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Fair Value Measurement
 3 Months Ended
Mar. 31, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurement Fair Value Measurement
Mid Penn uses estimates of fair value in applying various accounting standards for its consolidated financial statements on either a recurring or non-recurring basis. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. Mid Penn groups its assets and liabilities measured at fair value in three hierarchy levels, based on the observability and transparency of the inputs. The fair value hierarchy is as follows:
Level 1 - Inputs that represent quoted prices for identical instruments in active markets.
Level 2 - Inputs that represent quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability.
Level 3 - Inputs that are largely unobservable, as little or no market data exists for the instrument being valued.
A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below.
There were no transfers of assets between fair value Level 1 and Level 2 during the three months ended March 31, 2025 or the year ended December 31, 2024.
The following tables illustrate the assets and liabilities measured at fair value on a recurring basis and reported on the Consolidated Balance Sheets.
March 31, 2025
(In thousands)Level 1Level 2Level 3Total
Available-for-sale securities:
U.S. Treasury and U.S. government agencies$— $21,757 $— $21,757 
Mortgage-backed U.S. government agencies— 200,107 — 200,107 
State and political subdivision obligations— 3,595 — 3,595 
Corporate debt securities— 33,034 — 33,034 
Equity securities436 — — 436 
Loans held for sale— 6,851 — 6,851 
Other assets:
Derivative assets— 10,814 — 10,814 
Other liabilities:
Derivative liabilities— 9,901 9,901 
December 31, 2024
(In thousands)Level 1Level 2Level 3Total
Available-for-sale securities:
U.S. Treasury and U.S. government agencies$— $21,507 $— $21,507 
Mortgage-backed U.S. government agencies— 202,944 — 202,944 
State and political subdivision obligations— 3,596 — 3,596 
Corporate debt securities— 32,430 — 32,430 
Equity securities428 — — 428 
Loans held for sale— 7,064 — 7,064 
Other assets:
Derivative assets— 13,708 — 13,708 
Other liabilities:
Derivative Liabilities— 11,118 — 11,118 
The valuation methodologies and assumptions used to estimate the fair value for the items in the preceding tables are as follows:
Available for sale investment securities - The fair value of equity and debt securities classified as available for sale is determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities, but rather, relying on the securities’ relationship to other benchmark quoted prices.
Equity securities - The fair value of equity securities with readily determinable fair values is recorded on the Consolidated Balance Sheet, with realized and unrealized gains and losses reported in other expense on the Consolidated Statements of Income.
Loans held for sale - This category includes mortgage loans held for sale that are measured at fair value. Fair values as of March 31, 2025 were measured as the price that secondary market investors were offering for loans with similar characteristics.
Derivative instruments - Interest rate swaps are measured by alternative pricing sources with reasonable levels of price transparency in markets that are not active. Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets. These markets do, however, have comparable, observable inputs in which an alternative pricing source values these assets in order to arrive at a fair market value. These characteristics classify interest rate swap agreements as Level 2.
Mortgage banking derivatives - represent the fair value of mortgage banking derivatives in the form of interest rate locks and forward commitments with secondary market investors and the fair value of interest rate swaps. The fair values of Mid Penn’s interest rate locks, forward commitments and interest rate swaps represent the amounts that would be required to settle the derivative financial instruments at the balance sheet date. These characteristics classify Mortgage banking derivatives as Level 2. As of March 31, 2025, Mortgage banking derivatives are not considered material.
Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, upon their acquisition or when there is evidence of impairment).

The following table illustrates financial instruments measured at fair value on a nonrecurring basis:
March 31, 2025
(In thousands)Level 1Level 2Level 3Total
Individually evaluated loans, net of ACL$— $— $21,662 $21,662 
Foreclosed assets held for sale— — 1,402 1,402 
December 31, 2024
(In thousands)Level 1Level 2Level 3Total
Individually evaluated loans, net of ACL$— $— $21,171 $21,171 
Foreclosed assets held for sale— — 44 44 
Net loans - This category consists of loans that were individually evaluated for credit losses, net of the related ACL, and have been classified as Level 3 assets. All of Mid Penn’s individually evaluated loans for 2025 and 2024, whether reporting
a specific allowance allocation or not, are considered collateral-dependent. Mid Penn utilized Level 3 inputs such as independent appraisals of the underlying collateral, which generally includes various Level 3 inputs which are not observable. Appraisals may be adjusted downward by management for qualitative factors such as economic conditions and estimated liquidation expenses.
Foreclosed assets held for sale - Values are based on appraisals that consider the sales prices of property in the proximate vicinity.
The following table presents additional information about the valuation techniques for level 3 assets measured at fair value on a nonrecurring basis.
March 31, 2025
(In thousands)
Fair Value
Valuation Technique
Significant Unobservable Input
Range of Inputs
Weighted Average
Individually evaluated loans, net of ACL$21,662 
Appraisal of collateral
Appraisal adjustments
8%-100%26.5%
Foreclosed assets held for sale1,402 
Appraisal of collateral
Appraisal adjustments41%-41%41.0%
December 31, 2024
(In thousands)
Fair Value
Valuation Technique
Significant Unobservable Input
Range of Inputs
Weighted Average
Individually evaluated loans, net of ACL$21,171 Appraisal of collateralAppraisal adjustments—%-100%5.6%
Foreclosed assets held for sale44 Appraisal of collateralAppraisal adjustments26%-26%26.0%
The following tables summarize the carrying amount, fair value, and placement in the fair value hierarchy of Mid Penn's financial instruments as of the periods presented:
March 31, 2025
Carrying
Amount		Estimated Fair Value
(In thousands)Level 1Level 2Level 3Total
Financial instruments - assets
 Cash and cash equivalents $107,254 $107,254 $— $— $107,254 
 Available-for-sale securities258,493 — 258,493 — 258,493 
Held-to-maturity securities375,115 — 339,708 — 339,708 
 Equity securities436 436 — — 436 
 Loans held for sale6,851 — 6,851 — 6,851 
Net loans 4,455,329 — — 4,483,665 4,483,665 
  Restricted investment in bank stocks6,660 6,660 — 6,660 
  Accrued interest receivable27,263 27,263 — — 27,263 
  Derivative assets 10,814 — 10,814 — 10,814 
Financial instruments - liabilities
Deposits$4,732,202 $— $4,740,814 $— $4,740,814 
Short-term borrowings25,000 — 25,000 — 25,000 
Long-term debt (1)
20,462 — 20,369 — 20,369 
Subordinated debt45,587 — 43,246 — 43,246 
 Accrued interest payable12,900 12,900 — — 12,900 
 Derivative liabilities9,901 — 9,901 — 9,901 
(1)Long-term debt excludes finance lease obligations.
December 31, 2024
Estimated Fair Value
(In thousands)Carrying
Amount		Level 1Level 2Level 3Total
Financial instruments - assets
Cash and cash equivalents$70,564 $70,564 $— $— $70,564 
Available-for-sale securities260,477 — 260,477 — 260,477 
 Held-to-maturity securities382,447 — 340,648 — 340,648 
   Equity securities428 428 — — 428 
 Loans held for sale7,064 — 7,064 — 7,064 
Net loans 4,407,556 — — 4,430,623 4,430,623 
 Restricted investment in bank stocks7,461 7,461 — 7,461 
 Accrued interest receivable26,846 26,846 — — 26,846 
 Derivative assets13,708 — 13,708 — 13,708 
Financial instruments - liabilities
Deposits$4,689,927 $— $4,684,548 $— $4,684,548 
Short-term debt2,000 — 2,000 — 2,000 
Long-term debt (1)
20,540 — 19,120 — 19,120 
Subordinated debt45,741 — 42,811 — 42,811 
 Accrued interest payable13,484 13,484 — — 13,484 
 Derivative liabilities11,118 — 11,118 — 11,118 
(1)Long-term debt excludes finance lease obligations.
The Bank’s outstanding and unfunded credit commitments and financial standby letters of credit were deemed to have no significant fair value as of March 31, 2025 and December 31, 2024.