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Fair Value Measurements (Tables)
6 Months Ended
Jun. 30, 2015
Fair Value Disclosures [Abstract]  
Summary of Valuation of LCNB's Assets Recorded at Fair Value by Inputs Level
The following table summarizes the valuation of LCNB's assets recorded at fair value by input levels as of June 30, 2015 and December 31, 2014 (in thousands):
 
 
Fair Value Measurements at the End of
the Reporting Period Using
 
 
Fair Value Measurements
 
Quoted
Prices
in Active
Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
June 30, 2015
 
 
 
 
 
 
 
 
Recurring fair value measurements:
 
 
 
 
 
 
 
 
Investment securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. Treasury notes
 
$
86,286

 
86,286

 

 

U.S. Agency notes
 
108,090

 

 
108,090

 

U.S. Agency mortgage-backed securities
 
28,182

 

 
28,182

 

Certificates of deposit with other banks
 
2,584

 

 
2,584

 

Municipal securities:
 
 

 
 

 
 

 
 

Non-taxable
 
93,812

 

 
93,812

 

Taxable
 
25,482

 

 
25,482

 

Mutual funds
 
2,472

 
1,472

 
1,000

 

Trust preferred securities
 
49

 
49

 

 

Equity securities
 
903

 
903

 

 

Total recurring fair value measurements
 
$
347,860

 
88,710

 
259,150

 

Nonrecurring fair value measurements:
 
 

 
 

 
 
 
 

Impaired loans
 
$
4,719

 

 

 
4,719

Other real estate owned and repossessed assets
 
1,364

 

 

 
1,364

Total nonrecurring fair value measurements
 
$
6,083

 

 

 
6,083

 
 
 
 
 
 
 
 
 
December 31, 2014
 
 

 
 

 
 

 
 

Recurring fair value measurements:
 
 

 
 

 
 

 
 

Investment securities available-for-sale:
 
 

 
 

 
 

 
 

U.S. Treasury notes
 
$
62,560

 
62,560

 

 

U.S. Agency notes
 
83,637

 

 
83,637

 

U.S. Agency mortgage-backed securities
 
38,032

 

 
38,032

 

Certificates of deposit with other banks
 
3,086

 

 
3,086

 

Municipal securities:
 
 

 
 

 
 

 
 

Non-taxable
 
77,395

 

 
77,395

 

Taxable
 
16,395

 

 
16,395

 

Mutual funds
 
2,461

 
1,461

 
1,000

 

Trust preferred securities
 
50

 
50

 

 

Equity securities
 
1,749

 
1,749

 

 

Total recurring fair value measurements
 
$
285,365

 
65,820

 
219,545

 

Nonrecurring fair value measurements:
 
 

 
 

 
 

 
 

Impaired loans
 
$
4,872

 

 

 
4,872

Other real estate owned and repossessed assets
 
1,370

 

 

 
1,370

Total nonrecurring fair value measurements
 
$
6,242

 

 

 
6,242



Fair Value Measurements Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques
The following table presents quantitative information about unobservable inputs used in nonrecurring Level 3 fair value measurements at June 30, 2015 and December 31, 2014 (dollars in thousands):
 
 
 
 
 
 
 
 
Range
 
 
Fair Value
 
Valuation Technique
 
Unobservable Inputs
 
High
 
Low
 
Weighted Average
June 30, 2015:
 
 
 
 
 
 
 
 
 
 
 
 
Impaired loans
 
$
4,719

 
Estimated sales price
 
Adjustments for comparable properties, discounts to reflect current market conditions
 
Not applicable
 
 

 
Discounted cash flows
 
Discount rate
 
10.50
%
 
4.00
%
 
5.30
%
Other real estate owned
 
1,364

 
Estimated sales price
 
Adjustments for comparable properties, discounts to reflect current market conditions
 
Not applicable
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2014:
 
 
 
 
 
 
 
 
 
 
 
 
Impaired loans
 
$
4,872

 
Estimated sales price
 
Adjustments for comparable properties, discounts to reflect current market conditions
 
Not applicable
 
 
 
 
Discounted cash flows
 
Discount rate
 
10.50
%
 
4.00
%
 
5.36
%
Other real estate owned
 
$
1,370

 
Estimated sales price
 
Adjustments for comparable properties, discounts to reflect current market conditions
 
Not applicable
Carrying Amounts and Estimated Fair Values of Financial Instruments
Carrying amounts and estimated fair values of financial instruments as of June 30, 2015 and December 31, 2014 are as follows (in thousands):
 
 
 
 
Fair Value Measurements at the End of
the Reporting Period Using
 
 
Carrying
Amount
 
Fair
Value
 
Quoted
Prices
in Active
Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
June 30, 2015
 
 
 
 
 
 
 
 
 
 
FINANCIAL ASSETS:
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
27,913

 
27,913

 
27,913

 

 

Investment securities, held-to-maturity
 
24,677

 
24,590

 

 

 
24,590

Federal Reserve Bank stock
 
2,476

 
2,476

 
2,476

 

 

Federal Home Loan Bank stock
 
3,638

 
3,638

 
3,638

 

 

Loans, net
 
751,857

 
749,061

 

 

 
749,061

 
 
 
 
 
 
 
 
 
 
 
FINANCIAL LIABILITIES:
 
 

 
 

 
 
 
 
 
 
Deposits
 
1,084,033

 
1,085,255

 
855,070

 
230,185

 

Short-term borrowings
 
12,731

 
12,731

 
12,731

 

 

Long-term debt
 
6,085

 
6,534

 

 
6,534

 

 
 
 
 
 
 
 
 
 
 
 
December 31, 2014
 
 
 
 
 
 
 
 
 
 
FINANCIAL ASSETS:
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
15,845

 
15,845

 
15,845

 

 

Investment securities, held-to-maturity
 
22,725

 
22,138

 

 

 
22,138

Federal Reserve Bank stock
 
2,346

 
2,346

 
2,346

 

 

Federal Home Loan Bank stock
 
3,638

 
3,638

 
3,638

 

 

Loans, net
 
695,835

 
699,715

 

 

 
699,715

 
 
 
 
 
 
 
 
 
 
 
FINANCIAL LIABILITIES:
 
 

 
 

 
 
 
 
 
 
Deposits
 
946,205

 
947,541

 
731,766

 
215,775

 

Short-term borrowings
 
16,645

 
16,645

 
16,645

 

 

Long-term debt
 
11,357

 
11,944

 

 
11,944