Fair Value (Tables)

6 Months Ended

Jun. 30, 2022

Fair Value Disclosures [Abstract]

Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are summarized below (in thousands):

	Fair value measurements at June 30, 2022
				Quoted prices
				in active		Significant
				markets for		other			Significant
				identical		observable			unobservable
	Carrying			assets		inputs			inputs
	Value			(Level 1)		(Level 2)			(Level 3)
Assets:
Securities available-for-sale:
U. S. government agency securities	$	14,803		$	—	$	14,803		$	—
State and municipal securities		69,712			—		69,712			—
Mortgage-backed securities		280,216			—		280,216			—
Asset-backed securities		3,252			—		3,252			—
Other debt securities		69,437			—		69,437			—
Loans held for sale		21,764			—		21,764			—
Derivative assets:
Non-hedging derivatives:
Interest rate swaps - customer related		1,477			—		1,477			—
Mortgage loan interest rate lock commitments		626			—		—			626
Liabilities:
Derivative liabilities:
Non-hedging derivatives:
Derivative Liabilities - customer related		(1,477	)		—		(1,477	)		—
Mortgage-backed securities forward sales commitments		154			—		154			—

	Fair value measurements at December 31, 2021
				Quoted prices
				in active		Significant
				markets for		other			Significant
				identical		observable			unobservable
	Carrying			assets		inputs			inputs
	Value			(Level 1)		(Level 2)			(Level 3)
Assets:
Securities available-for-sale:
U. S. government agency securities	$	11,503		$	—	$	11,503		$	—
State and municipal securities		82,560			—		82,560			—
Mortgage-backed securities		293,607			—		293,607			—
Asset-backed securities		3,339			—		3,339			—
Other debt securities		68,387			—		68,387			—
Loans held for sale		37,306			—		37,306			—
Derivative assets:
Non-hedging derivatives:
Interest rate swaps - customer related		1,594			—		1,594			—
Mortgage loan interest rate lock commitments		696			—		—			696
Liabilities:
Derivative liabilities:
Non-hedging derivatives:
Interest rate swaps - customer related		(1,594	)		—		(1,594	)		—
Mortgage-backed securities forward sales commitments		(160	)		—		(160	)		—

Reconciliation of Assets Measured at Fair Value on Recurring Basis using Significant Unobservable Inputs (Level 3)

The table below presents a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2022 and 2021 (in thousands):

	Mortgage Loan Interest Rate
	Lock Commitments
	2022			2021
Balance of recurring Level 3 assets at January 1st	$	696		$	2,607
Total gains or losses for the period:
Included in mortgage banking income		(70	)		(1,307	)
Balance of recurring Level 3 assets at June 30th	$	626		$	1,300

Summary of Quantitative Information About Level 3 Fair Value Measurements for Assets Measured at Fair Value on Recurring and Non-recurring Basis

The following table presents quantitative information about recurring Level 3 fair value measurements (dollars in thousands):

					Range
	Fair		Valuation		(Weighted-
June 30, 2022	Value		Technique(s)	Unobservable Input(s)	Average)
Assets:
Non-hedging derivatives:
Mortgage loan interest rate lock commitments	$	626	Consensus pricing	Origination pull-through rate	67% - 100% (90%)

					Range
	Fair		Valuation		(Weighted-
December 31, 2021	Value		Technique(s)	Unobservable Input(s)	Average)
Assets:
Non-hedging derivatives:
Mortgage loan interest rate lock commitments	$	696	Consensus pricing	Origination pull-through rate	60% - 98% (80%)

The following table presents quantitative information about December 31, 2021 Level 3 fair value measurements for assets measured at fair value on a non-recurring basis (dollars in thousands):

					Range
	Fair		Valuation		(Weighted-
December 31, 2021	Value		Technique(s)	Unobservable Input(s)	Average)
Impaired loans:
Consumer real estate	$	454	Sales comparison approach	Appraisal discounts	10%

Summary of Assets Measured at Fair Value on a Nonrecurring Basis

There were no assets measured at fair value on a nonrecurring basis as of June 30, 2022. Assets measured at fair value on a nonrecurring basis as of December 31, 2021 are summarized below (in thousands).

	Fair value measurements at December 31, 2021
			Quoted prices
			in active		Significant
			markets for		other		Significant
			identical		observable		unobservable
	Carrying		assets		inputs		inputs
	Value		(level 1)		(level 2)		(level 3)
Assets:
Impaired loans:
Consumer real estate	$	454	$	—	$	—	$	454

Summary of Carrying Value and Fair Values of the Bank's Financial Instruments

The carrying value and estimated fair values of the Bank’s financial instruments at June 30, 2022 and December 31, 2021 were as follows (in thousands):

	June 30, 2022				December 31, 2021
	Carrying				Carrying				Fair value
	amount		Fair value		amount		Fair value		level of input
Financial assets:
Cash and due from banks, interest-bearing deposits in    financial institutions	$	113,825	$	113,825	$	395,225	$	395,225	Level 1
Federal funds sold		—		—		19,900		19,900	Level 1
Securities available-for-sale		437,420		437,420		459,396		459,396	Level 2
Securities held-to-maturity		1,769		1,775		1,782		1,830	Level 2
Loans held for sale		85,884		86,911		83,715		84,934	Level 2
Restricted equity securities		16,616	N/A			14,453	N/A		N/A
Loans held for investment		2,234,833		2,233,939		1,965,769		1,963,803	Level 3
Accrued interest receivable		8,017		8,017		7,376		7,376	Level 2
Other assets		91,280		91,280		91,064		91,064	Level 2 / Level 3
Financial liabilities:
Deposits		2,630,487		2,412,683		2,684,281		2,517,856	Level 3
Subordinated notes and Federal Home Loan bank advances and other borrowings		74,599		75,420		29,532		30,477	Level 2
Other liabilities		1,710		1,710		1,842		1,842	Level 3