Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

Financial assets and liabilities measured at fair value on a recurring basis

The following tables present the balances of financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2013 and December 31, 2012.

	September 30, 2013
	(In thousands)
	Total		Level I		Level II		Level III
Assets:
U.S. government agencies	$	21,465	$	—	$	21,465	$	—
Obligations of states and political subdivisions	76,104		—		76,104		—
Mortgage-backed securities:
Agency	161,055		—		161,055		—
Non-agency	18,123		—		18,123		—
Other asset-backed securities	36,237		—		36,237		—
Corporate preferred stock	73		—		73		—
Corporate securities	15,321		—		14,836		485
Mortgage interest rate locks	651		—		651		—
Loans held for sale	41,855		—		41,855		—
Interest rate swaps	167		—		167		—
Mortgage servicing rights	155		—		155		—
Liabilities:
Interest rate swaps	$	326	$	—	$	326	$	—
Mortgage banking hedge instruments	613		—		613		—

	December 31, 2012
	(In thousands)
	Total		Level I		Level II		Level III
Assets:
U.S. government agencies	$	15,822	$	—	$	15,822	$	—
Obligations of states and political subdivisions	78,300		—		78,300		—
Mortgage-backed securities:
Agency	166,943		—		166,943		—
Non-agency	15,579		—		15,579		—
Other asset-backed securities	34,642		—		34,642		—
Corporate preferred stock	62		—		62		—
Corporate securities	8,109		—		8,109		—
Loans held for sale	82,114		—		82,114		—
Mortgage interest rate locks	35		—		35		—
Interest rate swaps	80		—		80		—
Liabilities:
Interest rate swap	$	541	$	—	$	541	$	—
Mortgage banking hedge instruments	39		—		39		—

Quantitative information about Level III fair value measurements

The following table presents quantitative information as of September 30, 2013 related to Level III fair value measurements for financial assets measured at fair value on a recurring basis:

	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs
Corporate Securities	$	485	Third party trading desk	Prices heavily influenced by unobservable market inputs.

The following table presents quantitative information as of September 30, 2013 about Level III fair value measurements for financial assets measured at fair value on a non-recurring basis:

	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Impaired Loans	$	4,614	Market comparables	Discount applied to market comparables (1)	10% - 30% (21%)

⁽¹⁾ A discount percentage is applied based on age of independent appraisals, current market conditions, and experience within the local markets.

The following table presents quantitative information as of December 31, 2012 about Level III fair value measurements for financial assets measured at fair value on a non-recurring basis:

	Fair Value (in thousands)		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
Impaired Loans	$	1,178	Discounted appraised value	Discount for selling costs and age of appraisals.	10% - 30% (21%)
Other real estate owned	$	2,310	Discounted appraised value	Discount for selling costs, construction status, and age of appraisals.	12% (12%)

Financial and non-financial assets measured at fair value on a nonrecurring basis

The following table summarizes the Company’s non-financial assets that were measured at fair value on a nonrecurring basis during the period.

	September 30, 2013
	(In thousands)
Description	Total		Level I		Level II		Level III
Assets:
Other real estate owned	$	4,530	$	—	$	4,530	$	—
	December 31, 2012
	(In thousands)
Description	Total		Level I		Level II		Level III
Assets:
Other real estate owned	$	9,929	$	—	$	7,619	$	2,310

The following table summarizes the Company’s financial assets that were measured at fair value on a nonrecurring basis as of September 30, 2013 and December 31, 2012:

	September 30, 2013
	(In thousands)
Description	Total		Level I		Level II		Level III
Assets:
Impaired loans	$	8,305	$	—	$	3,691	$	4,614
	December 31, 2012
	(In thousands)
Description	Total		Level I		Level II		Level III
Assets:
Impaired loans	$	12,343	$	—	$	11,165	$	1,178

Estimated fair values and related carrying amounts of financial instruments

The estimated fair values, and related carrying amounts, of the Company's financial instruments as of September 30, 2013 are as follows:

					September 30, 2013
					Fair value measurements using:
	Carrying Amount		Total Fair Value		Level I		Level II		Level III
	(In thousands)
Financial assets:
Cash and cash equivalents	$	62,645	$	62,645	$	62,645	$	—	$	—
Securities	328,378		328,378		—		327,893		485
Loans held for sale	41,855		41,855		—		41,855		—
Net portfolio loans	702,724		716,046		—		3,691		712,355
Bank owned life insurance	16,851		16,851		—		16,851		—
Accrued interest receivable	3,924		3,924		—		3,924		—
Mortgage interest rate locks	651		651		—		651		—
Interest rate swaps	167		167		—		167		—
Mortgage servicing rights	155		155		—		155		—
Financial liabilities:
Deposits	$	958,566	$	961,035	$	—	$	961,035	$	—
Securities sold under agreements to repurchase	35,005		35,005		—		35,005		—
Short-term borrowings	5,451		5,451		—		5,451		—
FHLB borrowings	85,000		85,862		—		85,862		—
Subordinated notes	5,155		5,207		—		5,207		—
Accrued interest payable	527		527		—		527		—
Interest rate swaps	326		326		—		312		—
Mortgage banking hedge instruments	613		613		—		613		—

The estimated fair values, and related carrying amounts, of the Company's financial instruments at December 31, 2012 are as follows:

					December 31, 2012
					Fair value measurements using:
	Carrying Amount		Total Fair Value		Level I		Level II		Level III
	(In thousands)
Financial assets:
Cash and cash equivalents	$	54,415	$	54,415	$	54,415	$	—	$	—
Securities	319,457		319,457		—		319,457		—
Loans held for sale	82,114		82,114		—		82,114		—
Net portfolio loans	695,166		716,358		—		1,178		715,180
Bank owned life insurance	16,484		16,484		—		16,484		—
Accrued interest receivable	3,974		3,974		—		3,974		—
Mortgage interest rate locks	35		35		—		35		—
Interest rate swaps	80		80		—		80		—
Financial liabilities:
Deposits	$	981,900	$	984,682	$	—	$	984,682	$	—
Securities sold under agreements to repurchase	33,975		33,975		—		33,975		—
Short-term borrowings	11,873		11,873		—		11,873		—
FHLB borrowings	72,912		78,912		—		78,912		—
Subordinated notes	5,155		5,221		—		5,221		—
Accrued interest payable	654		654		—		654		—
Interest rate swaps	541		541		—		541		—
Mortgage banking hedge instruments	39		39		—		39		—