Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value of Financial Instruments [Abstract]

Schedule of Financial Assets Measured at Fair Value on Recurring Basis

For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at March 31, 2014 and December 31, 2013 are as follows:

	Fair Value Measurements Using:
As of March 31, 2014	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Fair Value
Investment securities available-for-sale
U.S. government agencies	$	-	$	63,059	$	-	$	63,059
Mortgage-backed securities-residential		-		31,538		-		31,538
Collateralized mortgage obligations:
Issued or guaranteed by U.S. government agencies		-		189,786		-		189,786
Non-agency		-		4,342		-		4,342
Corporate bonds		-		9,555		-		9,555
Municipal bonds		-		9,103		-		9,103
Other securities		-		-		4,780		4,780
Common stocks		49		-		-		49
Total investment securities available-for-sale	$	49	$	307,383	$	4,780	$	312,212

	Fair Value Measurements Using:
As of December 31, 2013	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Fair Value
Investment securities available-for-sale
U.S. government agencies	$	-	$	62,036	$	-	$	62,036
Mortgage-backed securities-residential		-		32,097		-		32,097
Collateralized mortgage obligations:
Issued or guaranteed by U.S. government agencies		-		189,103		-		189,103
Non-agency		-		4,479		-		4,479
Corporate bonds		-		9,438		-		9,438
Municipal bonds		-		6,900		-		6,900
Other securities		-		-		4,625		4,625
Common stocks		49		-		-		49
Total investment securities available-for-sale	$	49	$	304,053	$	4,625	$	308,727

Additional Information About Assets Measured at Fair Value on a Recurring Basis, Level 3 Inputs

The following tables present additional information about assets measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value for the three months ended March 31, 2014 and 2013:

(In thousands)	Other securities
Investment Securities Available for Sale	2014			2013
Beginning balance January 1,	$	4,625		$	4,164
Total gains/(losses) - (realized/unrealized):
Included in earnings		-			5
Included in other comprehensive income		284			140
Purchases		-			-
Sales and calls		(129	)		(84	)
Transfers in and/or out of Level 3		-			-
Ending balance March 31,	$	4,780		$	4,225

Financial Assets Measured at Fair Value on Nonrecurring Basis

For financial assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at March 31, 2014 and December 31, 2013 are as follows:

	Fair Value Measurements Using:
As of March 31, 2014	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Fair Value
Assets
Impaired loans and leases	$	-	$	-	$	3,253	$	3,253
Other real estate owned		-		-		8,112		8,112

	Fair Value Measurements Using:
As of December 31, 2013	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Fair Value
Assets
Impaired loans and leases	$	-	$	-	$	4,073	$	4,073
Other real estate owned		-		-		9,182		9,182
Loans and leases held for sale		-		-		1,446		1,446

Schedule of quantitative information about assets measured at fair value on nonrecurring basis

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value:

	Qualitative Information about Level 3 Fair Value Measurements
As of March 31, 2014 (In thousands)	Fair Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans and leases	$	3,253	Appraisal of	Appraisal adjustments	0.0% to -20% (-0.68%)
			collateral (1)	Liquidation expenses	0.0% to -26.99% (-10.26%)

Other real estate owned		8,112	Appraisal of	Appraisal adjustments	0.0% to -55.9% (-7.4%)
			collateral (1)	Liquidation expenses	-14.7%

(1)

Appraisals may be adjusted for qualitative factors such as interior condition of the property and liquidation expenses.

Fair Value by Balance Sheet Grouping Instruments

The tables below indicate the fair value of the Company’s financial instruments at March 31, 2014 and December 31, 2013.

					Fair Value Measurements
					At March 31, 2014
(In thousands)	Carrying amount		Estimated fair value		Quoted Prices in Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
Financial Assets:
Cash and cash equivalents	$	23,890	$	23,890	$	23,890	$	-	$	-
Investment securities available-for-sale		312,212		312,212		49		307,383		4,780
Other investment		2,250		2,250		-		-		2,250
Federal Home Loan Bank stock		4,004		4,004		-		-		4,004
Loans, net		346,792		346,145		-		-		346,145
Accrued interest receivable		6,675		6,675		-		6,675		-
Financial Liabilities:
Demand deposits		70,560		70,560		-		70,560		-
NOW and money markets		211,758		211,758		-		211,758		-
Savings		18,449		18,449		-		18,449		-
Time deposits		231,865		230,106		-		230,106		-
Short-term borrowings		5,000		5,000		5,000		-		-
Long-term borrowings		97,767		94,837		-		94,837		-
Subordinated debt		25,774		27,914		-		27,914		-
Accrued interest payable		1,435		1,435		-		1,435		-

					Fair Value Measurements
					At December 31, 2013
(In thousands)	Carrying amount		Estimated fair value		Quoted Prices in Active Markets for Identical Assets Level 1		Significant Other Observable Inputs Level 2		Significant Unobservable Inputs Level 3
Financial Assets:
Cash and cash equivalents	$	16,844	$	16,844	$	16,844	$	-	$	-
Investment securities available-for-sale		308,727		308,727		49		304,053		4,625
Other investment		2,250		2,250		-		-		2,250
Federal Home Loan Bank stock		4,204		4,204		-		-		4,204
Loans held for sale		1,446		1,446		-		-		1,446
Loans, net		352,810		349,336		-		-		349,336
Accrued interest receivable		7,054		7,054		-		7,054		-
Financial Liabilities:
Demand deposits		60,473		60,473		-		60,473		-
NOW and money markets		210,053		210,053		-		210,053		-
Savings		17,593		17,593		-		17,593		-
Time deposits		240,845		239,102		-		239,102		-
Short-term borrowings		10,000		10,000		10,000		-		-
Long-term borrowings		97,881		94,896		-		94,896		-
Subordinated debt		25,774		26,000		-		26,000		-
Accrued interest payable		965		965		-		965		-

- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

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- Definition

Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

-Paragraph 18

-Subparagraph c(2), d, e, f

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

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-Subparagraph b-d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

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-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13476-108611

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 10

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

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Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 14

-Subparagraph a

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

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Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 12: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 32

-Subparagraph a, c(1), c(2), c(3), d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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