FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2019

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis as of March 31, 2019:

	(in thousands)
March 31, 2019	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury securities	$	43,560	$	43,560	$	—	$	—
Securities of U.S. government agencies and corporations		33,625		—		33,625		—
Obligations of states and political subdivisions		22,863		—		22,863		—
Collateralized mortgage obligations		65,131		—		65,131		—
Mortgage-backed securities		133,470		—		133,470		—
Total investments at fair value	$	298,649	$	43,560	$	255,089	$	—

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis as of December 31, 2018:

	(in thousands)
December 31, 2018	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury securities	$	50,682	$	50,682	$	—	$	—
Securities of U.S. government agencies and corporations		42,076		—		42,076		—
Obligations of states and political subdivisions		19,168		—		19,168		—
Collateralized mortgage obligations		63,799		—		63,799		—
Mortgage-backed securities		138,912		—		138,912		—
Total investments at fair value	$	314,637	$	50,682	$	263,955	$	—

Assets Measured at Fair Value on a Non-recurring Basis

Assets measured at fair value on a non-recurring basis are included in the table below by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018:

	(in thousands)
March 31, 2019	Carrying Value		Level 1		Level 2		Level 3
Other real estate owned	$	1,092	$	—	$	—	$	1,092
Total assets at fair value	$	1,092	$	—	$	—	$	1,092

	(in thousands)
December 31, 2018	Carrying Value		Level 1		Level 2		Level 3
Impaired loans	$	300	$	—	$	—	$	300
Other real estate owned		1,092		—		—		1,092
Total assets at fair value	$	1,392	$	—	$	—	$	1,392

Key Methods and Assumptions Used in Measuring Fair Value of Impaired Loans and Other Real Estate Owned

Key methods and assumptions used in measuring the fair value of impaired loans and other real estate owned as of December 31, 2018 were as follows:

	Method	Assumption Inputs

Impaired loans	Collateral, market, income, enterprise, liquidation and discounted Cash Flows	External appraised values, management assumptions regarding market trends or other relevant factors, selling costs generally ranging from 6% to 10%, or the amount and timing of cash flows based on the loan's effective interest rate.
Other real estate owned	Collateral	External appraised values, management assumptions regarding market trends or other relevant factors, selling costs generally ranging from 6% to 10%.

Estimated Fair Value of Financial Instruments

The estimated fair values of the Company’s financial instruments for the periods ended March 31, 2019 and December 31, 2018 were approximately as follows:

			March 31, 2019				December 31, 2018
	Level		Carrying amount		Fair value		Carrying amount		Fair value

Financial assets:
Cash and cash equivalents		1	$	128,094	$	128,094	$	116,032	$	116,032
Certificates of deposit		2		10,045		10,118		7,595		7,573
Stock in Federal Home Loan Bank and other equity securities		3		6,019		6,019		6,019		6,019
Loans receivable:
Net loans		3		731,605		692,053		763,393		726,179
Loans held-for-sale		2		2,407		2,462		2,295		2,345
Interest receivable		2		4,410		4,410		4,158		4,158
Mortgage servicing rights		3		1,536		1,953		1,579		2,091
Financial liabilities:
Deposits		3		1,086,228		947,551		1,124,612		966,464
Interest payable		2		90		90		74		74