Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Jul. 31, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | KENTUCKY BANCSHARES INC /KY/ | |
Entity Central Index Key | 1,000,232 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 2,988,205 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED BALANCE SHEETS(una
CONSOLIDATED BALANCE SHEETS(unaudited) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and due from banks | $ 16,143 | $ 16,771 |
Federal funds sold | 205 | 398 |
Cash and cash equivalents | 16,348 | 17,169 |
Interest bearing time deposits | 1,280 | 1,280 |
Securities available for sale | 237,476 | 246,861 |
Trading Assets | 5,400 | 5,370 |
Mortgage loans held for sale | 1,719 | 776 |
Loans | 546,085 | 538,305 |
Allowance for loan losses | (5,950) | (6,012) |
Net loans | 540,135 | 532,293 |
Federal Home Loan Bank stock | 5,981 | 5,981 |
Real estate owned, net | 3,595 | 4,603 |
Bank premises and equipment, net | 16,270 | 16,479 |
Interest receivable | 3,661 | 3,299 |
Mortgage servicing rights | 1,261 | 1,209 |
Goodwill | 13,117 | 13,117 |
Other intangible assets | 116 | 177 |
Other assets | 6,595 | 6,595 |
Total assets | 852,954 | 855,209 |
Deposits | ||
Non-interest bearing | 179,909 | 176,743 |
Time deposits, $250,000 and over | 55,229 | 52,913 |
Other interest bearing | 408,878 | 425,213 |
Total deposits | 644,016 | 654,869 |
Repurchase agreements and other borrowings | 13,690 | 12,457 |
Federal funds purchased | 2,456 | |
Short-term Federal Home Loan Bank advances | 15,000 | 10,000 |
Long-term Federal Home Loan Bank advances | 85,417 | 83,785 |
Subordinated debentures | 7,217 | 7,217 |
Interest payable | 658 | 642 |
Other liabilities | 5,503 | 8,297 |
Total liabilities | $ 773,957 | $ 777,267 |
Stockholders' equity | ||
Preferred stock, 300,000 shares authorized and unissued | ||
Common stock, no par value; 10,000,000 shares authorized; 2,725,631 and 2,720,098 shares issued and outstanding on June 30, 2015 and December 31, 2014 | $ 12,728 | $ 12,662 |
Retained earnings | 66,701 | 64,489 |
Accumulated other comprehensive income (loss) | (432) | 791 |
Total stockholders' equity | 78,997 | 77,942 |
Total liabilities and stockholders' equity | $ 852,954 | $ 855,209 |
CONSOLIDATED BALANCE SHEETS(un3
CONSOLIDATED BALANCE SHEETS(unaudited) (Parenthetical) - $ / shares | Jun. 30, 2015 | Dec. 31, 2014 |
CONSOLIDATED BALANCE SHEETS(unaudited) | ||
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 2,725,631 | 2,720,098 |
Common stock, shares outstanding | 2,725,631 | 2,720,098 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
INTEREST INCOME: | ||||
Loans, including fees | $ 6,346 | $ 5,896 | $ 12,555 | $ 11,657 |
Securities | ||||
Taxable | 692 | 680 | 1,425 | 1,355 |
Tax exempt | 690 | 718 | 1,366 | 1,451 |
Trading Assets | 39 | 43 | 83 | 80 |
Other | 68 | 69 | 137 | 145 |
Total interest income | 7,835 | 7,406 | 15,566 | 14,688 |
INTEREST EXPENSE: | ||||
Deposits | 493 | 535 | 979 | 1,074 |
Repurchase agreements and other borrowings | 24 | 25 | 47 | 48 |
Federal Home Loan Bank advances | 397 | 309 | 799 | 623 |
Subordinated debentures | 58 | 58 | 115 | 115 |
Total interest expense | 972 | 927 | 1,940 | 1,860 |
Net interest income | 6,863 | 6,479 | 13,626 | 12,828 |
Provision for loan losses | 350 | 100 | 650 | 200 |
Net interest income after provision | 6,513 | 6,379 | 12,976 | 12,628 |
NON-INTEREST INCOME: | ||||
Service charges | 1,091 | 1,062 | 1,995 | 2,073 |
Loan service fee income, net | 55 | 5 | 108 | 34 |
Trust department income | 259 | 239 | 536 | 461 |
Gain on sale of available for sale securities, net | 243 | 245 | 251 | 433 |
Gain (loss) on trading assets | (48) | 91 | (53) | 162 |
Gain on sale of mortgage loans | 441 | 241 | 768 | 398 |
Brokerage income | 136 | 210 | 242 | 290 |
Debit card interchange income | 623 | 530 | 1,164 | 1,009 |
Other | 822 | 45 | 881 | 77 |
Total other income | 3,622 | 2,668 | 5,892 | 4,937 |
NON-INTEREST EXPENSE: | ||||
Salaries and employee benefits | 4,150 | 3,661 | 7,944 | 7,263 |
Occupancy expenses | 854 | 830 | 1,786 | 1,678 |
Repossession expenses, net | 237 | 25 | 282 | 23 |
FDIC Insurance | 145 | 140 | 301 | 268 |
Legal and professional fees | 293 | 322 | 578 | 458 |
Data processing | 386 | 331 | 753 | 668 |
Debit card expenses | 293 | 262 | 549 | 496 |
Amortization | 30 | 37 | 61 | 74 |
Advertising and marketing | 212 | 232 | 425 | 441 |
Taxes other than payroll, property and income | 229 | 197 | 459 | 422 |
Telephone | 77 | 87 | 145 | 176 |
Postage | 90 | 85 | 171 | 157 |
Loan fees | 104 | 83 | 197 | 160 |
Other | 608 | 483 | 1,274 | 945 |
Total other expenses | 7,708 | 6,775 | 14,925 | 13,229 |
Income before taxes | 2,427 | 2,272 | 3,943 | 4,336 |
Income taxes | 305 | 368 | 306 | 661 |
Net income | 2,122 | 1,904 | 3,637 | 3,675 |
Other Comprehensive Income (Loss), net of tax: | ||||
Change in Unrealized Gains on Securities | (2,160) | 1,730 | (1,223) | 4,981 |
Comprehensive Income (Loss) | $ (38) | $ 3,634 | $ 2,414 | $ 8,656 |
Earnings per share | ||||
Basic (in dollars per share) | $ 0.77 | $ 0.70 | $ 1.33 | $ 1.36 |
Diluted (in dollars per share) | 0.77 | 0.70 | 1.33 | 1.36 |
Dividends per share (in dollars per share) | $ 0.26 | $ 0.25 | $ 0.52 | $ 0.50 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited) - 6 months ended Jun. 30, 2015 - USD ($) $ in Thousands | Common Stock Including Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Total |
Balances at Dec. 31, 2014 | $ 12,662 | $ 64,489 | $ 791 | $ 77,942 |
Balances (in shares) at Dec. 31, 2014 | 2,720,098 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Common stock issued, net of forfeitures | $ 2 | 2 | ||
Common stock issued, net of forfeitures (in shares) | 5,872 | |||
Stock based compensation expense | $ 66 | 66 | ||
Common stock purchased and retired | $ (2) | (8) | (10) | |
Common stock purchased and retired (in shares) | (339) | |||
Net change in unrealized gain (loss) on securities available for sale, net of tax and reclassifications | (1,223) | (1,223) | ||
Net income | 3,637 | 3,637 | ||
Dividends declared - $0.52 per share | (1,417) | (1,417) | ||
Balances at Jun. 30, 2015 | $ 12,728 | $ 66,701 | $ (432) | $ 78,997 |
Balances (in shares) at Jun. 30, 2015 | 2,725,631 |
CONSOLIDATED STATEMENT OF CHAN6
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited) | ||||
Dividends per share (in dollars per share) | $ 0.26 | $ 0.25 | $ 0.52 | $ 0.50 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash Flows From Operating Activities | ||
Net Income | $ 3,637 | $ 3,675 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 843 | 904 |
Securities amortization (accretion), net | 494 | 303 |
Stock based compensation expense | 66 | 55 |
Provision for loan losses | 650 | 200 |
Securities available for sale gains, net | (251) | (433) |
Net change in trading assets | (30) | (5,242) |
Originations of loans held for sale | (24,562) | (13,757) |
Proceeds from sale of loans | 24,387 | 13,883 |
Losses (gain) on other real estate | 59 | (70) |
Gain on sale of mortgage loans | (768) | (398) |
Write-downs of other real estate, net | 227 | 10 |
Changes in: | ||
Interest receivable | (362) | 364 |
Other assets | (469) | 1,369 |
Interest payable | 16 | (57) |
Other liabilities | (2,165) | (1,707) |
Net cash from operating activities | 1,772 | (901) |
Cash Flows From Investing Activities | ||
Purchases of securities available for sale | (20,074) | (34,977) |
Proceeds from sales of securities | 9,051 | 40,030 |
Proceeds from principal payments, sales, maturities and calls of securities | 18,313 | 8,853 |
Net change in loans | (11,543) | (27,925) |
Proceeds from redemption of Federal Home Loan Bank stock | 750 | |
Purchases of bank premises and equipment | (440) | (705) |
Proceeds from the sale of other real estate | 4,057 | 1,551 |
Net cash from investing activities | (636) | (12,423) |
Cash Flows From Financing Activities: | ||
Net change in deposits | (10,853) | (19,991) |
Net change in repurchase agreements and other borrowings | 3,689 | 3,079 |
short-term advances from Federal Home Loan Bank | 15,000 | 105,000 |
payment on short-term Federal Home Loan Bank advances | (10,000) | (85,000) |
Long-term advances from Federal Home Loan Bank | 4,682 | 6,538 |
Payments on long-term Federal Home Loan Bank advances | (3,050) | (2,971) |
Proceeds from issuance of common stock | 2 | |
Purchase of common stock | (10) | (91) |
Dividends paid | (1,417) | (1,361) |
Net cash from financing activities | (1,957) | 5,203 |
Net change in cash and cash equivalents | (821) | (8,121) |
Cash and cash equivalents at beginning of period | 17,169 | 23,160 |
Cash and cash equivalents at end of period | 16,348 | 15,039 |
Cash paid during the year for: | ||
Interest expense | 1,924 | 1,917 |
Income taxes | 700 | |
Supplemental disclosures of non-cash investing activities | ||
Real estate acquired through foreclosure | $ 3,334 | $ 419 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial information presented as of any date other than December 31 has been prepared from the Company’s books and records without audit. The accompanying consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain financial information that is normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America, but is not required for interim reporting purposes, has been condensed or omitted. There have been no significant changes to the Company’s accounting and reporting policies as disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of such financial statements, have been included. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Basis of Presentation : The consolidated financial statements include the accounts of Kentucky Bancshares, Inc. (the “Company”, “we”, “our” or “us”), its wholly-owned subsidiaries, Kentucky Bank (the “Bank”) and KBI Insurance Company, Inc., and the Bank’s wholly-owned subsidiary, KB Special Assets Unit, LLC. Intercompany transactions and balances have been eliminated in consolidation. Nature of Operations : The Bank operates under a state bank charter and provides full banking services, including trust services, to customers located in Bourbon, Clark, Elliott, Fayette, Harrison, Jessamine, Madison, Rowan, Scott, Woodford and adjoining counties in Kentucky. Management continues to consider opportunities for branch expansion and will also consider acquisition opportunities that help advance its strategic objectives. As a state bank, the Bank is subject to regulation by the Kentucky Department of Financial Institutions and the Federal Deposit Insurance Corporation (“FDIC”). The Company, a bank holding company, is regulated by the Federal Reserve. On July 9, 2014, a new subsidiary of the Company was incorporated under the name KBI Insurance Company, Inc. KBI Insurance Company, Inc. is a subsidiary of Kentucky Bancshares, Inc. and is located in Las Vegas, Nevada. It is a captive insurance subsidiary which provides various liability and property damage insurance policies for Kentucky Bancshares, Inc. and its related subsidiaries. KBI Insurance Company, Inc. is regulated by the State of Nevada Division of Insurance. Our transfer, registrar and dividend agent, Registrar and Transfer Company, was recently acquired by Computershare. The migration to Computershare occurred October 31, 2014. Estimates in the Financial Statements : The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material to the financial statements. Trading Assets : The Company engages in trading activities for its own account. Securities that are held principally for resale in the near term are recorded at fair value with changes in fair value included in earnings. Interest and dividends are included in net interest income. Loss Contingencies : Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Reclassifications : Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications had no effect on prior period net income or stockholders’ equity. Adoption of New Accounting Standards In January 2014, FASB issued Accounting Standards Update 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (a consensus of the FASB Emerging Issues Task Force) . The ASU clarifies when an insubstance repossession or foreclosure occurs and a creditor is considered to have received physical possession of real estate property collateralizing a consumer mortgage loan. Specifically, the new ASU requires a creditor to reclassify a collateralized consumer mortgage loan to real estate property upon obtaining legal title to the real estate collateral, or the borrower voluntarily conveying all interest in the real estate property to the lender to satisfy the loan through a deed in lieu of foreclosure or similar legal agreement. Additional disclosures are required detailing the amount of foreclosed residential real estate property held by the creditor and the recorded investment in consumer mortgages collateralized by real estate property that are in the process of foreclosure. The new guidance is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2014. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements, but will result in additional disclosures. In May 2014, FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606) . The ASU creates a new topic, Topic 606, to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. Management is currently evaluating the impact of the adoption of this guidance on the Company’s financial statements. However, in April 2015, the FASB voted to defer the effective date of ASU 2014-09 by one year making the amendments effective for public entities for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Companies have the option to apply ASU 2014-09 as of the original effective date. In June 2014, FASB issued Accounting Standards Update 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. The amendments in this update require two accounting changes. First, the amendments in this update change the accounting for repurchase-to-maturity transactions to secured borrowing accounting. Second, for repurchase financing arrangements, the amendments require separate accounting for a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counter-party, which will result in secured borrowing accounting for the repurchase agreement. This update also requires certain disclosures for these types of transactions. This ASU became effective for the Company on January 1, 2015. The adoption of ASU 2014-11 did not have a material impact on the Company’s financial statements. |
SECURITIES
SECURITIES | 6 Months Ended |
Jun. 30, 2015 | |
SECURITIES | |
SECURITIES | 2. SECURITIES SECURITIES AVAILABLE FOR SALE Period-end securities are as follows: (in thousands) Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available for Sale June 30, 2015 U.S. government agencies $ $ $ ) $ States and political subdivisions ) Mortgage-backed - residential ) Equity securities — Total $ $ $ ) $ December 31, 2014 U.S. government agencies $ $ $ ) $ States and political subdivisions ) Mortgage-backed - residential ) Equity securities — Total $ $ $ ) $ The amortized cost and fair value of securities at June 30, 2015 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity are shown separately. Further discussion concerning Fair Value Measurements can be found in Note 8. (in thousands) Amortized Fair Cost Value Due in one year or less $ $ Due after one year through five years Due after five years through ten years Due after ten years Mortgage-backed - residential Equity Total $ $ Proceeds from sales of securities during the first six months of 2015 and 2014 were $9.1 million and $40.0 million. Gross gains of $251 thousand and $785 thousand and gross losses of $0 and $352 thousand were realized on those sales, respectively. The tax provision related to these realized net gains was $85 and $147 thousand, respectively. Proceeds from sales of securities during the three months ending June 30, 2015 and June 30, 2014 were $9.1 million and $23.5 million. Gross gains of $243 thousand and $477 thousand and gross losses of $0 and $232 were realized on those sales, respectively. The tax provision related to these realized gains and losses was $83 thousand for both periods, respectively. Securities with unrealized losses June 30, 2015 and at December 31, 2014 not recognized in income are as follows: June 30, 2015 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Description of Securities Value Loss Value Loss Value Loss U.S. Government agencies $ $ ) $ $ ) $ $ ) States and municipals ) ) ) Mortgage-backed - residential ) ) ) Total temporarily impaired $ $ ) $ $ ) $ $ ) December 31, 2014 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Description of Securities Value Loss Value Loss Value Loss U.S. Government agencies $ $ ) $ $ ) $ $ ) States and municipals ) ) ) Mortgage-backed - residential ) ) ) Total temporarily impaired $ $ ) $ $ ) $ $ ) The Company evaluates securities for other than temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. In analyzing an issuer’s financial condition, we may consider many factors including, (1) whether the securities are issued by the federal government or its agencies, (2) whether downgrades by bond rating agencies have occurred, (3) the results of reviews of the issuer’s financial condition and near-term prospects, (4) the length of time and the extent to which the fair value has been less than cost, and (5) whether we intend to sell the investment security or more likely than not will be required to sell the investment security before its anticipated recovery. Unrealized losses on securities included in the tables above have not been recognized into income because (1) all rated securities are investment grade and are of high credit quality, (2) management does not intend to sell and it is more likely than not that management would not be required to sell the securities prior to their anticipated recovery, (3) management believes the decline in fair value is largely due to changes in interest rates and (4) management believes the declines in fair value are temporary. The Company believes the fair value is expected to recover as the securities approach maturity. TRADING ASSETS The trading assets of $5.4 million are primarily comprised of municipal securities which are held for a minimal period of time. |
LOANS
LOANS | 6 Months Ended |
Jun. 30, 2015 | |
LOANS | |
LOANS | 3. LOANS Loans at period-end are as follows: (in thousands) 6/30/15 12/31/14 Commercial $ $ Real estate construction Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer Other Total $ $ Activity in the allowance for loan losses for the six month and three month periods indicated was as follows: Six Months Ended June 30, 2015 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ $ — $ $ Real estate Construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential — — Agricultural ) Consumer Other Unallocated — — $ $ $ $ $ Three Months Ended June 30, 2015 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ — $ — $ $ Real estate Construction — — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential — — Agricultural — ) Consumer Other Unallocated — — $ $ $ $ $ Six Months Ended June 30, 2014 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ $ — $ $ Real estate Construction — ) Real estate mortgage: 1-4 family residential Multi-family residential — — ) Non-farm & non-residential — ) Agricultural — ) Consumer Other Unallocated — — $ $ $ $ $ Three Months Ended June 30, 2014 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ — $ — $ $ Real estate Construction — Real estate mortgage: 1-4 family residential Multi-family residential — — ) Non-farm & non-residential — — ) Agricultural — ) Consumer Other Unallocated — — ) $ $ $ $ $ The following tables present the balance in the allowance for loan losses and the recorded investment (excluding accrued interest receivable amounting to $2.4 million as of June 30, 2015 and $2.0 million at December 31, 2014) in loans by portfolio segment and based on impairment method as of June 30, 2015 and December 31, 2014: As of June 30, 2015 (in thousands) Individually Collectively Evaluated for Evaluated for Impairment Impairment Total Allowance for Loan Losses: Commercial $ — $ $ Real estate construction — Real estate mortgage 1-4 family residential Multi-family residential — Non-farm & non-residential Agricultural Consumer — Other — Unallocated — $ $ $ Loans: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — Non-farm & non-residential Agricultural Consumer — Other — $ $ $ As of December 31, 2014 (in thousands) Individually Collectively Evaluated for Evaluated for Impairment Impairment Total Allowance for Loan Losses: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer — Other — Unallocated — $ $ $ Loans: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer — Other — $ $ $ The following table presents loans individually evaluated for impairment by class of loans as of and for the six months ended June 30, 2015 (in thousands): Unpaid Allowance for Average Interest Cash Basis Principal Recorded Loan Losses Recorded Income Interest Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential — Agricultural — With an allowance recorded: Real estate mortgage: 1-4 family residential Non-farm & non-residential Multi-family residential — — — — — Agricultural — — Consumer — — — — — — Other — — — — — Total $ $ $ $ $ $ The recorded investment in loans excludes accrued interest receivable and loan origination fees, net due to immateriality. The following table presents loans individually evaluated for impairment by class of loans for the six months ended June 30, 2014 (in thousands): Year to Date Year to Date Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential — — Non-farm & non-residential — Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ The recorded investment in loans excludes accrued interest receivable and loan origination fees, net due to immateriality. The following table presents loans individually evaluated for impairment by class of loans as of and for the year ended December 31, 2014 (in thousands): Unpaid Allowance for Average Interest Cash Basis Principal Recorded Loan Losses Recorded Income Interest Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ $ — $ $ $ Non-farm & non-residential — — — — — Agricultural — With an allowance recorded: Real estate mortgage 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ $ $ $ The recorded investment in loans excludes accrued interest receivable and loan origination fees, net due to immateriality. The following tables present loans individually evaluated for impairment by class of loans for the three months ending June 30, 2015 and June 30, 2014 (in thousands): Three Months Ending June 30, 2015 Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ $ Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential Agricultural — — Consumer — — — Other — — — Total $ $ $ The recorded investment in loans excludes accrued interest receivable and loan origination fees, net due to immateriality. Three Months Ending June 30, 2014 Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ — $ — Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ The recorded investment in loans excludes accrued interest receivable and loan origination fees, net due to immateriality. The following tables present the recorded investment in nonaccrual, loans past due over 90 days still on accrual and accruing troubled debt restructurings by class of loans as of June 30, 2015 and December 31, 2014: As of June 30, 2015 (in thousands) Loans Past Due Over 90 Days Accruing Still Troubled Debt Nonaccrual Accruing Restructurings Real estate construction $ $ — $ — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Consumer — Total $ $ $ As of December 31, 2014 (in thousands) Loans Past Due Over 90 Days Accruing Still Troubled Debt Nonaccrual Accruing Restructurings Commercial $ $ — $ — Real estate construction — — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Consumer — Total $ $ $ Nonaccrual loans secured by real estate make up 98.9% of the total nonaccruals at June 30, 2015. Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. A loan is considered impaired when, based on current information and events, it is probable that a creditor will be unable to collect all amounts due according to the contractual terms of the loan agreement. All amounts due according to the contractual terms means that both the contractual interest payments and the contractual principal payments of a loan will be collected as scheduled in the loan agreement. Nonaccrual loans are loans for which payments in full of principal or interest is not expected or which principal or interest has been in default for a period of 90 days or more unless the asset is both well secured and in the process of collection. Other impaired loans may be loans showing signs of weakness or interruptions in cash flow, but ultimately are current or less than 90 days past due with respect to principal and interest and for which we anticipate full payment of principal and interest but not in accordance with contractual terms. Additional factors considered by management in determining impairment and non-accrual status include payment status, collateral value, availability of current financial information, and the probability of collecting all contractual principal and interest payments. The following tables present the aging of the recorded investment in past due and non-accrual loans as of June 30, 2015 and December 31, 2014 by class of loans: As of June 30, 2015 (in thousands) 30—59 60—89 Loans Past Due Total Days Days Over 90 Days Past Due & Loans Not Past Due Past Due Still Accruing Non-accrual Non-accrual Past Due Commercial $ $ — $ — $ — $ $ Real estate construction — — — Real estate mortgage: 1-4 family residential Multi-family residential — — — Non-farm & non-residential — — — Agricultural — Consumer Other — — — — — Total $ $ $ $ $ $ As of December 31, 2014 ( in thousands) 30—59 60—89 Greater than Total Days Days 90 Days Past Due & Loans Not Past Due Past Due Past Due Non-accrual Non-accrual Past Due Commercial $ $ — $ — $ $ $ Real estate construction — — — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — — Agricultural — Consumer Other — — — — — Total $ $ $ $ $ $ Troubled Debt Restructurings: The Company has allocated $387 thousand in specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of June 30, 2015. The Company allocated $369 thousand for specific reserves to customers whose loan terms had been modified in troubled debt restructuring as of December 31, 2014. The Company has not committed to lend additional amounts as of June 30, 2015 and December 31, 2014 to customers with outstanding loans that are classified as troubled debt restructurings. All loans which have undergone a troubled debt restructuring modification are performing. Further, there were no troubled debt restructurings for which there was a payment default within twelve months following the modification during the periods ending June 30, 2015 and 2014. No loans were modified as troubled debt restructurings during the six or three months ending June 30, 2015 and 2014. Credit Quality Indicators: The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis. The Company uses the following definitions for risk ratings: Special Mention. Loans classified as special mention have one or more potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date. Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined and documented weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans. As of June 30, 2015 and December 31, 2014, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows: As of June 30, 2015 ( in thousands) Special Pass Mention Substandard Doubtful Commercial $ $ $ $ — Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Total $ $ $ $ As of December 31, 2014 ( in thousands) Special Pass Mention Substandard Doubtful Commercial $ $ $ $ — Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Total $ $ $ $ For consumer loans, the Company evaluates the credit quality based on the aging of the recorded investment in loans, which was previously presented. Non-performing consumer loans are loans which are greater than 90 days past due or on non-accrual status, and total $20 thousand at June 30, 2015 and $6 thousand at December 31, 2014. |
REAL ESTATE OWNED
REAL ESTATE OWNED | 6 Months Ended |
Jun. 30, 2015 | |
REAL ESTATE OWNED | |
REAL ESTATE OWNED | 4. REAL ESTATE OWNED Activity in real estate owned, net was as follows: Six Months Ended June 30 2015 2014 (in thousands) Beginning of year $ $ Additions Sales ) ) (Additions) subtractions to valuation allowance, net End of period $ $ Activity in the valuation allowance was as follows: Six Months Ended June 30 2015 2014 (in thousands) Beginning of year $ $ Write-downs of other real estate, net Reduction from sale ) ) End of period $ $ Expenses related to foreclosed assets include: Six Months Ended June 30 2015 2014 (in thousands) Net loss (gain) on sales reported in other income $ $ ) Write-downs of other real estate, net Operating expenses (receipts), net of rental income Repossession expenses, net For the period $ $ ) Three Months Ended June 30 2015 2014 (in thousands) Net loss (gain) on sales reported in other income $ $ ) Write-downs of other real estate, net Operating expenses (receipts), net of rental income Repossession expenses, net For the period $ $ |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2015 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 5. EARNINGS PER SHARE Basic earnings per common share is net income divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock based compensation agreements. The factors used in the earnings per share computation follow: Six Months Ended June 30 2015 2014 (in thousands) Basic Earnings Per Share Net Income $ $ Weighted average common shares outstanding Basic earnings per share $ $ Diluted Earnings Per Share Net Income $ $ Weighted average common shares outstanding Weighted average common and dilutive potential common shares outstanding Diluted earnings per share $ $ Three Months Ended June 30 2015 2014 (in thousands) Basic Earnings Per Share Net Income $ $ Weighted average common shares outstanding Basic earnings per share $ $ Diluted Earnings Per Share Net Income $ $ Weighted average common shares outstanding Weighted average common and dilutive potential common shares outstanding Diluted earnings per share $ $ Stock options for 2,400 shares of common stock for the six and three months ended June 30, 2015 and 12,725 shares of common stock for the six and three months ended June 30, 2014 were excluded from diluted earnings per share because their impact was antidilutive. |
STOCK COMPENSATION
STOCK COMPENSATION | 6 Months Ended |
Jun. 30, 2015 | |
STOCK COMPENSATION | |
STOCK COMPENSATION | 6. STOCK COMPENSATION We have four stock based compensation plans as described below. Two Stock Option Plans Under its expired 1999 Employee Stock Option Plan, the Company has granted certain officers and key employees stock option awards which vest and become fully exercisable at the end of five years and provided for issuance of up to 100,000 options. Under the expired 1993 Non-Employee Directors Stock Ownership Incentive Plan, the Company also granted certain directors stock option awards which vest and become fully exercisable immediately and provided for issuance of up to 20,000 options. For each Stock Option Plan, the exercise price of each option, which has a ten year life, was equal to the market price of the Company’s stock on the date of grant. Summary of activity in the stock option plan for the first six months of 2015 follows: Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Shares Price Term Value Outstanding, beginning of year $ Granted — — Forfeited or expired ) Exercised — — Outstanding, end of period $ 18.5 months $ — Vested and expected to vest $ 18.5 months $ — Exercisable, end of period $ 18.5 months $ — As of June 30, 2015, there was $0 of total unrecognized compensation cost related to nonvested stock options granted under the Plan. Since both stock option plans have expired, neither plan allows for additional options to be issued. 2005 Restricted Stock Grant Plan On May 10, 2005, the Company’s stockholders approved a restricted stock grant plan. Total shares issuable under the plan are 50,000. There were 5,385 shares issued during the first six months of 2015 and 7,475 shares issued during the first six months of 2014. There were no shares forfeited during the first six months of 2015 or 2014. A summary of changes in the Company’s nonvested shares for the year follows: Weighted-Average Fair Grant-Date Value Nonvested Shares Shares Fair Value Per Share Nonvested at January 1, 2015 $ $ Granted Vested ) ) Forfeited — — — Nonvested at June 30, 2015 $ $ As of June 30, 2015, there was $349,393 of total unrecognized compensation cost related to nonvested shares granted under the restricted stock grant plan. The cost is expected to be recognized over a weighted-average period of 3.1 years. As of June 30, 2015, no additional shares are available for issue under the restricted stock grant plan. 2009 Stock Award Plan On May 13, 2009, the Company’s stockholders approved a stock award plan that provides for the granting of both incentive and nonqualified stock options and other share based awards. Total shares issuable under the plan are 150,000. There were 465 shares issued during the first six months of 2015 and none in 2014. There were no shares forfeited during the first six months of 2015 or 2014. A summary of changes in the Company’s nonvested shares for the year follows: Weighted-Average Fair Grant-Date Value Nonvested Shares Shares Fair Value Per Share Nonvested at January 1, 2015 $ $ Granted Vested ) ) Forfeited — — — Nonvested at June 30, 2015 $ $ As of June 30, 2015, there was $22,582 of total unrecognized compensation cost related to nonvested shares granted under the restricted stock grant plan. The cost is expected to be recognized over a weighted-average period of 2.9 years. As of June 30, 2015, 148,635 shares are still available for issuance. |
OTHER BORROWINGS
OTHER BORROWINGS | 6 Months Ended |
Jun. 30, 2015 | |
OTHER BORROWINGS | |
OTHER BORROWINGS | 7. OTHER BORROWINGS At December 31, 2014 the Company had a $5 million revolving promissory note with a maturity date of July 26, 2015. The Company has no outstanding balances related to this promissory note at June 30, 2015 or December 31, 2014. Upon maturity, the Company renewed the revolving promissory note. The new note has similar terms as the original note and matures July 19, 2016. On July 20, 2015, the Company borrowed $5 million. The term loan has a fixed interest rate of 5.02%, requires quarterly principal and interest payments and matures July 20, 2025. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2015 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 8. FAIR VALUE MEASUREMENTS ASC Topic 820, “Fair Value Measurements and Disclosures”, defines fair value, establishes a framework for measuring fair value, and sets forth disclosures about fair value measurements. ASC Topic 825, “Financial Instruments” , allows entities to choose to measure certain financial assets and liabilities at fair value. The Company has not elected the fair value option for any financial assets or liabilities. ASC Topic 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. This Topic describes three levels of inputs that may be used to measure fair value: 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 company’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: Investment Securities and Trading Assets : The fair values for available for sale investment securities and trading assets are determined by quoted market prices, if available (Level 1). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Impaired Loans : The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent third party real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available for similar loans and collateral underlying such loans. Such adjustments were $14 thousand for 2015 and $387 for 2014 and resulted in a Level 3 classification of the inputs for determining fair value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted in accordance with the allowance policy. Other Real Estate Owned : Assets acquired through or instead of loan foreclosure and classified as other real estate owned (OREO) are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair value is commonly based on recent real estate appraisals which are updated no less frequently than annually. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach with data from comparable properties. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments were $372 thousand as of June 30, 2015 and $25 thousand as of June 30, 2014 and resulted in a Level 3 classification of the inputs for determining fair value. Real estate owned properties are evaluated on a quarterly basis for additional impairment and adjusted accordingly. Mortgage Servicing Rights : Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively based on a valuation model that calculates the present value of estimated future net servicing income, resulting in a Level 3 classification. Assets and Liabilities Measured on a Recurring Basis Available for sale investment securities and trading assets are the Company’s only balance sheet items that meet the disclosure requirements for instruments measured at fair value on a recurring basis. Disclosures are as follows in the tables below. Fair Value Measurements at June 30, 2015 Using (In thousands): Quoted Prices In Active Markets for Significant Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) U. S. government agencies $ $ — $ $ — States and municipals — — Mortgage-backed - residential — — Equity securities — — Trading Assets — — Total $ $ $ $ — Fair Value Measurements at December 31, 2014 Using (In thousands): Quoted Prices In Active Markets for Significant Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) U. S. government agencies $ $ — $ $ — States and municipals — — Mortgage-backed - residential — — Equity securities — — Trading Assets — — Total $ $ $ $ — There were no transfers between level 1 and level 2 during 2015 or 2014. Assets measured at fair value on a non-recurring basis are summarized below: Fair Value Measurements at June 30, 2015 Using: Quoted Prices In Active Other Markets for Significant Significant Identical Observable Unobservable (In thousands) Carrying Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Impaired loans: Real Estate Mortgage: Non-farm & non-residential — — Agricultural — — Other real estate owned: Residential — — Commercial Loan servicing rights — — Fair Value Measurements at December 31, 2014 Using: Quoted Prices In Active Other Markets for Significant Significant Identical Observable Unobservable (In thousands) Carrying Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Impaired loans: Real Estate Mortgage: Multi-family residential — — Non-farm & non-residential — — Agricultural — — Other real estate owned: Residential — — Loan servicing rights — — Impaired loans , which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a carrying amount of $270 thousand, which includes a valuation allowance of $270 thousand at June 30, 2015. During the first six months of 2015, no new loans became impaired. The total allowance for specific impaired loans decreased $301 thousand for the six months ending June 30, 2015 and decreased $101 thousand for the three months ending June 30, 2015. During the first six months of 2014, five new loans became impaired resulting in an additional provision for loan losses of $536 thousand. The total allowance for specific impaired loans increased $106 thousand for the six months ending June 30, 2014 and decreased $28 thousand for the three months ending June 30, 2014. Other real estate owned, which is measured at fair value less costs to sell, had a net carrying amount of $2.0 million, which is made up of the outstanding balance of $3.2 million, net of a valuation allowance of $1.2 million at June 30, 2015. The Company recorded $227 thousand in write-downs of other real estate owned properties for the six months ending June 30, 2015 and $201 thousand for the three months ending June 30, 2015. The Company recorded $10 thousand in write-downs of other real estate owned properties for the six months and three months ending June 30, 2014. Loan servicing rights, which are carried at the lower of cost or fair value, were carried at their fair value of $277 thousand, which is made up of the outstanding balance of $322 thousand, net of a valuation allowance of $45 thousand at June 30, 2015. The Company recorded a net recovery of prior write-downs of $34 thousand for the six months ending June 30, 2015 and a recovery of prior write-downs totaling $20 thousand for the three months ending June 30, 2015. For the first six months of 2014, the Company recorded net write-downs of $12 thousand and write-downs totaling $17 thousand for the three months ending June 30, 2014. At December 31, 2014, loan servicing rights were carried at their fair value of $292 thousand, which is made up of the outstanding balance of $371 thousand, net of a valuation allowance of $79 thousand. The following table presents quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2015 and December 31, 2014: Range June 30, 2015 Fair Valuation Unobservable (Weighted (In thousands) Value Technique(s) Input(s) Average) Impaired loans Non-farm & non-residential sales approach adjustment for differences between the comparable sales 0%-0% (0%) Agricultural sales approach adjustment for differences between the comparable sales 5%-44% (24%) Other real estate owned: Residential sales comparison adjustment for differences between the comparable sales 0%-28% (16%) income approach capitalization rate 8%-8% Commercial income approach capitalization rate 10%-10% Loan Servicing Rights discounted cash flow discount rates (12%-12%) (12%) Range December 31, 2014 Fair Valuation Unobservable (Weighted (In thousands) Value Technique(s) Input(s) Average) Impaired loans Real estate mortgage: Multi-family residential sales comparison adjustment for differences between the comparable sales 10%-10% (10%) Non-farm & non-residential sales comparison adjustment for differences between the comparable sales 0%-0% (0%) Agricultural sales comparison adjustment for differences between the comparable sales 5%-53% (43%) Other real estate owned: Residential sales comparison adjustment for differences between the comparable sales 0%-48% (11%) income approach capitalization rate 8%-10% Loan Servicing Rights discounted cash flow discount rates 12%-12% (12%) Fair Value of Financial Instruments The carrying amounts and estimated fair values of financial instruments, at June 30, 2015 and December 31, 2014 are as follows: June 30, 2015: Carrying (in thousands) Value Level 1 Level 2 Level 3 Total Financial assets Cash and cash equivalents $ $ $ — $ — $ Interest bearing deposits — — Securities — Trading Assets — Mortgage loans held for sale — — Loans, net — — FHLB Stock N/A N/A N/A N/A Interest receivable Financial liabilities Deposits $ $ $ $ — $ Securities sold under agreements to repurchase and other borrowings — — Federal Funds Purchased — — FHLB advances — — Subordinated Debentures — — Interest payable — December 31, 2014: Carrying (in thousands) Value Level 1 Level 2 Level 3 Total Financial assets Cash and cash equivalents $ $ $ — $ — $ Interest bearing deposits Securities — Trading assets Mortgage loans held for sale — — Loans, net — — FHLB Stock N/A N/A N/A N/A Interest receivable — Financial liabilities Deposits $ $ $ $ — $ Securities sold under agreements to repurchase and other borrowings — — FHLB advances — — Subordinated Debentures — — Interest Payable The methods and assumptions, not previously presented, used to estimate fair values are described as follows: Cash and Cash Equivalents - The carrying amounts of cash and short-term instruments approximate fair values and are classified as Level 1. FHLB Stock - It is not practical to determine the fair value of FHLB stock due to restrictions placed on its transferability. Loans - Fair values of loans, excluding loans held for sale, are estimated as follows: For variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values resulting in a Level 3 classification. Fair values for other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality resulting in a Level 3 classification. Impaired loans are valued at the lower of cost or fair value as described previously. The methods used to estimate the fair value of loans do not necessarily represent an exit price. The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification. Deposits - The fair values disclosed for demand deposits (e.g., interest and non-interest checking, passbook savings, and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amount) resulting in a Level 1 classification. The carrying amounts of variable rate, fixed-term money market accounts and certificates of deposit approximate their fair values at the reporting date resulting in a Level 1 classification. Fair values for fixed rate certificates of deposit are estimated using a discounted cash flows calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits resulting in a Level 2 classification. Securities Sold Under Agreements to Repurchase and Other Borrowings - The carrying amounts of borrowings under repurchase agreements approximate their fair values resulting in a Level 2 classification. The carrying amount of the Company’s variable rate borrowings approximate their fair values resulting in a Level 2 classification. Federal Funds Purchased - The carrying amounts of federal funds purchased approximate fair values and are classified as Level 1. FHLB Advances and Subordinated Debentures - The fair values of the Company’s FHLB advances are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 2 classification. The fair values of the Company’s Subordinated Debentures are estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements resulting in a Level 3 classification. Accrued Interest Receivable/Payable - The carrying amounts of accrued interest approximate fair value resulting in a Level 2 or Level 3 classification based on the level of the related asset/liability. Off-balance Sheet Instruments - Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of off-balance sheet instruments is not material. |
CHANGES IN ACCUMULATED OTHER CO
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT | 6 Months Ended |
Jun. 30, 2015 | |
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT | |
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT | 9. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT Changes in Accumulated Other Comprehensive Income by Component (1) (unaudited) (in thousands) Unrealized Gains and Losses on Available for Sale Securities For the Six Months Ending June 30 2015 2014 Beginning Balance $ $ ) Unrealized holding gains (losses) for the period, net of tax ) Reclassification adjustment for: Securities gains realized in income ) ) Income taxes ) ) Securities gains realized in income, net ) ) Net current period other comprehensive income ) Ending balance $ ) $ ) (1) All amounts are net of tax. Unrealized Gains and Losses on Available for Sale Securities For the Three Months Ending June 30 2015 2014 Beginning Balance $ $ ) Unrealized holding gains (losses) for the period, net of tax ) Reclassification adjustment for: Securities gains realized in income, net ) ) Income taxes ) ) ) ) Net current period other comprehensive income ) Ending balance $ ) $ ) (2) All amounts are net of tax. The following is significant amounts reclassified out of each component of accumulated other comprehensive Income (Loss) for the six months ending June 30, 2015 and 2014: June 30, 2015 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax June 30, 2014 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax The following is significant amounts reclassified out of each component of accumulated other comprehensive Income (Loss) for the three months ending June 30, 2015 and 2014: June 30, 2015 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax June 30, 2014 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 6 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | 10. SUBSEQUENT EVENT Effective with the close of business on July 24, 2015, Kentucky Bancshares completed its purchase of Madison Financial Corporation and its wholly-owned subsidiary Madison Bank, both of which were headquartered in Richmond, Kentucky. Under terms of an agreement and plan of share exchange dated January 21, 2015, the Company paid 1.1927 shares of Kentucky Bancshares common stock for each issued and outstanding share of Madison Financial Corporation stock. The transaction was valued at approximately $7.2 million. Following the acquisition, Madison Bank and its three branch locations, were merged into Kentucky Bank. At June 30, 2015, Madison Bank had total assets of $119 million, total loans of $81 million and total deposits of $95 million. Management has not yet completed all of the analyses needed to estimate the fair value of the assets and liabilities acquired, both tangible and intangible. |
REPURCHASE AGREEMENTS
REPURCHASE AGREEMENTS | 6 Months Ended |
Jun. 30, 2015 | |
REPURCHASE AGREEMENTS AND OTHER BORROWINGS | |
REPURCHASE AGREEMENTS | 11. REPURCHASE AGREEMENTS Repurchase agreements totaled $13.7 million as of June 30, 2015. Of this, $7.7 million were overnight obligations and $6.0 million had terms extending through May 2019 and an average weighted life of 2.5 years. The Company pledged agency-backed securities with a carrying amount of $16.6 million to secure repurchase agreements as of June 30, 2015. |
SUMMARY OF SIGNIFICANT ACCOUN19
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation : The consolidated financial statements include the accounts of Kentucky Bancshares, Inc. (the “Company”, “we”, “our” or “us”), its wholly-owned subsidiaries, Kentucky Bank (the “Bank”) and KBI Insurance Company, Inc., and the Bank’s wholly-owned subsidiary, KB Special Assets Unit, LLC. Intercompany transactions and balances have been eliminated in consolidation. |
Nature of Operations | Nature of Operations : The Bank operates under a state bank charter and provides full banking services, including trust services, to customers located in Bourbon, Clark, Elliott, Fayette, Harrison, Jessamine, Madison, Rowan, Scott, Woodford and adjoining counties in Kentucky. Management continues to consider opportunities for branch expansion and will also consider acquisition opportunities that help advance its strategic objectives. As a state bank, the Bank is subject to regulation by the Kentucky Department of Financial Institutions and the Federal Deposit Insurance Corporation (“FDIC”). The Company, a bank holding company, is regulated by the Federal Reserve. On July 9, 2014, a new subsidiary of the Company was incorporated under the name KBI Insurance Company, Inc. KBI Insurance Company, Inc. is a subsidiary of Kentucky Bancshares, Inc. and is located in Las Vegas, Nevada. It is a captive insurance subsidiary which provides various liability and property damage insurance policies for Kentucky Bancshares, Inc. and its related subsidiaries. KBI Insurance Company, Inc. is regulated by the State of Nevada Division of Insurance. Our transfer, registrar and dividend agent, Registrar and Transfer Company, was recently acquired by Computershare. The migration to Computershare occurred October 31, 2014. |
Estimates in the Financial Statements | Estimates in the Financial Statements : The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material to the financial statements. |
Trading Assets | Trading Assets : The Company engages in trading activities for its own account. Securities that are held principally for resale in the near term are recorded at fair value with changes in fair value included in earnings. Interest and dividends are included in net interest income. |
Loss Contingencies | Loss Contingencies : Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. |
Reclassifications | Reclassifications : Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications had no effect on prior period net income or stockholders’ equity. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards In January 2014, FASB issued Accounting Standards Update 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure (a consensus of the FASB Emerging Issues Task Force) . The ASU clarifies when an insubstance repossession or foreclosure occurs and a creditor is considered to have received physical possession of real estate property collateralizing a consumer mortgage loan. Specifically, the new ASU requires a creditor to reclassify a collateralized consumer mortgage loan to real estate property upon obtaining legal title to the real estate collateral, or the borrower voluntarily conveying all interest in the real estate property to the lender to satisfy the loan through a deed in lieu of foreclosure or similar legal agreement. Additional disclosures are required detailing the amount of foreclosed residential real estate property held by the creditor and the recorded investment in consumer mortgages collateralized by real estate property that are in the process of foreclosure. The new guidance is effective for annual periods, and interim reporting periods within those annual periods, beginning after December 15, 2014. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements, but will result in additional disclosures. In May 2014, FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606) . The ASU creates a new topic, Topic 606, to provide guidance on revenue recognition for entities that enter into contracts with customers to transfer goods or services or enter into contracts for the transfer of nonfinancial assets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide quantitative and qualitative information regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new guidance is effective for annual reporting periods, and interim reporting periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. Management is currently evaluating the impact of the adoption of this guidance on the Company’s financial statements. However, in April 2015, the FASB voted to defer the effective date of ASU 2014-09 by one year making the amendments effective for public entities for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Companies have the option to apply ASU 2014-09 as of the original effective date. In June 2014, FASB issued Accounting Standards Update 2014-11, Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures. The amendments in this update require two accounting changes. First, the amendments in this update change the accounting for repurchase-to-maturity transactions to secured borrowing accounting. Second, for repurchase financing arrangements, the amendments require separate accounting for a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counter-party, which will result in secured borrowing accounting for the repurchase agreement. This update also requires certain disclosures for these types of transactions. This ASU became effective for the Company on January 1, 2015. The adoption of ASU 2014-11 did not have a material impact on the Company’s financial statements. |
SECURITIES (Tables)
SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
SECURITIES | |
Schedule of securities available for sale | (in thousands) Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value Available for Sale June 30, 2015 U.S. government agencies $ $ $ ) $ States and political subdivisions ) Mortgage-backed - residential ) Equity securities — Total $ $ $ ) $ December 31, 2014 U.S. government agencies $ $ $ ) $ States and political subdivisions ) Mortgage-backed - residential ) Equity securities — Total $ $ $ ) $ |
Schedule of amortized cost and fair value of securities by contractual maturity | (in thousands) Amortized Fair Cost Value Due in one year or less $ $ Due after one year through five years Due after five years through ten years Due after ten years Mortgage-backed - residential Equity Total $ $ |
Schedule of securities with unrealized losses not recognized in income | June 30, 2015 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Description of Securities Value Loss Value Loss Value Loss U.S. Government agencies $ $ ) $ $ ) $ $ ) States and municipals ) ) ) Mortgage-backed - residential ) ) ) Total temporarily impaired $ $ ) $ $ ) $ $ ) December 31, 2014 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Description of Securities Value Loss Value Loss Value Loss U.S. Government agencies $ $ ) $ $ ) $ $ ) States and municipals ) ) ) Mortgage-backed - residential ) ) ) Total temporarily impaired $ $ ) $ $ ) $ $ ) |
LOANS (Tables)
LOANS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
LOANS | |
Schedule of loans | (in thousands) 6/30/15 12/31/14 Commercial $ $ Real estate construction Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer Other Total $ $ |
Schedule of activity in the allowance for loan losses | Six Months Ended June 30, 2015 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ $ — $ $ Real estate Construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential — — Agricultural ) Consumer Other Unallocated — — $ $ $ $ $ Three Months Ended June 30, 2015 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ — $ — $ $ Real estate Construction — — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential — — Agricultural — ) Consumer Other Unallocated — — $ $ $ $ $ Six Months Ended June 30, 2014 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ $ — $ $ Real estate Construction — ) Real estate mortgage: 1-4 family residential Multi-family residential — — ) Non-farm & non-residential — ) Agricultural — ) Consumer Other Unallocated — — $ $ $ $ $ Three Months Ended June 30, 2014 (in thousands) Beginning Ending Balance Charge-offs Recoveries Provision Balance Commercial $ $ — $ — $ $ Real estate Construction — Real estate mortgage: 1-4 family residential Multi-family residential — — ) Non-farm & non-residential — — ) Agricultural — ) Consumer Other Unallocated — — ) $ $ $ $ $ |
Schedule of allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method | As of June 30, 2015 (in thousands) Individually Collectively Evaluated for Evaluated for Impairment Impairment Total Allowance for Loan Losses: Commercial $ — $ $ Real estate construction — Real estate mortgage 1-4 family residential Multi-family residential — Non-farm & non-residential Agricultural Consumer — Other — Unallocated — $ $ $ Loans: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — Non-farm & non-residential Agricultural Consumer — Other — $ $ $ As of December 31, 2014 (in thousands) Individually Collectively Evaluated for Evaluated for Impairment Impairment Total Allowance for Loan Losses: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer — Other — Unallocated — $ $ $ Loans: Commercial $ — $ $ Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Consumer — Other — $ $ $ |
Schedule of loans individually evaluated for impairment by class of loans | The following table presents loans individually evaluated for impairment by class of loans as of and for the six months ended June 30, 2015 (in thousands): Unpaid Allowance for Average Interest Cash Basis Principal Recorded Loan Losses Recorded Income Interest Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential — Agricultural — With an allowance recorded: Real estate mortgage: 1-4 family residential Non-farm & non-residential Multi-family residential — — — — — Agricultural — — Consumer — — — — — — Other — — — — — Total $ $ $ $ $ $ The following table presents loans individually evaluated for impairment by class of loans for the six months ended June 30, 2014 (in thousands): Year to Date Year to Date Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential — — Non-farm & non-residential — Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ The following table presents loans individually evaluated for impairment by class of loans as of and for the year ended December 31, 2014 (in thousands): Unpaid Allowance for Average Interest Cash Basis Principal Recorded Loan Losses Recorded Income Interest Balance Investment Allocated Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ $ — $ $ $ Non-farm & non-residential — — — — — Agricultural — With an allowance recorded: Real estate mortgage 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ $ $ $ The following tables present loans individually evaluated for impairment by class of loans for the three months ending June 30, 2015 and June 30, 2014 (in thousands): Three Months Ending June 30, 2015 Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ $ Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential Agricultural — — Consumer — — — Other — — — Total $ $ $ Three Months Ending June 30, 2014 Average Interest Cash Basis Recorded Income Interest Investment Recognized Recognized With no related allowance recorded: Real estate mortgage: 1-4 family residential $ $ — $ — Agricultural With an allowance recorded: Real estate mortgage: 1-4 family residential Multi-family residential Non-farm & non-residential Agricultural Total $ $ $ |
Schedule of recorded investment in nonaccrual, loans past due over 90 days still on accrual and accruing troubled debt restructurings by class of loans | As of June 30, 2015 (in thousands) Loans Past Due Over 90 Days Accruing Still Troubled Debt Nonaccrual Accruing Restructurings Real estate construction $ $ — $ — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Consumer — Total $ $ $ As of December 31, 2014 (in thousands) Loans Past Due Over 90 Days Accruing Still Troubled Debt Nonaccrual Accruing Restructurings Commercial $ $ — $ — Real estate construction — — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Consumer — Total $ $ $ |
Schedule of aging of the recorded investment in past due and non-accrual loans | As of June 30, 2015 (in thousands) 30—59 60—89 Loans Past Due Total Days Days Over 90 Days Past Due & Loans Not Past Due Past Due Still Accruing Non-accrual Non-accrual Past Due Commercial $ $ — $ — $ — $ $ Real estate construction — — — Real estate mortgage: 1-4 family residential Multi-family residential — — — Non-farm & non-residential — — — Agricultural — Consumer Other — — — — — Total $ $ $ $ $ $ As of December 31, 2014 ( in thousands) 30—59 60—89 Greater than Total Days Days 90 Days Past Due & Loans Not Past Due Past Due Past Due Non-accrual Non-accrual Past Due Commercial $ $ — $ — $ $ $ Real estate construction — — — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — — Agricultural — Consumer Other — — — — — Total $ $ $ $ $ $ |
Schedule of risk category of loans by class of loans | As of June 30, 2015 ( in thousands) Special Pass Mention Substandard Doubtful Commercial $ $ $ $ — Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Total $ $ $ $ As of December 31, 2014 ( in thousands) Special Pass Mention Substandard Doubtful Commercial $ $ $ $ — Real estate construction — Real estate mortgage: 1-4 family residential Multi-family residential — — Non-farm & non-residential — Agricultural — Total $ $ $ $ |
REAL ESTATE OWNED (Tables)
REAL ESTATE OWNED (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
REAL ESTATE OWNED | |
Schedule of activity in real estate owned | Six Months Ended June 30 2015 2014 (in thousands) Beginning of year $ $ Additions Sales ) ) (Additions) subtractions to valuation allowance, net End of period $ $ |
Schedule of activity in the valuation allowance | Six Months Ended June 30 2015 2014 (in thousands) Beginning of year $ $ Write-downs of other real estate, net Reduction from sale ) ) End of period $ $ |
Schedule of expenses related to foreclosed assets | Six Months Ended June 30 2015 2014 (in thousands) Net loss (gain) on sales reported in other income $ $ ) Write-downs of other real estate, net Operating expenses (receipts), net of rental income Repossession expenses, net For the period $ $ ) Three Months Ended June 30 2015 2014 (in thousands) Net loss (gain) on sales reported in other income $ $ ) Write-downs of other real estate, net Operating expenses (receipts), net of rental income Repossession expenses, net For the period $ $ |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
EARNINGS PER SHARE | |
Schedule of factors used in the earnings per share computation | Six Months Ended June 30 2015 2014 (in thousands) Basic Earnings Per Share Net Income $ $ Weighted average common shares outstanding Basic earnings per share $ $ Diluted Earnings Per Share Net Income $ $ Weighted average common shares outstanding Weighted average common and dilutive potential common shares outstanding Diluted earnings per share $ $ Three Months Ended June 30 2015 2014 (in thousands) Basic Earnings Per Share Net Income $ $ Weighted average common shares outstanding Basic earnings per share $ $ Diluted Earnings Per Share Net Income $ $ Weighted average common shares outstanding Weighted average common and dilutive potential common shares outstanding Diluted earnings per share $ $ |
STOCK COMPENSATION (Tables)
STOCK COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Stock Based Compensation | |
Summary of activity for the Stock Option Plans | Weighted Weighted Average Average Remaining Aggregate Exercise Contractual Intrinsic Shares Price Term Value Outstanding, beginning of year $ Granted — — Forfeited or expired ) Exercised — — Outstanding, end of period $ 18.5 months $ — Vested and expected to vest $ 18.5 months $ — Exercisable, end of period $ 18.5 months $ — |
2005 Restricted Stock Grant Plan | |
Stock Based Compensation | |
Summary of changes in nonvested shares of restricted stock | Weighted-Average Fair Grant-Date Value Nonvested Shares Shares Fair Value Per Share Nonvested at January 1, 2015 $ $ Granted Vested ) ) Forfeited — — — Nonvested at June 30, 2015 $ $ |
2009 Stock Award Plan | |
Stock Based Compensation | |
Summary of changes in nonvested shares of stock award plan | Weighted-Average Fair Grant-Date Value Nonvested Shares Shares Fair Value Per Share Nonvested at January 1, 2015 $ $ Granted Vested ) ) Forfeited — — — Nonvested at June 30, 2015 $ $ |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
FAIR VALUE MEASUREMENTS | |
Schedule of assets measured at fair value on a recurring basis | Fair Value Measurements at June 30, 2015 Using (In thousands): Quoted Prices In Active Markets for Significant Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) U. S. government agencies $ $ — $ $ — States and municipals — — Mortgage-backed - residential — — Equity securities — — Trading Assets — — Total $ $ $ $ — Fair Value Measurements at December 31, 2014 Using (In thousands): Quoted Prices In Active Markets for Significant Other Significant Identical Observable Unobservable Fair Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) U. S. government agencies $ $ — $ $ — States and municipals — — Mortgage-backed - residential — — Equity securities — — Trading Assets — — Total $ $ $ $ — |
Schedule of assets measured at fair value on a non-recurring basis | Fair Value Measurements at June 30, 2015 Using: Quoted Prices In Active Other Markets for Significant Significant Identical Observable Unobservable (In thousands) Carrying Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Impaired loans: Real Estate Mortgage: Non-farm & non-residential — — Agricultural — — Other real estate owned: Residential — — Commercial Loan servicing rights — — Fair Value Measurements at December 31, 2014 Using: Quoted Prices In Active Other Markets for Significant Significant Identical Observable Unobservable (In thousands) Carrying Assets Inputs Inputs Description Value (Level 1) (Level 2) (Level 3) Impaired loans: Real Estate Mortgage: Multi-family residential — — Non-farm & non-residential — — Agricultural — — Other real estate owned: Residential — — Loan servicing rights — — |
Schedule of quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis | Range June 30, 2015 Fair Valuation Unobservable (Weighted (In thousands) Value Technique(s) Input(s) Average) Impaired loans Non-farm & non-residential sales approach adjustment for differences between the comparable sales 0%-0% (0%) Agricultural sales approach adjustment for differences between the comparable sales 5%-44% (24%) Other real estate owned: Residential sales comparison adjustment for differences between the comparable sales 0%-28% (16%) income approach capitalization rate 8%-8% Commercial income approach capitalization rate 10%-10% Loan Servicing Rights discounted cash flow discount rates (12%-12%) (12%) Range December 31, 2014 Fair Valuation Unobservable (Weighted (In thousands) Value Technique(s) Input(s) Average) Impaired loans Real estate mortgage: Multi-family residential sales comparison adjustment for differences between the comparable sales 10%-10% (10%) Non-farm & non-residential sales comparison adjustment for differences between the comparable sales 0%-0% (0%) Agricultural sales comparison adjustment for differences between the comparable sales 5%-53% (43%) Other real estate owned: Residential sales comparison adjustment for differences between the comparable sales 0%-48% (11%) income approach capitalization rate 8%-10% Loan Servicing Rights discounted cash flow discount rates 12%-12% (12%) |
Schedule of carrying amounts and estimated fair values of financial instruments | June 30, 2015: Carrying (in thousands) Value Level 1 Level 2 Level 3 Total Financial assets Cash and cash equivalents $ $ $ — $ — $ Interest bearing deposits — — Securities — Trading Assets — Mortgage loans held for sale — — Loans, net — — FHLB Stock N/A N/A N/A N/A Interest receivable Financial liabilities Deposits $ $ $ $ — $ Securities sold under agreements to repurchase and other borrowings — — Federal Funds Purchased — — FHLB advances — — Subordinated Debentures — — Interest payable — December 31, 2014: Carrying (in thousands) Value Level 1 Level 2 Level 3 Total Financial assets Cash and cash equivalents $ $ $ — $ — $ Interest bearing deposits Securities — Trading assets Mortgage loans held for sale — — Loans, net — — FHLB Stock N/A N/A N/A N/A Interest receivable — Financial liabilities Deposits $ $ $ $ — $ Securities sold under agreements to repurchase and other borrowings — — FHLB advances — — Subordinated Debentures — — Interest Payable |
CHANGES IN ACCUMULATED OTHER 26
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT | |
Schedule of changes in Accumulated Other Comprehensive Income (Loss) by Component | Changes in Accumulated Other Comprehensive Income by Component (1) (unaudited) (in thousands) Unrealized Gains and Losses on Available for Sale Securities For the Six Months Ending June 30 2015 2014 Beginning Balance $ $ ) Unrealized holding gains (losses) for the period, net of tax ) Reclassification adjustment for: Securities gains realized in income ) ) Income taxes ) ) Securities gains realized in income, net ) ) Net current period other comprehensive income ) Ending balance $ ) $ ) (1) All amounts are net of tax. Unrealized Gains and Losses on Available for Sale Securities For the Three Months Ending June 30 2015 2014 Beginning Balance $ $ ) Unrealized holding gains (losses) for the period, net of tax ) Reclassification adjustment for: Securities gains realized in income, net ) ) Income taxes ) ) ) ) Net current period other comprehensive income ) Ending balance $ ) $ ) (2) All amounts are net of tax. |
Significant amounts reclassified out of each component of AOCI | The following is significant amounts reclassified out of each component of accumulated other comprehensive Income (Loss) for the six months ending June 30, 2015 and 2014: June 30, 2015 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax June 30, 2014 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax The following is significant amounts reclassified out of each component of accumulated other comprehensive Income (Loss) for the three months ending June 30, 2015 and 2014: June 30, 2015 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax June 30, 2014 Details about Amount Affected Line Item Accumulated Other Reclassified From in the Statement Comprehensive Accumulated Other Where Net Income Components Comprehensive Income Income is Presented Unrealized gains and losses on available-for-sale securities $ ) Securities gains realized in income, net Provision for income taxes ) Net of tax |
SECURITIES (Details)
SECURITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Securities Available for Sale | ||
Amortized Cost | $ 238,130 | $ 245,662 |
Gross Unrealized Gains | 2,333 | 3,528 |
Gross Unrealized Losses | (2,987) | (2,329) |
Fair Value | 237,476 | 246,861 |
U.S. government agencies | ||
Securities Available for Sale | ||
Amortized Cost | 55,817 | 61,721 |
Gross Unrealized Gains | 27 | 1 |
Gross Unrealized Losses | (766) | (1,136) |
Fair Value | 55,078 | 60,586 |
States and political subdivisions | ||
Securities Available for Sale | ||
Amortized Cost | 87,055 | 86,322 |
Gross Unrealized Gains | 2,105 | 3,234 |
Gross Unrealized Losses | (965) | (275) |
Fair Value | 88,195 | 89,281 |
Mortgage-backed - residential | ||
Securities Available for Sale | ||
Amortized Cost | 94,988 | 97,349 |
Gross Unrealized Gains | 176 | 267 |
Gross Unrealized Losses | (1,256) | (918) |
Fair Value | 93,908 | 96,698 |
Equity | ||
Securities Available for Sale | ||
Amortized Cost | 270 | 270 |
Gross Unrealized Gains | 25 | 26 |
Fair Value | $ 295 | $ 296 |
SECURITIES (Details 2)
SECURITIES (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Amortized Cost | |||||
Due in one year or less | $ 40 | $ 40 | |||
Due after one year through five years | 17,392 | 17,392 | |||
Due after five years through ten years | 75,717 | 75,717 | |||
Due after ten years | 49,723 | 49,723 | |||
Securities due at a single maturity date | 142,872 | 142,872 | |||
Total | 238,130 | 238,130 | $ 245,662 | ||
Fair Value | |||||
Due in one year or less | 40 | 40 | |||
Due after one year through five years | 17,299 | 17,299 | |||
Due after five years through ten years | 75,588 | 75,588 | |||
Due after ten years | 50,346 | 50,346 | |||
Securities due at a single maturity date | 143,273 | 143,273 | |||
Fair Value | 237,476 | 237,476 | 246,861 | ||
Proceeds from sales of securities | 9,100 | $ 23,500 | 9,100 | $ 40,000 | |
Gross gains realized on sales of securities | 243 | 477 | 251 | 785 | |
Gross losses realized on sales of securities | 0 | 232 | 0 | 352 | |
Tax provision related to realized gains | 83 | $ 83 | 85 | $ 147 | |
Mortgage-backed - residential | |||||
Amortized Cost | |||||
Mortgage-backed - residential | 94,988 | 94,988 | |||
Total | 94,988 | 94,988 | 97,349 | ||
Fair Value | |||||
Mortgage-backed - residential | 93,908 | 93,908 | |||
Fair Value | 93,908 | 93,908 | 96,698 | ||
Equity | |||||
Amortized Cost | |||||
Amortized cost of equity securities | 270 | 270 | |||
Total | 270 | 270 | 270 | ||
Fair Value | |||||
Fair Value Equity Securities | 295 | 295 | |||
Fair Value | $ 295 | $ 295 | $ 296 |
SECURITIES (Details 3)
SECURITIES (Details 3) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Securities with unrealized losses | ||
Less than 12 Months, Fair Value | $ 88,712 | $ 64,224 |
Less than 12 Months, Unrealized Loss | (1,252) | (775) |
12 Months or More, Fair Value | 60,768 | 73,551 |
12 Months or More, Unrealized Loss | (1,735) | (1,554) |
Total, Fair Value | 149,480 | 137,775 |
Total, Unrealized Loss | (2,987) | (2,329) |
Trading Assets | ||
Trading Assets | 5,400 | 5,370 |
U.S. government agencies | ||
Securities with unrealized losses | ||
Less than 12 Months, Fair Value | 8,873 | 12,528 |
Less than 12 Months, Unrealized Loss | (66) | (176) |
12 Months or More, Fair Value | 36,854 | 45,066 |
12 Months or More, Unrealized Loss | (700) | (960) |
Total, Fair Value | 45,727 | 57,594 |
Total, Unrealized Loss | (766) | (1,136) |
States and political subdivisions | ||
Securities with unrealized losses | ||
Less than 12 Months, Fair Value | 19,875 | 5,011 |
Less than 12 Months, Unrealized Loss | (414) | (27) |
12 Months or More, Fair Value | 9,126 | 9,738 |
12 Months or More, Unrealized Loss | (551) | (248) |
Total, Fair Value | 29,001 | 14,749 |
Total, Unrealized Loss | (965) | (275) |
Trading Assets | ||
Trading Assets | 5,400 | |
Mortgage-backed - residential | ||
Securities with unrealized losses | ||
Less than 12 Months, Fair Value | 59,964 | 46,685 |
Less than 12 Months, Unrealized Loss | (772) | (572) |
12 Months or More, Fair Value | 14,788 | 18,747 |
12 Months or More, Unrealized Loss | (484) | (346) |
Total, Fair Value | 74,752 | 65,432 |
Total, Unrealized Loss | $ (1,256) | $ (918) |
LOANS (Details)
LOANS (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Loans | ||
Loans | $ 546,085 | $ 538,305 |
Commercial | ||
Loans | ||
Loans | 50,236 | 47,185 |
Real estate construction | ||
Loans | ||
Loans | 21,320 | 16,938 |
1-4 family residential | ||
Loans | ||
Loans | 196,215 | 189,458 |
Multi-family residential | ||
Loans | ||
Loans | 34,121 | 34,415 |
Non-farm & non-residential | ||
Loans | ||
Loans | 158,041 | 161,822 |
Agricultural | ||
Loans | ||
Loans | 68,921 | 71,345 |
Consumer | ||
Loans | ||
Loans | 17,031 | 16,863 |
Other | ||
Loans | ||
Loans | $ 200 | $ 279 |
LOANS (Details 2)
LOANS (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Activity in allowance for loan losses | ||||
Beginning Balance | $ 5,920 | $ 5,616 | $ 6,012 | $ 5,441 |
Charge-offs | 547 | 206 | 1,169 | 643 |
Recoveries | 227 | 104 | 457 | 616 |
Provision | 350 | 100 | 650 | 200 |
Ending Balance | 5,950 | 5,614 | 5,950 | 5,614 |
Commercial | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 340 | 208 | 339 | 230 |
Charge-offs | 25 | 200 | ||
Provision | 59 | 23 | 85 | 201 |
Ending Balance | 399 | 231 | 399 | 231 |
Real estate construction | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 438 | 329 | 446 | 358 |
Recoveries | 4 | 2 | 8 | |
Provision | 38 | 26 | 28 | (7) |
Ending Balance | 476 | 359 | 476 | 359 |
1-4 family residential | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 1,825 | 2,111 | 1,829 | 2,169 |
Charge-offs | 120 | 25 | 152 | 88 |
Recoveries | 2 | 4 | 5 | 16 |
Provision | 100 | 234 | 125 | 227 |
Ending Balance | 1,807 | 2,324 | 1,807 | 2,324 |
Multi-family residential | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 499 | 401 | 495 | 427 |
Charge-offs | 94 | 94 | ||
Recoveries | 2 | 2 | ||
Provision | 35 | (74) | 39 | (100) |
Ending Balance | 442 | 327 | 442 | 327 |
Non-farm & non-residential | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 1,030 | 930 | 813 | 564 |
Recoveries | 367 | |||
Provision | 44 | (196) | 261 | (197) |
Ending Balance | 1,074 | 734 | 1,074 | 734 |
Agricultural | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 723 | 553 | 998 | 578 |
Charge-offs | 242 | |||
Recoveries | 11 | 1 | 12 | 25 |
Provision | (156) | (8) | (190) | (57) |
Ending Balance | 578 | 546 | 578 | 546 |
Consumer | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 497 | 550 | 520 | 548 |
Charge-offs | 82 | 76 | 163 | 153 |
Recoveries | 12 | 23 | 27 | 41 |
Provision | 107 | 46 | 150 | 107 |
Ending Balance | 534 | 543 | 534 | 543 |
Other | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 34 | 11 | 32 | 51 |
Charge-offs | 251 | 105 | 493 | 202 |
Recoveries | 200 | 72 | 409 | 159 |
Provision | 72 | 55 | 107 | 25 |
Ending Balance | 55 | 33 | 55 | 33 |
Unallocated | ||||
Activity in allowance for loan losses | ||||
Beginning Balance | 534 | 523 | 540 | 516 |
Provision | 51 | (6) | 45 | 1 |
Ending Balance | $ 585 | $ 517 | $ 585 | $ 517 |
LOANS (Details 3)
LOANS (Details 3) - USD ($) $ in Thousands | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
Loans | ||||||
Accrued interest receivable | $ 2,400 | $ 2,000 | ||||
Allowance for Loan Losses: | ||||||
Individually Evaluated for Impairment | 698 | 998 | ||||
Collectively Evaluated for Impairment | 5,252 | 5,014 | ||||
Total | 5,950 | $ 5,920 | 6,012 | $ 5,614 | $ 5,616 | $ 5,441 |
Loans: | ||||||
Individually Evaluated for Impairment | 9,166 | 13,799 | ||||
Collectively Evaluated for Impairment | 536,919 | 524,506 | ||||
Total | 546,085 | 538,305 | ||||
Commercial | ||||||
Allowance for Loan Losses: | ||||||
Collectively Evaluated for Impairment | 399 | 339 | ||||
Total | 399 | 340 | 339 | 231 | 208 | 230 |
Loans: | ||||||
Collectively Evaluated for Impairment | 50,236 | 47,185 | ||||
Total | 50,236 | 47,185 | ||||
Real estate construction | ||||||
Allowance for Loan Losses: | ||||||
Collectively Evaluated for Impairment | 476 | 446 | ||||
Total | 476 | 438 | 446 | 359 | 329 | 358 |
Loans: | ||||||
Collectively Evaluated for Impairment | 21,320 | 16,938 | ||||
Total | 21,320 | 16,938 | ||||
1-4 family residential | ||||||
Allowance for Loan Losses: | ||||||
Individually Evaluated for Impairment | 170 | 56 | ||||
Collectively Evaluated for Impairment | 1,637 | 1,773 | ||||
Total | 1,807 | 1,825 | 1,829 | 2,324 | 2,111 | 2,169 |
Loans: | ||||||
Individually Evaluated for Impairment | 1,979 | 2,098 | ||||
Collectively Evaluated for Impairment | 194,236 | 187,360 | ||||
Total | 196,215 | 189,458 | ||||
Multi-family residential | ||||||
Allowance for Loan Losses: | ||||||
Individually Evaluated for Impairment | 94 | |||||
Collectively Evaluated for Impairment | 442 | 401 | ||||
Total | 442 | 499 | 495 | 327 | 401 | 427 |
Loans: | ||||||
Individually Evaluated for Impairment | 264 | |||||
Collectively Evaluated for Impairment | 34,121 | 34,151 | ||||
Total | 34,121 | 34,415 | ||||
Non-farm & non-residential | ||||||
Allowance for Loan Losses: | ||||||
Individually Evaluated for Impairment | 259 | 136 | ||||
Collectively Evaluated for Impairment | 815 | 677 | ||||
Total | 1,074 | 1,030 | 813 | 734 | 930 | 564 |
Loans: | ||||||
Individually Evaluated for Impairment | 2,922 | 2,958 | ||||
Collectively Evaluated for Impairment | 155,119 | 158,864 | ||||
Total | 158,041 | 161,822 | ||||
Agricultural | ||||||
Allowance for Loan Losses: | ||||||
Individually Evaluated for Impairment | 269 | 712 | ||||
Collectively Evaluated for Impairment | 309 | 286 | ||||
Total | 578 | 723 | 998 | 546 | 553 | 578 |
Loans: | ||||||
Individually Evaluated for Impairment | 4,265 | 8,479 | ||||
Collectively Evaluated for Impairment | 64,656 | 62,866 | ||||
Total | 68,921 | 71,345 | ||||
Consumer | ||||||
Allowance for Loan Losses: | ||||||
Collectively Evaluated for Impairment | 534 | 520 | ||||
Total | 534 | 497 | 520 | 543 | 550 | 548 |
Loans: | ||||||
Collectively Evaluated for Impairment | 17,031 | 16,863 | ||||
Total | 17,031 | 16,863 | ||||
Other | ||||||
Allowance for Loan Losses: | ||||||
Collectively Evaluated for Impairment | 55 | 32 | ||||
Total | 55 | 34 | 32 | 33 | 11 | 51 |
Loans: | ||||||
Collectively Evaluated for Impairment | 200 | 279 | ||||
Total | 200 | 279 | ||||
Unallocated | ||||||
Allowance for Loan Losses: | ||||||
Collectively Evaluated for Impairment | 585 | 540 | ||||
Total | $ 585 | $ 534 | $ 540 | $ 517 | $ 523 | $ 516 |
LOANS (Details 4)
LOANS (Details 4) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Unpaid Principal Balance | |||||
Total | $ 9,166 | $ 9,166 | $ 13,799 | ||
Recorded Investment | |||||
Total | 9,166 | 9,166 | 13,799 | ||
Allowance for Loan Losses Allocated | 698 | 698 | 998 | ||
Average Recorded Investment | |||||
Total | 9,357 | $ 14,393 | 10,716 | $ 14,344 | 14,183 |
Interest Income Recognized | |||||
Total | 80 | 183 | 138 | 221 | 308 |
Cash Basis Interest Recognized | |||||
Total | 80 | 183 | 138 | 221 | 308 |
1-4 family residential | |||||
Unpaid Principal Balance | |||||
With no related allowance recorded | 1,345 | 1,345 | 1,618 | ||
With an allowance recorded | 634 | 634 | 480 | ||
Recorded Investment | |||||
With no related allowance recorded | 1,345 | 1,345 | 1,618 | ||
With an allowance recorded | 634 | 634 | 480 | ||
Allowance for Loan Losses Allocated | 170 | 170 | 56 | ||
Average Recorded Investment | |||||
With no related allowance recorded | 1,476 | 1,562 | 1,524 | 1,002 | 1,147 |
With an allowance recorded | 556 | 1,377 | 556 | 1,991 | 990 |
Interest Income Recognized | |||||
With no related allowance recorded | 28 | 42 | 25 | ||
With an allowance recorded | 5 | 38 | 10 | 44 | 18 |
Cash Basis Interest Recognized | |||||
With no related allowance recorded | 28 | 42 | 25 | ||
With an allowance recorded | 5 | 38 | 10 | 44 | 18 |
Multi-family residential | |||||
Unpaid Principal Balance | |||||
With an allowance recorded | 264 | ||||
Recorded Investment | |||||
With an allowance recorded | 264 | ||||
Allowance for Loan Losses Allocated | 94 | ||||
Average Recorded Investment | |||||
With an allowance recorded | 47 | 310 | 323 | 284 | |
Interest Income Recognized | |||||
With an allowance recorded | 1 | 5 | 5 | ||
Cash Basis Interest Recognized | |||||
With an allowance recorded | 1 | 5 | 5 | ||
Non-farm & non-residential | |||||
Unpaid Principal Balance | |||||
With an allowance recorded | 2,922 | 2,922 | 2,958 | ||
Recorded Investment | |||||
With an allowance recorded | 2,922 | 2,922 | 2,958 | ||
Allowance for Loan Losses Allocated | 259 | 259 | 136 | ||
Average Recorded Investment | |||||
With no related allowance recorded | 267 | 552 | |||
With an allowance recorded | 2,931 | 3,553 | 2,940 | 3,043 | 3,173 |
Interest Income Recognized | |||||
With an allowance recorded | 30 | 48 | 59 | 73 | 115 |
Cash Basis Interest Recognized | |||||
With an allowance recorded | 30 | 48 | 59 | 73 | 115 |
Agricultural | |||||
Unpaid Principal Balance | |||||
With no related allowance recorded | 205 | 205 | 442 | ||
With an allowance recorded | 4,060 | 4,060 | 8,037 | ||
Recorded Investment | |||||
With no related allowance recorded | 205 | 205 | 442 | ||
With an allowance recorded | 4,060 | 4,060 | 8,037 | ||
Allowance for Loan Losses Allocated | 269 | 269 | 712 | ||
Average Recorded Investment | |||||
With no related allowance recorded | 322 | 2,836 | 362 | 2,684 | 2,696 |
With an allowance recorded | 4,025 | 4,755 | 5,215 | 5,034 | 5,341 |
Interest Income Recognized | |||||
With no related allowance recorded | 17 | 77 | 27 | 80 | 29 |
With an allowance recorded | 19 | 19 | 116 | ||
Cash Basis Interest Recognized | |||||
With no related allowance recorded | $ 17 | 77 | $ 27 | 80 | 29 |
With an allowance recorded | $ 19 | $ 19 | $ 116 |
LOANS (Details 5)
LOANS (Details 5) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Loans | ||
Nonaccrual | $ 1,367 | $ 6,577 |
Loans Past Due Over 90 Days Still Accruing | 267 | 24 |
Accruing Troubled Debt Restructurings | $ 6,106 | 6,138 |
Percentage of nonaccrual loans secured by real estate | 98.90% | |
Minimum period for which principal or interest is in default for loans to be considered as nonaccrual | 90 days | |
Maximum period past due for loans to be considered as impaired | 90 days | |
Commercial | ||
Loans | ||
Nonaccrual | 25 | |
Real estate construction | ||
Loans | ||
Nonaccrual | $ 138 | 142 |
1-4 family residential | ||
Loans | ||
Nonaccrual | 834 | 1,390 |
Loans Past Due Over 90 Days Still Accruing | 99 | 23 |
Accruing Troubled Debt Restructurings | 474 | 480 |
Multi-family residential | ||
Loans | ||
Nonaccrual | 264 | |
Loans Past Due Over 90 Days Still Accruing | 131 | |
Non-farm & non-residential | ||
Loans | ||
Nonaccrual | 380 | 380 |
Accruing Troubled Debt Restructurings | 1,803 | 1,829 |
Agricultural | ||
Loans | ||
Nonaccrual | 4,371 | |
Loans Past Due Over 90 Days Still Accruing | 32 | |
Accruing Troubled Debt Restructurings | 3,829 | 3,829 |
Consumer | ||
Loans | ||
Nonaccrual | 15 | 5 |
Loans Past Due Over 90 Days Still Accruing | $ 5 | $ 1 |
LOANS (Details 6)
LOANS (Details 6) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | $ 2,021 | $ 1,827 |
60-89 Days Past Due | 406 | 399 |
Greater than 90 Days Past Due | 267 | 24 |
Non-accrual | 1,367 | 6,577 |
Total Past Due and Non-accrual | 4,061 | 8,827 |
Loans Not Past Due | 542,024 | 529,478 |
Commercial | ||
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | 365 | 92 |
Non-accrual | 25 | |
Total Past Due and Non-accrual | 365 | 117 |
Loans Not Past Due | 49,871 | 47,068 |
Real estate construction | ||
Aging of recorded investment in past due and non-accrual loans | ||
Non-accrual | 138 | 142 |
Total Past Due and Non-accrual | 138 | 142 |
Loans Not Past Due | 21,182 | 16,796 |
1-4 family residential | ||
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | 1,570 | 1,531 |
60-89 Days Past Due | 381 | 232 |
Greater than 90 Days Past Due | 99 | 23 |
Non-accrual | 834 | 1,390 |
Total Past Due and Non-accrual | 2,884 | 3,176 |
Loans Not Past Due | 193,331 | 186,282 |
Multi-family residential | ||
Aging of recorded investment in past due and non-accrual loans | ||
60-89 Days Past Due | 131 | |
Greater than 90 Days Past Due | 131 | |
Non-accrual | 264 | |
Total Past Due and Non-accrual | 131 | 395 |
Loans Not Past Due | 33,990 | 34,020 |
Non-farm & non-residential | ||
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | 67 | |
Non-accrual | 380 | 380 |
Total Past Due and Non-accrual | 380 | 447 |
Loans Not Past Due | 157,661 | 161,375 |
Agricultural | ||
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | 17 | 7 |
60-89 Days Past Due | 6 | 11 |
Greater than 90 Days Past Due | 32 | |
Non-accrual | 4,371 | |
Total Past Due and Non-accrual | 55 | 4,389 |
Loans Not Past Due | 68,866 | 66,956 |
Consumer | ||
Aging of recorded investment in past due and non-accrual loans | ||
30-59 Days Past Due | 69 | 130 |
60-89 Days Past Due | 19 | 25 |
Greater than 90 Days Past Due | 5 | 1 |
Non-accrual | 15 | 5 |
Total Past Due and Non-accrual | 108 | 161 |
Loans Not Past Due | 16,923 | 16,702 |
Other | ||
Aging of recorded investment in past due and non-accrual loans | ||
Loans Not Past Due | $ 200 | $ 279 |
LOANS (Details 7)
LOANS (Details 7) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($)loan | Jun. 30, 2014loan | Jun. 30, 2015USD ($)loan | Jun. 30, 2014USD ($)loan | Dec. 31, 2014USD ($) | |
LOANS | |||||
Reserves to customers whose loan terms have been modified in troubled debt restructurings | $ 387 | $ 387 | $ 369 | ||
Trouble debt restructuring defaulted on payment | $ 0 | $ 0 | |||
Number of loans modified | loan | 0 | 0 | 0 | 0 |
LOANS (Details 8)
LOANS (Details 8) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Credit Quality Indicators | ||
Loans | $ 546,085 | $ 538,305 |
Pass | ||
Credit Quality Indicators | ||
Loans | 498,045 | 484,879 |
Special Mention | ||
Credit Quality Indicators | ||
Loans | 22,511 | 20,844 |
Substandard | ||
Credit Quality Indicators | ||
Loans | 8,244 | 15,278 |
Doubtful | ||
Credit Quality Indicators | ||
Loans | 56 | 160 |
Commercial | ||
Credit Quality Indicators | ||
Loans | 50,236 | 47,185 |
Commercial | Pass | ||
Credit Quality Indicators | ||
Loans | 48,623 | 45,602 |
Commercial | Special Mention | ||
Credit Quality Indicators | ||
Loans | 1,396 | 1,307 |
Commercial | Substandard | ||
Credit Quality Indicators | ||
Loans | 217 | 275 |
Real estate construction | ||
Credit Quality Indicators | ||
Loans | 21,320 | 16,938 |
Real estate construction | Pass | ||
Credit Quality Indicators | ||
Loans | 19,843 | 15,529 |
Real estate construction | Special Mention | ||
Credit Quality Indicators | ||
Loans | 1,242 | 1,267 |
Real estate construction | Substandard | ||
Credit Quality Indicators | ||
Loans | 235 | 142 |
1-4 family residential | ||
Credit Quality Indicators | ||
Loans | 196,215 | 189,458 |
1-4 family residential | Pass | ||
Credit Quality Indicators | ||
Loans | 183,844 | 176,791 |
1-4 family residential | Special Mention | ||
Credit Quality Indicators | ||
Loans | 6,194 | 5,439 |
1-4 family residential | Substandard | ||
Credit Quality Indicators | ||
Loans | 6,121 | 7,068 |
1-4 family residential | Doubtful | ||
Credit Quality Indicators | ||
Loans | 56 | 160 |
Multi-family residential | ||
Credit Quality Indicators | ||
Loans | 34,121 | 34,415 |
Multi-family residential | Pass | ||
Credit Quality Indicators | ||
Loans | 33,966 | 33,990 |
Multi-family residential | Substandard | ||
Credit Quality Indicators | ||
Loans | 155 | 425 |
Non-farm & non-residential | ||
Credit Quality Indicators | ||
Loans | 158,041 | 161,822 |
Non-farm & non-residential | Pass | ||
Credit Quality Indicators | ||
Loans | 151,237 | 154,857 |
Non-farm & non-residential | Special Mention | ||
Credit Quality Indicators | ||
Loans | 6,074 | 5,178 |
Non-farm & non-residential | Substandard | ||
Credit Quality Indicators | ||
Loans | 732 | 1,787 |
Agricultural | ||
Credit Quality Indicators | ||
Loans | 68,921 | 71,345 |
Agricultural | Pass | ||
Credit Quality Indicators | ||
Loans | 60,532 | 58,110 |
Agricultural | Special Mention | ||
Credit Quality Indicators | ||
Loans | 7,605 | 7,653 |
Agricultural | Substandard | ||
Credit Quality Indicators | ||
Loans | 784 | 5,581 |
Consumer | ||
Credit Quality Indicators | ||
Loans | 17,031 | 16,863 |
Consumer | Non-performing | ||
Credit Quality Indicators | ||
Loans | $ 20 | $ 6 |
Minimum period past due for loans to be considered as non-performing | 90 days |
REAL ESTATE OWNED (Details)
REAL ESTATE OWNED (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Activity in real estate owned | ||||
Beginning of year | $ 4,603 | $ 3,379 | ||
Additions | 3,334 | 419 | ||
Sales | (4,727) | (1,540) | ||
(Additions) subtractions to valuation allowance, net | (385) | (48) | ||
End of period | $ 3,595 | $ 2,306 | 3,595 | 2,306 |
Activity in the valuation allowance | ||||
Beginning of year | 1,583 | 1,524 | ||
Write-downs of other real estate, net | 201 | 10 | 227 | 10 |
Reduction from sale | (612) | (58) | ||
End of period | 1,198 | 1,476 | 1,198 | 1,476 |
Expenses related to foreclosed assets | ||||
Net loss (gain) on sales reported in other income | 20 | (24) | 59 | (70) |
Write-downs of other real estate, net | 201 | 10 | 227 | 10 |
Operating expenses (receipts), net of rental income | 36 | 15 | 55 | 13 |
Repossession expenses, net | 237 | 25 | 282 | 23 |
End of year | $ 257 | $ 1 | $ 341 | $ (47) |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Basic Earnings Per Share | ||||
Net Income | $ 2,122 | $ 1,904 | $ 3,637 | $ 3,675 |
Weighted average common shares outstanding | 2,707 | 2,708 | 2,707 | 2,708 |
Basic earnings per share (in dollars per share) | $ 0.77 | $ 0.70 | $ 1.33 | $ 1.36 |
Diluted Earnings Per Share | ||||
Net income | $ 2,122 | $ 1,904 | $ 3,637 | $ 3,675 |
Weighted average common shares outstanding | 2,707 | 2,708 | 2,707 | 2,708 |
Weighted average common and dilutive potential common shares outstanding | 2,707 | 2,708 | 2,707 | 2,708 |
Diluted earnings per share (in dollars per share) | $ 0.77 | $ 0.70 | $ 1.33 | $ 1.36 |
EARNINGS PER SHARE (Details 2)
EARNINGS PER SHARE (Details 2) - shares | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Stock options | ||
Antidilutive securities | ||
Antidilutive shares excluded from computation of diluted earnings per share | 2,400 | 12,725 |
STOCK COMPENSATION (Details)
STOCK COMPENSATION (Details) - Jun. 30, 2015 - Stock options - shares | Total |
Stock Option Plans | |
Stock Based Compensation | |
Life of awards | 10 years |
1999 Plan | |
Stock Based Compensation | |
Vesting period | 5 years |
Number of shares authorized for issuance | 100,000 |
1993 Non-Employee Directors Stock Ownership Incentive Plan | |
Stock Based Compensation | |
Number of shares authorized for issuance | 20,000 |
STOCK COMPENSATION (Details 2)
STOCK COMPENSATION (Details 2) - Jun. 30, 2015 - Stock Option Plans - USD ($) $ / shares in Units, $ in Thousands | Total |
Shares | |
Outstanding, beginning of year (in shares) | 12,625 |
Forfeited or expired (in shares) | (10,225) |
Outstanding, end of period (in shares) | 2,400 |
Vested and expected to vest (in shares) | 2,400 |
Exercisable, end of period (in shares) | 2,400 |
Weighted Average Exercise Price | |
Outstanding, beginning of year (in dollars per share) | $ 30.46 |
Forfeited or expired (in dollars per share) | 30.48 |
Outstanding, end of period (in dollars per share) | 30.38 |
Vested and expected to vest (in dollars per share) | $ 30.38 |
Weighted Average Remaining Contractual Term | |
Outstanding, end of period | 18 months 15 days |
Vested and expected to vest | 18 months 15 days |
Exercisable, end of period | 18 months 15 days |
Additional disclosures | |
Unrecognized compensation cost related to nonvested stock options granted | $ 0 |
STOCK COMPENSATION (Details 3)
STOCK COMPENSATION (Details 3) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
2005 Restricted Stock Grant Plan | Restricted stock | ||
Stock Based Compensation | ||
Number of shares authorized for issuance | 50,000 | |
Shares available for issuance | 0 | |
Shares | ||
Nonvested at the beginning of the period (in shares) | 17,694 | |
Granted (in shares) | 5,385 | 7,475 |
Vested (in shares) | (5,175) | |
Forfeited (in shares) | 0 | 0 |
Nonvested at the end of the period (in shares) | 17,904 | |
Weighted-Average Grant-Date Fair Value | ||
Nonvested shares, balance at the beginning of the period (in dollars) | $ 365,586 | |
Granted (in dollars) | 147,280 | |
Vested (in dollars) | (101,767) | |
Nonvested shares, balance at the end of the period (in dollars) | $ 411,099 | |
Fair Value Per Share | ||
Nonvested shares, balance at the beginning of the period (in dollars per share) | $ 20.66 | |
Granted (in dollars per share) | 27.35 | |
Vested (in dollars per share) | 19.67 | |
Nonvested shares, balance at the end of the period (in dollars per share) | $ 22.96 | |
Additional disclosures | ||
Total unrecognized compensation cost related to nonvested shares granted | $ 349,393 | |
Period over which cost is expected to be recognized | 3 years 1 month 6 days | |
2009 Stock Award Plan | ||
Stock Based Compensation | ||
Number of shares authorized for issuance | 150,000 | |
Shares available for issuance | 148,635 | |
Shares | ||
Nonvested at the beginning of the period (in shares) | 720 | |
Granted (in shares) | 465 | |
Vested (in shares) | (180) | |
Nonvested at the end of the period (in shares) | 1,005 | |
Weighted-Average Grant-Date Fair Value | ||
Nonvested shares, balance at the beginning of the period (in dollars) | $ 16,704 | |
Granted (in dollars) | 12,718 | |
Vested (in dollars) | (4,176) | |
Nonvested shares, balance at the end of the period (in dollars) | $ 25,246 | |
Fair Value Per Share | ||
Nonvested shares, balance at the beginning of the period (in dollars per share) | $ 23.20 | |
Granted (in dollars per share) | 27.35 | |
Vested (in dollars per share) | 23.20 | |
Nonvested shares, balance at the end of the period (in dollars per share) | $ 25.12 | |
Additional disclosures | ||
Total unrecognized compensation cost related to nonvested shares granted | $ 22,582 | |
2009 Stock Award Plan | Restricted stock | ||
Additional disclosures | ||
Period over which cost is expected to be recognized | 2 years 10 months 24 days |
OTHER BORROWINGS (Details)
OTHER BORROWINGS (Details) - USD ($) $ in Millions | Jul. 20, 2015 | Jun. 30, 2015 | Dec. 31, 2014 |
OTHER BORROWINGS | |||
Borrowings | $ 5 | ||
Fixed interest rate | 5.02% | ||
Revolving promissory note | |||
OTHER BORROWINGS | |||
Maximum borrowing capacity | $ 5 | ||
Outstanding balance | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Fair value on instruments on recurring basis | |||
Securities available for sale | $ 237,476 | $ 246,861 | |
Transfers from Level 1 to Level 2 | 0 | 0 | |
Transfers from Level 2 to Level 1 | 0 | 0 | |
Impaired Loans | |||
Fair value on instruments on recurring basis | |||
Adjustments for differences between the comparable sales and income data available | 14 | $ 387 | |
Other Real Estate Owned | |||
Fair value on instruments on recurring basis | |||
Adjustments for differences between the comparable sales and income data available | 372 | $ 25 | |
Carrying Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 237,476 | 246,861 | |
Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 295 | 296 | |
Significant Other Observable Inputs (Level 2) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 237,181 | 246,565 | |
Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 242,876 | 252,231 | |
Recurring | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 5,695 | 5,666 | |
Recurring | Significant Other Observable Inputs (Level 2) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 237,181 | 246,565 | |
U.S. government agencies | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 55,078 | 60,586 | |
U.S. government agencies | Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 55,078 | 60,586 | |
U.S. government agencies | Recurring | Significant Other Observable Inputs (Level 2) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 55,078 | 60,586 | |
States and political subdivisions | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 88,195 | 89,281 | |
States and political subdivisions | Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 88,195 | 89,281 | |
States and political subdivisions | Recurring | Significant Other Observable Inputs (Level 2) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 88,195 | 89,281 | |
Mortgage-backed - residential | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 93,908 | 96,698 | |
Mortgage-backed - residential | Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 93,908 | 96,698 | |
Mortgage-backed - residential | Recurring | Significant Other Observable Inputs (Level 2) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 93,908 | 96,698 | |
Equity | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 295 | 296 | |
Equity | Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 295 | 296 | |
Equity | Recurring | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 295 | 296 | |
Trading Assets | Recurring | Fair Value | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | 5,400 | 5,370 | |
Trading Assets | Recurring | Quoted Prices In Active Markets for Identical Assets (Level 1) | |||
Fair value on instruments on recurring basis | |||
Securities available for sale | $ 5,400 | $ 5,370 |
FAIR VALUE MEASUREMENTS (Deta46
FAIR VALUE MEASUREMENTS (Details 2) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)loan | Jun. 30, 2014USD ($)loan | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Impaired Loans | ||||||
Valuation allowance of impaired loans | $ 698 | $ 698 | $ 998 | |||
Other real estate owned, net: | ||||||
Outstanding balance of other real estate owned | 3,595 | $ 2,306 | 3,595 | $ 2,306 | 4,603 | $ 3,379 |
Valuation allowance of other real estate owned | 1,198 | 1,476 | 1,198 | $ 1,476 | 1,583 | $ 1,524 |
Loan servicing rights | ||||||
Mortgage servicing rights | 1,261 | 1,261 | 1,209 | |||
Non-recurring | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 270 | 270 | ||||
Valuation allowance of impaired loans | 270 | $ 270 | ||||
Number of impaired loans | loan | 0 | 5 | ||||
Impaired loans, additional provision for loan losses | $ 536 | |||||
Decrease in allowance for specific impaired loans | (101) | 28 | $ (301) | 106 | ||
Other real estate owned, net: | ||||||
Other real estate owned | 2,000 | 2,000 | ||||
Outstanding balance of other real estate owned | 3,200 | 3,200 | ||||
Valuation allowance of other real estate owned | 1,200 | 1,200 | ||||
Write downs of other real estate owned | 201 | 10 | 227 | 10 | ||
Loan servicing rights | ||||||
Mortgage servicing rights | 277 | 277 | 292 | |||
Outstanding balance of loan servicing rights | 322 | 322 | 371 | |||
Valuation allowance of loan servicing rights | 45 | 45 | 79 | |||
Write-downs of loan servicing rights | 20 | $ 17 | 34 | $ 12 | ||
Non-recurring | Carrying Value | ||||||
Loan servicing rights | ||||||
Mortgage servicing rights | 277 | 277 | 292 | |||
Non-recurring | Significant Unobservable Inputs (Level 3) | ||||||
Loan servicing rights | ||||||
Mortgage servicing rights | 277 | 277 | 292 | |||
Non-recurring | Multi-family residential | Carrying Value | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 169 | |||||
Non-recurring | Multi-family residential | Significant Unobservable Inputs (Level 3) | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 169 | |||||
Non-recurring | Non-farm & non-residential | Carrying Value | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 226 | 226 | 366 | |||
Non-recurring | Non-farm & non-residential | Significant Unobservable Inputs (Level 3) | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 226 | 226 | 366 | |||
Non-recurring | Agricultural | Carrying Value | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 44 | 44 | 3,729 | |||
Non-recurring | Agricultural | Significant Unobservable Inputs (Level 3) | ||||||
Impaired Loans | ||||||
Impaired loans, at fair value | 44 | 44 | 3,729 | |||
Non-recurring | Residential | Carrying Value | ||||||
Other real estate owned, net: | ||||||
Other real estate owned | 1,651 | 1,651 | 1,670 | |||
Non-recurring | Residential | Significant Unobservable Inputs (Level 3) | ||||||
Other real estate owned, net: | ||||||
Other real estate owned | 1,651 | 1,651 | $ 1,670 | |||
Non-recurring | Commercial | Carrying Value | ||||||
Other real estate owned, net: | ||||||
Other real estate owned | 347 | 347 | ||||
Non-recurring | Commercial | Significant Unobservable Inputs (Level 3) | ||||||
Other real estate owned, net: | ||||||
Other real estate owned | $ 347 | $ 347 |
FAIR VALUE MEASUREMENTS (Deta47
FAIR VALUE MEASUREMENTS (Details 3) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2015 | Dec. 31, 2014 | |
Fair Value Measurements | ||
Loan servicing rights | $ 1,261 | $ 1,209 |
Non-recurring | ||
Fair Value Measurements | ||
Impaired loans, at fair value | 270 | |
Other real estate owned | 2,000 | |
Loan servicing rights | 277 | 292 |
Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Loan servicing rights | 277 | 292 |
Non-recurring | Discounted cash flow | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Loan servicing rights | $ 277 | $ 292 |
Non-recurring | Minimum | Discounted cash flow | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Discount rates | 12.00% | 12.00% |
Non-recurring | Maximum | Discounted cash flow | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Discount rates | 12.00% | 12.00% |
Non-recurring | Weighted average | Discounted cash flow | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Discount rates | 12.00% | 12.00% |
Multi-family residential | Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 169 | |
Multi-family residential | Non-recurring | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 169 | |
Multi-family residential | Non-recurring | Minimum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 10.00% | |
Multi-family residential | Non-recurring | Maximum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 10.00% | |
Multi-family residential | Non-recurring | Weighted average | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 10.00% | |
Non-farm & non-residential | Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 226 | $ 366 |
Non-farm & non-residential | Non-recurring | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 366 | |
Non-farm & non-residential | Non-recurring | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 226 | |
Non-farm & non-residential | Non-recurring | Minimum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Non-farm & non-residential | Non-recurring | Minimum | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Non-farm & non-residential | Non-recurring | Maximum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Non-farm & non-residential | Non-recurring | Maximum | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Non-farm & non-residential | Non-recurring | Weighted average | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Non-farm & non-residential | Non-recurring | Weighted average | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | |
Agricultural | Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 44 | $ 3,729 |
Agricultural | Non-recurring | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 3,729 | |
Agricultural | Non-recurring | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Impaired loans, at fair value | $ 44 | |
Agricultural | Non-recurring | Minimum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 5.00% | |
Agricultural | Non-recurring | Minimum | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 5.00% | |
Agricultural | Non-recurring | Maximum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 53.00% | |
Agricultural | Non-recurring | Maximum | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 44.00% | |
Agricultural | Non-recurring | Weighted average | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 43.00% | |
Agricultural | Non-recurring | Weighted average | Sales approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 24.00% | |
Residential | Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Other real estate owned | $ 1,651 | $ 1,670 |
Residential | Non-recurring | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Other real estate owned | $ 1,651 | $ 1,670 |
Residential | Non-recurring | Minimum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 0.00% | 0.00% |
Residential | Non-recurring | Minimum | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 8.00% | 8.00% |
Residential | Non-recurring | Maximum | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 28.00% | 48.00% |
Residential | Non-recurring | Maximum | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 8.00% | 10.00% |
Residential | Non-recurring | Weighted average | Sales comparison | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Adjustment for differences between the comparable sales and income data available (as a percent) | 16.00% | 11.00% |
Residential | Non-recurring | Weighted average | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 8.00% | 9.00% |
Commercial | Non-recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Other real estate owned | $ 347 | |
Commercial | Non-recurring | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Other real estate owned | $ 347 | |
Commercial | Non-recurring | Minimum | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 10.00% | |
Commercial | Non-recurring | Maximum | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 10.00% | |
Commercial | Non-recurring | Weighted average | Income approach | Significant Unobservable Inputs (Level 3) | ||
Fair Value Measurements | ||
Capitalization rate (as a percent) | 10.00% |
FAIR VALUE MEASUREMENTS (Deta48
FAIR VALUE MEASUREMENTS (Details 4) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Financial Assets | ||
Interest bearing deposits | $ 1,280 | $ 1,280 |
Securities | 237,476 | 246,861 |
Trading Assets | 5,400 | 5,370 |
Mortgage loans held for sale | 1,719 | 776 |
Interest receivable | 3,661 | 3,299 |
Financial liabilities | ||
Interest payable | 658 | 642 |
Quoted Prices In Active Markets for Identical Assets (Level 1) | ||
Financial Assets | ||
Cash and cash equivalents | 16,348 | 17,169 |
Interest bearing deposits | 1,280 | 1,280 |
Securities | 295 | 296 |
Trading Assets | 5,400 | 5,370 |
Interest receivable | 3 | |
Financial liabilities | ||
Deposits | 461,492 | 470,912 |
Federal Funds Purchased | 2,456 | |
Significant Other Observable Inputs (Level 2) | ||
Financial Assets | ||
Securities | 237,181 | 246,565 |
Mortgage loans held for sale | 1,733 | 782 |
Interest receivable | 1,296 | 1,274 |
Financial liabilities | ||
Deposits | 183,880 | 185,429 |
Securities sold under agreements to repurchase and other borrowings | 13,697 | 12,620 |
FHLB advances | 95,450 | 88,373 |
Interest payable | 648 | 633 |
Significant Unobservable Inputs (Level 3) | ||
Financial Assets | ||
Loans, net | 537,951 | 535,213 |
Interest receivable | 2,362 | 2,025 |
Financial liabilities | ||
Subordinated debentures | 7,204 | 7,209 |
Interest payable | 10 | 9 |
Carrying Value | ||
Financial Assets | ||
Cash and cash equivalents | 16,348 | 17,169 |
Interest bearing deposits | 1,280 | 1,280 |
Securities | 237,476 | 246,861 |
Trading Assets | 5,400 | 5,370 |
Mortgage loans held for sale | 1,719 | 776 |
Loans, net | 540,135 | 532,293 |
FHLB stock | 5,981 | 5,981 |
Interest receivable | 3,661 | 3,299 |
Financial liabilities | ||
Deposits | 644,016 | 654,869 |
Securities sold under agreements to repurchase and other borrowings | 13,690 | 12,457 |
Federal Funds Purchased | 2,456 | |
FHLB advances | 100,417 | 93,785 |
Subordinated debentures | 7,217 | 7,217 |
Interest payable | 658 | 642 |
Fair Value | ||
Financial Assets | ||
Cash and cash equivalents | 16,348 | 17,169 |
Interest bearing deposits | 1,280 | 1,280 |
Securities | 237,476 | 246,861 |
Trading Assets | 5,400 | 5,370 |
Mortgage loans held for sale | 1,733 | 782 |
Loans, net | $ 537,951 | 535,213 |
FHLB stock | ||
Interest receivable | $ 3,661 | 3,299 |
Financial liabilities | ||
Deposits | 645,372 | 656,341 |
Securities sold under agreements to repurchase and other borrowings | 13,697 | 12,620 |
Federal Funds Purchased | 2,456 | |
FHLB advances | 95,450 | 88,373 |
Subordinated debentures | 7,204 | 7,209 |
Interest payable | $ 658 | $ 642 |
CHANGES IN ACCUMULATED OTHER 49
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Changes in accumulated other comprehensive income (loss) by component | ||||
Beginning Balance | $ 1,728 | $ (1,875) | $ 791 | $ (5,126) |
Unrealized holding gains (losses) for the period, net of tax | (2,000) | 1,892 | (1,057) | 5,267 |
Reclassification adjustment for: | ||||
Reclassification of realized amount | (243) | (245) | (251) | (433) |
Income taxes | (83) | (83) | (85) | (147) |
Securities gains realized in income, net | (160) | (162) | (166) | (286) |
Net current period other comprehensive income | (2,160) | 1,730 | (1,223) | 4,981 |
Ending Balance | $ (432) | $ (145) | $ (432) | $ (145) |
CHANGES IN ACCUMULATED OTHER 50
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reclassifications out of AOCI by component | ||||
Securities gains realized in income, net | $ (243) | $ (245) | $ (251) | $ (433) |
Provision for income taxes | 305 | 368 | 306 | 661 |
Net of tax | (2,122) | (1,904) | (3,637) | (3,675) |
Unrealized Gains and Losses on Available for Sale Securities | Amount Reclassified From Accumulated Other Comprehensive Income | ||||
Reclassifications out of AOCI by component | ||||
Securities gains realized in income, net | (243) | (245) | (251) | (433) |
Provision for income taxes | 83 | 83 | 85 | 147 |
Net of tax | $ (160) | $ (162) | $ (166) | $ (286) |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Madison Financial Corporation And Wholly Owned Subsidiary $ in Millions | Jul. 24, 2015USD ($)itemshares | Jun. 30, 2015USD ($) |
Total assets | $ 119 | |
Total loans | 81 | |
Total deposits | $ 95 | |
Subsequent Event | ||
Exchange for each issued and outstanding share of Madison common stock by Kentucky Bancshares | shares | 1.1927 | |
Transaction value | $ 7.2 | |
Number of branch locations merged | item | 3 |
REPURCHASE AGREEMENTS (Details)
REPURCHASE AGREEMENTS (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
REPURCHASE AGREEMENTS | ||
Repurchase agreements and other borrowings | $ 13,690 | $ 12,457 |
Average weighted life | 2 years 6 months | |
Carrying amount of agency-backed securities pledged to secure repurchase agreements | $ 16,600 | |
Overnight obligations | ||
REPURCHASE AGREEMENTS | ||
Repurchase agreements and other borrowings | 7,700 | |
Terms extending through May 2019 | ||
REPURCHASE AGREEMENTS | ||
Repurchase agreements and other borrowings | $ 6,000 |
Uncategorized Items - ktyb-2015
Label | Element | Value |
Gain (Loss) on Sale of Mortgage Loans | us-gaap_GainLossOnSaleOfMortgageLoans | $ 241 |
Gain (Loss) on Sale of Mortgage Loans | us-gaap_GainLossOnSaleOfMortgageLoans | $ 441 |