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Note 7 - Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2016

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

(dollars in thousands)	Total		(Level 1) Quoted Prices in Active Markets for Identical Assets		(Level 2) Significant Other Observable Inputs		(Level 3) Significant Unobservable Inputs

September 3 0 , 2016
Assets:

Collateralized mortgage obligations	$	200,396	$	-	$	200,396	$	-
Agency mortgage-backed securities		11,686		-		11,686		-
Municipal securities		24,442		-		24,442		-
Corporate bonds		45,428		-		42,495		2,933
Asset-backed securities		15,717		-		15,717		-
Trust Preferred Securities		1,691		-		-		1,691
Other securities		25		-		25		-
Securities Available for Sale	$	299,385	$	-	$	294,761	$	4,624

Mortgage Loans Held for Sale	$	26,865	$	-	$	26,865	$	-

SBA Servicing Assets	$	5,297	$	-	$	-	$	5,297

Interest Rate Lock Commitments	$	1,027	$	-	$	1,027	$	-

Liabilities:

Interest Rate Lock Commitments	$	9	$	-	$	9	$	-

Best Efforts Forward Loan Sales Commitments	$	377	$	-	$	377	$	-

Mandatory Forward Loan Sales Commitments	$	294	$	-	$	294	$	-

December 31, 2015
Assets:

Collateralized mortgage obligations	$	178,145	$	-	$	178,145	$	-
Agency mortgage-backed securities		10,171		-		10,171		-
Municipal securities		23,344		-		23,344		-
Corporate bonds		54,129		-		51,295		2,834
Asset-backed securities		17,005		-		17,005		-
Trust Preferred Securities		1,883		-		-		1,883
Other securities		118		-		118		-
Securities Available for Sale	$	284,795	$	-	$	280,078	$	4,717

SBA Servicing Assets	$	4,886		-		-	$	4,886

Schedule of Servicing Assets at Fair Value [Table Text Block]

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	201 6			201 5			201 6			201 5
Beginning balance	$	5,118		$	4,319		$	4,886		$	4,099
Additions		503			227			1,305			672
Fair value adjustments		(324	)		(372	)		(894	)		(597	)
Ending balance	$	5,297		$	4,174		$	5,297		$	4,174

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

	Three Months Ended September 30, 201 6					Three Months Ended September 30, 201 5
Level 3 Investments Only (dollars in thousands)	Trust Preferred Securities			Corporate Bonds		Trust Preferred Securities			Corporate Bonds
Balance, July 1st	$	1,755		$	2,870	$	2,006		$	2,684
Unrealized gains (losses)		(62	)		63		220			17
Paydowns		-			-		-			-
Proceeds from sales		-			-		(414	)		-
Realized losses		-			-		(142	)		-
Impairment charges on Level 3		(2	)		-		-			-
Balance, September 30th	$	1,691		$	2,933	$	1,670		$	2,701

	Nine Months Ended September 30, 201 6					Nine Months Ended September 30, 201 5
Level 3 Investments Only (dollars in thousands)	Trust Preferred Securities			Corporate Bonds		Trust Preferred Securities			Corporate Bonds
Balance, January 1st	$	1,883		$	2,834	$	3,193		$	3,005
Unrealized gains (losses)		(185	)		99		669			(304	)
Paydowns		-			-		(19	)		-
Proceeds from sales		-			-		(1,952	)		-
Realized losses		-			-		(218	)		-
Impairment charges on Level 3		(7	)		-		(3	)		-
Balance, September 30th	$	1,691		$	2,933	$	1,670		$	2,701

Fair Value Measurements, Nonrecurring [Table Text Block]

(dollars in thousands)	Total		(Level 1) Quoted Prices in Active Markets for Identical Assets		(Level 2) Significant Other Observable Inputs		(Level 3) Significant Unobservable Inputs
September 30, 2016:
Impaired loans	$	9,331	$	-	$	-	$	9,331
Other real estate owned		8,593		-		-		8,593

December 31, 2015:
Impaired loans	$	5,734	$	-	$	-	$	5,734
Other real estate owned		10,034		-		-		10,034

Fair Value Inputs, Assets, Quantitative Information [Table Text Block]

	Quantitative Information about Level 3 Fair Value Measurements
Asset Description	Fair Value		Valuation Technique	Unobservable Input	Range Weighted Average
September 30, 2016
Corporate bonds	$	2,933	Discounted Cash Flows	Discount Rate			(4.35%)

Trust preferred securities	$	1,691	Discounted Cash Flows	Discount Rate		8.45%	-	8.95%	(8.68%)

				Conditional Prepayment Rate			(6.16%)
SBA servicing assets	$	5,297	Discounted Cash Flows	Discount Rate			(10.00%)

				Liquidation expenses (2)		4%	-	76%	(15%)	(3)
Impaired loans	$	9,331	Appraised Value of Collateral (1)	Appraisal adjustment (2)			(0%)			(3)

				Liquidation expenses (2)		7%	-	27%	(12%)	(3)
			Appraised Value of Collateral (1)	Appraisal adjustment (2)			(0%)			(3)
Other real estate owned	$	8,593	Sales Price	Liquidation expenses (2)			(7%)			(3)

December 31, 2015
Corporate bonds	$	2,834	Discounted Cash Flows	Discount Rate			(4.11%)

Trust preferred securities	$	1,883	Discounted Cash Flows	Discount Rate		7.31%	-	7.81%	(7.77%)

				Conditional Prepayment Rate			(6.27%)
SBA servicing assets	$	4,886	Discounted Cash Flows	Discount Rate			(10.00%)

Impaired loans	$	5,734	Appraised Value of Collateral (1)	Liquidation expenses (2)		12%	-	78%	(20%)	(3)

				Liquidation expenses (2)		6%	-	30%	(10%)	(3)
			Appraised Value of Collateral (1)	Appraisal adjustment (2)			(50%)			(3)
Other real estate owned	$	10,034	Sales Price	Liquidation expenses (2)		7%	-	9%	(9%)	(3)

Fair Value, Option, Quantitative Disclosures [Table Text Block]

Mortgage loans held for sale		Carrying Amount				Aggregate Unpaid Principal Balance				Excess Carrying Amount Over Aggregate Unpaid Principal Balance
September 30, 2016		$	26,865			$	25,726			$	1,139

Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets [Table Text Block]

(dollars in thousands)	September 3 0 , 2016			December 31, 2015

SBA Servicing Asset

Fair Value of SBA Servicing Asset	$	5,297		$	4,886

Composition of SBA Loans Serviced for Others
Fixed-rate SBA loans		0	%		0	%
Adjustable-rate SBA loans		100	%		100	%
Total		100	%		100	%

Weighted Average Remaining Term (in years)		21.2			20.9

Prepayment Speed		6.16	%		6.27	%
Effect on fair value of a 10% increase	$	(162	)	$	(151	)
Effect on fair value of a 20% increase		(318	)		(296	)

Weighted Average Discount Rate		10.00	%		10.00	%
Effect on fair value of a 10% increase	$	(223	)	$	(206	)
Effect on fair value of a 20% increase		(429	)		(397	)

Fair Value, by Balance Sheet Grouping [Table Text Block]

	Fair Value Measurements at September 30, 2016
(dollars in thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Balance Sheet Data
Financial assets:
Cash and cash equivalents	$	150,041	$	150,041	$	150,041	$	-	$	-
Investment securities available for sale		299,385		299,385		-		294,761		4,624
Investment securities held to maturity		220,470		223,247		-		223,247		-
Restricted stock		1,366		1,366		-		1,366		-
Loans held for sale		29,715		29,715		-		26,865		2,850
Loans receivable, net		936,088		917,242		-		-		917,242
SBA servicing assets		5,297		5,297		-		-		5,297
Accrued interest receivable		4,588		4,588		-		4,588		-
Interest rate lock commitments		1,027		1,027		-		1,027		-

Financial liabilities:
Deposits
Demand, savings and money market	$	1,473,105	$	1,473,105	$	-	$	1,473,105	$	-
Time		109,127		109,172		-		109,172		-
Subordinated debt		22,476		18,257		-		-		18,257
Accrued interest payable		339		339		-		339		-
Interest rate lock commitments		9		9				9
Best efforts forward loan sales commitments		377		377				377
Mandatory forward loan sales commitments		294		294				294

Off-Balance Sheet Data
Commitments to extend credit		-		-				-		-
Standby letters-of-credit		-		-				-		-

	Fair Value Measurements at December 31, 2015
(dollars in thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Balance Sheet Data
Financial assets:
Cash and cash equivalents	$	27,139	$	27,139	$	27,139	$	-	$	-
Investment securities available for sale		284,795		284,795		-		280,078		4,717
Investment securities held to maturity		172,277		171,845		-		171,845		-
Restricted stock		3,059		3,059		-		3,059		-
Loans held for sale		3,653		3,831		-		-		3,831
Loans receivable, net		866,066		849,578		-		-		849,578
SBA servicing assets		4,886		4,886		-		-		4,886
Accrued interest receivable		4,216		4,216		-		4,216		-

Financial liabilities:
Deposits
Demand, savings and money market	$	1,181,720	$	1,181,720	$	-	$	1,181,720	$	-
Time		67,578		67,422		-		67,422		-
Short-term borrowings		47,000		47,000		-		47,000		-
Subordinated debt		22,476		18,972		-		-		18,972
Accrued interest payable		245		245		-		245		-

Off-Balance Sheet Data		-		-		-		-		-
Commitments to extend credit		-		-		-		-		-
Standby letters-of-credit

- Definition

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

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