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Fair Value (Tables)
 9 Months Ended
Sep. 30, 2018
Fair Value Disclosures [Abstract]  
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis
Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:
 
 
Fair Value Measurements at September 30, 2018 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable Inputs (Level 3)
 
Total
Obligations of State and Political Subdivisions
 
$
—

 
$
279,376

 
$
4,663

 
$
284,039

MBS/CMO - Residential
 
—

 
455,588

 
—

 
455,588

Equity Securities
 
—

 
—

 
353

 
353

Total Securities and Other Investments
 
$
—

 
$
734,964

 
$
5,016

 
$
739,980

 
 
 
 
 
 
 
 
 
Loans Held-for-Sale
 
$
—

 
$
9,178

 
$
—

 
$
9,178

 
 
 
 
 
 
 
 
 
Derivative Assets
 
$
—

 
$
3,490

 
$
—

 
$
3,490

 
 
 
 
 
 
 
 
 
Mortgage Servicing Rights
 
$
—

 
$
1,023

 
$
—

 
$
1,023

 
 
 
 
 
 
 
 
 
Derivative Liabilities
 
$
—

 
$
3,425

 
$
—

 
$
3,425


 
 
Fair Value Measurements at December 31, 2017 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable  Inputs (Level 3)
 
Total
Obligations of State and Political Subdivisions
 
$
—

 
$
267,660

 
$
5,649

 
$
273,309

MBS/CMO - Residential
 
—

 
467,332

 
—

 
467,332

Equity Securities
 
—

 
—

 
353

 
353

Total Securities and Other Investments
 
$
—

 
$
734,992

 
$
6,002

 
$
740,994

 
 
 
 
 
 
 
 
 
Loans Held-for-Sale
 
$
—

 
$
6,719

 
$
—

 
$
6,719

 
 
 
 
 
 
 
 
 
Derivative Assets
 
$
—

 
$
1,564

 
$
—

 
$
1,564

 
 
 
 
 
 
 
 
 
Mortgage Servicing Rights
 
$
—

 
$
547

 
$
—

 
$
547

 
 
 
 
 
 
 
 
 
Derivative Liabilities
 
$
—

 
$
1,633

 
$
—

 
$
1,633
Schedule of Reconciliation of all Assets Measured at Fair Value on Recurring Basis, Using Significant Unobservable Inputs (Level 3)
The tables below present a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2018 and 2017:
 
 
Obligations of State and Political Subdivisions
 
Equity Securities
 
 
2018
 
2017
 
2018
 
2017
 
 
 
 
 
 
 
 
 
Balance of Recurring Level 3 Assets at July 1
 
$
5,167

 
$
6,464

 
$
353

 
$
353

Total Gains or Losses Included in Other Comprehensive Income
 
(44
)
 
—

 
—

 
—

Maturities / Calls
 
(460
)
 
(450
)
 
—

 
—

Purchases
 
—

 
—

 
—

 
—

Balance of Recurring Level 3 Assets at September 30
 
$
4,663

 
$
6,014

 
$
353

 
$
353


 

Obligations of State and Political Subdivisions

Equity Securities
 

2018

2017

2018

2017













Balance of Recurring Level 3 Assets at January 1

$
5,649


$
7,295


$
353


$
353

Total Gains or Losses Included in Other Comprehensive Income

(66
)

34


—


—

Maturities / Calls

(920
)

(1,315
)

—


—

Purchases

—


—


—


—

Balance of Recurring Level 3 Assets at September 30

$
4,663


$
6,014


$
353


$
353
Schedule of Assets and Liabilities Measured at Fair Value on Non-Recurring Basis
Assets and liabilities measured at fair value on a non-recurring basis are summarized below:
 
 
Fair Value Measurements at September 30, 2018 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable 
Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Impaired Loans
 
 

 
 

 
 

 
 

Commercial and Industrial Loans
 
$
—

 
$
—

 
$
2,192

 
$
2,192

Commercial Real Estate Loans
 
—

 
—

 
2,965

 
2,965

 
 
 
Fair Value Measurements at December 31, 2017 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable 
Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Impaired Loans
 
 

 
 

 
 

 
 

Commercial and Industrial Loans
 
$
—

 
$
—

 
$
3,354

 
$
3,354

Commercial Real Estate Loans
 
—

 
—

 
3,438

 
3,438
Schedule of Fair Value Assets and Liabilities Measured on Nonrecurring Basis Valuation Techniques
The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at September 30, 2018 and December 31, 2017:
September 30, 2018
 
Fair Value

Valuation Technique(s)

Unobservable Input(s)

Range (Weighted Average)

 








Impaired Loans - Commercial and Industrial Loans
 
$
2,192

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
0%-100%
(100%)
Impaired Loans - Commercial Real Estate Loans
 
$
2,965


Sales comparison approach

Adjustment for physical condition of comparable properties sold

18%-76%
(54%)


December 31, 2017
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range (Weighted Average)
 
 
 
 
 
 
 
 
 
Impaired Loans - Commercial and Industrial Loans
 
$
3,354

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
0%-95%
(84%)
Impaired Loans - Commercial Real Estate Loans
 
$
3,438

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
30%-76%
(47%)
Schedule of Carrying Amounts and Estimated Fair Values of Company's Financial Instruments
The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ending September 30, 2018 and December 31, 2017. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision. In accordance with the adoption of ASU 2016-01, the table below for September 30, 2018, presents the fair values measured using an exit price notion. The fair value of loans as of December 31, 2017 was measured using an entrance price notion.
 
 
 
 
Fair Value Measurements at
September 30, 2018 Using
 
 
Carrying Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Financial Assets:
 
 

 
 

 
 

 
 

 
 

Cash and Short-term Investments
 
$
65,584

 
$
50,980

 
$
14,604

 
$
—

 
$
65,584

Loans, Net
 
2,315,417

 
—

 
—

 
2,274,223

 
2,274,223

FHLB Stock and Other Restricted Stock
 
13,048

 
N/A

 
N/A

 
N/A

 
N/A

Accrued Interest Receivable
 
15,218

 
—

 
3,972

 
11,246

 
15,218

Financial Liabilities:
 
 

 
 

 
 

 
 

 
 

Demand, Savings, and Money Market Deposits
 
(2,240,239
)
 
(2,240,239
)
 
—

 
—

 
(2,240,239
)
Time Deposits
 
(400,608
)
 
—

 
(399,625
)
 
—

 
(399,625
)
Short-term Borrowings
 
(220,389
)
 
—

 
(220,389
)
 
—

 
(220,389
)
Long-term Debt
 
(106,650
)
 
—

 
(93,587
)
 
(11,250
)
 
(104,837
)
Accrued Interest Payable
 
(1,152
)
 
—

 
(1,075
)
 
(77
)
 
(1,152
)


 
 
 
 
Fair Value Measurements at
December 31, 2017 Using
 
 
Carrying Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Financial Assets:
 
 

 
 

 
 

 
 

 
 

Cash and Short-term Investments
 
$
70,359

 
$
48,467

 
$
16,349

 
$
—

 
$
64,816

Loans, Net
 
2,119,152

 
—

 
—

 
2,120,154

 
2,120,154

FHLB Stock and Other Restricted Stock
 
13,048

 
N/A

 
N/A

 
N/A

 
N/A

Accrued Interest Receivable
 
13,258

 
—

 
3,574

 
9,684

 
13,258

Financial Liabilities:
 
 

 
 

 
 

 
 

 
 

Demand, Savings, and Money Market Deposits
 
(2,096,167
)
 
(1,096,167
)
 
—

 
—

 
(1,096,167
)
Time Deposits
 
(387,885
)
 
—

 
(388,640
)
 
—

 
(388,640
)
Short-term Borrowings
 
(133,499
)
 
—

 
(133,499
)
 
—

 
(133,499
)
Long-term Debt
 
(141,717
)
 
—

 
(129,366
)
 
(11,052
)
 
(140,418
)
Accrued Interest Payable
 
(1,058
)
 
—

 
(1,042
)
 
(16
)
 
(1,058
)