Fair Values of Financial Instruments

6 Months Ended

Jun. 30, 2021

Investments All Other Investments [Abstract]

Fair Values of Financial Instruments

NOTE 6 – FAIR VALUES OF FINANCIAL INSTRUMENTS

The fair values of recognized financial instruments as of June 30, 2021 and December 31, 2020 are as follows:

(Dollars in thousands)	Carrying Value		Level I		Level II		Level III		Fair Value
June 30, 2021
Financial assets
Cash and cash equivalents	$	312,344	$	312,344	$	—	$	—	$	312,344
Securities held-to-maturity		24,878		—		25,003		—		25,003
Restricted stock		4,614	N/A		N/A		N/A		N/A
Loans held for sale		1,465		1,465		—		—		1,465
Net loans		544,155		—		—		548,622		548,622
Bank-owned life insurance		23,710		23,710		—		—		23,710
Accrued interest receivable		1,659		1,659		—		—		1,659
Mortgage servicing rights		561		—		—		561		561
Financial liabilities
Deposits	$	986,668	$	861,672	$	—	$	125,568	$	987,240
Short-term borrowings		38,475		38,475		—		—		38,475
Other borrowings		3,570		—		—		3,640		3,640
Accrued interest payable		69		69		—		—		69
December 31, 2020
Financial assets
Cash and cash equivalents	$	181,652	$	181,652	$	—	$	—	$	181,652
Securities held-to-maturity		9,045		—		9,225		—		9,225
Restricted stock		4,614	N/A		N/A		N/A		N/A
Loans held for sale		1,378		1,378		—		—		1,378
Net loans		600,885		—		—		598,583		598,583
Bank-owned life insurance		21,416		21,416		—		—		21,416
Accrued interest receivable		2,159		2,159		—		—		2,159
Mortgage servicing rights		488		—		—		488		488
Financial liabilities
Deposits	$	891,562	$	768,230	$	—	$	124,127	$	892,357
Short-term borrowings		37,215		37,215		—		—		37,215
Other borrowings		4,664		—		—		4,775		4,775
Accrued interest payable		90		90		—		—		90

The Company also has unrecognized financial instruments on June 30, 2021 and December 31, 2020.  These financial instruments relate to commitments to extend credit and letters of credit.  The aggregate contract amount of such financial instruments was approximately $237 million on June 30, 2021 and $228 million on December 31, 2020.  Such amounts are also considered to be the fair values.

The fair value estimates of financial instruments are made at a specific point in time based on relevant market information.  Since no ready market exists for a significant portion of the financial instruments, fair value estimates are largely based on judgments after considering such factors as future expected credit losses, current economic conditions, risk characteristics of various financial instruments, and other factors.  These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot be determined with precision.  Changes in assumptions could significantly affect these estimates.