Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2019

Assets Measured at Fair Value on a Recurring Basis

The following tables present the assets and liabilities reported on the Consolidated Balance Sheet at their fair value on a recurring basis as of March 31, 2019 and December 31, 2018 by level within the fair value hierarchy (in thousands). Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

March 31, 2019	Level I		Level II		Level III		Total
Fair value measurements on a recurring basis:
Assets
Equity securities	$	527	$	-	$	-	$	527
Available for sale securities:
U.S. Agency securities		-		102,864		-		102,864
U.S. Treasury securities		33,507		-		-		33,507
Obligations of state and
political subdivisions		-		60,598		-		60,598
Corporate obligations		-		3,039		-		3,039
Mortgage-backed securities in
government sponsored entities		-		44,429		-		44,429


December 31, 2018	Level I		Level II		Level III		Total
Fair value measurements on a recurring basis:
Assets
Equity securities	$	516	$	-	$	-	$	516
Available for sale securities:
U.S. Agency securities		-		106,385		-		106,385
U.S. Treasuries securities		33,358		-		-		33,358
Obligations of state and
political subdivisions		-		52,047		-		52,047
Corporate obligations		-		3,034		-		3,034
Mortgage-backed securities in
government sponsored entities		-		46,186		-		46,186

Assets Measured at Fair Value on Non-recurring Basis

Assets measured at fair value on a nonrecurring basis as of March 31, 2019 and December 31, 2018 are included in the table below (in thousands):

March 31, 2019	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	5,220	$	5,220
Other real estate owned		-		-		3,560		3,560

December 31, 2018	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	5,815	$	5,815
Other real estate owned		-		-		532		532

Significant Unobservable Inputs Used in Fair Value Measurement Process

The following table provides a listing of the significant unobservable inputs used in the fair value measurement process for items valued utilizing Level III techniques (dollars in thousands).

March 31, 2019	Fair Value		Valuation Technique(s)	Unobservable input	Range			Weighted average
Impaired Loans	$	5,220	Appraised Collateral Values	Discount for time since appraisal		0-100	%		18.48	%
				Selling costs		5%-12	%		8.78	%
				Holding period	0 - 12 months			11.67 months

Other real estate owned		3,560	Appraised Collateral Values	Discount for time since appraisal		15-67	%		17.90	%

December 31, 2018	Fair Value		Valuation Technique(s)	Unobservable input	Range
Impaired Loans		5,815	Appraised Collateral Values	Discount for time since appraisal		0-100	%		19.22	%
				Selling costs		5%-12	%		8.70	%
				Holding period	6 - 12 months			11.61 months

Other real estate owned		532	Appraised Collateral Values	Discount for time since appraisal		20-55	%		31.44	%

Fair Value of Financial Instruments

The carrying amount and fair value of the Company’s financial instruments that are not required to be measured or reported at fair value on a recurring basis are as follows (in thousands):

	Carrying
March 31, 2019	Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Interest bearing time deposits with other banks	$	15,498	$	15,608	$	-	$	-	$	15,608
Loans held for sale		183		183		183		-		-
Net loans		1,077,833		1,068,984		-		-		1,068,984

Financial liabilities:
Deposits		1,181,654		1,178,511		889,970		-		288,541
Borrowed funds		108,263		107,602		-		-		107,602

	Carrying
December 31, 2018	Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Interest bearing time deposits with other banks	$	15,498	$	15,422	$	-	$	-	$	15,422
Loans held for sale		1,127		1,126		-		-		1,126
Net loans		1,068,999		1,062,645		-		-		1,062,645

Financial liabilities:
Deposits		1,185,156		1,180,694		886,686		-		294,008
Borrowed funds		91,194		90,427		-		-		90,427