Fair Value of Financial Instruments and Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value, by Balance Sheet Grouping

The carrying amount, estimated fair values, and placement in the fair value hierarchy of the Company’s financial instruments as of September 30, 2020 and December 31, 2019 are as follows:

	Fair Value Measurements
(dollars in thousands)	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
September 30, 2020
Assets
Cash and short-term investments	$	148,839	$	148,839	$	148,839	$	—	$	—
Investment securities available for sale	363,601		363,601		—		361,599		2,002
Other investments, at cost	3,296		3,296		2,567		729		—
Loans held for sale	55,864		55,864		—		55,864		—
Loans, net	1,090,586		1,111,221		—		—		1,111,221
Liabilities
Deposits	1,416,400		1,416,311		—		1,416,311		—
Paycheck Protection Program Liquidity Facility	22,500		20,742		—		20,742		—
Federal Home Loan Bank advances	134,500		134,500		—		134,500		—
Other borrowings	38,042		38,042		—		38,046		—

	Fair Value Measurements
(dollars in thousands)	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
December 31, 2019
Assets
Cash and short-term investments	$	104,092	$	104,092	$	104,192	$	—	$	—
Investment securities available for sale	347,332		347,332		—		345,310		2,022
Other investments, at cost	4,288		4,288		3,559		729		—
Loans held for sale	10,076		10,076		—		10,076		—
Loans, net	961,951		938,475		—		—		938,475
Liabilities
Deposits	1,293,742		1,294,506		—		1,294,506		—
Federal Home Loan Bank advances	47,000		44,402		—		44,402		—
Other borrowings	38,792		38,792		—		38,792		—

Fair Value Measurements, Recurring and Nonrecurring

The following table presents the recorded amount of the Company’s assets measured at fair value on a recurring and nonrecurring basis as of September 30, 2020 and December 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall. The table below includes only impaired loans with a specific reserve and only other real estate properties with a valuation allowance at September 30, 2020 and December 31, 2019. Those impaired loans and other real estate properties are shown net of the related specific reserves and valuation allowances.

			Fair Value Measurements at Reporting Date Using
(dollars in thousands)	Total Fair Value		(Level 1)		(Level 2)		(Level 3)
September 30, 2020
Recurring Securities Available for Sale
U.S. treasury securities	$	245	$	—	$	245	$	—
State, county & municipal securities	38,906		—		38,906		—
Corporate Debt securities	3,753		—		1,751		2,002
Mortgage-backed securities	320,697		—		320,697		—
Total available for sale securities	$	363,601	$	—	$	361,599	$	2,002
Nonrecurring
Collateral Dependent Impaired Loans	$	2,178	$	—	$	—	$	2,178
Other Real Estate	1,875		—		—		1,875
Total nonrecurring assets	$	4,053	$	—	$	—	$	4,053

			Fair Value Measurements at Reporting Date Using
(dollars in thousands)	Total Fair Value		(Level 1)		(Level 2)		(Level 3)
December 31, 2019
Recurring Securities Available for Sale
State, county & municipal securities	$	5,115	$	—	$	5,115	$	—
Corporate Debt securities	2,806		—		784		2,022
Mortgage-backed securities	339,411		—		339,411		—
Total available for sale securities	$	347,332	$	—	$	345,310	$	2,022
Nonrecurring
Collateral Dependent Impaired Loans	$	5,985	$	—	$	—	5,985
Other Real Estate	1,320		—		—		1,320
Total nonrecurring assets	$	7,305	$	—	$	—	$	7,305

Fair Value Measurement Inputs and Valuation Techniques

The following table presents quantitative information about the significant unobservable inputs used in the fair value measurements for assets in level 3 of the fair value hierarchy measured on a nonrecurring basis at September 30, 2020 and December 31, 2019. This table is comprised primarily of collateral dependent impaired loans and other real estate:

(dollars in thousands)	September 30, 2020		Valuation Techniques	Unobservable Inputs	Range Weighted Avg
Collateral Dependent Impaired Loans	$	2,178	Appraised Value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	10	%	80	%
Other Real Estate	1,875		Appraised Value/Comparable Sales	Discounts to reflect current market conditions and estimated costs to sell	—	%	20	%

(dollars in thousands)	December 31, 2019		Valuation Techniques	Unobservable Inputs	Range Weighted Avg
Collateral Dependent Impaired Loans	$	5,985	Appraised Value	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell	—	%	20	%
Other Real Estate	1,320		Appraised Value/Comparable Sales	Discounts to reflect current market conditions and estimated costs to sell	—	%	20	%

The following table presents quantitative information about recurring level 3 fair value measurements as of September 30, 2020 and December 31, 2019.

(dollars in thousands)
September 30, 2020	Fair Value		Valuation Techniques	Unobservable Inputs	Range (Weighted Avg)
Corporate debt securities	$	2,002	Discounted Cash Flow	Discount Rate or Yield	N/A*
December 31, 2019
Corporate debt securities	$	2,022	Discounted Cash Flow	Discount Rate or Yield	N/A*

*    The Company relies on a third-party pricing service to value its securities. The details of the unobservable inputs and other adjustments used by the third-party pricing service were not readily available to the Company.

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The table below presents a reconciliation and statement of income classification of gains and losses for all assets measured at fair value on a recurring basis using significant unobservable inputs (level 3) for the nine months ended September 30, 2020 and 2019.

	Available for Sale Securities
(dollars in thousands)	September 30, 2020		September 30, 2019
Balance, Beginning	$	2,022	$	4,277
Transfers out of Level 3	—		—
Sales	—		—
Paydowns			(883)
Realized Loss on Sale of Security	—		—
Unrealized gains (losses) included in Other Comprehensive Income	(20)		40
Balance, Ending	$	2,002	$	3,434