Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2015

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis.



	Balance at		Fair Value Measurements Using:
Dollars in thousands	September 30, 2015		Level 1		Level 2		Level 3
Available for sale securities
U.S. Government sponsored agencies	$	28,054	$	—	$	28,054	$	—
Mortgage backed securities:
Government sponsored agencies	143,564		—		143,564		—
Nongovernment sponsored entities	8,701		—		8,701		—
State and political subdivisions	3,426		—		3,426		—
Corporate debt securities	10,669		—		6,853		3,816
Other equity securities	77		—		77		—
Tax-exempt state and political subdivisions	77,636		—		77,636		—
Total available for sale securities	$	272,127	$	—	$	268,311	$	3,816

Derivative financial liabilities
Interest rate swaps	$	6,006	$	—	$	6,006	$	—



	Balance at		Fair Value Measurements Using:
Dollars in thousands	December 31, 2014		Level 1		Level 2		Level 3
Available for sale securities
U.S. Government sponsored agencies	$	23,174	$	—	$	23,174	$	—
Mortgage backed securities:
Government sponsored agencies	149,777		—		149,777		—
Nongovernment sponsored entities	12,145		—		12,145		—
State and political subdivisions	8,694		—		8,694		—
Corporate debt securities	3,776		—		—		3,776
Other equity securities	7		—		7		—
Tax-exempt state and political subdivisions	85,261		—		85,261		—
Total available for sale securities	$	282,834	$	—	$	279,058	$	3,776

Derivative financial liabilities
Interest rate swaps	$	2,911	$	—	$	2,911	$	—

Assets measured at fair value on a nonrecurring basis are included in the table below.



	Balance at		Fair Value Measurements Using:
Dollars in thousands	September 30, 2015		Level 1		Level 2		Level 3
Residential mortgage loans held for sale	$	83	$	—	$	83	$	—

Collateral-dependent impaired loans
Commercial	$	—	$	—	$	—	$	—
Commercial real estate	176		—		176		—
Construction and development	—		—		—		—
Residential real estate	414		—		414		—
Total collateral-dependent impaired loans	$	590	$	—	$	590	$	—

Foreclosed properties
Commercial real estate	1,701		—		1,701		—
Construction and development	19,908		—		19,850		58
Residential real estate	388		—		388		—
Total foreclosed properties	$	21,997	$	—	$	21,939	$	58



	Balance at		Fair Value Measurements Using:
Dollars in thousands	December 31, 2014		Level 1		Level 2		Level 3
Residential mortgage loans held for sale	$	527	$	—	$	527	$	—

Collateral-dependent impaired loans
Commercial	$	44	—		$	—	$	44
Commercial real estate	344		—		344		—
Construction and development	852		—		852		—
Residential real estate	312		—		312		—
Total collateral-dependent impaired loans	$	1,552	$	—	$	1,508	$	44

Foreclosed properties
Commercial real estate	3,892		—		3,892		—
Construction and development	20,952		—		20,841		111
Residential real estate	2,025		—		2,025		—
Total foreclosed properties	$	26,869	$	—	$	26,758	$	111

The carrying values and estimated fair values of our financial instruments are summarized below:



	September 30, 2015				December 31, 2014
Dollars in thousands	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets
Cash and cash equivalents	$	12,289	$	12,289	$	12,510	$	12,510
Securities available for sale	272,127		272,127		282,834		282,834
Other investments	7,016		7,016		6,183		6,183
Loans held for sale, net	83		83		527		527
Loans, net	1,062,348		1,066,321		1,019,842		1,033,890
Accrued interest receivable	5,295		5,295		5,838		5,838
	$	1,359,158	$	1,363,131	$	1,327,734	$	1,341,782
Financial liabilities
Deposits	$	1,072,091	$	1,085,804	$	1,061,314	$	1,078,406
Short-term borrowings	145,291		145,291		123,633		123,633
Long-term borrowings	76,059		82,179		77,490		84,732
Subordinated debentures	—		—		16,800		16,800
Subordinated debentures owed to unconsolidated subsidiary trusts	19,589		19,589		19,589		19,589
Accrued interest payable	768		768		812		812
Derivative financial liabilities	6,006		6,006		2,911		2,911
	$	1,319,804	$	1,339,637	$	1,302,549	$	1,326,883