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

12 Months Ended

Dec. 31, 2014

Fair Value of Financial Instruments and Fair Value Measurements [Abstract]

Carrying amount and estimated fair values of financial instruments

The carrying amount and estimated fair values of the Company’s financial instruments as of December 31 are as follows:

	Carrying		Estimated		Level
2014	Amount		Fair Value		1		2		3
	(in Thousands)
Assets
Cash and Short-Term Investments	$	65,811	$	65,811	$	65,811	$	-	$	-
Investment Securities Available for Sale		274,595		274,595		-		273,647		948
Investment Securities Held to Maturity		30		30		-		30		-
Federal Home Loan Bank Stock		2,831		2,831		2,831		-		-
Loans, Net		736,930		738,948		-		731,170		7,778
Bank-Owned Life Insurance		14,531		14,531		14,531		-		-
Liabilities
Deposits		979,303		980,874		551,057		429,817		-
Subordinated Debentures		24,229		24,229		24,229		-		-
Other Borrowed Money		40,000		41,962		-		41,962		-
2013
Assets
Cash and Short-Term Investments	$	68,147	$	68,147	$	68,147	$	-	$	-
Investment Securities Available for Sale		263,258		263,258		-		262,317		941
Investment Securities Held to Maturity		37		37		-		37		-
Federal Home Loan Bank Stock		3,164		3,164		3,164		-		-
Loans, Net		739,052		741,112		-		729,436		11,676
Bank-Owned Life Insurance		10,165		10,165		10,165		-		-
Liabilities
Deposits		987,529		989,101		526,646		462,455		-
Subordinated Debentures		24,229		24,229		24,229		-		-
Other Borrowed Money		40,000		42,074		-		42,074		-

Assets and liabilities measured at fair value on a recurring and nonrecurring basis

Assets and Liabilities Measured at Fair Value on a Recurring and Nonrecurring Basis -The following table presents the recorded amount of the Company’s assets measured at fair value on a recurring and nonrecurring basis as of December 31, 2014 and 2013, 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 December 31, 2013.  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
2014	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring
Securities Available for Sale
U.S. Government Agencies Mortgage-Backed	$	271,063,669	$	-	$	271,063,669	$	-
State, County and Municipal		3,530,917		-		2,582,527		948,390
	$	274,594,586	$	-	$	273,646,196	$	948,390
Nonrecurring
Impaired Loans	$	7,778,279	$	-	$	-	$	7,778,279
Other Real Estate	$	6,128,365	$	-	$	-	$	6,128,365
2013
Recurring
Securities Available for Sale
U.S. Government Agencies Mortgage-Backed	$	259,348,058	$	-	$	259,348,058	$	-
State, County and Municipal		3,909,832		-		2,968,567		941,265
	$	263,257,890	$	-	$	262,316,625		941,265
Nonrecurring
Impaired Loans	$	11,675,691	$	-	$	-	$	11,675,691
Other Real Estate	$	7,019,799	$	-	$	-	$	7,019,799

Quantitative information for financial instruments measured at fair value

The following tables present 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 December 31, 2014 and 2013.  These tables are comprised primarily of collateral dependent impaired loans and other real estate owned:

	December 31, 2014		Valuation Techniques	Unobservable Inputs	Range (Weighted Avg)
Real Estate
Commercial Construction	$	82,422	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(22.00)% - 38.10% (8.05%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.00% - 10.00% (5.00%)
Residential Real Estate		1,650,474	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(2.30)% - 191.70% (94.70%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.00% - 10.00% (5.00%)
			Income Approach	Capitalization Rate		13.75%
Commercial Real Estate		5,678,297	Sales Comparison	Adjustment for Differences Between the Comparable Sales		0.00% - 0.00% (0.00%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.00% - 90.00% (45.00%)
			Income Approach	Capitalization Rate		11.00%
Farmland		367,086	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(8.30)% - 252.50% (122.10%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		10.00% - 50.00% (30.00%)
Other Real Estate Owned		6,128,365	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(40.00)% - 45.00% (2.50%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.33% - 69.36% (31.88%)
			Income Approach	Discount Rate		9.00%
				Capitalization Rate		10.00%

	December 31, 2013		Valuation Techniques	Unobservable Inputs	Range (Weighted Avg)
Impaired Loans
Commercial	$	1,019,084	Sales Comparison	Adjustment for Differences Between the Comparable Sales		0.00% - 15.00% (7.50%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		10.00% - 50.00% (30.00%)
Real Estate
Commercial Construction		2,641,041	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(16.00)% - 28.00% (6.00%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.00% - 10.00% (5.00%)
			Income Approach	Capitalization Rate		8.50%
Residential Real Estate		1,323,296	Sales Comparison	Adjustment for Differences Between the Comparable Sales		0.00% - 46.00% (23.00%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.00% - 25.00% (12.50%)
Commercial Real Estate		5,450,788	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(27.20%) - 216.80% (94.80%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		25.00% - 90.00% (57.50%)
			Income Approach	Capitalization Rate		11.00%
Farmland		1,241,482	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(55.00%) - 388.00% (166.50%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		10.00%-35.00% (22.50%)
Other Real Estate Owned		7,019,799	Sales Comparison	Adjustment for Differences Between the Comparable Sales		(10.00%) - 319.10% (154.55%)
				Management Adjustments for Age of Appraisals and/or Current Market Conditions		0.36% - 87.81% (29.99%)
			Income Approach	Discount Rate		10.00%

Fair value measurement using significant unobservable inputs (Level 3)

The following table 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 years ended December 31, 2014, 2013 and 2012:

	Available for Sale Securities
	2014		2013			2012
Balance, Beginning	$	941,265	$	1,138,238		$	1,122,427
Transfers into Level 3		-		-			788,933
Transfers out of Level 3		-		(41,908	)		-
Securities Purchased During the Year		-		-			-
Securities Called During the Year		-		-			(1,000,000	)
Loss on OTTI Impairment Included in Noninterest Income		-		(366,623	)		(59,568	)
Unrealized Gains Included in Other Comprehensive Income		7,125		211,558			78,201
Balance, Ending	$	948,390	$	941,265		$	1,138,238

The following table presents quantitative information about recurring level 3 fair value measurements as of December 31, 2014 and 2013:

December 31, 2014	Fair Value		Valuation Techniques	Unobservable Inputs	Range (Weighted Avg)
State, County and Municipal	$	948,390	Discounted Cash Flow	Discount Rate or Yield		N/A*
December 31, 2013
State, County and Municipal	$	941,265	Discounted Cash Flow	Discount Rate or Yield		N/A*

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