Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2013

Schedule of fair value assets and liabilities measured on recurring basis

The following table presents the balances of financial assets measured at fair value on a recurring basis during the period (in thousands):

				Fair Value Measurements at December 31, 2013 Using
	Balance as of December 31,			Quoted Prices in Active Markets for Identical Assets			Significant Other Observable Inputs			Significant Unobservable Inputs
Description	2013			Level 1			Level 2			Level 3
Assets:
Securities available for sale:
Federal agencies and GSEs		$	65,881		$	-		$	65,881		$	-
Mortgage-backed and CMOs			69,608			-			69,608			-
State and municipal			198,733			-			198,733			-
Corporate			10,799			-			10,799			-
Equity securities			1,103			-			-			1,103
Total		$	346,124		$	-		$	345,021		$	1,103

				Fair Value Measurements at December 31, 2012 Using
	Balance as of December 31,			Quoted Prices in Active Markets for Identical Assets			Significant Other Observable Inputs			Significant Unobservable Inputs
Description	2012			Level 1			Level 2			Level 3
Assets:
Securities available for sale:
Federal agencies and GSEs		$	42,759		$	-		$	42,759		$	-
Mortgage-backed and CMOs			83,308			-			83,308			-
State and municipal			202,731			2,110			200,621			-
Corporate			6,448			-			6,097			351
Total		$	335,246		$	2,110		$	332,785		$	351

The following table summarizes the Company's assets that were measured at fair value on a nonrecurring basis during the period (in thousands):

				Fair Value Measurements at December 31, 2013 Using
	Balance as of December 31,			Quoted Prices in Active Markets for Identical Assets			Significant Other Observable Inputs			Significant Unobservable Inputs
Description	2013			Level 1			Level 2			Level 3
Assets:
Loans held for sale		$	2,760		$	-		$	2,760		$	-
Impaired loans, net of valuation allowance			3,193			-			-			3,193
Other real estate owned			3,422			-			-			3,422

				Fair Value Measurements at December 31, 2012 Using
	Balance as of December 31,			Quoted Prices in Active Markets for Identical Assets			Significant Other Observable Inputs			Significant Unobservable Inputs
Description	2012			Level 1			Level 2			Level 3
Assets:
Loans held for sale		$	13,852		$	-		$	13,852		$	-
Impaired loans, net of valuation allowance			3			-			-			3
Other real estate owned			6,193			-			-			6,193

Schedule of fair value measurements using significant unobservable inputs (Level 3)

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Balances as of January 1, 2013			Total Realized / Unrealized Gains (Losses) Included in						Purchases, Sales, Issuances and Settlements, Net				Transfer In (Out) of Level 3			Balances as of December 31, 2013
	Balances as of January 1, 2013			Net Income			Other Comprehensive Income			Purchases, Sales, Issuances and Settlements, Net				Transfer In (Out) of Level 3			Balances as of December 31, 2013
Securities available for sale:

Corporate		$	351		$	136		$	-		$	(487	)		$	-		$	-
Equity			-			-			103			1,000				-			1,103
Total assets		$	351		$	136		$	103		$	513			$	-		$	1,103

Schedule of quantitative information of assets measured at Level 3

Quantitative Information About Level 3 Fair Value Measurements as of December 31, 2013:

Assets	Valuation Technique	Unobservable Input	Weighted Rate

Securities available for sale	Discounted cash flow analysis	Discount rate	11%

Impaired loans	Discounted appraised value	Selling cost	6%

Other real estate owned	Discounted appraised value	Selling cost	6%
Other real estate owned	Discounted appraised value	Discount for lack of marketability and age of appraisal	9%

Schedule of carrying values and estimated fair values of the entity's financial instruments

The carrying values and estimated fair value of the Company's financial instruments as of December 31, 2013 are as follows (in thousands):

	Fair Value Measurements at December 31, 2013 Using
	Carrying Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Fair Value Balance
	Carrying Value		Level 1		Level 2		Level 3		Fair Value Balance
Financial Assets:
Cash and cash equivalents	$	67,681	$	-	$	67,681	$	-	$	67,681
Securities available for sale		346,124		-		345,021		1,103		346,124
Restricted stock		4,889		-		4,889		-		4,889
Loans held for sale		2,760		-		2,760		-		2,760
Loans, net of allowance		782,071		-		-		783,825		783,825
Bank owned life insurance		14,746		-		14,746		-		14,746
Accrued interest receivable		4,741		-		4,741		-		4,741

Financial Liabilities:
Deposits	$	1,057,675	$	-	$	668,077	$	392,991	$	1,061,068
Repurchase agreements		39,478		-		39,478		-		39,478
Other borrowings		9,951		-		-		10,560		10,560
Trust preferred capital notes		27,419		-		-		18,162		18,162
Accrued interest payable		610		-		610		-		610

The carrying values and estimated fair values of the Company's financial instruments at December 31, 2012 are as follows (in thousands):

	Fair Value Measurements at December 31, 2012 Using
	Carrying Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Fair Value Balance
	Carrying Value		Level 1		Level 2		Level 3		Fair Value Balance
Financial Assets:
Cash and cash equivalents	$	47,442	$	-	$	47,442	$	-	$	47,442
Securities available for sale		335,246		2,110		332,785		351		335,246
Restricted stock		5,287		-		5,287		-		5,287
Loans held for sale		13,852		-		13,852		-		13,852
Loans, net of allowance		776,587		-		-		777,761		777,761
Bank owned life insurance		14,289		-		14,289		-		14,289
Accrued interest receivable		4,711		-		4,711		-		4,711

Financial Liabilities:
Deposits	$	1,027,667	$	-	$	618,099	$	424,378	$	1,042,477
Repurchase agreements		49,942		-		49,942		-		49,942
Other borrowings		10,079		-		-		11,062		11,062
Trust preferred capital notes		27,317		-		-		22,524		22,524
Accrued interest payable		755		-		755		-		755

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 15

-Subparagraph b-d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

-Paragraph 18

-Subparagraph c(2), d, e, f

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 32

-Subparagraph a, c(1), c(2), c(3), d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

-Paragraph 2

-Subparagraph (a)

-URI http://asc.fasb.org/extlink&oid=7578670&loc=d3e19207-110258

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

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-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13433-108611

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 50

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-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13467-108611

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

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-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13476-108611

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 10

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 50

-Paragraph 30

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-URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 14

-Subparagraph a

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

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-URI http://asc.fasb.org/extlink&oid=6447952&loc=d3e13220-108610

Reference 12: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

-Paragraph 19

-Subparagraph a, b, c(1), d(1)

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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