FAIR VALUE (Tables)

9 Months Ended

Sep. 30, 2018

Summary of assets measured at fair value on recurring basis

The following presents assets measured on a recurring basis at September 30, 2018 and December 31, 2017 (in thousands):


	Quoted
	Prices in		Significant
	Active Markets		Other		Significant
	for Identical		Observable		Unobservable
	Assets		Inputs		Inputs		Reported
September 30, 2018	(Level 1)		(Level 2)		(Level 3)		Balance
Investment securities available-for-sale:
U.S. Treasury debt	$	249	$	—	$	—	$	249
GNMA mortgage-backed securities – residential		—		34,522		—		34,522
Securities issued by U.S. government sponsored entities and agencies		—		8,281		—		8,281
Corporate collateralized mortgage obligations and mortgage-backed securities		—		1,423		—		1,423
SBIC		—		1,017		—		1,017
Total securities available-for-sale	$	249	$	45,243	$	—	$	45,492
Equity securities not available-for-sale	$	687	$	—	$	—	$	687
Interest rate lock and forward delivery commitments	$	—	$	885	$	—	$	885


	Quoted
	Prices in		Significant
	Active Markets		Other		Significant
	for Identical		Observable		Unobservable
	Assets		Inputs		Inputs		Reported
December 31, 2017	(Level 1)		(Level 2)		(Level 3)		Balance
Investment securities available-for-sale:
U.S. Treasury debt	$	249	$	—	$	—	$	249
GNMA mortgage-backed securities – residential		—		40,836		—		40,836
Securities issued by U.S. government sponsored entities and agencies		—		9,453		—		9,453
Corporate collateralized mortgage obligations and mortgage-backed securities		—		1,479		—		1,479
SBIC		—		930		—		930
Equity mutual fund		703		—		—		703
Total securities available-for-sale	$	952	$	52,698	$	—	$	53,650
Interest rate lock and forward delivery commitments	$	—	$	665	$	—	$	665

Summary of assets measured at fair value on nonrecurring basis

The following presents assets measured on a nonrecurring basis as of September 30, 2018 and December 31, 2017 (in thousands):


	Quoted
	Prices in		Significant
	Active Markets		Other		Significant
	for Identical		Observable		Unobservable
	Assets		Inputs		Inputs		Reported
September 30, 2018	(Level 1)		(Level 2)		(Level 3)		Balance
Other real estate owned:
Commercial properties	$	—	$	—	$	658	$	658
Total other real estate owned	$	—	$	—	$	658	$	658

Total impaired loans:
Commercial and industrial	$	—	$	—	$	795	$	795
Total impaired loans	$	—	$	—	$	795	$	795


	Quoted
	Prices in		Significant
	Active Markets		Other		Significant
	for Identical		Observable		Unobservable
	Assets		Inputs		Inputs		Reported
December 31, 2017	(Level 1)		(Level 2)		(Level 3)		Balance
Other real estate owned:
Commercial properties	$	—	$	—	$	658	$	658
Total other real estate owned	$	—	$	—	$	658	$	658

Total impaired loans:
Commercial and industrial	$	—	$	—	$	1,113	$	1,113
Total impaired loans	$	—	$	—	$	1,113	$	1,113

Summary of carrying amounts and estimated fair values of financial instruments

The following presents carrying amounts and estimated fair values for financial instruments as of September 30, 2018 and December 31, 2017 (in thousands):


	Carrying		Fair Value Measurements Using:
September 30, 2018	Amount		Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	70,418	$	70,418	$	—	$	—
Securities available-for-sale		45,492		249		45,243		—
Loans, net		850,199		—		—		824,504
Mortgage loans held for sale		19,238		—		19,238		—
Correspondent bank stock		2,392		N/A		N/A		N/A
Accrued interest receivable		2,854		—		2,854		—
Other assets		687		687		—		—
Liabilities:
Deposits	$	878,639	$	—	$	880,065	$	—
Borrowings:
FHLB Topeka Borrowings – fixed rate		44,598		—		44,984		—
2016 Subordinated notes – fixed-to-floating rate		6,560		—		—		6,546
Accrued interest payable		211		—		211		—


	Carrying		Fair Value Measurements Using:
December 31, 2017	Amount		Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	9,502	$	9,502	$	—	$	—
Securities available-for-sale		53,650		952		52,698		—
Loans, net		806,402		—		—		822,392
Mortgage loans held for sale		22,940		—		22,940		—
Correspondent bank stock		1,555		N/A		N/A		N/A
Accrued interest receivable		2,421		—		2,421		—
Promissory notes, net		5,792		—		—		5,792
Liabilities:
Deposits	$	816,117	$	—	$	821,059	$	—
Borrowings:
FHLB Topeka Borrowings – fixed rate		28,563		—		29,108		—
2016 Subordinated notes – fixed-to-floating rate		6,560		—		—		6,893
2012 Subordinated notes – fixed rate		6,875		—		—		7,129
Accrued interest payable		197		—		197		—