Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2017

Fair Value Disclosures [Abstract]

Schedule of assets and liabilities measured at fair value on recurring basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016.

(dollars in thousands)	Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total (Fair Value)
September 30, 2017
Assets:
Investment securities available for sale:
U. S. agency securities	$	—	$	177,918	$	—	$	177,918
Residential mortgage backed securities		—		301,526		—		301,526
Municipal bonds		—		63,147		—		63,147
Corporate bonds		—		11,717		1,500		13,217
Other equity investments		—		—		218		218
Loans held for sale		—		25,980		—		25,980
Mortgage banking derivatives		—		—		63		63
Interest rate swap derivatives		—		191		—		191
Total assets measured at fair value on a recurring basis as of September 30, 2017	$	—	$	580,479	$	1,781	$	582,260
Liabilities:
Mortgage banking derivatives	$	—	$	—	$	36	$	36
Interest rate swap derivatives		—		24		—		24
Total liabilities measured at fair value on a recurring basis as of September 30, 2017	$	—	$	24	$	36	$	60
December 31, 2016
Assets:
Investment securities available for sale:
U. S. agency securities	$	—	$	106,142	$	—	$	106,142
Residential mortgage backed securities		—		326,239		—		326,239
Municipal bonds		—		95,930		—		95,930
Corporate bonds		—		8,079		1,500		9,579
Other equity investments		—		—		218		218
Loans held for sale		—		51,629		—		51,629
Mortgage banking derivatives		—		—		114		114
Total assets measured at fair value on a recurring basis as of December 31, 2016	$	—	$	588,019	$	1,832	$	589,851
Liabilities:
Mortgage banking derivatives	$	—	$	—	$	55	$	55
Interest rate swap derivatives		—		692		—		692
Total liabilities measured at fair value on a recurring basis as of December 31, 2016	$	—	$	692	$	55	$	747

the aggregate fair value and the aggregate unpaid principal balance for residential real estate loans

The following table summarizes the difference between the aggregate fair value and the aggregate unpaid principal balance for residential real estate loans held for sale measured at fair value as of September 30, 2017 and December 31, 2016.

	September 30, 2017
			Aggregate Unpaid
(dollars in thousands)	Fair Value		Principal Balance		Difference
Residential mortgage loans held for sale	$	25,980	$	25,473	$	507
FHA mortgage loans held for sale	$	—	$	—	$	—

	December 31, 2016
			Aggregate Unpaid
(dollars in thousands)	Fair Value		Principal Balance		Difference
Residential mortgage loans held for sale	$	51,629	$	51,021	$	608
FHA mortgage loans held for sale	$	—	$	—	$	—

Schedule of reconciliation of activity of siginificant unobservable inputs (Level 3)

The following is a reconciliation of activity for assets and liabilities measured at fair value based on Significant Other Unobservable Inputs (Level 3):

	Investment		Mortgage Banking
(dollars in thousands)	Securities		Derivatives			Total
Assets:
Beginning balance at January 1, 2017	$	1,718	$	114		$	1,832
Realized loss included in earnings - net mortgage banking derivatives		—		(51	)		(51	)
Purchases of available-for-sale securities		—		—			—
Principal redemption		—		—			—
Ending balance at September 30, 2017	$	1,718	$	63		$	1,781
Liabilities:
Beginning balance at January 1, 2017	$	—	$	55		$	55
Realized loss included in earnings - net mortgage banking derivatives		—		(19	)		(19	)
Principal redemption		—		—			—
Ending balance at September 30, 2017	$	—	$	36		$	36

	Investment			Mortgage Banking
(dollars in thousands)	Securities			Derivatives		Total
Assets:
Beginning balance at January 1, 2016	$	219		$	24	$	243
Realized gain included in earnings - net mortgage banking derivatives		—			90		90
Purchases of available-for-sale securities		1,500			—		1,500
Principal redemption		(1	)		—		(1	)
Ending balance at December 31, 2016	$	1,718		$	114	$	1,832
Liabilities:
Beginning balance at January 1, 2016	$	—		$	30	$	30
Realized loss included in earnings - net mortgage banking derivatives		—			25		25
Principal redemption		—			—		—
Ending balance at December 31, 2016	$	—		$	55	$	55

Schedule of assets measured at fair value on nonrecurring basis

Assets measured at fair value on a nonrecurring basis are included in the table below:

(dollars in thousands)	Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total (Fair Value)
September 30, 2017
Impaired loans:
Commercial	$	—	$	—	$	2,757	$	2,757
Income producing - commercial real estate		—		—		8,714		8,714
Owner occupied - commercial real estate		—		—		5,885		5,885
Real estate mortgage - residential		—		—		301		301
Construction - commercial and residential		—		—		2,030		2,030
Home equity		—		—		504		504
Other consumer		—		—		11		11
Other real estate owned		—		—		1,394		1,394
Total assets measured at fair value on a nonrecurring basis as of September 30, 2017	$	—	$	—	$	21,596	$	21,596

(dollars in thousands)	Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total (Fair Value)
December 31, 2016
Impaired loans:
Commercial	$	—	$	—	$	2,956	$	2,956
Income producing - commercial real estate		—		—		12,993		12,993
Owner occupied - commercial real estate		—		—		2,133		2,133
Real estate mortgage - residential		—		—		555		555
Construction - commercial and residential		—		—		1,550		1,550
Other consumer		—		—		13		13
Other real estate owned		—		—		2,694		2,694
Total assets measured at fair value on a nonrecurring basis as of December 31, 2016	$	—	$	—	$	22,894	$	22,894

Schedule of fair value by balance sheet grouping

The estimated fair values of the Company’s financial instruments at September 30, 2017 and December 31, 2016 are as follows:

					Fair Value Measurements
					Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
(dollars in thousands)	Carrying Value		Fair Value		(Level 1)		(Level 2)		(Level 3)
September 30, 2017
Assets
Cash and due from banks	$	8,246	$	8,246	$	—	$	8,246	$	—
Federal funds sold		8,548		8,548		—		8,548		—
Interest bearing deposits with other banks		432,156		432,156		—		432,156		—
Investment securities		556,026		556,026		—		554,308		1,718
Federal Reserve and Federal Home Loan Bank stock		30,980		30,980		—		30,980		—
Loans held for sale		25,980		25,980		—		25,980		—
Loans, net		6,021,237		6,075,997		—		—		6,075,997
Bank owned life insurance		61,238		61,238		—		61,238		—
Annuity investment		11,591		11,591		—		11,591		—
Mortgage banking derivatives		63		63		—		—		63
Interst rate swap derivatives		191		191		—		191		—
Liabilities
Noninterest bearing deposits		1,843,157		1,843,157		—		1,843,157		—
Interest bearing deposits		3,248,118		3,248,118		—		3,248,118		—
Certificates of deposit		822,677		821,892		—		821,892		—
Customer repurchase agreements		73,569		73,569		—		73,569		—
Borrowings		416,807		448,768		—		448,768		—
Mortgage banking derivatives		36		36		—		—		36
Interest rate swap derivatives		24		24		—		24		—
December 31, 2016
Assets
Cash and due from banks	$	10,285	$	10,285	$	—	$	10,285	$	—
Federal funds sold		2,397		2,397		—		2,397		—
Interest bearing deposits with other banks		355,481		355,481		—		355,481		—
Investment securities		538,108		538,108		—		536,390		1,718
Federal Reserve and Federal Home Loan Bank stock		21,600		21,600		—		21,600		—
Loans held for sale		51,629		51,629		—		51,629		—
Loans, net		5,618,819		5,624,084		—		—		5,624,084
Bank owned life insurance		60,130		60,130		—		60,130		—
Annuity investment		11,929		11,929		—		11,929		—
Mortgage banking derivatives		114		114		—		—		114
Liabilities
Noninterest bearing deposits		1,775,684		1,775,684		—		1,775,684		—
Interest bearing deposits		3,191,682		3,191,682		—		3,191,682		—
Certificates of deposit		748,748		745,985		—		745,985		—
Customer repurchase agreements		68,876		68,876		—		68,876		—
Borrowings		216,514		203,657		—		203,657		—
Mortgage banking derivatives		55		55		—		—		55
Interest rate swap derivatives		692		692		—		692		—