Fair Value Measurement (Tables)

3 Months Ended

Mar. 31, 2019

Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the balances of financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 by levels within the valuation hierarchy:

	Fair Value Measurements
(In thousands)	Balance		Level 1		Level 2		Level 3
Assets at March 31, 2019:
Available for sale securities:
Obligations of U.S. Government corporations and agencies	$	56,992	$	-	$	56,992	$	-
Obligations of states and political subdivisions		12,781		-		12,781		-
Total available for sale securities		69,773		-		69,773		-
Mutual funds		389		389		-		-
Interest rate swaps		205		-		205		-
Total assets at fair value	$	70,367	$	389	$	69,978	$	-
Liabilities at March 31, 2019:
Interest rate swaps	$	45	$	-	$	45	$	-
Total liabilities at fair value	$	45	$	-	$	45	$	-

Assets at December 31, 2018:
Available for sale securities:
Obligations of U.S. Government corporations and agencies	$	56,409	$	-	$	56,409	$	-
Obligations of states and political subdivisions		14,580		-		14,580		-
Corporate bonds		895		-		895		-
Total available for sale securities		71,884		-		71,884		-
Mutual funds		382		382		-		-
Interest rate swaps		367		-		367		-
Total assets at fair value	$	72,633	$	382	$	72,251	$	-
Liabilities at December 31, 2018:
Interest rate swaps	$	38	$	-	$	38	$	-
Total liabilities at fair value	$	38	$	-	$	38	$	-

Summary of Financial Assets Measured at Fair Value on a Nonrecurring Basis

The following table summarizes the Company’s financial assets that were measured at fair value on a nonrecurring basis at March 31, 2019 and December 31, 2018.

	March 31, 2019
(In thousands)	Balance		Level 1		Level 2		Level 3
Assets:
Impaired loans, net	$	2,408	$	-	$	-	$	2,408
Other real estate owned, net		1,356		-		-		1,356

	December 31, 2018
(In thousands)	Balance		Level 1		Level 2		Level 3
Assets:
Impaired loans, net	$	2,438	$	-	$	-	$	2,438
Other real estate owned, net		1,356		-		-		1,356

Summary of Quantitative Information About Level 3 Fair Value Measurements

The following table displays quantitative information about Level 3 fair value measurements at March 31, 2019 and December 31, 2018.

	March 31, 2019
(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Weighted Average Discount
Impaired loans, net	$	2,408	Appraised values	Age of appraisal, current market conditions, experience within local market		86	%
Other real estate owned, net		1,356	Appraised values	Age of appraisal, current market conditions and selling costs		18	%
Total	$	3,764

	December 31, 2018
(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Weighted Average Discount
Impaired loans, net	$	2,438	Appraised values	Age of appraisal, current market conditions, experience within local market		86	%
Other real estate owned, net		1,356	Appraised values	Age of appraisal, current market conditions and selling costs		18	%
Total	$	3,794

Schedule of Estimated Fair Values of Financial Instruments

The estimated fair values and related carrying amounts of the Company’s financial instruments are as follows:

	March 31, 2019
(In thousands)	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Assets
Cash and short-term investments	$	38,008	$	38,008	$	-	$	-	$	38,008
Securities available for sale		69,773		-		69,773		-		69,773
Restricted investments		2,571		-		2,571		-		2,571
Mortgage loans held for sale		260		-		260		-		260
Loans, net		539,672		-		-		530,988		530,988
Accrued interest receivable		2,054		-		2,054		-		2,054
Mutual funds		389		389		-		-		389
Interest rate swaps		205		-		205		-		205
Bank-owned life insurance		13,688		-		13,688		-		13,688
Total financial assets	$	666,620	$	38,397	$	88,551	$	530,988	$	657,936

Liabilities
Deposits	$	592,358	$	-	$	592,016	$	-	$	592,016
FHLB advances		29,759		-		29,763		-		29,763
Junior subordinated debt		4,124		-		4,596		-		4,596
Accrued interest payable		399		-		399		-		399
Interest rate swaps		45		-		45		-		45
Total financial liabilities	$	626,685	$	-	$	626,819	$	-	$	626,819

	December 31, 2018
(In thousands)	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Assets
Cash and short-term investments	$	67,110	$	67,110	$	-	$	-	$	67,110
Securities available for sale		71,884		-		71,884		-		71,884
Restricted investments		2,240		-		2,240		-		2,240
Loans, net		544,188		-		-		537,072		537,072
Accrued interest receivable		1,942		-		1,942		-		1,942
Mutual funds		382		382		-		-		382
Interest rate swaps		367		-		367		-		367
Bank-owned life insurance		13,595		-		13,595		-		13,595
Total financial assets	$	701,708	$	67,492	$	90,028	$	537,072	$	694,592

Liabilities
Deposits	$	635,638	$	-	$	634,917	$	-	$	634,917
FHLB advances		23,780		-		23,633		-		23,633
Junior subordinated debt		4,124		-		4,414		-		4,414
Accrued interest payable		300		-		300		-		300
Interest rate swaps		38		-		38		-		38
Total financial liabilities	$	663,880	$	-	$	663,302	$	-	$	663,302