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Fair Value (Tables)
 9 Months Ended
Sep. 30, 2017
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Fair Value on Recurring Basis
Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:
 
 
Fair Value Measurements at September 30, 2017 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Obligations of State and Political Subdivisions
 
$
—

 
$
260,754

 
$
5,742

 
$
266,496

MBS/CMO - Residential
 
—

 
474,861

 
—

 
474,861

Equity Securities
 
—

 
—

 
353

 
353

Total Securities
 
$
—

 
$
735,615

 
$
6,095

 
$
741,710

 
 
 
 
 
 
 
 
 
Loans Held-for-Sale
 
$
—

 
$
8,484

 
$
—

 
$
8,484

 
 
 
 
 
 
 
 
 
Derivative Assets
 
$
—

 
$
1,750

 
$
—

 
$
1,750

 
 
 
 
 
 
 
 
 
Mortgage Servicing Rights
 
$
—

 
$
563

 
$
—

 
$
563

 
 
 
 
 
 
 
 
 
Derivative Liabilities
 
$
—

 
$
1,848

 
$
—

 
$
1,848


 
 
Fair Value Measurements at December 31, 2016 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable  Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Obligations of State and Political Subdivisions
 
$
—

 
$
240,495

 
$
7,024

 
$
247,519

MBS/CMO - Residential
 
—

 
461,914

 
—

 
461,914

Equity Securities
 
—

 
—

 
353

 
353

Total Securities
 
$
—

 
$
702,409

 
$
7,377

 
$
709,786

 
 
 
 
 
 
 
 
 
Loans Held-for-Sale
 
$
—

 
$
15,273

 
$
—

 
$
15,273

 
 
 
 
 
 
 
 
 
Derivative Assets
 
$
—

 
$
1,291

 
$
—

 
$
1,291

 
 
 
 
 
 
 
 
 
Mortgage Servicing Rights
 
$
—

 
$
611

 
$
—

 
$
611

 
 
 
 
 
 
 
 
 
Derivative Liabilities
 
$
—

 
$
1,238

 
$
—

 
$
1,238
Reconciliation of all Assets Measured at Fair Value on Recurring Basis, Using Significant Unobservable Inputs (Level 3)
The tables below present a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2017 and 2016:
 
 
Obligations of State and Political Subdivisions
 
Equity Securities
 
 
2017
 
2016
 
2017
 
2016
 
 
 
 
 
 
 
 
 
Balance of Recurring Level 3 Assets at July 1
 
$
6,192

 
$
7,942

 
$
353

 
$
353

Total Gains or Losses Included in Other Comprehensive Income
 
—

 
—

 
—

 
—

Maturities / Calls
 
(450
)
 
(555
)
 
—

 
—

Purchases
 
—

 
—

 
—

 
—

Balance of Recurring Level 3 Assets at September 30
 
$
5,742

 
$
7,387

 
$
353

 
$
353

 

Obligations of State and Political Subdivisions

Equity Securities
 

2017

2016

2017

2016













Balance of Recurring Level 3 Assets at January 1

$
7,023


$
8,749


$
353


$
353

Total Gains or Losses Included in Other Comprehensive Income

34


38


—


—

Maturities / Calls

(1,315
)

(1,400
)

—


—

Purchases

—


—


—


—

Balance of Recurring Level 3 Assets at September 30

$
5,742


$
7,387


$
353


$
353
Assets and Liabilities Measured at Fair Value on Non-Recurring Basis
Assets and liabilities measured at fair value on a non-recurring basis are summarized below:
 
 
Fair Value Measurements at September 30, 2017 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable 
Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Impaired Loans
 
 

 
 

 
 

 
 

Commercial and Industrial Loans
 
$
—

 
$
—

 
$
2,622

 
$
2,622

Commercial Real Estate Loans
 
—

 
—

 
1,966

 
1,966

Agricultural Loans
 
—

 
—

 
158

 
158

 
 
 
Fair Value Measurements at December 31, 2016 Using
 
 
Quoted Prices in Active Markets for Identical Assets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable 
Inputs (Level 3)
 
Total
Assets:
 
 

 
 

 
 

 
 

Impaired Loans
 
 

 
 

 
 

 
 

Commercial and Industrial Loans
 
$
—

 
$
—

 
$
60

 
$
60

Commercial Real Estate Loans
 
—

 
—

 
348

 
348

Agricultural Loans
 
—

 
—

 
—

 
—
Fair Value Assets and Liabilities Measured on Nonrecurring Basis Valuation Techniques
The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at September 30, 2017 and December 31, 2016:
September 30, 2017
 
Fair Value

Valuation Technique(s)

Unobservable Input(s)

Range (Weighted Average)

 








Impaired Loans - Commercial and Industrial Loans
 
$
2,622

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
21%-95%
(29%)
Impaired Loans - Commercial Real Estate Loans
 
$
1,966


Sales comparison approach

Adjustment for physical condition of comparable properties sold

28%-76%
(49%)
Impaired Loans - Agricultural Loans
 
$
158

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
34%
(34%)


December 31, 2016
 
Fair Value
 
Valuation Technique(s)
 
Unobservable Input(s)
 
Range (Weighted Average)
 
 
 
 
 
 
 
 
 
Impaired Loans - Commercial and Industrial Loans
 
$
60

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
0%-100%
(89%)
Impaired Loans - Commercial Real Estate Loans
 
$
348

 
Sales comparison approach
 
Adjustment for physical condition of comparable properties sold
 
33%-77%
(56%)
Carrying Amounts and Estimated Fair Values of Company's Financial Instruments
The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ending September 30, 2017 and December 31, 2016. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision.
 
 
 
 
Fair Value Measurements at
September 30, 2017 Using
 
 
Carrying Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Financial Assets:
 
 

 
 

 
 

 
 

 
 

Cash and Short-term Investments
 
$
54,562

 
$
44,804

 
$
9,758

 
$
—

 
$
54,562

Loans, Net
 
2,066,258

 
—

 
—

 
2,061,198

 
2,061,198

FHLB Stock and Other Restricted Stock
 
13,048

 
N/A

 
N/A

 
N/A

 
N/A

Accrued Interest Receivable
 
12,860

 
—

 
3,744

 
9,116

 
12,860

Financial Liabilities:
 
 

 
 

 
 

 
 

 
 

Demand, Savings, and Money Market Deposits
 
(2,043,388
)
 
(2,043,388
)
 
—

 
—

 
(2,043,388
)
Time Deposits
 
(381,184
)
 
—

 
(380,873
)
 
—

 
(380,873
)
Short-term Borrowings
 
(117,199
)
 
—

 
(117,199
)
 
—

 
(117,199
)
Long-term Debt
 
(144,742
)
 
—

 
(133,176
)
 
(11,202
)
 
(144,378
)
Accrued Interest Payable
 
(932
)
 
—

 
(873
)
 
(59
)
 
(932
)
 
 
 
 
 
Fair Value Measurements at
December 31, 2016 Using
 
 
Carrying Value
 
Level 1
 
Level 2
 
Level 3
 
Total
Financial Assets:
 
 

 
 

 
 

 
 

 
 

Cash and Short-term Investments
 
$
64,816

 
$
48,467

 
$
16,349

 
$
—

 
$
64,816

Loans, Net
 
1,974,074

 
—

 
—

 
1,980,523

 
1,980,523

FHLB Stock and Other Restricted Stock
 
13,048

 
N/A

 
N/A

 
N/A

 
N/A

Accrued Interest Receivable
 
11,413

 
—

 
3,289

 
8,124

 
11,413

Financial Liabilities:
 
 

 
 

 
 

 
 

 
 

Demand, Savings, and Money Market Deposits
 
(1,971,370
)
 
(1,971,370
)
 
—

 
—

 
(1,971,370
)
Time Deposits
 
(378,181
)
 
—

 
(378,000
)
 
—

 
(378,000
)
Short-term Borrowings
 
(137,554
)
 
—

 
(137,554
)
 
—

 
(137,554
)
Long-term Debt
 
(120,560
)
 
—

 
(109,709
)
 
(10,793
)
 
(120,502
)
Accrued Interest Payable
 
(789
)
 
—

 
(775
)
 
(14
)
 
(789
)