FAIR VALUE ACCOUNTING (Tables)

6 Months Ended

Jun. 30, 2020

The following tables present the financial instruments measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019:



	Fair Value		Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Investment securities:
U.S. government agency obligations	$	35,353	$	—	$	35,353	$	—
Obligations of states and political subdivisions	140		—		140		—
Mortgage-backed securities	59,372		—		59,372		—
Corporate debt securities	20,079		—		20,079		—
Corporate asset based securities	34,822		—		34,822		—
Trust preferred securities	12,950		—		12,950		—
Total	$	162,716	$	—	$	162,716	$	—
December 31, 2019
Investment securities:
U.S. government agency obligations	$	51,805	$	—	$	51,805	$	—
Obligations of states and political subdivisions	281		—		281		—
Mortgage-backed securities	71,331		—		71,331		—
Corporate debt securities	18,725		—		18,725		—
Corporate asset backed securities	26,854		—		26,854		—
Trust preferred securities	11,123		—		11,123		—
Total	$	180,119	$	—	$	180,119	$	—

The following tables present the financial instruments measured at fair value on a nonrecurring basis as of June 30, 2020 and December 31, 2019:



	Carrying Value		Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2020
Foreclosed and repossessed assets, net	$	734	$	—	$	—	$	734
Impaired loans with allocated allowances	4,058		—		—		4,058
Mortgage servicing rights	3,509		—		—		3,509
Total	$	8,301	$	—	$	—	$	8,301
December 31, 2019
Foreclosed and repossessed assets, net	$	1,460	$	—	$	—	$	1,460
Impaired loans with allocated allowances	3,175		—		—		3,175
Mortgage servicing rights	4,282		—		—		4,309
Total	$	8,917	$	—	$	—	$	8,944

The following table represents additional quantitative information about assets measured at fair value on a

recurring and nonrecurring basis and for which we have utilized Level 3 inputs to determine their fair value at

June 30, 2020.



	Fair Value		Valuation Techniques (1)	Significant Unobservable Inputs (2)	Range
June 30, 2020
Foreclosed and repossessed assets, net	$	734	Appraisal value	Estimated costs to sell	10 - 15%
Impaired loans with allocated allowances	$	4,058	Appraisal value	Estimated costs to sell	10 - 15%
Mortgage servicing rights	$	3,509	Discounted cash flows	Discounted rates	9.5% - 12.5%
December 31, 2019
Foreclosed and repossessed assets, net	$	1,460	Appraisal value	Estimated costs to sell	10 - 15%
Impaired loans with allocated allowances	$	3,175	Appraisal value	Estimated costs to sell	10 - 15%
Mortgage servicing rights	$	4,309	Discounted cash flows	Discounted rates	9.5% - 12.5%

(1) Fair value is generally determined through independent third-party appraisals of the underlying

collateral, which generally includes various level 3 inputs which are not observable.

(2) The fair value basis of impaired loans and real estate owned may be adjusted to reflect management

estimates of disposal costs including, but not limited to, real estate brokerage commissions, legal fees,

and delinquent property taxes.

The carrying amount and estimated fair value of the Company’s financial instruments as of the dates indicated below were as follows:



		June 30, 2020				December 31, 2019
	Valuation Method Used	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	(Level I)	$	39,581	$	39,581	$	55,840	$	55,840
Other interest-bearing deposits	(Level II)	3,752		3,855		4,744		4,792
Securities available for sale “AFS”	(Level II)	162,716		162,716		180,119		180,119
Securities held to maturity “HTM”	(Level II)	10,541		10,922		2,851		2,957
Equity securities with readily determinable fair value	(Level I)	188		188		246		246
Other investments	(Level II)	15,193		15,193		15,005		15,005
Loans receivable, net	(Level III)	1,267,802		1,292,278		1,167,060		1,161,660
Loans held for sale	(Level II)	8,876		8,876		5,893		5,893
Mortgage servicing rights	(Level III)	3,509		3,509		4,282		4,309
Accrued interest receivable	(Level 1)	5,855		5,855		4,738		4,738
Financial liabilities:
Deposits	(Level III)	$	1,272,197	$	1,273,191	$	1,195,702	$	1,192,777
FHLB advances	(Level II)	124,484		129,689		130,971		131,593
Other borrowings	(Level I)	43,595		43,595		43,560		43,560
Accrued interest payable	(Level I)	373		373		453		453