Fair Value Disclosures (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring Basis

The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

(Dollars in thousands)	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
June 30, 2017:
Securities available for sale:
U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) and agencies	$	—	$	3,500	$	—	$	3,500
Residential collateralized mortgage obligations- GSE	—		25,670		—		25,670
Residential mortgage backed securities – GSE	—		22,999		—		22,999
Obligations of state and political subdivisions	—		20,328		—		20,328
Trust preferred debt securities – single issuer	945		1,421		—		2,366
Corporate debt securities	16,257		8,709		—		24,966
Other debt securities	—		13,123		—		13,123
Total	$	17,202	$	95,750	$	—	$	112,952

(Dollars in thousands)	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
December 31, 2016:
Securities available for sale:
U. S. Treasury securities and obligations of U.S. Government sponsored corporations (“GSE”) and agencies	$	—	$	3,479	$	—	$	3,479
Residential collateralized mortgage obligations- GSE	—		22,560		—		22,560
Residential mortgage backed securities – GSE	—		31,476		—		31,476
Obligations of state and political subdivisions	—		21,400		—		21,400
Trust preferred debt securities – single issuer	—		2,272		—		2,272
Corporate debt securities	12,826		8,942		—		21,768
Other debt securities	—		839		—		839
Total	$	12,826	$	90,968	$	—	$	103,794

Fair Value Measurements, Nonrecurring

Assets and liabilities subject to fair value adjustments (impairment) on a nonrecurring basis for the six months ended June 30, 2017 and the twelve months ended December 31, 2016 were as follows:

(Dollars in thousands)	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total Fair Value
June 30, 2017:
Impaired loans	$	—	$	—	$	6,124	$	6,124
Other real estate owned	—		—		190		190
December 31, 2016:
Impaired loans	$	—	$	—	$	4,130	$	4,130

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis, where there was evidence of impairment, and for which the Company has utilized Level 3 inputs to determine fair value:

Quantitative Information about Level 3 Fair Value Measurements
(Dollars in thousands)	Fair Value Estimate		Valuation Techniques	Unobservable Input	Range (Weighted Average)
June 30, 2017
Impaired loans	$	6,124	Appraisal of collateral (1)	Appraisal adjustments (2)	13% - 42% (32.3%)
Other real estate owned	$	190	Appraisal of collateral (1)	Appraisal adjustments (2)	—%
December 31, 2016
Impaired loans	$	4,130	Appraisal of collateral (1)	Appraisal adjustments (2)	3%-100% (29.1%)

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable.

(2)

Includes quantitative adjustments by management and estimated liquidation expenses.

Fair Value, by Balance Sheet Grouping

The estimated fair values and carrying amounts of financial assets and liabilities as of June 30, 2017 and December 31, 2016 were as follows:

June 30, 2017
(Dollars in thousands)	Carrying			Level 1		Level 2			Level 3		Fair
	Value			Inputs		Inputs			Inputs		Value
Cash and cash equivalents	$	14,211		$	14,211	$	—		$	—	$	14,211
Securities available for sale	112,952			17,202		95,750			—		112,952
Securities held to maturity	124,922			—		127,075			—		127,075
Loans held for sale	3,594			—		3,651			—		3,651
Loans, net	754,912			—		—			762,068		762,068
SBA servicing asset	665			—		822			—		822
Interest rate lock derivative	145			—		145			—		145
Accrued interest receivable	3,060			—		3,060			—		3,060
FHLB stock	4,003			—		4,003			—		4,003
Deposits	(864,415		)	—		(863,537		)	—		(863,537		)
Borrowings	(73,825		)	—		(73,848		)	—		(73,848		)
Redeemable subordinated debentures	(18,557		)	—		(12,150		)	—		(12,150		)
Accrued interest payable	(812		)	—		(812		)	—		(812		)

December 31, 2016
(Dollars in thousands)	Carrying			Level 1		Level 2			Level 3		Fair
	Value			Inputs		Inputs			Inputs		Value
Cash and cash equivalents	$	14,886		$	14,668	$	—		$	—	$	14,668
Securities available for sale	103,794			12,826		90,968			—		103,794
Securities held to maturity	126,810			—		128,559			—		128,559
Loans held for sale	14,829			—		15,103			—		15,103
Loans, net	717,314			—		—			721,285		721,285
SBA servicing asset	605			—		822			—		822
Interest rate lock derivative	123			—		123			—		123
Accrued interest receivable	3,095			—		3,095			—		3,095
FHLB stock	3,962			—		3,962			—		3,962
Deposits	(834,516		)	—		(834,050		)	—		(834,050		)
Borrowings	(73,050		)	—		(73,222		)	—		(73,222		)
Redeemable subordinated debentures	(18,557		)	—		(11,922		)	—		(11,922		)
Accrued interest payable	(866		)	—		(866		)	—		(866		)