Fair Value of Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value of Assets and Liabilities

Schedule of balances of financial assets and liabilities measured at fair value on a recurring basis

	June 30, 2020
	Fair Value Measurements Using						Assets/Liabilities at
(Dollars in thousands)	Level 1		Level 2		Level 3		Fair Value
Assets:
Securities available for sale
U.S. government agencies and corporations	$	—	$	37,205	$	—	$	37,205
Mortgage-backed securities		—		106,249		—		106,249
Obligations of states and political subdivisions		—		103,679		—		103,679
Total securities available for sale		—		247,133		—		247,133
Loans held for sale		—		180,137		—		180,137
Derivatives
IRLC		—		3,701		—		3,701
Interest rate swaps on loans		—		9,743		—		9,743
Total assets	$	—	$	440,714	$	—	$	440,714
Liabilities:
Derivatives
Interest rate swaps on loans	$	—	$	9,743	$	—	$	9,743
Cash flow hedges		—		2,273		—		2,273
Forward sales of TBA securities		—		93		—		93
Total liabilities	$	—	$	12,109	$	—	$	12,109

	December 31, 2019
	Fair Value Measurements Using						Assets/Liabilities at
(Dollars in thousands)	Level 1		Level 2		Level 3		Fair Value
Assets:
Securities available for sale
U.S. government agencies and corporations	$	—	$	21,440	$	—	$	21,440
Mortgage-backed securities		—		86,585		—		86,585
Obligations of states and political subdivisions		—		81,708		—		81,708
Total securities available for sale		—		189,733		—		189,733
Loans held for sale		—		90,500		—		90,500
Derivatives
IRLC		—		1,083		—		1,083
Interest rate swaps on loans		—		2,462		—		2,462
Total assets	$	—	$	283,778	$	—	$	283,778
Liabilities:
Derivatives
Interest rate swaps on loans	$	—	$	2,462	$	—	$	2,462
Cash flow hedges		—		145		—		145
Forward sales of TBA securities		—		25		—		25
Total liabilities	$	—	$	2,632	$	—	$	2,632

Schedule of balances of assets measured at fair value on a nonrecurring basis

	June 30, 2020
	Fair Value Measurements Using						Assets at Fair
(Dollars in thousands)	Level 1		Level 2		Level 3		Value
Other real estate owned, net	$	—	$	—	$	268	$	268
Total	$	—	$	—	$	268	$	268

	December 31, 2019
	Fair Value Measurements Using						Assets at Fair
(Dollars in thousands)	Level 1		Level 2		Level 3		Value
Impaired loans, net	$	—	$	—	$	102	$	102
Other real estate owned, net		—		—		268		268
Total	$	—	$	—	$	370	$	370

Schedule of quantitative information about Level 3 fair value measurements for financial assets measured at fair value on a nonrecurring basis

	Fair Value Measurements at June 30, 2020
(Dollars in thousands)	Fair Value		Valuation Technique(s)	Unobservable Inputs	Range (Weighted Average)1
Other real estate owned, net	$	268	Appraisals	Discount to reflect current market conditions and estimated selling costs	33%-75% (45%)
Total	$	268

1 The weighted average of unobservable inputs is calculated based on the relative asset fair values.

Schedule of carrying amounts and estimated fair values of financial instruments

	Carrying		Fair Value Measurements at June 30, 2020 Using						Total Fair
(Dollars in thousands)	Value		Level 1		Level 2		Level 3		Value
Financial assets:
Cash and short-term investments	$	80,300	$	80,300	$	—	$	—	$	80,300
Securities available for sale		247,133		—		247,133		—		247,133
Loans, net		1,292,896		—		—		1,299,598		1,299,598
Loans held for sale		180,137		—		180,137		—		180,137
Derivatives
IRLC		3,701		—		3,701		—		3,701
Interest rate swaps on loans		9,743		—		9,743		—		9,743
Bank-owned life insurance		19,862		—		19,862		—		19,862
Accrued interest receivable		8,104		8,104		—		—		8,104
Financial liabilities:
Demand deposits		1,153,248		1,153,248		—		—		1,153,248
Time deposits		492,541		—		501,932		—		501,932
Borrowings		91,336		—		92,667		—		92,667
Derivatives
Cash flow hedges		2,273		—		2,273		—		2,273
Interest rate swaps on loans		9,743		—		9,743		—		9,743
Forward sales of TBA securities		93		—		93		—		93
Accrued interest payable		1,210		1,210		—		—		1,210

	Carrying		Fair Value Measurements at December 31, 2019 Using						Total Fair
(Dollars in thousands)	Value		Level 1		Level 2		Level 3		Value
Financial assets:
Cash and short-term investments	$	165,433	$	165,433	$	—	$	—	$	165,433
Securities available for sale		189,733		—		189,733		—		189,733
Loans, net		1,082,318		—		—		1,082,783		1,082,783
Loans held for sale		90,500		—		90,500		—		90,500
Derivatives
IRLC		1,083		—		1,083		—		1,083
Interest rate swaps on loans		2,462		—		2,462		—		2,462
Bank-owned life insurance		16,044		—		16,044		—		16,044
Accrued interest receivable		6,776		6,776		—		—		6,776
Financial liabilities:
Demand deposits		869,194		869,194		—		—		869,194
Time deposits		422,056		—		423,605		—		423,605
Borrowings		161,170		—		154,964		—		154,964
Derivatives
Cash flow hedges		145		—		145		—		145
Interest rate swaps on loans		2,462		—		2,462		—		2,462
Forward sales of TBA securities		25		—		25				25
Accrued interest payable		1,291		1,291		—		—		1,291