FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2017

The table below presents the balance of financial assets and liabilities at March 31, 2017 measured at fair value on a recurring basis:


			Fair Value Measurements at Reporting Date Using
			Quoted Prices in
			Active Markets for		Significant Other		Significant
			Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Total		(Level 1)		(Level 2)		(Level 3)
Assets
U.S. Treasury Obligations	$	10,164	$	—	$	10,164	$	—
U.S. GSEs		83,512		—		83,512		—
FHLB Obligations		67,050		—		67,050		—
Agency MBSs		64,277		—		64,277		—
Agency CMBSs		23,370		—		23,370		—
Agency CMOs		39,616		—		39,616		—
Interest rate swap agreements		973		—		973		—
Total assets	$	288,962	$	—	$	288,962	$	—
Liabilities
Interest rate swap agreements		774		—		774		—
Total liabilities	$	774	$	—	$	774	$	—

The table below presents the balance of financial assets and liabilities at December 31, 2016 measured at fair value on a recurring basis:


			Fair Value Measurements at Reporting Date Using
			Quoted Prices in
			Active Markets for		Significant Other		Significant
			Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Total		(Level 1)		(Level 2)		(Level 3)
Assets
U.S. Treasury Obligations	$	25,183	$	—	$	25,183	$	—
U.S. GSEs		93,353		—		93,353		—
FHLB Obligations		67,006		—		67,006		—
Agency MBSs		75,209		—		75,209		—
Agency CMBSs		23,608		—		23,608		—
Agency CMOs		49,333		—		49,333		—
ABSs		306		—		306		—
Interest rate swap agreements		422		—		422		—
Total assets	$	334,420	$	—	$	334,420	$	—
Liabilities
Interest rate swap agreements		194		—		194		—
Total liabilities	$	194	$	—	$	194	$	—

The fair value of Merchants’ financial instruments as of March 31, 2017 are summarized in the table below:


	Carrying
(In thousands)	Amount		Fair Value		Level 1		Level 2		Level 3
Cash and cash equivalents	$	59,762	$	59,762	$	59,762	$	—	$	—
Securities available for sale		287,989		287,989		—		287,989		—
Securities held to maturity		80,991		81,088		—		81,088		—
FHLB stock		7,044		N/A		N/A		N/A		N/A
Loans, net of allowance for loan losses		1,529,531		1,511,073		—		—		1,511,073
Interest rate swap agreement		973		973		—		973		—
Accrued interest receivable		5,085		5,085		—		1,096		3,989
Total	$	1,971,375	$	1,945,970	$	59,762	$	371,146	$	1,515,062
Deposits	$	1,511,676	$	1,510,694	$	1,321,166	$	189,528	$	—
Short-term borrowings		75,000		75,000		—		75,000		—
Securities sold under agreement to repurchase		249,582		249,651		—		249,651		—
Other long-term debt		3,630		3,585		—		3,585		—
Junior subordinated debentures issued to unconsolidated subsidiary trust		20,619		14,721		—		14,721		—
Interest rate swap agreement		774		774		—		774		—
Accrued interest payable		123		123		11		112		—
Total	$	1,861,404	$	1,854,548	$	1,321,177	$	533,371	$	—

The fair value of Merchants’ financial instruments as of December 31, 2016 are summarized in the table below:


	Carrying
(In thousands)	Amount		Fair Value		Level 1		Level 2		Level 3
Cash and cash equivalents	$	82,953	$	82,953	$	82,953	$	—	$	—
Securities available for sale		333,998		333,998		—		333,998		—
Securities held to maturity		85,694		85,749		—		85,749		—
FHLB stock		4,976		N/A		N/A		N/A		N/A
Loans, net of allowance for loan losses		1,501,550		1,484,718		—		—		1,484,718
Interest rate swap agreement		422		422		—		422		—
Accrued interest receivable		4,722		4,722		—		1,232		3,490
Total	$	2,014,315	$	1,992,562	$	82,953	$	421,401	$	1,488,208
Deposits	$	1,527,470	$	1,526,626	$	1,328,262	$	198,364	$	—
Short-term borrowings		40,000		40,000		—		40,000		—
Securities sold under agreement to repurchase		312,118		312,019		—		312,019		—
Other long-term debt		3,651		3,600		—		3,600		—
Junior subordinated debentures issued to unconsolidated subsidiary trust		20,619		14,775		—		14,775		—
Interest rate swap agreement		194		194		—		194		—
Accrued interest payable		110		110		11		99		—
Total	$	1,904,162	$	1,897,324	$	1,328,273	$	569,051	$	—