Fair Values of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2012

Fair Value Measurements of Assets Measured at Fair Value on Recurring Basis

The following table presents the fair value measurements of assets measured at fair value on a recurring basis and level within the ASC 820 fair value hierarchy in which the fair value measurements fall:

			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
December 31, 2012
Mortgage-backed securities
Government sponsored agencies	$	126,375	$	—	$	126,375	$	—
Collateralized mortgage obligations
Government sponsored agencies		118,235		—		118,235		—
Federal agencies		13,006		—		13,006		—
Municipals		3,264		—		3,264		—
Small Business Administration		8		—		8		—
Corporate obligations		20,309		—		17,834		2,475
Available-for-sale securities	$	281,197	$	—	$	278,772	$	2,475

December 31, 2011
Mortgage-backed securities
Government sponsored agencies	$	202,846	$	—	$	202,846	$	—
Collateralized mortgage obligations
Government sponsored agencies		100,061		—		100,061		—
Federal agencies		2,002		—		2,002		—
Municipals		3,558		—		3,558		—
Small Business Administration		12		—		12		—
Corporate obligations		22,399		—		19,945		2,454
Available-for-sale securities	$	330,878	$	—	$	328,424	$	2,454

Reconciliation of Recurring Fair Value Measurements Recognized in Balance Sheet using Significant Unobservable (Level Three) Inputs

The following is a reconciliation of the beginning and ending balances for the years ended December 31, 2012, 2011 and 2010 of recurring fair value measurements recognized in the accompanying balance sheets using significant unobservable (Level 3) inputs:

	2012			2011			2010
Beginning balance	$	2,454		$	2,645		$	2,539
Total realized and unrealized gains (losses)
Included in net income		—			(193	)		(416	)
Included in other comprehensive income (loss)		30			(56	)		540
Purchases, issuances and settlements		(9	)		58			(18	)
Ending balance	$	2,475		$	2,454		$	2,645
Total gains or losses for the period included in net income attributable to the change in unrealized gains or losses related to assets still held at the reporting date	$	—		$	(193	)	$	(416	)

Fair Value Measurement of Assets Measured at Fair Value on Nonrecurring Basis

The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the ASC 820 fair value hierarchy in which the fair value measurements fall:

			Fair Value Measurements Using
	Fair Value		Level 1		Level 2		Level 3
December 31, 2012
Impaired loans	$	8,032	$	—	$	—	$	8,032
Other real estate owned		355		—		—		355
Mortgage-servicing rights		1,731		—		—		1,731
December 31, 2011
Impaired loans	$	16,511	$	—	$	—	$	16,511
Other real estate owned		202		—		—		202
Mortgage-servicing rights		2,626		—		—		2,626

Quantitative Information about Unobservable Inputs used in Recurring and Nonrecurring Level Three Fair Value Measurements

The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements.

December 31, 2012	Fair Value		Valuation Technique	Unobservable Inputs	Range
Trust Preferred Securities	$	2,475	Discounted cash flow	Discount rate		9.0% - 17.0%
				Constant prepayment rate		2.0%
				Cumulative projected prepayments		40.0%
				Probability of default		1.5%-2.2%
				Projected cures given deferral		0%-15.0%
				Loss severity		58.0% – 79.4%
Impaired loans (collateral dependent)	$	8,032	Third party valuations	Discount to reflect realizable value		0%-40%
Foreclosed real estate	$	355	Third party valuations	Discount to reflect realizable value less estimated selling costs		0%-25%
Mortgage servicing rights	$	1,731	Third party valuations	Prepayment speeds Discount rates Servicing fee		100%-700% 10.1% 0.25%

Estimated Fair Values of Financial Instruments

The estimated fair values of the Company’s financial instruments not carried at fair value in the consolidated balance sheets as of the dates noted below are as follows:

					Fair Value Measurements Using
December 31, 2012	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents	$	32,778	$	32,778	$	32,778	$	—	$	—
Loans held for sale		5,106		5,235		—		5,235		—
Loans, net		969,545		993,539		—		—		993,539
FHLB stock		14,391		14,391		—		14,391		—
Interest receivable		3,846		3,846		—		3,846		—
Liabilities
Deposits		1,184,009		1,195,825		606,066		—		589,759
FHLB advances		74,675		75,688		—		75,688		—
Other borrowings		11,606		12,648		—		12,648		—
Interest payable		236		236		—		236		—

December 31, 2011	Carrying Amount		Fair Value
Assets
Cash and cash equivalents	$	55,223	$	55,223
Interest-bearing deposits		1,415		1,415
Loans held for sale		1,441		1,459
Loans		900,460		921,212
FHLB stock		14,391		14,391
Interest receivable		4,248		4,248
Liabilities
Deposits		1,168,357		1,133,751
FHLB advances		101,451		103,980
Other borrowings		12,410		13,083
Interest payable		340		340