FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2020

FAIR VALUE MEASUREMENTS [Abstract]

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 September 30, 2020:

(in thousands)
September 30, 2020	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	$	30,873	$	30,873	$	—	$	—
Securities of U.S. government agencies and corporations		79,245		—		79,245		—
Obligations of states and political subdivisions		32,241		—		32,241		—
Collateralized mortgage obligations		78,517		—		78,517		—
Mortgage-backed securities		142,493		—		142,493		—
Total investments at fair value	$	363,369	$	30,873	$	332,496	$	—

There were no transfers of assets measured at fair value on a recurring basis between level 1 and level 2 of the fair value hierarchy.

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

(in thousands)
December 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	$	43,255	$	43,255	$	—	$	—
Securities of U.S. government agencies and corporations		53,912		—		53,912		—
Obligations of states and political subdivisions		27,031		—		27,031		—
Collateralized mortgage obligations		79,420		—		79,420		—
Mortgage-backed securities		139,279		—		139,279		—
Total investments at fair value	$	342,897	$	43,255	$	299,642	$	—

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 September 30, 2020 and December 31, 2019:

(in thousands)
September 30, 2020	Carrying Value		Level 1		Level 2		Level 3
Mortgage servicing rights	$	1,264	$	—	$	—	$	1,264
Total assets at fair value	$	1,264	$	—	$	—	$	1,264

(in thousands)
December 31, 2019	Carrying Value		Level 1		Level 2		Level 3
Impaired loans	$	170	$	—	$	—	$	170
Total assets at fair value	$	170	$	—	$	—	$	170

Key Methods and Assumptions Used in Measuring Fair Value

Key methods and assumptions used in measuring the fair value of mortgage servicing rights as of September 30, 2020 and impaired loans as of  December 31, 2019 were as follows:

	Method	Assumption Inputs
Mortgage servicing rights	Discounted cash flows	Present value of expected future cash flows was estimated using a discount rate factor of 10.00% as of September 30, 2020.  A constant prepayment rate of 18.91% as of September 30, 2020 was utilized.
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.

Estimated Fair Value of Financial Instruments

The estimated fair values of the Company’s financial instruments for the periods ended September 30, 2020 and December 31, 2019 were approximately as follows:

(in thousands)			September 30, 2020				December 31, 2019
	Level		Carrying amount		Fair value		Carrying amount		Fair value
Financial assets:
Cash and cash equivalents		1	$	275,643	$	275,643	$	111,493	$	111,493
Certificates of deposit		2		18,142		18,751		14,700		14,984
Stock in Federal Home Loan Bank and other equity securities		3		6,480		6,480		6,574		6,574
Loans receivable:
Net loans		3		965,847		921,387		768,873		723,507
Loans held-for-sale		2		4,650		4,812		4,130		4,213
Interest receivable		2		5,088		5,088		4,295		4,295
Mortgage servicing rights		3		1,264		1,264		1,481		1,631
Financial liabilities:
Deposits		3		1,499,001		1,468,740		1,138,632		1,035,644
Federal Home Loan Bank advances		2		10,000		9,993		—		—
Interest payable		2		87		87		92		92