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FAIR VALUE (Tables)

12 Months Ended

Dec. 31, 2022

Schedule of Assets Measured at Fair Value on a Recurring Basis

The tables below present the balances of assets and liabilities measured at fair value on a recurring basis as of December 31, 2022 and 2021:


	2022
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
U.S. Treasury securities	$	3,034	$	0	$	0	$	3,034
U.S. government sponsored agency securities	0		126,961		0		126,961
Mortgage-backed securities: residential	0		492,308		0		492,308

State and municipal securities	0		561,150		2,075		563,225
Total Available-for-Sale Securities	3,034		1,180,419		2,075		1,185,528
Mortgage banking derivative	0		43		0		43
Interest rate swap derivative	0		36,920		0		36,920
Total assets	$	3,034	$	1,217,382	$	2,075	$	1,222,491

Liabilities:

Interest rate swap derivative	$	0	$	36,921	$	0	$	36,921
Total liabilities	$	0	$	36,921	$	0	$	36,921


	2021
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
U.S. Treasury securities	$	900	$	0	$	0	$	900
U.S. government sponsored agency securities	0		143,452		0		143,452
Mortgage-backed securities: residential	0		486,676		0		486,676
Mortgage-backed securities: commercial	0		523		0		523
State and municipal securities	0		764,964		2,043		767,007
Total Available-for-Sale Securities	900		1,395,615		2,043		1,398,558
Mortgage banking derivative	0		398		0		398
Interest rate swap derivative	0		14,309		0		14,309
Total assets	$	900	$	1,410,322	$	2,043	$	1,413,265

Liabilities:
Mortgage banking derivative	$	0	$	2	$	0	$	2
Interest rate swap derivative	0		14,329		0		14,329
Total liabilities	$	0	$	14,331	$	0	$	14,331

Schedule of Assets Measured at Fair Value on a Nonrecurring Basis

The tables below present the amount of assets measured at fair value on a nonrecurring basis as of December 31, 2022 and 2021:


	2022
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Collateral dependent loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	3,178	$	3,178
Non-working capital loans	0		0		8,354		8,354
Commercial real estate and multi-family residential loans:
Owner occupied loans	0		0		425		425
Agri-business and agricultural loans:
Loans secured by farmland	0		0		35		35




Total collateral dependent loans	$	0	$	0	$	11,992	$	11,992
Other real estate owned	0		0		100		100
Total assets	$	0	$	0	$	12,092	$	12,092


	2021
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Collateral dependent loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	247	$	247
Non-working capital loans	0		0		5,095		5,095
Commercial real estate and multi-family residential loans:

Owner occupied loans	0		0		791		791
Agri-business and agricultural loans:
Loans secured by farmland	0		0		231		231




Total collateral dependent loans	$	0	$	0	$	6,364	$	6,364
Other real estate owned	0		0		196		196
Total assets	$	0	$	0	$	6,560	$	6,560

Schedule of Fair Value Measured on Nonrecurring Basis Valuation Techniques

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2022:

(dollars in thousands)

Fair Value

Valuation Methodology

Unobservable Inputs

Average

Range of Inputs

Collateral dependent loans:

Commercial and industrial

11,532

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

62%

29%-99%

Collateral dependent loans:

Commercial real estate and multi-family residential

425

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

57%

37%-76%

Collateral dependent loans:

Agri-business and agricultural

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

76%

Other real estate owned

100

Appraisals

Discount to reflect current market conditions and ultimate collectability

68%

NOTE 5 – FAIR VALUE (continued)

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2021:

(dollars in thousands)

Fair Value

Valuation Methodology

Unobservable Inputs

Average

Range of Inputs

Collateral dependent loans:

Commercial and industrial

5,342

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

65%

22%-99%

Collateral dependent loans:

Commercial real estate

791

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

51%

34%-68%

Collateral dependent loans:

Agri-business and agricultural

231

Collateral based measurements

Discount to reflect current market conditions and ultimate collectability

35%

3% - 68%

Other real estate owned

196

Appraisals

Discount to reflect current market conditions and ultimate collectability

38%

Schedule of Fair Values and the Related Carrying Values of Financial Instruments

The following tables contain the estimated fair values and the related carrying values of the Company’s financial instruments at December 31, 2022 and 2021. Items which are not financial instruments are not included.


	2022
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	130,282	$	129,069	$	1,213	$	0	$	130,282
Securities available-for-sale	1,185,528		3,034		1,180,419		2,075		1,185,528
Securities held-to-maturity	128,242		0		111,029		0		111,029
Real estate mortgages held-for-sale	357		0		372		0		372
Loans, net	4,637,790		0		0		4,454,678		4,454,678
Mortgage banking derivative	43		0		43		0		43
Interest rate swap derivative	36,920		0		36,920		0		36,920
Federal Reserve and Federal Home Loan Bank Stock	15,795		N/A		N/A		N/A		N/A
Accrued interest receivable	27,994		0		9,598		18,396		27,994
Financial Liabilities:
Certificates of deposit	626,186		0		621,206		0		621,206
All other deposits	4,834,434		4,834,434		0		0		4,834,434
Federal Funds purchased	22,000		22,000		0		0		22,000
Federal Home Loan Bank advances	275,000		275,000		0		0		275,000

Interest rate swap derivative	36,921		0		36,921		0		36,921
Standby letters of credit	249		0		0		249		249
Accrued interest payable	3,186		486		2,700		0		3,186

NOTE 5 – FAIR VALUE (continued)


	2021
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	683,240	$	681,286	$	1,954	$	0	$	683,240
Securities available-for-sale	1,398,558		900		1,395,615		2,043		1,398,558
Real estate mortgages held-for-sale	7,470		0		7,634		0		7,634
Loans, net	4,220,068		0		0		4,144,000		4,144,000
Mortgage banking derivative	398		0		398		0		398
Interest rate swap derivative	14,309		0		14,309		0		14,309
Federal Reserve and Federal Home Loan Bank Stock	13,772		N/A		N/A		N/A		N/A
Accrued interest receivable	17,674		0		7,689		9,985		17,674
Financial Liabilities:
Certificates of deposit	829,518		0		833,617		0		833,617
All other deposits	4,905,889		4,905,889		0		0		4,905,889

Federal Home Loan Bank advances	75,000		0		66,118		0		66,118
Mortgage banking derivative	2		0		2		0		2
Interest rate swap derivative	14,329		0		14,329		0		14,329
Standby letters of credit	272		0		0		272		272
Accrued interest payable	2,619		84		2,535		0		2,619