FAIR VALUE (Tables)

9 Months Ended

Sep. 30, 2018

Schedule of Financial Assets (Liabilities) Measured at Fair Value

The following tables summarize quantitative disclosures about the fair value measurements for each category of financial assets (liabilities) carried at fair value:



As of September 30, 2018	Fair Value			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
Assets (liabilities) at fair value on a recurring basis:
Available for sale securities:
Mortgage-backed securities	$	86,761		$	—	$	86,761		$	—
Collateralized mortgage obligations	111,140			—		111,140			—
Municipal securities	15,363			—		15,363			—
Corporate bonds	19,114			—		19,114			—
Derivative instruments	(308		)	—		(308		)	—

Assets at fair value on a nonrecurring basis:
Impaired loans	11,372			—		—			11,372
Other real estate owned	1,783			—		—			1,783



As of December 31, 2017	Fair Value			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
Assets (liabilities) at fair value on a recurring basis:
Available for sale securities:
Mortgage-backed securities	$	90,678		$	—	$	90,678		$	—
Collateralized mortgage obligations	115,311			—		115,311			—
Municipal securities	7,546			—		7,546			—
Corporate bonds	18,837			—		18,837			—
Derivative instruments	(571		)	—		(571		)	—

Assets at fair value on a nonrecurring basis:
Impaired loans	6,206			—		—			6,206
Other real estate owned	2,244			—		—			2,244

Schedule of Foreclosed Assets Measured at Fair Value

The following table presents foreclosed assets that were remeasured and recorded at fair value as of:



	September 30, 2018			December 31, 2017			September 30, 2017
Other real estate owned remeasured at initial recognition:
Carrying value of other real estate owned prior to remeasurement	$	180		$	1,082		$	544
Charge-offs recognized in the allowance for loan losses	(23		)	(195		)	(175		)
Fair value of other real estate owned remeasured at initial recognition	$	157		$	887		$	369

Other real estate owned remeasured subsequent to initial recognition:
Carrying value of other real estate owned prior to remeasurement	$	599		$	—		$	—
Write-downs included in collection and other real estate owned expense	(56		)	—			—
Fair value of other real estate owned remeasured subsequent to initial recognition	$	543		$	—		$	—

Schedule of Quantitative Information About Nonrecurring Level 3 Fair Value Measurements

The following tables present quantitative information about nonrecurring Level 3 fair value measurements as of:



	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
September 30, 2018
Impaired loans	$	11,372	Fair value of collateral - sales comparison approach	Selling costs or other normal adjustments: Real estate Equipment	10%-20% (16%) 10%-20% (19.9%)
Other real estate owned	$	1,783	Appraisal value of collateral	Selling costs or other normal adjustments	10%-20% (16%)



	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)
December 31, 2017
Impaired loans	$	6,206	Fair value of collateral - sales comparison approach	Selling costs or other normal adjustments: Real estate Equipment	10%-20% (16%) 10%-20% (3.6%)
Other real estate owned	$	2,244	Appraisal value of collateral	Selling costs or other normal adjustments	10%-20% (16%)

Schedule of Carrying Amounts And Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments not previously discussed in this note, as of September 30, 2018 and December 31, 2017, are as follows:



	Fair value measurements as of September 30, 2018 using:
	Carrying Amount		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
Financial assets:
Cash, due from banks, federal funds sold and interest-bearing deposits	$	54,051	$	54,051	$	—	$	—	$	54,051
Marketable securities held to maturity	164,839		—		162,596		—		162,596
Loans, net	1,638,149		—		—		1,622,802		1,622,802
Accrued interest receivable	7,760		—		7,760		—		7,760
Nonmarketable equity securities	13,818		—		13,818		—		13,818
Cash surrender value of life insurance	25,747		—		25,747		—		25,747
Financial liabilities:
Deposits	$	1,837,339	$	1,443,080	$	393,086	$	—	$	1,836,166
Securities sold under repurchase agreements	11,107		—		11,107		—		11,107
Accrued interest payable	1,464		—		1,464		—		1,464
Federal Home Loan Bank advances	129,140		—		128,853		—		128,853
Subordinated debentures	12,810		—		10,662		—		10,662



	Fair value measurements as of December 31, 2017 using:
	Carrying Amount		Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
Financial assets:
Cash, due from banks, federal funds sold and interest-bearing deposits	$	91,428	$	91,428	$	—	$	—	$	91,428
Marketable securities held to maturity	174,684		—		176,790		—		176,790
Loans, net	1,347,779		—		—		1,346,361		1,346,361
Accrued interest receivable	8,174		—		8,174		—		8,174
Nonmarketable equity securities	9,453		—		9,453		—		9,453
Cash surrender value of life insurance	19,117		—		19,117		—		19,117
Financial liabilities:
Deposits	$	1,676,320	$	1,378,467	$	297,978	$	—	$	1,676,445
Securities sold under repurchase agreements	12,879		—		12,879		—		12,879
Accrued interest payable	922		—		922		—		922
Federal Home Loan Bank advances	45,153		—		44,722		—		44,722
Subordinated debentures	13,810		—		11,495		—		11,495

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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