v3.25.2
Fair Value
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Fair Value
 
Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
 
Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
 
The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Investment Securities: The fair values for investment securities are determined by quoted market prices, if available (Level 1). For investment securities where quoted prices are not available, fair values are calculated based on market prices of similar investment securities (Level 2). For investment securities where quoted prices or market prices of similar investment securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Level 3 pricing is obtained from a third-party based upon similar trades that are not traded frequently without adjustment by the Company. At June 30, 2025, the Company held no Level 3 securities. Absent the credit rating, significant assumptions must be made such that the credit risk input becomes an unobservable input and thus these investment securities are reported by the Company in a Level 3 classification.
 
Derivatives: The fair values of derivatives are based on valuation models using observable market data as of the measurement date (Level 2).
 
Collateral Dependent Loans: Fair values for collateral dependent loans are generally based on appraisals obtained from licensed real estate appraisers and in certain circumstances includes consideration of offers obtained to purchase properties prior to foreclosure. Appraisals for commercial real estate generally use three methods to derive value: cost, sales or market comparison and income approach. The cost method bases value in the cost to replace the current property. Value of market comparison approach evaluates the sales price of similar properties in the same market area. The income approach considers net operating income generated by the property and an investor’s required return. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Comparable sales adjustments are based on known sales prices of similar type and similar use properties and duration of time that the property has been on the market to sell. Such adjustments made in the appraisal process are typically significant and result in a Level 3 classification of the inputs for determining fair value.
 
Appraisals for both collateral-dependent loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Company’s Risk Management Area reviews the assumptions and approaches utilized in the appraisal. In determining the value of collateral dependent loans and other real estate owned, significant unobservable inputs may be used which include: physical condition of comparable properties sold, net operating income generated by the property and investor rates of return.
 
Other Real Estate: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate are measured at the lower of carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property utilizing similar techniques as discussed above for Individually Analyzed Loans, resulting in a Level 3 classification. In cases where the carrying amount exceeds the fair value, less costs to sell, impairment loss is recognized.

Loans Held-for-Sale: The fair values of loans held for sale are determined by using quoted prices for similar assets, adjusted for specific attributes of that loan resulting in a Level 2 classification.

Assets and Liabilities Measured on a Recurring Basis
 
Assets and liabilities measured at fair value on a recurring basis, including financial assets and liabilities for which the Company has elected the fair value option, are summarized below:
 Fair Value Measurements at June 30, 2025 Using
 Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant
Unobservable
 Inputs (Level 3)		Total
Assets:
U.S. Treasury$160,247 $— $— $160,247 
Obligations of State and Political Subdivisions— 459,138 — 459,138 
MBS/CMO— 702,718 — 702,718 
US Gov’t Sponsored Entities & Agencies— 249,749 — 249,749 
Total Securities$160,247 $1,411,605 $— $1,571,852 
Loans Held-for-Sale$— $13,880 $— $13,880 
Derivative Assets$— $5,180 $— $5,180 
Derivative Liabilities$— $5,271 $— $5,271 
 Fair Value Measurements at December 31, 2024 Using
 Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant
Unobservable  Inputs (Level 3)		Total
Assets:
U.S. Treasury$110,864 $— $— $110,864 
Obligations of State and Political Subdivisions— 463,169 — 463,169 
MBS/CMO— 702,179 — 702,179 
US Gov’t Sponsored Entities & Agencies— 241,075 — 241,075 
Total Securities$110,864 $1,406,423 $— $1,517,287 
Loans Held-for-Sale$— $8,239 $— $8,239 
Derivative Assets$— $6,439 $— $6,439 
Derivative Liabilities$— $6,476 $— $6,476 
As of June 30, 2025 and December 31, 2024, the aggregate fair value, contractual balance (including accrued interest), and gain or loss on Loans Held-for-Sale was as follows:
June 30, 2025December 31, 2024
Aggregate Fair Value$13,880 $8,239 
Contractual Balance13,660 8,111 
Gain (Loss)220 128 
The total amount of gains and losses from changes in fair value included in earnings for the three and six months ended June 30, 2025 for loans held for sale were $96 and $92, respectively. The total amount of gains and losses from changes in fair value included in earnings for the three and six months ended June 30, 2024 for loans held for sale were $122 and $210, respectively.

The tables below present a reconciliation of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and six months ended June 30, 2025 and 2024:
 Obligations of State and Political SubdivisionsMBS/CMO
 2025202420252024
Balance of Recurring Level 3 Assets at April 1$— $76 $— $991 
Total Gains (Losses) Included in Other Comprehensive Income— — — 18 
Maturities / Calls— — — — 
Acquired through Bank Acquisition— — — — 
Balance of Recurring Level 3 Assets at June 30$— $76 $— $1,009 
 Obligations of State and Political SubdivisionsMBS/CMO
 2025202420252024
Balance of Recurring Level 3 Assets at January 1$— $75 $— $984 
Total Gains (Losses) Included in Other Comprehensive Income— 1 — 25 
Maturities / Calls— — — — 
Acquired through Bank Acquisition— — — — 
Balance of Recurring Level 3 Assets at June 30$— $76 $— $1,009 
Of the total gain (loss) included in earnings for the three months ended June 30, 2025 and 2024, $0 and $18 was attributable to other changes in fair value, respectively. Of the total gain (loss) included in earnings for the six months ended June 30, 2025 and 2024, $0 and $26 was attributable to other changes in fair value, respectively.

Assets and Liabilities Measured on a Non-Recurring Basis
 
Assets and liabilities measured at fair value on a non-recurring basis are summarized below:
 Fair Value Measurements at June 30, 2025 Using
 Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable 
Inputs (Level 3)		Total
Assets:    
Collateral Dependent Loans    
Commercial and Industrial Loans$— $— $17,032 $17,032 
Commercial Real Estate Loans$— $— $26,623 $26,623 
Agricultural Loans$— $— $1,131 $1,131 
Consumer Loans$— $— $4 $4 
Home Equity Loans$— $— $329 $329 
Residential Mortgage Loans$— $— $1,199 $1,199 
Fair Value Measurements at December 31, 2024 Using
Quoted Prices in Active Markets for Identical Assets (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable 
Inputs (Level 3)		Total
Assets:
Collateral Dependent Loans
Commercial and Industrial Loans$— $— $3,695 $3,695 
Commercial Real Estate Loans$— $— $1,402 $1,402 
Agricultural Loans$— $— $1,910 $1,910 
Consumer Loans$— $— $10 $10 
Home Equity Loans$— $— $328 $328 
Residential Mortgage Loans$— $— $303 $303 

The following tables present quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2025 and December 31, 2024:
June 30, 2025Fair ValueValuation Technique(s)Unobservable Input(s)Range (Weighted Average)
Collateral Dependent Loans -
    Commercial and Industrial Loans		$17,032 Sales comparison approachAdjustment for physical condition of comparable properties sold
7%-100%
(69%)
Collateral Dependent Loans -
    Commercial Real Estate Loans		$26,623 Sales comparison approachAdjustment for physical condition of comparable properties sold
19%-83%
(66%)
Collateral Dependent Loans -
    Agricultural Loans		$1,131 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-100%
(36%)
Collateral Dependent Loans -
    Consumer Loans		$4 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)
Collateral Dependent Loans -
    Home Equity Loans		$329 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)
Collateral Dependent Loans -
    Residential Mortgage Loans		$1,199 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)
December 31, 2024Fair ValueValuation Technique(s)Unobservable Input(s)Range (Weighted Average)
Collateral Dependent Loans -
    Commercial and Industrial Loans		$3,695 Sales comparison approachAdjustment for physical condition of comparable properties sold
30%-88%
(53%)
Collateral Dependent Loans -
    Commercial Real Estate Loans		$1,402 Sales comparison approachAdjustment for physical condition of comparable properties sold
30%-68%
(46%)
Collateral Dependent Loans -
    Agricultural Loans		$1,910 Sales comparison approachAdjustment for physical condition of comparable properties sold
30%-100%
(57%)
Collateral Dependent Loans -
    Consumer Loans		$10 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)
Collateral Dependent Loans -
    Home Equity Loans		$328 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)
Collateral Dependent Loans -
    Residential Mortgage Loans		$303 Sales comparison approachAdjustment for physical condition of comparable properties sold
20%-20%
(20%)

The carrying amounts and estimated fair values of the Company’s financial instruments not previously presented are provided in the tables below for the periods ended June 30, 2025 and December 31, 2024. Not all of the Company’s assets and liabilities are considered financial instruments, and therefore are not included in the tables. Because no active market exists for a significant portion of the Company’s financial instruments, fair value estimates were based on subjective judgments, and therefore cannot be determined with precision.
  Fair Value Measurements at
June 30, 2025 Using
 Carrying ValueLevel 1Level 2Level 3Total
Financial Assets:     
Cash and Short-term Investments$200,148 $99,871 $100,277 $— $200,148 
Interest Bearing Time Deposits with Banks500 — 500 — 500 
Loans, Net5,582,974 — — 5,509,638 5,509,638 
Accrued Interest Receivable35,636 — 8,858 26,778 35,636 
Financial Liabilities:
Demand, Savings, and Money Market Deposits(5,624,768)(5,624,768)— — (5,624,768)
Time Deposits(1,329,918)— (1,322,916)— (1,322,916)
Short-term Borrowings(23,290)— (23,290)— (23,290)
Long-term Debt(178,743)— (78,016)(100,013)(178,029)
Accrued Interest Payable(8,548)— (8,374)(174)(8,548)
  Fair Value Measurements at
December 31, 2024 Using
 Carrying ValueLevel 1Level 2Level 3Total
Financial Assets:     
Cash and Short-term Investments$188,792 $69,249 $119,543 $— $188,792 
Interest Bearing Time Deposits with Banks500 — 500 — 500 
Loans, Net4,072,818 — — 3,993,595 3,993,595 
Accrued Interest Receivable31,280 — 8,499 22,781 31,280 
Financial Liabilities:
Demand, Savings, and Money Market Deposits(4,412,474)(4,412,474)— — (4,412,474)
Time Deposits(916,601)— (911,059)— (911,059)
Short-term Borrowings(56,862)— (56,862)— (56,862)
Long-term Debt(153,269)— (77,591)(75,210)(152,801)
Accrued Interest Payable(8,468)— (8,116)(352)(8,468)