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Fair Values of Financial Instruments
 3 Months Ended
Mar. 31, 2022
Investments All Other Investments [Abstract]  
Fair Values of Financial Instruments

Note 12 – Fair Values of Financial Instruments

ASC 825, “Disclosures about Fair Value of Financial Instruments,” requires disclosure of the fair value of financial assets and financial liabilities, including those that are not measured and reported at fair value on a recurring basis or non-recurring basis.

The fair value estimates presented at March 31, 2022 and December 31, 2021 are based on relevant market information and information about the financial instruments. Fair value estimates are intended to represent the price an asset could be sold at or the price at which a liability could be settled. However, given there is no active market or observable market transactions for many of the Company’s financial instruments, the Company has made estimates of many of these fair values which are subjective in nature, involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimated values. The estimated fair values disclosed in the following table do not represent market values of all assets and liabilities of the Company and should not be interpreted to represent the underlying value of the Company.

The following table reflects a comparison of carrying amounts and the estimated fair value of the financial instruments as of March 31, 2022 and December 31, 2021:

 

March 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Carrying

Value

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(dollars in thousands)

 

FINANCIAL ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

115,710

 

 

$

115,710

 

 

$

115,710

 

 

$

—

 

 

$

—

 

Securities available for sale

 

 

322,268

 

 

 

322,268

 

 

 

29,389

 

 

 

292,879

 

 

 

—

 

Securities held to maturity

 

 

30,722

 

 

 

29,909

 

 

 

—

 

 

 

15,370

 

 

 

14,539

 

Equity securities

 

 

383

 

 

 

383

 

 

 

383

 

 

 

—

 

 

 

—

 

Loans held for investment, net

 

 

441,768

 

 

 

431,121

 

 

 

—

 

 

 

—

 

 

 

431,121

 

Loans held for sale

 

 

11,910

 

 

 

11,910

 

 

 

—

 

 

 

11,910

 

 

 

—

 

Restricted stock

 

 

1,428

 

 

 

1,428

 

 

 

1,428

 

 

 

—

 

 

 

—

 

Loan servicing rights

 

 

5,240

 

 

 

6,239

 

 

 

—

 

 

 

6,239

 

 

 

—

 

Mortgage banking derivatives

 

 

1,485

 

 

 

1,485

 

 

 

—

 

 

 

1,216

 

 

 

269

 

Accrued interest receivable

 

 

2,731

 

 

 

2,731

 

 

 

—

 

 

 

—

 

 

 

2,731

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

$

883,498

 

 

 

882,711

 

 

 

—

 

 

 

882,711

 

 

 

—

 

Short-term borrowings

 

 

1,344

 

 

 

1,344

 

 

 

—

 

 

 

1,344

 

 

 

—

 

Long-term borrowings

 

 

29,549

 

 

 

28,248

 

 

 

—

 

 

 

—

 

 

 

28,248

 

Mortgage banking derivatives

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Accrued interest payable

 

 

68

 

 

 

68

 

 

 

—

 

 

 

—

 

 

 

68

 

 

December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Carrying

Value

 

 

Estimated

Fair Value

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(dollars in thousands)

 

FINANCIAL ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

94,410

 

 

$

94,357

 

 

$

90,924

 

 

$

3,433

 

 

$

—

 

Securities available for sale

 

 

330,337

 

 

 

330,337

 

 

 

—

 

 

 

330,337

 

 

 

—

 

Securities held to maturity

 

 

30,801

 

 

 

32,045

 

 

 

—

 

 

 

16,898

 

 

 

15,147

 

Equity securities

 

 

392

 

 

 

392

 

 

 

392

 

 

 

—

 

 

 

—

 

Loans held for investment, net

 

 

416,753

 

 

 

412,585

 

 

 

—

 

 

 

—

 

 

 

412,585

 

Loans held for sale

 

 

21,684

 

 

 

21,684

 

 

 

—

 

 

 

21,684

 

 

 

—

 

Restricted stock

 

 

921

 

 

 

921

 

 

 

921

 

 

 

—

 

 

 

—

 

Loan servicing rights

 

 

5,078

 

 

 

5,509

 

 

 

—

 

 

 

5,509

 

 

 

—

 

Mortgage banking derivatives

 

 

1,269

 

 

 

1,269

 

 

 

—

 

 

 

253

 

 

 

1,016

 

Accrued interest receivable

 

 

2,554

 

 

 

2,554

 

 

 

—

 

 

 

—

 

 

 

2,554

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits

 

$

836,752

 

 

$

836,567

 

 

$

—

 

 

$

836,567

 

 

$

—

 

Short-term borrowings

 

 

1,081

 

 

 

1,081

 

 

 

—

 

 

 

1,081

 

 

 

—

 

Long-term borrowings

 

 

29,530

 

 

 

30,039

 

 

 

—

 

 

 

—

 

 

 

30,039

 

Mortgage banking derivatives

 

 

50

 

 

 

50

 

 

 

—

 

 

 

50

 

 

 

—

 

Accrued interest payable

 

 

7

 

 

 

7

 

 

 

—

 

 

 

—

 

 

 

7

 

At March 31, 2022 the Company’s subsidiary bank had outstanding standby letters of credit and commitments to extend credit. These off-balance sheet financial instruments are generally exercisable at the market rate prevailing at the date the underlying transaction will be completed; therefore, the fair value is the fee the Bank is expected to receive. This amount is deemed immaterial by management. See Note 10.