%)
Other real estate owned, net		3,663	Discounted appraised value	Selling Cost Lack of Marketability	3%-11% (7%) 9%-100% (24%)

	Balance as of December 31, 2017		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans	$	3,491	Discounted appraised value	Selling Cost Lack of Marketability	6%-20% (16%) 50%-90% (65%)
			Discounted cash flows	Discount rate	5%-6% (6%)
Other real estate owned, net		4,284	Discounted appraised value	Selling Cost Lack of Marketability	3%-13% (8%) 10%-100% (16%)

Summary of Assets and Liabilities at Carrying Value and Estimated Fair Value on a Nonrecurring Basis

The following tables summarize the Company’s financial assets and liabilities at carrying values and estimated fair values on a nonrecurring basis as of the dates stated.


	Carrying Value as of		Fair Value as of		Fair Value Measurements as of September 30, 2018 Using
	September 30, 2018		September 30, 2018		Level 1		Level 2		Level 3
Financial Assets:
Cash and due from banks	$	6,610	$	6,610	$	6,610	$	—	$	—
Interest-bearing deposits		15,906		15,906		15,906		—		—
Certificates of deposit		2,976		2,976		—		2,976		—
Federal funds sold		197		197		197		—		—
Restricted securities		6,750		6,750		—		6,750		—
Loans receivable, net		846,993		831,095		—		—		831,095
Loans held for sale		—		—		—		—		—
Accrued interest receivable		3,060		3,060		—		—		3,060
Financial Liabilities:
Noninterest-bearing liabilities		108,602		108,602		108,602		—		—
Savings and interest-bearing demand deposits		330,690		330,690		—		330,690		—
Time deposits		369,836		370,777		—		370,777		—
Securities sold under repurchase agreements		6,083		6,083		—		6,083		—
FHLB advances		80,000		79,690		—		79,690		—
Subordinated notes, net		6,889		7,043		—		7,043		—


	Carrying Value as of		Fair Value as of		Fair Value Measurements as of December 31, 2017 Using
	December 31, 2017		December 31, 2017		Level 1		Level 2		Level 3
Financial Assets:
Cash and due from banks	$	9,396	$	9,396	$	9,396	$	—	$	—
Interest-bearing deposits		41,971		41,971		41,971		—		—
Certificates of deposit		3,224		3,224		—		3,224		—
Federal funds sold		6,961		6,961		6,961		—		—
Restricted securities		5,787		5,787		—		5,787		—
Loans receivable, net		758,726		774,099		—		—		774,099
Loans held for sale		1,651		1,651		—		1,651		—
Accrued interest receivable		3,194		3,194		—		—		3,194
Financial Liabilities:
Noninterest-bearing liabilities		103,037		103,037		103,037		—		—
Savings and interest-bearing demand deposits		299,820		299,820		—		299,820		—
Time deposits		358,989		356,450		—		-		356,450
Securities sold under repurchase agreements		9,498		9,498		—		9,498		—
FHLB advances		70,000		70,486		—		70,486		—
Subordinated notes, net		6,877		7,000		—		—		7,000