FAIR VALUE DISCLOSURES (Tables)

9 Months Ended

Sep. 30, 2020

FAIR VALUE DISCLOSURES

Schedule of Assets Measured at Fair Value on a Recurring Basis

The table below presents the balances of assets measured at fair value on a recurring basis:

	September 30, 2020
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
U.S. government sponsored agencies	$	0	$	10,026	$	0	$	10,026
Mortgage-backed securities: residential		0		248,266		0		248,266
Mortgage-backed securities: commercial		0		39,161		0		39,161
State and municipal securities		0		346,436		145		346,581
Total Securities		0		643,889		145		644,034
Mortgage banking derivative		0		1,075		0		1,075
Interest rate swap derivative		0		25,184		0		25,184
Total assets	$	0	$	670,148	$	145	$	670,293
Liabilities:
Mortgage banking derivative		0		41		0		41
Interest rate swap derivative		0		25,203		0		25,203
Total liabilities	$	0	$	25,244	$	0	$	25,244

	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
Mortgage-backed securities: residential	$	0	$	288,181	$	0	$	288,181
Mortgage-backed securities: commercial		0		36,972		0		36,972
State and municipal securities		0		282,935		145		283,080
Total Securities		0		608,088		145		608,233
Mortgage banking derivative		0		198		0		198
Interest rate swap derivative		0		7,263		0		7,263
Total assets	$	0	$	615,549	$	145	$	615,694
Liabilities:
Mortgage banking derivative		0		14		0		14
Interest rate swap derivative		0		7,860		0		7,860
Total liabilities	$	0	$	7,874	$	0	$	7,874

Schedule of Assets Measured at Fair Value on a Nonrecurring Basis

The fair value of Level 3 available-for-sale securities was immaterial and thus did not require additional recurring fair value disclosure.

The table below presents the balances of assets measured at fair value on a nonrecurring basis:

	September 30, 2020
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	432	$	432
Non-working capital loans		0		0		5,666		5,666
Commercial real estate and multi-family residential loans:
Owner occupied loans		0		0		2,678		2,678
Agri-business and agricultural loans:
Loans secured by farmland		0		0		81		81
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		0		0		393		393
Open end and junior lien loans		0		0		585		585
Total impaired loans	$	0	$	0	$	9,835	$	9,835
Other real estate owned		0		0		0		0
Mortgage servicing rights, net of valuation allowance		0		3,565		0		3,565
Total assets	$	0	$	3,565	$	9,835	$	13,400

	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	3,126	$	3,126
Non-working capital loans		0		0		6,374		6,374
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		0		43		43
Owner occupied loans		0		0		1,449		1,449
Agri-business and agricultural loans:
Loans secured by farmland		0		0		57		57
Other commercial loans								0
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		0		0		474		474
Open end and junior lien loans		0		0		587		587
Other consumer loans		0		0		11		11
Total impaired loans	$	0	$	0	$	12,121	$	12,121
Other real estate owned		0		0		0		0
Total assets	$	0	$	0	$	12,121	$	12,121

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 September 30, 2020:

(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	6,098	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	44	%	21%-100%
Impaired loans:
Commercial real estate		2,678	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	33	%	10%-75%
Impaired loans:
Agribusiness and agricultural		81	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	44	%
Impaired loans:
Consumer 1-4 family mortgage		978	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	10	%	6%-17%

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, 2019:

(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	9,500	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	53	%	1%-100%
Impaired loans:
Commercial real estate		1,492	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	27	%	7%-61%
Impaired loans:
Agribusiness and agricultural		57	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	61	%
Impaired loans:
Consumer 1-4 family mortgage		1,061	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	14	%	5%-100%
Impaired loans:
Other consumer		11	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	36	%

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

The following table contains the estimated fair values and the related carrying values of the Company’s financial instruments. Items which are not financial instruments are not included.

	September 30, 2020
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	129,081	$	126,364	$	2,717	$	0	$	129,081
Securities available-for-sale		644,034		0		643,889		145		644,034
Real estate mortgages held-for-sale		10,097		0		10,543		0		10,543
Loans, net		4,529,177		0		0		4,491,862		4,491,862
Federal Reserve and Federal Home Loan Bank Stock		13,772		N/A		N/A		N/A		N/A
Accrued interest receivable		18,447		0		3,535		14,912		18,447
Financial Liabilities:
Certificates of deposit		(1,213,390)		0		(1,223,667)		0		(1,223,667)
All other deposits		(3,554,564)		(3,554,564)		0		0		(3,554,564)
Other short-term borrowings		(10,500)		0		(10,500)		0		(10,500)
Federal Home Loan Bank advances		(75,000)		0		(69,066)		0		(69,066)
Standby letters of credit		(657)		0		0		(657)		(657)
Accrued interest payable		(6,303)		(56)		(6,247)		0		(6,303)

	December 31, 2019
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	99,381	$	96,603	$	2,778	$	0	$	99,381
Securities available-for-sale		608,233		0		608,088		145		608,233
Real estate mortgages held-for-sale		4,527		0		4,614		0		4,614
Loans, net		4,015,176		0		0		3,979,006		3,979,006
Federal Reserve and Federal Home Loan Bank Stock		13,772		N/A		N/A		N/A		N/A
Accrued interest receivable		15,391		0		3,729		11,662		15,391
Financial Liabilities:
Certificates of deposit		(1,192,067)		0		(1,202,060)		0		(1,202,060)
All other deposits		(2,941,752)		(2,941,752)		0		0		(2,941,752)
Federal Home Loan Bank advances		(170,000)		0		(169,998)		0		(169,998)
Standby letters of credit		(915)		0		0		(915)		(915)
Accrued interest payable		(11,604)		(102)		(11,502)		0		(11,604)