FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2022

FAIR VALUE OF FINANCIAL INSTRUMENTS [Abstract]

Assets Measured at Fair Value on a Recurring Basis

The following tables present the assets reported on the consolidated balance sheet at their fair value on a recurring basis as of December 31, 2022 and 2021 (in thousands) by level within the fair value hierarchy. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

2022	Level I		Level II			Level III		Total
Fair value measurements on a recurring basis:
Assets
Equity securities	$	2,208	$	-		$	-	$	2,208
Available for sale securities:
U.S. Agency securities		-		70,677			-		70,677
U.S. Treasuries securities		148,570		-			-		148,570
Obligations of state and political subdivisions		-		110,300			-		110,300
Corporate obligations		-		9,383			-		9,383
Mortgage-backed securities in government sponsored entities		-		100,576			-		100,576
Other Assets
Derivative instruments		-		16,599			-		16,599
Liabilities
Derivative instruments		-		(9,726	)		-		(9,726	)

2021	Level I		Level II			Level III		Total
Fair value measurements on a recurring basis:
Assets
Equity securities	$	2,270	$	-		$	-	$	2,270
Available for sale securities:
U.S. Agency securities		-		73,945			-		73,945
U.S. Treasuries securities		115,347		-			-		115,347
Obligations of state and political subdivisions		-		112,021			-		112,021
Corporate obligations		-		10,333			-		10,333
Mortgage-backed securities in government sponsored entities		-		100,756			-		100,756
Other Assets
Derivative instruments		-		4,011			-		4,011
Liabilities
Derivative instruments		-		(2,101	)		-		(2,101	)

Assets Measured at Fair Value on Non-recurring Basis

Assets measured at fair value on a nonrecurring basis as of December 31, 2022 and 2021 (in thousands) are included in the table below:

2022	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	496	$	496
Other real estate owned		-		-		297		297

2021	Level I		Level II		Level III		Total
Impaired Loans	$	-	$	-	$	459	$	459
Other real estate owned		-		-		552		552

Significant Unobservable Inputs Used in Fair Value Measurement Process

The following table provides a listing of the significant unobservable inputs used in the fair value measurement process for items valued utilizing level III techniques (dollars in thousands).

2022	Fair Value	Valuation Technique(s)	Unobservable input	Range	Weighted average
Impaired Loans	496	Appraised Collateral Values	Discount for time since appraisal	0-100%	25.16%
			Selling costs	8%-10%	8.41%
			Holding period	6 - 12 months	11.51 months
Other real estate owned	297	Appraised Collateral Values	Discount for time since appraisal	20-84%	39.84%

2021	Fair Value	Valuation Technique(s)	Unobservable input	Range	Weighted average
Impaired Loans	459	Appraised Collateral Values	Discount for time since appraisal	0-100%	23.38%
			Selling costs	8%-10%	8.27%
			Holding period	6 - 12 months	11.52 months
Other real estate owned	552	Appraised Collateral Values	Discount for time since appraisal	20-44%	41.76%

Carrying Amount and Fair Value of Financial Instruments

The carrying amount and fair value of the Company’s financial instruments that are not required to be measured or reported at fair value on a recurring basis are as follows (in thousands):

December 31, 2022	Carrying Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Interest bearing time deposits with other banks	$	6,055	$	6,055	$	-	$	-	$	6,055
Loans held for sale		725		725		-		-		725
Net loans		1,706,447		1,662,514		-		-		1,662,514
Financial liabilities:
Deposits		1,844,208		1,832,037		1,566,517		-		265,520
Borrowed funds		257,278		246,288		-		-		246,288

December 31, 2021	Carrying Amount		Fair Value		Level I		Level II		Level III
Financial assets:
Interest bearing time deposits with other banks	$	11,026	$	11,026	$	-	$	-	$	11,026
Loans held for sale		4,554		4,554		-		-		4,554
Net loans		1,424,229		1,426,698		-		-		1,426,698
Financial liabilities:
Deposits		1,836,151		1,836,179		1,506,535		-		329,644
Borrowed funds		73,977		72,346		-		-		72,346