FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2022

FAIR VALUE OF FINANCIAL INSTRUMENTS

Summary of assets measured at fair value on a recurring basis

June 30, 2022	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
		(dollars in thousands)
Debt securities available-for-sale:
U.S. Treasury	$	159,205	$	—	$	—	$	159,205
U.S. government agency		—		58,217		—		58,217
Municipal		—		260,541		—		260,541
Mortgage-backed:
Agency residential		—		225,042		—		225,042
Agency commercial		—		149,236		—		149,236
Corporate		—		72,465		—		72,465
Equity securities with readily determinable fair values		3,103		—		—		3,103
Mortgage servicing rights		—		—		10,089		10,089
Derivative financial assets		—		3,935		—		3,935
Derivative financial liabilities		—		3,709		—		3,709

December 31, 2021	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
		(dollars in thousands)
Debt securities available-for-sale:
U.S. Treasury	$	108,976	$	—	$	—	$	108,976
U.S. government agency		—		128,105		—		128,105
Municipal		—		297,077		—		297,077
Mortgage-backed:
Agency residential		—		179,466		—		179,466
Agency commercial		—		164,061		—		164,061
Corporate		—		64,483		—		64,483
Equity securities with readily determinable fair values		3,443		—		—		3,443
Mortgage servicing rights		—		—		7,994		7,994
Derivative financial assets		—		8,697		—		8,697
Derivative financial liabilities		—		9,377		—		9,377

Schedule of quantitative information about the unobservable inputs used in recurring Level 3 fair value measurements

The following tables present additional information about the unobservable inputs used in the fair value measurement of the mortgage servicing rights (dollars in thousands):

June 30, 2022	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Mortgage servicing rights	$	10,089	Discounted cash flows	Constant pre-payment rates (CPR)	7.0% to 41.2% (7.9%)
				Discount rate	9.0% to 11.0% (9.1%)
December 31, 2021	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Mortgage servicing rights	$	7,994	Discounted cash flows	Constant pre-payment rates (CPR)	7.0% to 88.9% (11.7%)
				Discount rate	9.0% to 11.0% (9.0%)

Summary of assets measured at fair value on a nonrecurring basis

June 30, 2022	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
		(dollars in thousands)
Loans held for sale	$	—	$	5,312	$	—	$	5,312
Collateral-dependent impaired loans		—		—		17,238		17,238
Bank premises held for sale		—		—		319		319
Foreclosed assets		—		—		2,891		2,891

December 31, 2021	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
		(dollars in thousands)
Loans held for sale	$	—	$	4,942	$	—	$	4,942
Collateral-dependent impaired loans		—		—		22,423		22,423
Bank premises held for sale		—		—		1,452		1,452
Foreclosed assets		—		—		3,278		3,278

Schedule of quantitative information about the unobservable inputs used in non-recurring Level 3 fair value measurements

The following tables present quantitative information about unobservable inputs used in nonrecurring Level 3 fair value measurements (dollars in thousands):

June 30, 2022	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Collateral-dependent impaired loans	$	17,238	Appraisal of collateral	Appraisal adjustments	Not meaningful
Bank premises held for sale		319	Appraisal	Appraisal adjustments	7% (7%)
Foreclosed assets		2,891	Appraisal	Appraisal adjustments	7% (7%)
December 31, 2021	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Collateral-dependent impaired loans	$	22,423	Appraisal of collateral	Appraisal adjustments	Not meaningful
Bank premises held for sale		1,452	Appraisal	Appraisal adjustments	7% (7%)
Foreclosed assets		3,278	Appraisal	Appraisal adjustments	7% (7%)

Summary information on the carrying amounts and estimated fair values of the Company's financial instruments

	Fair Value	June 30, 2022				December 31, 2021
	Hierarchy	Carrying		Estimated		Carrying		Estimated
	Level	Amount		Fair Value		Amount		Fair Value
			(dollars in thousands)
Financial assets:
Cash and cash equivalents	Level 1	$	160,031	$	160,031	$	409,268	$	409,268
Debt securities held-to-maturity	Level 2		548,236		510,152		336,185		336,027
Restricted stock	Level 3		2,813		2,813		2,739		2,739
Loans, net	Level 3		2,427,092		2,450,897		2,475,753		2,494,686
Investments in unconsolidated subsidiaries	Level 3		1,165		1,165		1,165		1,165
Accrued interest receivable	Level 2		14,263		14,263		14,901		14,901
Financial liabilities:
Time deposits	Level 3		274,893		268,761		328,208		327,779
Securities sold under agreements to repurchase	Level 2		51,091		51,091		61,256		61,256
Subordinated notes	Level 3		39,356		38,854		39,316		41,602
Junior subordinated debentures	Level 3		37,747		33,787		37,714		33,640
Accrued interest payable	Level 2		974		974		1,043		1,043