Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Disclosures [Abstract]

Fair value measurements of assets on a recurring basis

The following table summarizes the balances of assets measured at fair value on a recurring basis at September 30, 2013 and December 31, 2012.

	September 30, 2013
	Total		Level 1		Level 2		Level 3
	(In thousands)
Investment securities available for sale:
U.S. Treasury and U.S. Government-sponsored agencies	$	6,071	$	—	$	6,071	$	—
Municipal securities	50,387		—		50,387		—
Mortgage backed securities and collateralized mortgage obligations—residential:
U.S Government-sponsored agencies	110,768		—		110,768		—
Total	$	167,226	$	—	$	167,226	$	—

	December 31, 2012
	Total		Level 1		Level 2		Level 3
	(In thousands)
Investment securities available for sale:
U.S. Treasury and U.S. Government-sponsored agencies	$	11,035	$	—	$	11,035	$	—
Municipal securities	47,360		—		47,360		—
Mortgage backed securities and collateralized mortgage obligations—residential:
U.S Government-sponsored agencies	85,898		—		85,898		—
Total	$	144,293	$	—	$	144,293	$	—

Fair value measurements of assets on a nonrecurring basis

The tables below represent assets measured at fair value on a nonrecurring basis at September 30, 2013 and December 31, 2012 and the net losses (gains) recorded in earnings during the three and nine months ended September 30, 2013 and 2012.

	Basis (1)		Fair Value at September 30, 2013
			Total		Level 1		Level 2		Level 3		Net Losses (Gains) Recorded in Earnings During the Three Months Ended September 30, 2013			Net Losses (Gains) Recorded in Earnings During the Nine Months Ended September 30, 2013
	(In thousands)
Impaired originated loans:
Commercial business	$	11,476	$	7,364	$	—	$	—	$	7,364	$	664		$	2,482
One-to-four family residential	359		359		—		—		359		—			(18		)
Real estate construction and land development	4,396		4,396		—		—		4,396		—			(764		)
Consumer	39		—		—		—		—		32			39
Total impaired originated loans	16,270		12,119		—		—		12,119		696			1,739
Purchased other impaired loans:
Commercial business	5,887		4,558		—		—		4,558		1,082			1,378
One-to-four family residential	455		420		—		—		420		(4		)	(17		)
Consumer	10		7		—		—		7		—			31
Total purchased other impaired loans	6,352		4,985		—		—		4,985		1,078			1,392
Investment securities held to maturity:
Mortgage back securities and collateralized mortgage obligations—residential:
Private residential collateralized mortgage obligations	16		13		—		13		—		—			26
Other real estate owned	1,537		1,190		—		—		1,190		45			45
Total	$	24,175	$	18,307	$	—	$	13	$	18,294	$	1,819		$	3,202

	Basis (1)		Fair Value at December 31, 2012
			Total		Level 1		Level 2		Level 3		Net Losses (Gains) Recorded in Earnings During the Three Months Ended September 30, 2012			Net Losses (Gains) Recorded in Earnings During the Nine Months Ended September 30, 2012
	(In thousands)
Impaired originated loans:
Commercial business	$	11,781	$	9,028	$	—	$	—	$	9,028	$	1,041		$	1,361
One-to-four family residential	811		764		—		—		764		(23		)	75
Real estate construction and land development	6,077		4,628		—		—		4,628		(62		)	447
Consumer	109		—		—		—		—		—			—
Total impaired originated loans	18,778		14,420		—		—		14,420		956			1,883
Purchased other impaired loans:
Commercial business	781		742		—		—		742		23			23
One-to-four family residential	527		422		—		—		422		—			—
Consumer	163		6		—		—		6		(2		)	(2		)
Total purchased other impaired loans	1,471		1,170		—		—		1,170		21			21
Investment securities held to maturity:
Mortgage back securities and collateralized mortgage obligations – residential:
Private residential collateralized mortgage obligations	117		113		—		113		—		—			60
Other real estate owned	3,042		2,391		—		—		2,391		—			310
Total	$	23,408	$	18,094	$	—	$	113	$	17,981	$	977		$	2,274

(1) Basis represents the unpaid principal balance of impaired originated and purchased other impaired loans, amortized cost of investment securities held to maturity, and carrying value at ownership date of other real estate owned.

Fair value measurements for financial instruments measured at fair value on a non-recurring basis

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at September 30, 2013 and December 31, 2012.

	September 30, 2013
	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range of Inputs; Weighted Average
	(Dollars in thousands)
Impaired originated loans	$	12,119	Market approach	Adjustment for differences between the comparable sales	(35.1%) - 11.1%; (1.7%)
Purchased other impaired loans	$	4,985	Market approach	Adjustment for differences between the comparable sales	(5.0%) - 0.0%;  (2.5%)
Other real estate owned	$	1,190	Market approach	Adjustment for differences between the comparable sales	(47.7)% - 5.0%; (22.6%)

	December 31, 2012
	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range of Inputs; Weighted Average
	(Dollars in thousands)
Impaired originated loans	$	14,420	Market approach	Adjustment for differences between the comparable sales	(35.1)% - 22.0%; (2.0%)
Purchased other impaired loans	$	1,170	Market approach	Adjustment for differences between the comparable sales	(5.0%) - 0.0%;  (2.5%)
Other real estate owned	$	2,391	Market approach	Adjustment for differences between the comparable sales	(47.7%) - 5.0%;  (27.6%)

Schedule of carrying value and fair value of financial instruments

The tables below present the carrying value amount of the Company’s financial instruments and their corresponding estimated fair values at the dates indicated.

	September 30, 2013
	Carrying Value		Fair Value Total		Fair Value Measurements Using:
					Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and cash equivalents	$	135,123	$	135,123	$	135,123	$	—	$	—
Other interest earning deposits	17,415		17,525		—		17,525		—
Investment securities available for sale	167,226		167,226		—		167,226		—
Investment securities held to maturity	35,113		35,509		—		35,509		—
FHLB stock	5,795		N/A		N/A		—		—
Loans receivable, net of allowance	1,208,082		1,199,552		—		—		1,199,552
Accrued interest receivable	5,658		5,658		17		1,309		4,332
Financial Liabilities:
Deposits:
Noninterest deposits, NOW accounts, money market accounts, savings accounts	1,105,867		1,105,867		1,105,867		—		—
Certificate of deposit accounts	320,118		320,443		—		320,443		—
Total deposits	$	1,425,985	$	1,426,310	$	1,105,867	$	320,443	$	—
Securities sold under agreement to repurchase	$	22,655	$	22,655	$	22,655	$	—	$	—
Accrued interest payable	$	155	$	155	$	16	$	139	$	—

	December 31, 2012
	Carrying Value		Fair Value Total		Fair Value Measurements Using:
					Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and cash equivalents	$	104,268	$	104,268	$	104,268	$	—	$	—
Other interest earning deposits	2,818		2,818		—		2,818		—
Investment securities available for sale	144,293		144,293		—		144,293		—
Investment securities held to maturity	10,099		11,010		—		11,010		—
FHLB stock	5,495		N/A		N/A		—		—
Loans held for sale	1,676		1,676		—		—		1,676
Loans receivable, net of allowance	998,344		1,012,880		—		—		1,012,880
Accrued interest receivable	4,821		4,821		6		717		4,098
Financial Liabilities:
Deposits:
Noninterest deposits, NOW accounts, money market accounts, savings accounts	829,044		829,044		829,044		—		—
Certificate of deposit accounts	288,927		290,484		—		290,484		—
Total deposits	$	1,117,971	$	1,119,528	$	829,044	$	290,484	$	—
Securities sold under agreement to repurchase	$	16,021	$	16,021	$	16,021	$	—	$	—
Accrued interest payable	$	106	$	106	$	19	$	87	$	—