Fair Value (Tables)

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Reconciliation of Level 3 Available for Sale Debt Securities Measured at Fair Value on Recurring Basis

The following table presents a reconciliation of the Level 3 available for sale debt securities measured at fair value on a recurring basis for the three and nine months ended September 30, 2020 and 2019:

	For the three months ended September 30,				For the nine months ended September 30,
(In thousands)	2020		2019		2020		2019
Balance at beginning of period (1)	$	6,243	$	—	$	6,238	$	—
Purchases/additions		—		—		—		—
Sales/reductions		—		—		—		—
Realized gains (losses)		—		—		—		—
Unrealized losses		(728)		—		(723)		—
Balance at end of period	$	5,515	$	—	$	5,515	$	—

(1) Includes AFS debt securities classified as Level 2 at December 31, 2019, which were transferred to Level 3 during the period ended September 30, 2020.

Balances of Assets And Liabilities Measured at Fair Value on Recurring Basis

The tables below present the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019:

	Fair Value Measurements at September 30, 2020 Using
			Quoted Prices in
	Assets/Liabilities		Active Markets		Significant Other		Significant
	Measured at Fair		for Identical		Observable		Unobservable
(In thousands)	Value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Measured on a recurring basis:
Assets:
Debt securities available for sale:
U.S. Government sponsored entities	$	2,763	$	—	$	2,763	$	—
State and political subdivisions		3,051		—		3,051		—
Residential mortgage-backed securities		19,685		—		19,685		—
Corporate and other securities		23,214		—		17,699		5,515
Total debt securities available for sale	$	48,713	$	—	$	43,198	$	5,515
Equity securities with readily determinable fair values		1,674		—		1,674		—
Total equity securities	$	1,674	$	—	$	1,674	$	—
Loans held for sale		7,175		—		7,175		—
Total loans held for sale	$	7,175	$	—	$	7,175	$	—
Interest rate swap agreements		(1,293)		—		(1,293)		—
Total swap agreements	$	(1,293)	$	—	$	(1,293)	$	—

	Fair value Measurements at December 31, 2019 Using
			Quoted Prices in
	Assets/Liabilities		Active Markets		Significant Other		Significant
	Measured at Fair		for Identical		Observable		Unobservable
(In thousands)	Value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Measured on a recurring basis:
Assets:
Debt securities available for sale:
U.S. Government sponsored entities	$	5,753	$	—	$	5,753	$	—
State and political subdivisions		5,154		—		5,154		—
Residential mortgage-backed securities		27,964		—		27,964		—
Corporate and other securities		25,404		—		25,404		—
Total debt securities available for sale	$	64,275	$	—	$	64,275	$	—
Equity securities with readily determinable fair values		2,289		—		2,289		—
Total equity securities	$	2,289	$	—	$	2,289	$	—
Loans held for sale		14,862		—		14,862		—
Total loans held for sale	$	14,862	$	—	$	14,862	$	—
Interest rate swap agreements		238		—		238		—
Total swap agreements	$	238	$	—	$	238	$	—

Assets and Liabilities Subject to Fair Value Adjustments (Impairment) on Non-Recurring Basis Carried on Balance Sheet by Caption and by Level within Hierarchy

The following tables present the assets and liabilities subject to fair value adjustments (impairment) on a non-recurring basis carried on the balance sheet by caption and by level within the hierarchy (as described above):

	Fair Value Measurements at September 30, 2020 Using
			Quoted Prices		Significant
			in Active		Other		Significant		Net (Credit)
	Assets/Liabilities		Markets for		Observable		Unobservable		Provision
	Measured at Fair		Identical Assets		Inputs		Inputs		During
(In thousands)	Value		(Level 1)		(Level 2)		(Level 3)		Period
Measured on a non-recurring basis:
Financial assets:
OREO	$	711	$	—	$	—	$	711	$	(200)
Impaired collateral-dependent loans		7,871		—		—		7,871		564

	Fair Value Measurements at December 31, 2019 Using
			Quoted Prices		Significant
			in Active		Other		Significant
	Assets/Liabilities		Markets for		Observable		Unobservable		Net Credit
	Measured at Fair		Identical Assets		Inputs		Inputs		During
(In thousands)	Value		(Level 1)		(Level 2)		(Level 3)		Period
Financial assets:
OREO	$	1,723	$	—	$	—	$	1,723	$	(231)
Impaired collateral-dependent loans		1,925		—		—		1,925		(253)

Carrying Amount and Estimated Fair Values of Financial Instruments

The table below presents the carrying amount and estimated fair values of the Company’s financial instruments presented as of September 30, 2020 and December 31, 2019:

		September 30, 2020				December 31, 2019
	Fair value	Carrying		Estimated		Carrying		Estimated
(In thousands)	level	amount		fair value		amount		fair value
Financial assets:
Cash and cash equivalents	Level 1	$	201,395	$	201,395	$	158,016	$	158,016
Securities (1)	Level 2		50,387		50,387		66,564		66,564
SBA loans held for sale	Level 2		6,192		7,175		13,529		14,862
Loans, net of allowance for loan losses (2)	Level 2		1,584,862		1,604,944		1,395,634		1,398,997
FHLB stock	Level 2		12,394		12,394		14,184		14,184
Servicing assets	Level 3		2,138		2,138		2,026		2,026
Accrued interest receivable	Level 2		10,169		10,169		6,984		6,984
OREO	Level 3		711		711		1,723		1,723
Financial liabilities:
Deposits	Level 2		1,493,440		1,498,622		1,250,114		1,252,082
Borrowed funds and subordinated debentures	Level 2		250,310		252,596		293,310		292,766
Accrued interest payable	Level 2		283		283		455		455

(1) Includes corporate securities that are considered Level 3 and reported separately in the table under the “Fair Value on a Recurring Basis” heading. These securities had book values of $6.2 million and market values of $5.5 million.

(2) Includes collateral-dependent impaired loans that are considered Level 3 and reported separately in the tables under the “Fair Value on a Nonrecurring Basis” heading. Collateral-dependent impaired loans, net of specific reserves totaled $7.9 million and $1.9 million at September 30, 2020 and December 31, 2019, respectively.