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Derivatives
 6 Months Ended
Jun. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Disclosure [Text Block] Derivatives
Park uses certain derivative financial instruments (or "derivatives") to meet the needs of its clients while managing the interest rate risk associated with certain transactions. Park does not use derivatives for speculative purposes. A summary of derivative instruments utilized by Park follows.

Interest Rate Swaps
Park utilizes interest rate swap agreements as part of its asset liability management strategy to help manage its interest rate risk position and as a means to meet the financing, interest rate and other risk management needs of qualifying commercial banking customers. The notional amount of the interest rate swaps does not represent the amount exchanged by the parties. The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest rate swap agreements.

Borrowing Derivatives: Interest rate swaps with notional amounts totaling $25.0 million at both June 30, 2020 and December 31, 2019 were designated as cash flow hedges of certain FHLB advances.

Loan Derivatives: In conjunction with the Carolina Alliance acquisition, Park acquired interest rate swaps related to certain commercial loans. These interest rate swaps were simultaneously hedged by offsetting interest rate swaps that Carolina Alliance executed with a third party, such that Carolina Alliance minimized its net interest rate risk exposure resulting from such transactions. These interest rate swaps had a notional amount totaling $34.2 million and $35.5 million at June 30, 2020 and December 31, 2019, respectively.

All of the Company's interest rate swaps were determined to be fully effective during the three-month and six-month periods ended June 30, 2020 and June 30, 2019. As such, no amount of ineffectiveness has been included in net income. Therefore, the aggregate fair value of the swaps is recorded in other assets and other liabilities with changes in fair value recorded in other comprehensive income. The amount included in accumulated other comprehensive income would be reclassified to current earnings should the hedges no longer be considered effective. Park expects the hedges to remain fully effective during the remaining respective terms of the swaps.
Summary information about Park's interest rate swaps as of June 30, 2020 and December 31, 2019 follows:

June 30, 2020December 31, 2019
(In thousands, except weighted average data)Borrowing DerivativesLoan DerivativesBorrowing DerivativesLoan Derivatives
Notional amounts$25,000  $34,219  $25,000  $35,503  
Weighted average pay rates2.595 %4.688 %2.595 %4.695 %
Weighted average receive rates1.135 %4.688 %2.002 %4.695 %
Weighted average maturity (years)2.09.82.510.2
Unrealized losses$1,168  $—  $575  $—  

Interest (expense) income recorded on swap transactions was $(86,000) and $1,000 for the three-month periods ended June 30, 2020 and 2019, respectively, and was $(132,000) and $9,000 for the six-month periods ended June 30, 2020 and 2019, respectively.

Interest Rate Swaps

The following table presents the net gains (losses), net of income taxes, recorded in AOCI and the Consolidated Condensed Statements of Income related to interest rate swaps for the three-month and six-month periods ended June 30, 2020 and 2019.

Three Months Ended
June 30, 2020
(In thousands)Amount of Gain (Loss) Recognized in OCI (Effective Portion)Amount of Gain (Loss) Reclassified from OCI to Interest IncomeAmount of Gain (Loss) Recognized in Other Non-interest Income (Ineffective Portion)
Interest rate contracts$15  $—  $—  

Three Months Ended
June 30, 2019
(In thousands)Amount of Gain (Loss) Recognized in OCI (Effective Portion)Amount of Gain (Loss) Reclassified from OCI to Interest IncomeAmount of Gain (Loss) Recognized in Other Non-interest Income (Ineffective Portion)
Interest rate contracts$(301) $—  $—  
Six Months Ended
June 30, 2020
(In thousands)Amount of Gain (Loss) Recognized in OCI (Effective Portion)Amount of Gain (Loss) Reclassified from OCI to Interest IncomeAmount of Gain (Loss) Recognized in Other Non-interest Income (Ineffective Portion)
Interest rate contracts$(468) $—  $—  

Six Months Ended
June 30, 2019
(In thousands)Amount of Gain (Loss) Recognized in OCI (Effective Portion)Amount of Gain (Loss) Reclassified from OCI to Interest IncomeAmount of Gain (Loss) Recognized in Other Non-interest Income (Ineffective Portion)
Interest rate contracts$(507) $—  $—  

The following tables reflect the interest rate swaps included in the Consolidated Condensed Balance Sheets as of June 30, 2020 and December 31, 2019.

(In thousands)June 30, 2020
Notional AmountFair Value
Included in other assets:
Borrowing derivatives - interest rate swaps related to FHLB advances$—  $—  
Loan derivatives - instruments associated with loans
 Matched interest rate swaps with borrower 34,219  4,776  
 Matched interest rate swaps with counterparty—  —  
   Total included in other assets$34,219  $4,776  
Included in other liabilities:
Borrowing derivatives - interest rate swaps related to FHLB advances$25,000  $(1,168) 
Loan derivatives - instruments associated with loans
 Matched interest rate swaps with borrower —  —  
 Matched interest rate swaps with counterparty34,219  (4,776) 
    Total included in other liabilities$59,219  $(5,944) 
(In thousands)December 31, 2019
Notional AmountFair Value
Included in other assets:
Borrowing derivatives - interest rate swaps related to FHLB advances$—  $—  
Loan derivatives - instruments associated with loans
 Matched interest rate swaps with borrower 24,421  1,781  
 Matched interest rate swaps with counterparty11,083  89  
   Total included in other assets$35,504  $1,870  
Included in other liabilities:
Borrowing derivatives - interest rate swaps related to FHLB advances$25,000  $(575) 
Loan derivatives - instruments associated with loans
 Matched interest rate swaps with borrower 11,083  (89) 
 Matched interest rate swaps with counterparty24,421  (1,781) 
    Total included in other liabilities$60,504  $(2,445) 

Mortgage Banking Derivatives
Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. In order to hedge the change in interest rates resulting from its commitments to fund the loans, the Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into. These mortgage banking derivatives are not designated in hedge relationships. The fair value of the interest rate lock is recorded at the time the commitment to fund the mortgage loan is executed and is adjusted for the expected exercise of the commitment before the loan is funded. Fair values of these mortgage banking derivatives are estimated based on changes in mortgage interest rates from the date the interest on the loan is locked. Changes in the fair values of these derivatives are included in "Other service income" in the Condensed Consolidated Statements of Income.

At June 30, 2020 and December 31, 2019, Park had $126.6 million and $15.9 million, respectively, of interest rate lock commitments. The fair value of these mortgage banking derivatives was reflected by a derivative asset of $2.0 million and $221,000 at June 30, 2020 and December 31, 2019, respectively.

Other Derivatives
In connection with the sale of Park’s Class B Visa shares during 2009, Park entered into a swap agreement with the purchaser of the shares. The swap agreement adjusts for dilution in the conversion ratio of Class B Visa shares resulting from certain Visa litigation. At June 30, 2020, the fair value of the swap liability of $226,000 was an estimate of the exposure based upon probability-weighted potential Visa litigation losses.