Highlands Bankshares 10-Q 13 May 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 13, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	HIGHLANDS BANKSHARES INC /VA/
Entity Central Index Key	1,008,579
Document Period End Date	Mar. 31, 2016
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		8,112,562
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q1
Document Type	10-Q
Amendment Flag	false

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
ASSETS
Cash and due from banks	$ 18,298	$ 26,713
Federal funds sold	31,600	20,178
Total Cash and Cash Equivalents	49,898	46,891
Investment securities available for sale (amortized cost $83,129 at March 31, 2016, $80,239 at December 31, 2015)	83,599	79,860
Other investments, at cost	6,611	6,592
Loans, net of allowance for loan losses of $5,825 at March 31, 2016, $5,654 at December 31, 2015	422,327	426,429
Premises and equipment, net	20,435	20,612
Deferred tax assets	11,646	12,126
Interest receivable	1,811	1,761
Bank owned life Insurance	14,021	14,585
Other real estate owned	5,346	5,694
Other assets	2,138	2,432
Total Assets	617,832	616,982
Deposits:
Non-interest bearing	128,122	129,634
Interest bearing	364,975	365,278
Total Deposits	493,097	494,912
Interest, taxes and other liabilities	1,240	761
Other short-term borrowings	20,051	20,052
Long-term debt	47,686	47,698
Total Other Liabilities	68,977	68,511
Total Liabilities	562,074	563,422
STOCKHOLDERS' EQUITY
Common stock (8,113 and 7,851 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively)	5,070	4,907
Preferred Stock (2,092 shares issued and outstanding)	4,184	4,184
Additional paid-in capital	18,891	17,944
Retained earnings	27,303	26,773
Accumulated other comprehensive income	310	(248)
Total Stockholders' Equity	55,758	53,560
Total Liabilities and Stockholders' Equity	$ 617,832	$ 616,982

Consolidated Balance Sheets (U3

Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
ASSETS
Investment securities available for sale, amortization cost	$ 83,129	$ 80,239
Loans, allowance for loan losses	$ 5,825	$ 5,654
STOCKHOLDERS' EQUITY
Common stock, shares issued (in shares)	8,113	7,851
Common stock, shares outstanding (in shares)	8,113	7,851
Preferred stock shares issued	2,092	2,092
Preferred stock shares outstanding	2,092	2,092

Consolidated Statements of Inco

Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
INTEREST INCOME
Loans receivable and fees on loans	$ 5,478	$ 5,298
Securities available for sale:
Taxable	297	313
Exempt from taxable income	78	108
Other investment income	57	52
Federal funds sold	26	21
Total Interest Income	5,936	5,792
INTEREST EXPENSE
Deposits	453	570
Other borrowed funds	592	585
Total Interest Expense	1,045	1,155
Net Interest Income	4,891	4,637
Provision for Loan Losses	224	100
Net Interest Income after Provision for Loan Losses	4,667	4,537
NON-INTEREST INCOME
Securities gains (losses), net	35	16
Service charges on deposit accounts	398	391
Other service charges, commissions and fees	441	335
Other operating income	284	124
Total Non-Interest Income	1,158	866
NON-INTEREST EXPENSE
Salaries and employee benefits	2,919	2,446
Occupancy expense of bank premises	313	309
Furniture and equipment expense	351	340
Other operating expense	1,302	1,317
Foreclosed Assets - Write-down and operating expenses	219	234
Total Non-Interest Expense	5,104	4,646
Income Before Income Taxes	721	757
Income Tax Expense (Note 3)	191	177
Net Income	$ 530	$ 580
Basic Earnings Per Common Share (Note 6)	$ 0.07	$ 0.07
Earnings Per Common Share - Assuming Dilution	0.05	0.06
Dividends Per Share	$ 0	$ 0

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Consolidated Statements Of Comprehensive Income
Net Income	$ 530	$ 580
Other Comprehensive Income
Unrealized gains on securities during the period	880	250
Less: reclassification adjustment for (gains) included in net income	(35)	(16)
Other Comprehensive Income, before tax	845	234
Income tax expense related to other comprehensive income	287	80
Other Comprehensive Income	558	154
Comprehensive Income	$ 1,088	$ 734

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 530	$ 580
Adjustments to reconcile net income to net cash provided by operating activities
Provision for loan losses	224	100
Depreciation and amortization	243	233
Net realized gains on available for sale securities	(35)	(16)
Net amortization on securities	221	249
(Increase) decrease in interest receivable	(50)	1
Valuation adjustment of other real estate owned	166	20
Decrease in other assets	1,010	174
Increase in interest, taxes and other liabilities	479	303
Net cash provided by operating activities	2,788	1,644
Securities available for sale:
Proceeds from sale of securities	11,549	1,025
Proceeds from maturities of debt and equity securities	3,457	3,829
Purchase of debt and equity securities	(18,082)	(6,045)
(Purchases) redemptions of other investments	(19)	168
Net (increase) decrease in loans	3,725	(5,199)
Proceeds from sales of other real estate owned	328	328
Proceeds from cash surrender value of life insurance	93	0
Premises and equipment expenditures	(114)	(86)
Net cash provided by (used in) investing activities	937	(5,983)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net decrease in time deposits	(3,890)	(2,865)
Net increase in demand, savings and other deposits	2,075	7,360
Decrease in short-term borrowings	(1)	(1)
Decrease in long-term debt	(12)	(12)
Issuance of common stock	1,110	0
Net cash provided by (used in) financing activities	(718)	4,482
Net increase in cash and cash equivalents	3,007	143
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	46,891	55,810
CASH AND CASH EQUIVALENTS AT END OF PERIOD	49,898	55,953
Cash paid during the period for:
Interest	1,059	1,165
Income taxes	0	0
SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS
Transfer of loans to other real estate owned	153	2,794
Loans originated from sales of other real estate owned	$ 10	$ 0

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock	Preferred Stock	Additional Paid In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Total
Balance at Dec. 31, 2014	$ 4,907	$ 4,184	$ 18,180	$ 25,436	$ 95	$ 52,802
Balance, Shares at Dec. 31, 2014	7,851	2,092
Net Income				580		580
Other Comprehensive Income					154	154
Additional Paid In Capital			(233)			(233)
Balance at Mar. 31, 2015	$ 4,907	$ 4,184	17,947	26,016	249	53,303
Balance, Shares at Mar. 31, 2015	7,851	2,092
Balance at Dec. 31, 2015	$ 4,907	$ 4,184	17,944	26,773	(248)	53,560
Balance, Shares at Dec. 31, 2015	7,851	2,092
Net Income				530		530
Common Stock Issuance	$ 163		947			1,110
Common Stock Issuance, Shares	262
Other Comprehensive Income					558	558
Balance at Mar. 31, 2016	$ 5,070	$ 4,184	$ 18,891	$ 27,303	$ 310	$ 55,758
Balance, Shares at Mar. 31, 2016	8,113	2,092

1. General

1. General	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
General	The consolidated financial statements of Highlands Bankshares, Inc. (the “Company”) conform to United States generally accepted accounting principles and to banking industry practices. The accompanying consolidated interim financial statements are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the consolidated financial statements have been included. All such adjustments are of a normal and recurring nature. The consolidated balance sheet as of December 31, 2015 has been extracted from the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 (the “2015 Form 10-K”). The notes included herein should be read in conjunction with the notes to consolidated financial statements included in the 2015 Form 10-K. The results of operations for the three-month period ended March 31, 2016, are not necessarily indicative of the results to be expected for the full year. The preparation of financial statements 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.

2. Loans and Allowance for Loan

2. Loans and Allowance for Loan Losses	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Loans and Allowance for Loan Losses	The composition of net loans is as follows: March 31, 2016 December 31, 2015 Real Estate Secured: Residential 1-4 family $ 197,778 $ 194,287 Multifamily 22,884 23,895 Construction and Land Loans 17,793 19,163 Commercial, Owner Occupied 72,072 73,031 Commercial, Non-owner occupied 33,327 38,025 Second mortgages 8,186 8,169 Equity lines of credit 6,280 6,000 Farmland 12,378 11,283 370,698 373,853 Secured (other) and unsecured Personal 20,284 20,775 Commercial 34,693 35,144 Agricultural 3,065 2,959 58,042 58,878 Overdrafts 193 139 428,933 432,870 Less: Allowance for loan losses 5,825 5,654 Net deferred fees 781 787 6,606 6,441 Loans, net $ 422,327 $ 426,429 The following table is an analysis of past due loans as of March 31, 2016 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Financing Receivables Recorded Investment > 90 Days and Accruing Real Estate Secured Residential 1-4 family $ 2,616 $ 437 $ 1,792 $ 4,845 $ 192,933 $ 197,778 $ - Equity lines of credit 4 - 50 54 6,226 6,280 - Multifamily - - - - 22,884 22,884 - Farmland 380 - 246 626 11,752 12,378 - Construction, Land Development, Other Land Loans 250 75 46 371 17,422 17,793 - Commercial Real Estate- Owner Occupied 195 127 6,653 6,975 65,097 72,072 - Commercial Real Estate- Non Owner Occupied - - - - 33,327 33,327 - Second Mortgages 134 - 68 202 7,984 8,186 - Non Real Estate Secured Personal 133 29 114 276 20,201 20,477 - Commercial 381 52 524 957 33,736 34,693 - Agricultural 21 - - 21 3,044 3,065 - Total $ 4,114 $ 720 $ 9,493 $ 14,327 $ 414,606 $ 428,933 $ - The following table is an analysis of past due loans as of December 31, 2015: 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Financing Receivables Recorded Investment > 90 Days and Accruing Real Estate Secured Residential 1-4 family $ 4,193 $ 1,580 $ 2,545 $ 8,318 $ 185,969 $ 194,287 $ - Equity lines of credit 24 - 17 41 5,959 6,000 - Multifamily - - - - 23,895 23,895 - Farmland 56 7 303 366 10,917 11,283 - Construction, Land Development, Other Land Loans 49 61 37 147 19,016 19,163 - Commercial Real Estate- Owner Occupied 514 485 5,014 6,013 67,018 73,031 - Commercial Real Estate- Non Owner Occupied - - - - 38,025 38,025 - Second Mortgages 88 37 5 130 8,039 8,169 - Non Real Estate Secured Personal 264 141 163 568 20,346 20,914 - Commercial 590 217 366 1,173 33,971 35,144 - Agricultural 45 - - 45 2,914 2,959 - Total $ 5,823 $ 2,528 $ 8,450 $ 16,801 $ 416,069 $ 432,870 $ - Loans are considered delinquent when payments have not been made according to the terms of the contract. The accrual of interest on loans is discontinued at the time the loan is 90 days delinquent unless the credit is well-secured and in process of collection. Additionally, in certain instances, loans that have been restructured or modified may also be classified as non-accrual per regulatory guidance until a satisfactory payment history has been established. Credit card loans and other personal loans are typically charged off no later than 180 days past due. In all cases, loans are placed on non-accrual or charged-off at an earlier date if collection of principal or interest is considered doubtful. The following is a summary of non-accrual loans at March 31, 2016 and December 31, 2015: March 31, 2016 December 31, 2015 Real Estate Secured Residential 1-4 Family $ 1,792 $ 2,675 Multifamily - - Construction and Land Loans 46 71 Commercial-Owner Occupied 6,653 5,856 Commercial- Non Owner Occupied - - Second Mortgages 68 5 Equity Lines of Credit 50 17 Farmland 246 303 Secured (other) and Unsecured Personal 114 163 Commercial 524 366 Agricultural - - Total $ 9,493 $ 9,456 The following is a summary of residential real estate currently in the process of foreclosure as well as foreclosed residential real estate as of March 31, 2016. Number 03/31/16 Balance Residential real estate in the process of foreclosure 4 $ 371 Foreclosed residential real estate 8 $ 1,130 The following tables represent a summary of credit quality indicators of the Company’s loan portfolio at March 31, 2016 and December 31, 2015. The grades are assigned and/or modified by the Company’s credit review and credit analysis departments based on the creditworthiness of the borrower and the overall strength of the loan. Credit Risk Profile by Internally Assigned Grade as of March 31, 2016 Grade (1) Residential 1-4 Family Multifamily Farmland Construction, Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate Non-Owner Occupied Quality 25,624 - 24 3,144 2,513 491 Satisfactory 114,859 19,762 7,439 5,955 35,879 15,724 Acceptable 46,160 1,331 3,910 6,337 24,350 12,872 Special Mention 3,277 782 193 388 2,340 2,362 Substandard 7,858 1,009 812 1,969 6,990 1,878 Doubtful - - - - - - Total $ 197,778 $ 22,884 $ 12,378 $ 17,793 $ 72,072 $ 33,327 Credit Risk Profile by Internally Assigned Grade as of December 31, 2015 Grade (1) Residential 1-4 Family Multifamily Farmland Construction, Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate Non-Owner Occupied Quality 25,939 - 25 3,036 2,870 1,481 Satisfactory 109,993 20,271 6,323 7,406 38,926 19,979 Acceptable 46,639 1,811 3,922 6,420 21,671 12,157 Special Mention 3,133 792 195 397 2,552 2,523 Substandard 8,583 1,021 818 1,904 7,012 1,885 Doubtful - - - - - - Total $ 194,287 $ 23,895 $ 11,283 $ 19,163 $ 73,031 $ 38,025 (1) Quality Conformity in all respects with Bank policy, guidelines, underwriting standards, and Federal and State regulations (no exceptions of any kind). Documented historical cash flow that meets or exceeds required minimum Bank guidelines, or that can be supplemented with verifiable cash flow from other sources. Adequate secondary sources to liquidate the debt, including combinations of liquidity, liquidation of collateral, or liquidation value to the net worth of the borrower or guarantor. For existing loans, all of the requirements above apply plus all payments have been made as agreed, current financial information on all borrowers and guarantors has been obtained and analyzed, and overall business operating trends are either stable or improving. Satisfactory- General conformity to the Bank's policy requirements, product guidelines and underwriting standards. Any exceptions that are identified during the underwriting and approval process have been adequately mitigated by other factors. Documented historical cash flow that meets or exceeds required minimum Bank guidelines, or that can be supplemented with verifiable cash flow from other sources. Adequate secondary sources to liquidate the debt, including combinations of liquidity, liquidation of collateral, or liquidation value to the net worth of the borrower or guarantor. For existing loans, all of the requirements outlined above will apply, plus all payments have been made as agreed, current financial information on all borrowers and guarantors has been obtained and analyzed, and overall business operating trends are stable with any declines considered minor and temporary. Acceptable-This grade is given to loans that show signs of weakness in either adequate sources of repayment or collateral, but have demonstrated mitigating factors that minimize the risk of delinquency or loss. Loans assigned this rating may demonstrate some or all of the following characteristics: Additional exceptions to the Bank's policy requirements, product guidelines or underwriting standards that present a higher degree of risk to the Bank. Although the combination and/or severity of identified exceptions is greater, all exceptions have been properly mitigated by other factors. Unproved, insufficient or marginal primary sources of repayment that appear sufficient to service the debt at this time. Repayment weaknesses may be due to minor operational issues, financial trends, or reliance on projected (not historic) performance. Marginal or unproven secondary sources to liquidate the debt, including combinations of liquidation of collateral and liquidation value to the net worth of the borrower or guarantor. For existing loans, payments have generally been made as agreed with only minor and isolated delinquencies. Special Mention Loans with underwriting guideline tolerances and/or exceptions with no identifiable mitigating factors. Extending loans that are currently performing satisfactorily but with potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the Bank's position at some future date. Potential weaknesses are the result of deviations from prudent lending practices. Loans where adverse economic conditions that develop subsequent to the loan origination do not jeopardize liquidation of the debt, but do substantially increase the level of risk may also warrant this rating. Substandard- The weaknesses may include, but are not limited to: · High debt to worth ratios and or declining or negative earnings trends · Declining or inadequate liquidity · Improper loan structure or questionable repayment sources · Lack of well-defined secondary repayment source, and · Unfavorable competitive comparisons. Such loans are no longer considered to be adequately protected due to the borrower's declining net worth, lack of earnings capacity, declining collateral margins and/or unperfected collateral positions. A possibility of loss of a portion of the loan balance cannot be ruled out. The repayment ability of the borrower is marginal or weak and the loan may have exhibited excessive overdue status or extensions and/or renewals. Doubtful However, these loans are not yet rated as loss because certain events may occur which would salvage the debt. Among these events are: · Injection of capital · Alternative financing · Liquidation of assets or the pledging of additional collateral. Credit Risk Profile based on payment activity as of March 31, 2016 Consumer - Non Real Estate Equity Line of Credit / Second Mortgages Commercial - Non Real Estate Agricultural - Non Real Estate Performing $ 20,363 $ 14,348 $ 34,169 $ 3,065 Nonperforming (>90 days past due) 114 118 524 - Total $ 20,477 $ 14,466 $ 34,693 $ 3,065 Credit Risk Profile based on payment activity as of December 31, 2015 Consumer - Non Real Estate Equity Line of Credit /Jr. liens Commercial - Non Real Estate Agricultural - Non Real Estate Performing $ 20,751 $ 14,147 $ 34,778 $ 2,959 Nonperforming (>90 days past due) 163 22 366 - Total $ 20,914 $ 14,169 $ 35,144 $ 2,959 The following tables reflect the Bank’s impaired loans at March 31, 2016: March 31, 2016 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With No Related Allowance Real Estate Secured Residential 1-4 family $ 6,660 $ 6,660 $ - $ 6,869 $ 77 Equity lines of credit 50 50 - 50 - Multifamily 1,009 1,009 - 1,015 13 Farmland 812 812 - 814 8 Construction, Land Development, Other Land Loans 1,550 1,550 - 1,548 23 Commercial Real Estate- Owner Occupied 5,523 5,523 - 5,546 12 Commercial Real Estate- Non Owner Occupied - - - - - Second Mortgages 211 211 - 305 2 Non Real Estate Secured Personal /Consumer 67 67 - 67 1 Commercial 117 117 - 216 1 Agricultural - - - - - Total $ 15,999 $ 15,999 $ - $ 16,430 $ 137 March 31, 2016 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an Allowance Recorded Real Estate Secured Residential 1-4 family $ 1,409 $ 1,409 $ 228 $ 1,628 $ 23 Equity lines of credit - - - - - Multifamily - - - - - Farmland - - - - - Construction, Land Development, Other Land Loans 445 445 21 445 7 Commercial Real Estate- Owner Occupied 2,206 2,206 925 2,163 - Commercial Real Estate- Non Owner Occupied 1,878 1,878 283 1,882 15 Second Mortgages 216 216 59 117 2 Non Real Estate Secured Personal /Consumer 80 80 42 97 - Commercial 849 849 599 760 6 Agricultural - - - - - Total $ 7,083 $ 7,083 $ 2,157 $ 7,092 $ 53 The following tables reflect the Bank’s impaired loans at December 31, 2015: December 31, 2015 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no Related Allowance Real Estate Secured Residential 1-4 family $ 7,078 $ 7,078 $ - $ 7,533 $ 247 Equity lines of credit 51 51 - 38 2 Multifamily 1,021 1,021 - 1,137 60 Farmland 816 816 - 829 38 Construction, Land Development, Other Land Loans 1,547 1,547 - 1,643 92 Commercial Real Estate- Owner Occupied 5,569 5,569 - 7,379 132 Commercial Real Estate- Non Owner Occupied - - - - - Second Mortgages 398 398 - 508 14 Non Real Estate Secured Personal 68 68 - 61 4 Commercial 315 315 - 338 13 Agricultural - - - - - Total $ 16,863 $ 16,863 $ - $ 19,466 $ 602 December 31, 2015 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an Allowance Recorded Real Estate Secured Residential 1-4 family $ 1,846 $ 1,846 $ 249 $ 2,497 $ 93 Equity lines of credit - - - - - Multifamily - - - - - Farmland - - - - - Construction, Land Development, Other Land Loans 446 446 32 406 25 Commercial Real Estate- Owner Occupied 2,119 2,119 799 1,761 9 Commercial Real Estate- Non Owner Occupied 1,885 1,885 290 1,901 56 Second Mortgages 18 18 10 9 1 Non Real Estate Secured Personal 114 114 45 184 4 Commercial 670 670 512 736 28 Agricultural - - - 4 - Total $ 7,098 $ 7,098 $ 1,937 $ 7,498 $ 216 The following tables present the balance in the allowance for loan losses and the recorded investment in loans by loan category and is segregated by impairment evaluation method as of March 31, 2016 and March 31, 2015. Three months ended March 31, 2016 Residential 1-4 Family Multifamily Construction and Land Loans Commercial Owner Occupied Commercial Non-Owner Occupied Second Mortgages Equity Line of Credit Farmland Personal and Overdrafts Commercial and Agricultural Unallocated Total Allowance for Credit Losses: Beginning Balance December 31, 2015 $ 654 $ - $ 37 $ 1,012 $ 748 $ 43 $ 20 $ 7 $ 704 $ 886 $ 1,543 $ 5,654 Provision for Credit Losses (33) - (18) 97 (130) 40 (3) (1) (94) 60 306 224 Charge-offs 27 - - - - - - - 139 23 - 189 Recoveries (1) - (2) - - - (1) - (131) (1) - (136) Net Charge-offs 26 - (2) - - - (1) - 8 22 - 53 Ending Balance March 31, 2016 595 - 21 1,109 618 83 18 6 602 924 1,849 5,825 Ending Balance: Individually evaluated for impairment 228 - 21 925 283 59 - - 42 599 - 2,157 Ending Balance: Collectively Evaluated for Impairment 367 - - 184 335 24 18 6 560 325 1,849 3,668 Loans: Ending Balance: Individually Evaluated for Impairment 8,069 1,009 1,995 7,729 1,878 427 50 812 147 966 - 23,082 Ending Balance: Collectively Evaluated for Impairment 189,709 21,875 15,798 64,343 31,449 7,759 6,230 11,566 20,330 36,792 - 405,851 Ending Balance: March 31, 2016 $197,778 $22,884 $17,793 $72,072 $33,327 $8,186 $6,280 $12,378 $20,477 $37,758 - $428,933 Three months ended March 31, 2015 Residential 1-4 Family Multifamily Construction and Land Loans Commercial Owner Occupied Commercial Non-Owner Occupied Second Mortgages Equity Line of Credit Farmland Personal and Overdrafts Commercial and Agricultural Unallocated Total Allowance for Credit Losses: Beginning Balance December 31, 2014 $ 995 $ 20 $ 87 $ 409 $ 1,063 $ 67 $ 74 $ 12 $ 665 $ 982 $ 1,103 $ 5,477 Provision for Credit Losses 42 (20) (19) 42 (29) 3 (6) 1 31 177 (122) 100 Charge-offs 47 - - 392 - 3 - - 77 64 - 583 Recoveries - - 7 275 - - - - 12 1 - 295 Net Charge-offs 47 - (7) 117 - 3 - - 65 63 - 288 Ending Balance March 31, 2015 990 - 75 334 1,034 67 68 13 631 1,096 981 5,289 Ending Balance: Individually evaluated for impairment 567 - 20 - 320 - - - 144 604 - 1,655 Ending Balance: Collectively Evaluated for Impairment 423 - 55 334 714 67 68 13 487 492 981 3,634 Loans: Ending Balance: Individually Evaluated for Impairment 11,731 1,260 2,123 7,964 1,999 242 74 826 226 1,154 - 27,599 Ending Balance: Collectively Evaluated for Impairment 177,512 19,013 15,302 62,376 30,279 7,632 6,165 8,435 20,550 34,945 - 382,209 Ending Balance: March 31, 2015 $189,243 $20,273 $17,425 $70,340 $32,278 $7,874 $6,239 $9,261 $20,776 $36,099 - $409,808 A loan is considered impaired and an allowance for loan losses is established on loans for which it is probable that the full collection of principal and interest is in doubt. Once a loan is identified as individually impaired, management measures impairment using one of several methods, including collateral value based on recent appraisal and /or tax assessment value, liquidation value and/or discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At March 31, 2016 and December 31, 2015, all of the total impaired loans were evaluated based on the fair value of the collateral. On a quarterly basis, the ALLL methodology begins with the determination of individually impaired loans. All loans that are rated “7” (Doubtful) are assessed as impaired based on the expectation that the full collection of principal and interest is in doubt. All loans that are rated “6” (Substandard) or are expected to be downgraded to “6”, require additional analysis to determine whether they may be impaired. All loans that are rated “5” (Special Mention) are presumed not to be impaired. However, “5” rated loans with the following characteristics warrant further analysis before completing an assessment of impairment: • A loan is 60 days or more delinquent on scheduled principal or interest; • A loan is presently in an unapproved over advanced position; • A loan is newly modified; or, • A loan is expected to be modified. The Company’s credit administration personnel and senior financial officers are responsible for tracking, coding, and monitoring loans that become Troubled Debt Restructurings (“TDRs”). Concessions are made to existing borrowers in the form of modified interest rates and / or payment terms. The loans are segregated for regulatory and external reporting. Each specific TDR is reviewed to determine if the accrual of interest should be discontinued and also reviewed for impairment. The Company’s senior credit administration officer performs this analysis on a quarterly basis in addition to determining any other loans that are impaired within the loan portfolio. The Company had a total of $9,826 and $12,060 of loans categorized as troubled debt restructurings as of March 31, 2016 and December 31, 2015, respectively. Interest is accrued on TDRs if the loan is otherwise not impaired and the full collection of principal and interest under the modified terms is still deemed probable. In the determination of the allowance for loan losses, management considers troubled debt restructurings and subsequent defaults in these restructurings by adjusting the loan grades of such loans. Defaults resulting in charge-offs affect the historical loss experience ratios which are a component of the allowance calculation. Additionally, specific reserves may be established on restructured loans evaluated individually. The following tables summarize the troubled debt restructurings during the three months ended March 31, 2016 and 2015. Troubled Debt Restructurings –Three months ended March 31, 2016 Interest only Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland 1 57 57 Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 1 92 92 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 149 149 Troubled Debt Restructurings Below Market Rate Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family 1 848 848 Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 1 848 848 Troubled Debt Restructurings Loan term extension Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Business Commercial Agricultural Total Troubled Debt Restructurings All Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Total Restructurings 3 997 997 Troubled Debt Restructurings That Subsequently Defaulted Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total - - - Troubled Debt Restructurings –Three months ended March 31, 2015 Interest only Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 2 2,203 2,203 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 2,203 2,203 Troubled Debt Restructurings Below Market Rate Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family 1 863 863 Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 1 1,547 1,547 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 2,410 2,410 Troubled Debt Restructurings Loan term extension Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Business Commercial Agricultural Total Troubled Debt Restructurings All Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Total Restructurings 4 4,613 4,613 Troubled Debt Restructurings That Subsequently Defaulted Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total The loan review function performs various tasks that are utilized to discover weaknesses within the loan portfolio. These include annual reviews on loan relationships that are greater than $500. The relationship review includes a discussion on the collateral, repayment history, guarantor(s) financial position, and debt service coverage on an individual and global level. These reviews are based primarily upon federal tax returns for cash flow determination, internally prepared interim statements and personal financial statements. Debt service coverage (DSC) is calculated on each individual customer, or guarantor, as well as the aggregate or global DSC. The DSC is discounted to determine a “stressed” DSC. Collateral evaluation includes an inspection of the collateral file to determine if the Bank is indeed properly securitized. Collateral is discounted, when appropriate, to determine a “stressed” loan to value (LTV) ratio. In addition to annual loan relationship reviews, quarterly reviews on all loan relationships over $100 that are graded Substandard, Doubtful and Loss are also completed. This quarterly review process is comprised of a shortened version of the full relationship review. These quarterly reviews include a discussion on personal credit management, DSC and LTV. In addition to these quarterly reviews of non-pass watch list relationships, a semi-annual review is conducted on all Special Mention loan relationships that are on the watch list. These reviews are prepared in the same manner as the quarterly non-pass relationship reviews. The appropriateness of the risk rating of each relationship is assessed, with changes to the risk rating being made by the Senior Credit Review Officer, when deemed appropriate. Other measures taken to determine potential problem relationships include the monthly preparation of the watch list. During that process, past due loan reports are reviewed, as well as any other information that might be presented by loan officers, regarding a particular loan relationship that is exhibiting stress. To be considered as a watch list relationship, distinct characteristics must be exhibited. These include, but are not limited to late payments greater than 60 days, a low DSC calculation, bankruptcy filings, casualty losses, or other issues that would cause a perceived increase in the risk of loss to the Bank. The final segment of the loan review process involves special reviews. These reviews target specific segments of the loan portfolio, i.e. credit cards, equity lines, consumer loans, construction loans, and other specific segments of the loan portfolio that management wishes to have reviewed. However, currently, the primary emphasis of the loan review function is loan relationship review work, and watch list management. The segments of the Company’s loan portfolio are disaggregated to a level that allows management to monitor risk and performance. In reviewing risk, management has determined there to be several different risk categories within the loan portfolio. The allowance for loan losses consists of amounts applicable to: (i) the commercial loan portfolio; (ii) the commercial real estate loan portfolio; (iii) the construction loan portfolio; (iv) the consumer loan portfolio; and, (v) the residential loan portfolio. The commercial real estate (“CRE”) loan segment is further disaggregated into two classes. Non-owner occupied CRE loans, which include loans secured by non-owner occupied nonfarm nonresidential properties, generally have a greater risk profile than all other CRE loans, which include multifamily structures and owner-occupied commercial structures. The construction loan segment is further disaggregated into two classes. One-to-four family residential construction loans are generally made to individuals for the acquisition of and/or construction on a lot or lots on which a residential dwelling is to be built. Commercial construction loans are generally made to developers or investors for the purpose of acquiring, developing and constructing residential or commercial structures. Construction lending is generally considered to involve a higher degree of credit risk than long-term permanent financing. The following describes the Company’s basic methodology for computing its ALLL. On a quarterly basis, the ALLL methodology begins with the identification of loans subject to ASC 310. All loans that are rated “7” (Doubtful) are assessed as impaired based on the expectation that the full collection of principal and interest is in doubt. All loans that are rated “6” (Substandard) or are expected to be downgraded to “6”, require additional analysis to determine whether they may be impaired under ASC 310. All loans that are rated “5” (Special Mention) are presumed not to be impaired. However, “5” rated loans, together with any Troubled Debt Restructured (TDR) loan, may warrant further analysis before completing an assessment of impairment. For ASC 310 loans that are individually evaluated and found to be impaired (primarily those designated as Substandard and Doubtful), the associated ALLL will be based upon one of the three impairment measurement methods specified within ASC 310: (1) Present value of expected future cash flows discounted at the loan’s effective interest rate; (2) Loan’s observable market price; or (3) Fair value of the collateral. To determine the amount of loan loss exposure for the impaired ASC 310 loans, the value of collateral for secured loans is evaluated to determine the current value and potential exposure. The collateral value is adjusted for its age and condition, and, for real estate, adjusted for condition, location, and age of the most current appraisal. If the adjusted value of the collateral is less than the current principal balance, the difference is designated as direct exposure for loan loss calculations. The total balance of unsecured loans is considered as direct exposure. ASC 450 Loan Loss For all other loans, including individual loans determined not to be impaired under ASC 310, the associated ALLL is calculated in accordance with ASC 450 that provides for estimated credit losses likely to be realized on groups of loans with similar risk characteristics. The Company uses standard call report categories to segregate loans into groups with similar risk characteristics. Estimated credit losses reflect significant factors that affect the collectability of the portfolio as of the evaluation date. Key factors that influence risk within the Company’s loan portfolio are divided into three major categories: (1) Historical Loss Factor: To calculate the anticipated loan loss in each call report category for ASC 450 loans, the Company begins with the net loss in each category for each of the last twelve quarters. The Company uses a rolling twelve quarter weighted historical loss average where the most recent quarters are weighted heavier than the earlier quarters so that the calculation reflects current risk trends within the portfolio. The weighting used by the Company is similar to the Rule of 78’s with the net losses of the most recent quarter weighted at 12/78ths and those in the first quarter in the twelve quarter period weighted at 1/78 th . (2) External economic factors: Economic conditions have a significant impact on Company’s loan portfolio because deteriorating conditions can adversely impact both collateral values and the customer’s ability to service debt. Management has selected the following external factors as indicators of economic conditions: a. National GDP Growth Rate b. Local Unemployment Rates c. The Prime Rate The values for external factors are updated on a quarterly basis based on current economic data. (3) Internal process factors: Internal factors that influence loss rates as a result of risk management and control practices include the following: d. Past-Due Loans e. Non-Accrual Loans f. CRE Concentrations g. Loan Volume Level h. Level and Trend of Classified Loans The values for internal factors are updated on a quarterly basis based on current portfolio metrics. Once the quarterly ALLL is computed, the calculations are reviewed by the Company’s credit administration committee which is comprised of the CEO, CFO, and Senior Lending Officers, including Credit Review personnel. The Company’s controller also performs a detailed review of the computations, estimates, etc. included in the ALLL calculation. The ALLL is then reviewed and approved by the Board of Directors.

3. Income Taxes

3. Income Taxes	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Income Taxes	Income tax expense for the three months ended March 31 is different than the amount computed by applying the statutory corporate federal income tax rate of 34% to income before taxes. The reasons for these differences are as follows: 2016 2015 Tax expense at statutory rate $ 245 $ 257 Reduction in taxes from: Tax-exempt interest (26) (37) Other, net (28) (43) Income tax expense $ 191 $ 177

4. Capital Requirements

4. Capital Requirements	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Capital Requirements	Regulators of the Company and its subsidiary, Highlands Union Bank (the “Bank”), have implemented risk-based capital guidelines which require compliance with certain minimum capital ratios as a percent of assets and other certain off-balance sheet items that are adjusted for predefined credit risk factors. On July 7, 2013 the Federal Reserve Board approved Basel III Final Rules to begin implementation January 1, 2015. The desired overall objective of Basel III is to improve the banking sector’s ability to absorb shocks arising from financial and economic stress. The Final Rule includes a new Common Equity Tier 1 (CET1) minimum ratio and raises the Tier 1 Risk Weighted Assets ratio to 6% from 4%. In addition, the new rules require a bank to maintain a capital conservation buffer of between 2 and 2 ½ % beginning in 2016. Additionally, the new rules increase the risk weighting of various assets. The new rules will be phased in beginning in 2015 with complete compliance required by 2019. Generally, the Basel III Final Rule will require banks to maintain higher levels of common equity and regulatory capital. On December 18, 2014, the President of the United States signed into law Public Law 113-250 (the “Act”), which directs the Board of Governors of the Federal Reserve System (Board) to propose revisions to the Small Bank Holding Company Policy Statement (Policy Statement) to raise the total consolidated asset limit in the Policy Statement from $500 million to $1 billion. On February 5, 2015 the Company received notification from the Federal Reserve Bank that it would no longer be required to report holding company consolidated capital ratios. The following tables present the capital ratios for the Bank only. March 31, 2016 Entity Tier 1 Total Risk Based Leverage CET 1 Highlands Union Bank 11.84% 13.11% 7.60% 11.84% December 31, 2015 Entity Tier 1 Total Risk Based Leverage CET 1 Highlands Union Bank 11.28% 12.55% 7.33% 11.28%

5. Private Placement Capital Ra

5. Private Placement Capital Raise / Rights Offering	3 Months Ended
	Mar. 31, 2016
Private Placement Capital Raise Rights Offering
Private Placement Capital Raise / Rights Offering	On April 16, 2014, management and board of directors of Highlands Bankshares, Inc. announced the completion of a $16,525 private placement capital raise. Purchasers in the private placement included outside investors, as well as certain directors and executive officers of the Company. The Company sold 2,673,249 newly issued shares of the Company’s common stock at $3.50 per share, and 2,048,179 shares of Series-A convertible perpetual preferred stock at $3.50 per share. The private placement was disclosed on Form 8-K on April 16, 2014. The Company immediately paid off a Holding Company Loan in the amount of $3,440 to Community Bankers Bank on April 16, 2014 with the funds received from the capital raise. The Company also paid off the remaining $3,150 of its trust preferred securities including accrued interest. The payoff totaling $4,802 was completed on July 15, 2014. The Company down-streamed to the subsidiary Bank in June 2014 $7,500 of funds received from the capital raise. During the third quarter of 2014, the Company also conducted a rights offering to its existing shareholders other than directors and executive officers. The Company raised a total of $556 as a result of the offering. The Company immediately down-streamed $400 of the $556 to the Bank in September of 2014. In October 2014, one of the private placement purchasers, TNH Financial Fund, LP, purchased another $183 of common and preferred stock which allowed them to maintain the same ownership percentage that was held immediately prior to the rights offering. Net proceeds received from the private placement issues and rights offering totaled $16,123. In January of 2016, the Company’s CEO, Timothy K. Schools purchased 235,294 shares of the Company’s common stock at a price of $4.25 per share in a private placement as disclosed on Form 4 on January 12, 2016. In February 2016, two of the private placement purchasers participating in the capital raise in 2014, MFP Partners LP and Deerhill Pond Investment Partners, LP, each purchased another 12,744 shares of common stock at $4.25 per share which allowed them to maintain the same ownership percentage that was held immediately prior to the Mr. Schools’ purchase. The company down-streamed $1,150 to the Bank.

6. Stock and Earnings Per Share

6. Stock and Earnings Per Share	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Stock and Earnings Per Share	Earnings per common share is computed using the weighted average outstanding shares for the three months ended March 31, 2015 and 2016. During 2014, the Company issued a total of 2,092,287 shares of Series A preferred stock (See Note 5). These preferred shares are non-voting mandatorily convertible non-cumulative preferred shares which are entitled to receive dividends equal to dividends paid on the Company’s common shares. The Series A preferred shares will rank pari passu with the common stock with respect to all terms (other than voting), including, the payment of dividends or distributions, and payments and rights upon liquidation and dissolution. The following is a reconciliation of the numerators and the denominators of the basic and diluted earnings per common share computation: For the three months ended March 31 2016 2015 Income available to common stockholders $ 530 $ 580 Weighted average shares outstanding 8,089 7,851 Shares outstanding including assumed conversion 10,205 9,943 Basic earnings per common share $ 0.07 $ 0.07 Fully diluted earnings per share (including convertible preferred shares oustanding) $ 0.05 $ 0.06

7. Commitments and Contingencie

7. Commitments and Contingencies	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Commitments and Contingencies	The Bank is a party to various financial instruments with off-balance sheet risk arising in the normal course of business to meet the financing needs of its customers. Those financial instruments include commitments to extend credit and standby letters of credit. At March 31, 2016, these commitments included: standby letters of credit of $255; equity lines of credit of $7,818; credit card lines of credit of $6,561; commercial real estate, construction and land development commitments of $3,051; and other unused commitments to fund interest earning assets of $27,13888.

8. Fair Value

8. Fair Value	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Fair Value	The Company utilizes fair value measurements to record fair value adjustments to certain assets and to determine fair value disclosures. Securities available-for-sale are recorded at fair value on a recurring basis. Additionally, from time to time, the Company may be required to record at fair value other assets on a nonrecurring basis. These nonrecurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets. Fair Value Hierarchy Under ASC Topic 820 on Fair Value Measurements and Disclosures, the Company groups assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are: Level 1 Valuation is based upon quoted prices for identical instruments traded in active markets. Level 2 Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level 3 Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques. In general, fair value is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon third party models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality, the Company’s creditworthiness, among other things, as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. The Company’s valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While management believes the Company’s valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Recurring - Investment Securities Available for Sale Securities classified as available for sale are reported at fair value utilizing Level 2. For Level 2 securities, the Company obtains fair value measurements from multiple independent third party sources. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information, and the bond’s terms and conditions, among other things. The following tables summarize the Company’s available for sale securities portfolio measured at fair value on a recurring basis as of March 31, 2016 and December 31, 2015, segregated by the level of the valuation inputs within the fair value hierarchy. March 31, 2016 Level 1 Level 2 Level 3 Total Fair Value Available for Sale Securities State and Political Subdivisions $ - $ 7,011 $ - $ 7,011 Mortgage Backed Securities $ - $ 66,549 $ - $ 66,549 SBA Pools $ - $ 10,039 $ - $ 10,039 Total AFS Securities $ - $ 83,599 $ - $ 83,599 December 31, 2015 Level 1 Level 2 Level 3 Total Fair Value Available for Sale Securities State and Political Subdivisions $ - $ 6,958 $ - $ 6,958 Mortgage Backed Securities $ - $ 62,593 $ - $ 62,593 SBA Pools $ - $ 10,309 $ - $ 10,309 Total AFS Securities $ - $ 79,860 $ - $ 79,860 Non Recurring - Loans The Company does not record loans at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment using one of several methods, including recently appraised collateral value and /or tax assessed value, liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At March 31, 2016 and December 31, 2015, all of the total impaired loans were evaluated based on the fair value of the collateral. The Company frequently obtains appraisals prepared by external professional appraisers and applies discounts ranging from 8% to 40% depending on type of property, condition, location, etc. The Company also, in certain instances, prepares internally generated valuations from on-site inspections, third-party valuation models or other information. Non Recurring -Foreclosed Assets / Repossessions Foreclosed assets and repossessions are adjusted to fair value upon transfer of the loans to foreclosed assets and repossessions. Subsequently, foreclosed assets and repossessions are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices or recent appraised values of the collateral, which the Company considers to be nonrecurring Level 2. When the current appraised value is not available and /or further discounted below the most recent appraised value less selling costs due to such things as absorption rates and market conditions, the Company classifies the foreclosed assets within Level 3 of the fair value hierarchy. The following table summarizes the Company’s assets at fair value on a non - recurring basis as of March 31, 2016 and December 31, 2015 segregated by the level of the valuation inputs within the fair value hierarchy. The tables disclose the recorded investment of impaired loans requiring a specific allowance. March 31, 2016 Level 1 Level 2 Level 3 Total Fair Value Impaired Loans $ - $ - $ 7,083 $ 7,083 Repossessions/OREO, net $ - $ - $ 5,359 $ 5,359 December 31, 2015 Level 1 Level 2 Level 3 Total Fair Value Impaired Loans $ - $ - $ 7,098 $ 7,098 Repossessions/OREO, net $ - $ - $ 5,724 $ 5,724 The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis for which the Company uses Level 3 inputs to determine fair value (dollars in thousands): Quantitative Information about Level 3 Fair Value Measurements March 31, December 31, Valuation Unobservable Range 2016 2015 Techniques Input (2) (Weighted Average) OREO,Repossessions $ 5,359 $ 5,724 Appraisal of collateral (1) Appraisal adjustments 0% to 45% (13%) Liquidation expenses 0% to 10% (9%) Impaired loans $ 7,083 $ 7,098 Fair value of collateral –real estate (1), (3) Appraisal adjustments 0% to 10% (9%) Fair value of collateral –equipment, inventory, other (1), (3) Appraisal adjustments 25% to 50% (33%) Liquidation expenses 0% to 10% (9%) Valuation adjustments and liquidation cost adjustments represent unobservable inputs for OREO and impaired loans. The ranges of discounts applied are based on age of independent appraisals, type and condition of collateral, current market conditions, and experience with the local market. (1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are not identifiable. (2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percent of the appraisal. (3) Includes qualitative adjustments by management. General The Company has no liabilities carried at fair value or measured at fair value on a recurring or non-recurring basis. Fair Value of Financial Instruments Fair value is 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. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company. Cash and Cash Equivalents The carrying amount reported in the balance sheets for cash, short-term investments and federal funds sold approximates fair value. Securities Available for Sale Fair values are determined in the manner as described above. Other Investments Other investments include Federal Home Loan Bank stock, Federal Reserve Bank stock, Community Bankers Bank stock, and Pacific Coast Bankers Bank. The carrying value of those securities approximates fair value based on the redemption provisions of those Banks. Also included in other investments are certificates of deposit purchased from other FDIC insured banks in which the carrying amount approximates fair value. Loans The fair value of loans represent the amount at which the loans of the Bank could be exchanged on the open market, based upon the current lending rate for similar types of lending arrangements discounted over the remaining life of the loans. For fixed rate loans and for variable rate loans with infrequent re-pricing or re-pricing limits, fair value is based on discounted cash flows using current market rates applied to the cash flow analysis. Deposits The fair value of time deposits is based on discounted cash flows using current market rates applied to the cash flow analysis for each time deposit. Other non-maturity deposits are reported at their carrying values. Other Short-Term Borrowings Fair values of other short-term borrowings are estimated using discounted cash flow analyses based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. Estimated maturity dates are also included in the calculation of fair value for these borrowings. Long-term Debt and Capital Securities Rates currently available to the Company for debt with similar terms and remaining maturities or established call prices are used to estimate fair value of existing debt. Off-Balance Sheet Instruments The amount of off-balance sheet commitments to extend credit, standby letters of credit, and financial guarantees, is considered equal to fair value. Because of the uncertainty involved in attempting to assess the likelihood and timing of commitments being drawn upon, coupled with the lack of an established market and the wide diversity of fee structures, the Company does not believe it is meaningful to provide an estimate of fair value that differs from the given value of the commitment. The carrying amounts and fair values of the Company's financial instruments at March 31, 2016 and December 31, 2015 were as follows: March 31, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value Cash and cash equivalents $ 49,898 $ 49,898 $ 46,891 $ 46,891 Securities available for sale 83,599 83,599 79,860 79,860 Other investments 6,611 6,611 6,592 6,592 Loans, net 422,327 415,371 426,429 419,907 Deposits (493,097) (477,851) (494,912) (472,197) Other short-term borrowings (20,051) (20,898) (20,052) (21,970) Long-term debt (47,686) (50,575) (47,698) (50,313)

9. Investment Securities Availa

9. Investment Securities Available For Sale	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Investment Securities Available For Sale	The amortized cost and market value of securities available for sale are as follows: March 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value State and political subdivisions $ 6,900 $ 111 $ - $ 7,011 Mortgage backed securities 66,193 441 85 66,549 SBA Pools 10,036 21 18 10,039 $ 83,129 $ 573 $ 103 $ 83,599 December 31, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value State and political subdivisions $ 6,834 $ 124 $ - $ 6,958 Mortgage backed securities 62,911 160 478 62,593 SBA Pools 10,494 9 194 10,309 $ 80,239 $ 293 $ 672 $ 79,860 Investment securities available for sale with a carrying value of $36,105 and $31,422 at March 31, 2016 and December 31, 2015, respectively, and a market value of $36,278 and $31,355 at March 31, 2016 and December 31, 2015, respectively, were pledged as collateral on public deposits, FHLB advances and for other purposes as required or permitted by law. The following table presents the age of gross unrealized losses and fair value by investment category: March 31, 2016 Less Than 12 months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses State and political subdivisions $ - $ - $ - $ - $ - $ - Mortgage-backed securities 2,601 12 9,427 73 12,028 85 SBA Pools 130 2 4,672 16 4,802 18 Total $ 2,731 $ 14 $ 14,099 $ 89 $16,830 $ 103 December 31, 2015 Less Than 12 months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses State and political subdivisions $ - $ - $ - $ - $ - $ - Mortgage-backed securities 45,790 363 4,589 115 50,379 478 SBA Pools 157 3 9,110 191 9,267 194 Total $ 45,947 $ 366 $ 13,699 $ 306 $59,646 $ 672 The Company assesses its securities for OTTI quarterly by reviewing credit ratings, financial and regulatory reports as well as other pertinent published financial data. As of March 31, 2016 and December 31, 2015, the Company's assessment revealed no impairment other than that deemed temporary on those securities. The amortized cost and estimated fair value of securities available for sale at March 31, 2016 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Amortized Cost Approximate Market Value Due in one year or less $ 1,060 $ 1,066 Due after one year through five years 2,932 2,997 Due after five years through ten years 6 6 Due after ten years 12,938 12,981 16,936 17,050 Mortgage-backed securities 66,193 66,549 $ 83,129 $ 83,599

10. Formal Written Agreement

10. Formal Written Agreement	3 Months Ended
	Mar. 31, 2016
Formal Written Agreement
Formal Written Agreement	On October 13, 2010, the Company and Bank entered into a written agreement (“Written Agreement”) with the Federal Reserve Bank of Richmond (the “Reserve Bank”). Under the terms of the Written Agreement, the Bank has agreed to develop and submit to the Reserve Bank for approval within the time periods specified therein written plans or programs to: · strengthen board oversight of the management and operations of the Bank; · strengthen credit risk management and administration; · provide for the effective grading of the Bank’s loan portfolio; · summarize the findings of its review of the adequacy of the staffing of its loan review function; · improve the Bank’s position with respect to loans, relationships, or other assets in excess of $500,000 that currently are, or in the future become past due more than 90 days, on the Bank’s problem loan list, or adversely classified in any report of examination of the Bank; · review and revise the Bank’s methodology for determining the allowance for loan and lease losses (“ALLL”) and maintain an adequate ALLL; · maintain sufficient capital at the Company and the Bank; · establish a revised written contingency funding plan; · establish a revised written strategic and capital plan; · establish a revised investment policy; · improve the Bank’s earnings and overall condition; · revise the Bank’s information technology program; · establish a disaster recovery and business continuity program; and, · establish a committee to monitor compliance with all aspects of the written agreement. Further, both the Company and the Bank have agreed to refrain from declaring or paying dividends without prior regulatory approval. The Company has agreed that it will not take any other form of payment representing a reduction in Bank’s capital or make any distributions of interest, principal or other sums on subordinated debentures or trust preferred securities without prior regulatory approval. The Company also has agreed not to incur, increase or guarantee any debt or not to purchase or redeem any shares of its stock without prior regulatory approval.

11. Summary of Significant Acco

11. Summary of Significant Accounting Policy Update For Certain Required Disclosures	3 Months Ended
	Mar. 31, 2016
NotesToFinancialStatementsAbstract
Summary of Significant Accounting Policy Update For Certain Required Disclosures	In January 2016, the FASB issued ASU No. 2016-01 Financial Instruments—Overall (Subtopic 825-10). The amendments address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The amendments will be effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of these amendments on its financial statements. In February 2016, the FASB issued ASU No. 2016-02 Leases (Topic 842). This amended the Leases topic of the Accounting Standards Codification to revise certain aspects of recognition, measurement, presentation, and disclosure of leasing transactions. The amendments will be effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the effect that implementation of the new standard will have on its financial position, results of operations, and cash flows. Other accounting standards have been issued by the FASB that are not currently applicable to the Company or are not expected to have a material impact on the Company’s financial statements

11. Summary of Significant Ac19

11. Summary of Significant Accounting Policy Update For Certain Required Disclosures (Policies)	3 Months Ended
	Mar. 31, 2016
Summary Of Significant Accounting Policy Update For Certain Required Disclosures Policies
Recently Issued Accounting Pronouncements	In January 2016, the FASB issued ASU No. 2016-01 Financial Instruments—Overall (Subtopic 825-10). The amendments address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The amendments will be effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of these amendments on its financial statements. In February 2016, the FASB issued ASU No. 2016-02 Leases (Topic 842). This amended the Leases topic of the Accounting Standards Codification to revise certain aspects of recognition, measurement, presentation, and disclosure of leasing transactions. The amendments will be effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the effect that implementation of the new standard will have on its financial position, results of operations, and cash flows. Other accounting standards have been issued by the FASB that are not currently applicable to the Company or are not expected to have a material impact on the Company’s financial statements

2. Loans and Allowance for Lo20

2. Loans and Allowance for Loan Losses (Tables)	3 Months Ended
	Mar. 31, 2016
DisclosureLoansAndAllowanceForLoanLossesTablesAbstract
Composition of net loans	March 31, 2016 December 31, 2015 Real Estate Secured: Residential 1-4 family $ 197,778 $ 194,287 Multifamily 22,884 23,895 Construction and Land Loans 17,793 19,163 Commercial, Owner Occupied 72,072 73,031 Commercial, Non-owner occupied 33,327 38,025 Second mortgages 8,186 8,169 Equity lines of credit 6,280 6,000 Farmland 12,378 11,283 370,698 373,853 Secured (other) and unsecured Personal 20,284 20,775 Commercial 34,693 35,144 Agricultural 3,065 2,959 58,042 58,878 Overdrafts 193 139 428,933 432,870 Less: Allowance for loan losses 5,825 5,654 Net deferred fees 781 787 6,606 6,441 Loans, net $ 422,327 $ 426,429
Analysis of past due loans	The following table is an analysis of past due loans as of March 31, 2016 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Financing Receivables Recorded Investment > 90 Days and Accruing Real Estate Secured Residential 1-4 family $ 2,616 $ 437 $ 1,792 $ 4,845 $ 192,933 $ 197,778 $ - Equity lines of credit 4 - 50 54 6,226 6,280 - Multifamily - - - - 22,884 22,884 - Farmland 380 - 246 626 11,752 12,378 - Construction, Land Development, Other Land Loans 250 75 46 371 17,422 17,793 - Commercial Real Estate- Owner Occupied 195 127 6,653 6,975 65,097 72,072 - Commercial Real Estate- Non Owner Occupied - - - - 33,327 33,327 - Second Mortgages 134 - 68 202 7,984 8,186 - Non Real Estate Secured Personal 133 29 114 276 20,201 20,477 - Commercial 381 52 524 957 33,736 34,693 - Agricultural 21 - - 21 3,044 3,065 - Total $ 4,114 $ 720 $ 9,493 $ 14,327 $ 414,606 $ 428,933 $ - The following table is an analysis of past due loans as of December 31, 2015: 30-59 Days Past Due 60-89 Days Past Due Greater Than 90 Days Total Past Due Current Total Financing Receivables Recorded Investment > 90 Days and Accruing Real Estate Secured Residential 1-4 family $ 4,193 $ 1,580 $ 2,545 $ 8,318 $ 185,969 $ 194,287 $ - Equity lines of credit 24 - 17 41 5,959 6,000 - Multifamily - - - - 23,895 23,895 - Farmland 56 7 303 366 10,917 11,283 - Construction, Land Development, Other Land Loans 49 61 37 147 19,016 19,163 - Commercial Real Estate- Owner Occupied 514 485 5,014 6,013 67,018 73,031 - Commercial Real Estate- Non Owner Occupied - - - - 38,025 38,025 - Second Mortgages 88 37 5 130 8,039 8,169 - Non Real Estate Secured Personal 264 141 163 568 20,346 20,914 - Commercial 590 217 366 1,173 33,971 35,144 - Agricultural 45 - - 45 2,914 2,959 - Total $ 5,823 $ 2,528 $ 8,450 $ 16,801 $ 416,069 $ 432,870 $ -
Schedule of non-accrual loans	March 31, 2016 December 31, 2015 Real Estate Secured Residential 1-4 Family $ 1,792 $ 2,675 Multifamily - - Construction and Land Loans 46 71 Commercial-Owner Occupied 6,653 5,856 Commercial- Non Owner Occupied - - Second Mortgages 68 5 Equity Lines of Credit 50 17 Farmland 246 303 Secured (other) and Unsecured Personal 114 163 Commercial 524 366 Agricultural - - Total $ 9,493 $ 9,456
Residential real estate current	Number 03/31/16 Balance Residential real estate in the process of foreclosure 4 $ 371 Foreclosed residential real estate 8 $ 1,130
Credit Risk Profile by Internally Assigned Grade	Credit Risk Profile by Internally Assigned Grade as of March 31, 2016 Grade (1) Residential 1-4 Family Multifamily Farmland Construction, Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate Non-Owner Occupied Quality 25,624 - 24 3,144 2,513 491 Satisfactory 114,859 19,762 7,439 5,955 35,879 15,724 Acceptable 46,160 1,331 3,910 6,337 24,350 12,872 Special Mention 3,277 782 193 388 2,340 2,362 Substandard 7,858 1,009 812 1,969 6,990 1,878 Doubtful - - - - - - Total $ 197,778 $ 22,884 $ 12,378 $ 17,793 $ 72,072 $ 33,327 Credit Risk Profile by Internally Assigned Grade as of December 31, 2015 Grade (1) Residential 1-4 Family Multifamily Farmland Construction, Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate Non-Owner Occupied Quality 25,939 - 25 3,036 2,870 1,481 Satisfactory 109,993 20,271 6,323 7,406 38,926 19,979 Acceptable 46,639 1,811 3,922 6,420 21,671 12,157 Special Mention 3,133 792 195 397 2,552 2,523 Substandard 8,583 1,021 818 1,904 7,012 1,885 Doubtful - - - - - - Total $ 194,287 $ 23,895 $ 11,283 $ 19,163 $ 73,031 $ 38,025
Credit Risk Profile based on payment activity	Credit Risk Profile based on payment activity as of March 31, 2016 Consumer - Non Real Estate Equity Line of Credit / Second Mortgages Commercial - Non Real Estate Agricultural - Non Real Estate Performing $ 20,363 $ 14,348 $ 34,169 $ 3,065 Nonperforming (>90 days past due) 114 118 524 - Total $ 20,477 $ 14,466 $ 34,693 $ 3,065 Credit Risk Profile based on payment activity as of December 31, 2015 Consumer - Non Real Estate Equity Line of Credit /Jr. liens Commercial - Non Real Estate Agricultural - Non Real Estate Performing $ 20,751 $ 14,147 $ 34,778 $ 2,959 Nonperforming (>90 days past due) 163 22 366 - Total $ 20,914 $ 14,169 $ 35,144 $ 2,959
Impaired loans	The following tables reflect the Bank’s impaired loans at March 31, 2016: March 31, 2016 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With No Related Allowance Real Estate Secured Residential 1-4 family $ 6,660 $ 6,660 $ - $ 6,869 $ 77 Equity lines of credit 50 50 - 50 - Multifamily 1,009 1,009 - 1,015 13 Farmland 812 812 - 814 8 Construction, Land Development, Other Land Loans 1,550 1,550 - 1,548 23 Commercial Real Estate- Owner Occupied 5,523 5,523 - 5,546 12 Commercial Real Estate- Non Owner Occupied - - - - - Second Mortgages 211 211 - 305 2 Non Real Estate Secured Personal /Consumer 67 67 - 67 1 Commercial 117 117 - 216 1 Agricultural - - - - - Total $ 15,999 $ 15,999 $ - $ 16,430 $ 137 March 31, 2016 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an Allowance Recorded Real Estate Secured Residential 1-4 family $ 1,409 $ 1,409 $ 228 $ 1,628 $ 23 Equity lines of credit - - - - - Multifamily - - - - - Farmland - - - - - Construction, Land Development, Other Land Loans 445 445 21 445 7 Commercial Real Estate- Owner Occupied 2,206 2,206 925 2,163 - Commercial Real Estate- Non Owner Occupied 1,878 1,878 283 1,882 15 Second Mortgages 216 216 59 117 2 Non Real Estate Secured Personal /Consumer 80 80 42 97 - Commercial 849 849 599 760 6 Agricultural - - - - - Total $ 7,083 $ 7,083 $ 2,157 $ 7,092 $ 53 The following tables reflect the Bank’s impaired loans at December 31, 2015: December 31, 2015 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no Related Allowance Real Estate Secured Residential 1-4 family $ 7,078 $ 7,078 $ - $ 7,533 $ 247 Equity lines of credit 51 51 - 38 2 Multifamily 1,021 1,021 - 1,137 60 Farmland 816 816 - 829 38 Construction, Land Development, Other Land Loans 1,547 1,547 - 1,643 92 Commercial Real Estate- Owner Occupied 5,569 5,569 - 7,379 132 Commercial Real Estate- Non Owner Occupied - - - - - Second Mortgages 398 398 - 508 14 Non Real Estate Secured Personal 68 68 - 61 4 Commercial 315 315 - 338 13 Agricultural - - - - - Total $ 16,863 $ 16,863 $ - $ 19,466 $ 602 December 31, 2015 Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With an Allowance Recorded Real Estate Secured Residential 1-4 family $ 1,846 $ 1,846 $ 249 $ 2,497 $ 93 Equity lines of credit - - - - - Multifamily - - - - - Farmland - - - - - Construction, Land Development, Other Land Loans 446 446 32 406 25 Commercial Real Estate- Owner Occupied 2,119 2,119 799 1,761 9 Commercial Real Estate- Non Owner Occupied 1,885 1,885 290 1,901 56 Second Mortgages 18 18 10 9 1 Non Real Estate Secured Personal 114 114 45 184 4 Commercial 670 670 512 736 28 Agricultural - - - 4 - Total $ 7,098 $ 7,098 $ 1,937 $ 7,498 $ 216
Allowance for loan losses and the recorded investment in loans by loan category	Three months ended March 31, 2016 Residential 1-4 Family Multifamily Construction and Land Loans Commercial Owner Occupied Commercial Non-Owner Occupied Second Mortgages Equity Line of Credit Farmland Personal and Overdrafts Commercial and Agricultural Unallocated Total Allowance for Credit Losses: Beginning Balance December 31, 2015 $ 654 $ - $ 37 $ 1,012 $ 748 $ 43 $ 20 $ 7 $ 704 $ 886 $ 1,543 $ 5,654 Provision for Credit Losses (33) - (18) 97 (130) 40 (3) (1) (94) 60 306 224 Charge-offs 27 - - - - - - - 139 23 - 189 Recoveries (1) - (2) - - - (1) - (131) (1) - (136) Net Charge-offs 26 - (2) - - - (1) - 8 22 - 53 Ending Balance March 31, 2016 595 - 21 1,109 618 83 18 6 602 924 1,849 5,825 Ending Balance: Individually evaluated for impairment 228 - 21 925 283 59 - - 42 599 - 2,157 Ending Balance: Collectively Evaluated for Impairment 367 - - 184 335 24 18 6 560 325 1,849 3,668 Loans: Ending Balance: Individually Evaluated for Impairment 8,069 1,009 1,995 7,729 1,878 427 50 812 147 966 - 23,082 Ending Balance: Collectively Evaluated for Impairment 189,709 21,875 15,798 64,343 31,449 7,759 6,230 11,566 20,330 36,792 - 405,851 Ending Balance: March 31, 2016 $197,778 $22,884 $17,793 $72,072 $33,327 $8,186 $6,280 $12,378 $20,477 $37,758 - $428,933 Three months ended March 31, 2015 Residential 1-4 Family Multifamily Construction and Land Loans Commercial Owner Occupied Commercial Non-Owner Occupied Second Mortgages Equity Line of Credit Farmland Personal and Overdrafts Commercial and Agricultural Unallocated Total Allowance for Credit Losses: Beginning Balance December 31, 2014 $ 995 $ 20 $ 87 $ 409 $ 1,063 $ 67 $ 74 $ 12 $ 665 $ 982 $ 1,103 $ 5,477 Provision for Credit Losses 42 (20) (19) 42 (29) 3 (6) 1 31 177 (122) 100 Charge-offs 47 - - 392 - 3 - - 77 64 - 583 Recoveries - - 7 275 - - - - 12 1 - 295 Net Charge-offs 47 - (7) 117 - 3 - - 65 63 - 288 Ending Balance March 31, 2015 990 - 75 334 1,034 67 68 13 631 1,096 981 5,289 Ending Balance: Individually evaluated for impairment 567 - 20 - 320 - - - 144 604 - 1,655 Ending Balance: Collectively Evaluated for Impairment 423 - 55 334 714 67 68 13 487 492 981 3,634 Loans: Ending Balance: Individually Evaluated for Impairment 11,731 1,260 2,123 7,964 1,999 242 74 826 226 1,154 - 27,599 Ending Balance: Collectively Evaluated for Impairment 177,512 19,013 15,302 62,376 30,279 7,632 6,165 8,435 20,550 34,945 - 382,209 Ending Balance: March 31, 2015 $189,243 $20,273 $17,425 $70,340 $32,278 $7,874 $6,239 $9,261 $20,776 $36,099 - $409,808
Troubled debt restructurings	Troubled Debt Restructurings –Three months ended March 31, 2016 Interest only Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland 1 57 57 Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 1 92 92 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 149 149 Troubled Debt Restructurings Below Market Rate Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family 1 848 848 Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 1 848 848 Troubled Debt Restructurings Loan term extension Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Business Commercial Agricultural Total Troubled Debt Restructurings All Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Total Restructurings 3 997 997 Troubled Debt Restructurings That Subsequently Defaulted Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total - - - Troubled Debt Restructurings –Three months ended March 31, 2015 Interest only Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 2 2,203 2,203 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 2,203 2,203 Troubled Debt Restructurings Below Market Rate Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family 1 863 863 Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied 1 1,547 1,547 Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total 2 2,410 2,410 Troubled Debt Restructurings Loan term extension Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Business Commercial Agricultural Total Troubled Debt Restructurings All Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Total Restructurings 4 4,613 4,613 Troubled Debt Restructurings That Subsequently Defaulted Number of Contracts Pre- Modification Outstanding Recorded Investment Post - Modification Recorded Investment Real Estate Secured Residential 1-4 family Equity lines of credit Multifamily Farmland Construction, Land Development, Other Land Loans Commercial Real Estate- Owner Occupied Commercial Real Estate- Non Owner Occupied Second Mortgages Non Real Estate Secured Personal / Consumer Commercial Agricultural Total

3. Income Taxes (Tables)

3. Income Taxes (Tables)	3 Months Ended
	Mar. 31, 2016
Loans: [Abstract]
Income tax reconciliation	2016 2015 Tax expense at statutory rate $ 245 $ 257 Reduction in taxes from: Tax-exempt interest (26) (37) Other, net (28) (43) Income tax expense $ 191 $ 177

4. Capital Requirements (Tables

4. Capital Requirements (Tables)	3 Months Ended
	Mar. 31, 2016
Farmland, real estate secured impaired loans, fair value disclosure
Schedule of Capital Ratios as Required by Regulators	March 31, 2016 Entity Tier 1 Total Risk Based Leverage CET 1 Highlands Union Bank 11.84% 13.11% 7.60% 11.84% December 31, 2015 Entity Tier 1 Total Risk Based Leverage CET 1 Highlands Union Bank 11.28% 12.55% 7.33% 11.28%

6. Per Share Amounts (Tables)

6. Per Share Amounts (Tables)	3 Months Ended
	Mar. 31, 2016
Past due days
Schedule of Earnings Per Share, Basic and Diluted	For the three months ended March 31 2016 2015 Income available to common stockholders $ 530 $ 580 Weighted average shares outstanding 8,089 7,851 Shares outstanding including assumed conversion 10,205 9,943 Basic earnings per common share $ 0.07 $ 0.07 Fully diluted earnings per share (including convertible preferred shares oustanding) $ 0.05 $ 0.06

8. Fair Value (Tables)

8. Fair Value (Tables)	3 Months Ended
	Mar. 31, 2016
Liabilities Less Deposits
Available for sale securities portfolio measured at fair value on a recurring basis	March 31, 2016 Level 1 Level 2 Level 3 Total Fair Value Available for Sale Securities State and Political Subdivisions $ - $ 7,011 $ - $ 7,011 Mortgage Backed Securities $ - $ 66,549 $ - $ 66,549 SBA Pools $ - $ 10,039 $ - $ 10,039 Total AFS Securities $ - $ 83,599 $ - $ 83,599 December 31, 2015 Level 1 Level 2 Level 3 Total Fair Value Available for Sale Securities State and Political Subdivisions $ - $ 6,958 $ - $ 6,958 Mortgage Backed Securities $ - $ 62,593 $ - $ 62,593 SBA Pools $ - $ 10,309 $ - $ 10,309 Total AFS Securities $ - $ 79,860 $ - $ 79,860
Assets at fair value on a non - recurring basis segregated by the level of the valuation inputs within the fair value hierarchy	March 31, 2016 Level 1 Level 2 Level 3 Total Fair Value Impaired Loans $ - $ - $ 7,083 $ 7,083 Repossessions/OREO, net $ - $ - $ 5,359 $ 5,359 December 31, 2015 Level 1 Level 2 Level 3 Total Fair Value Impaired Loans $ - $ - $ 7,098 $ 7,098 Repossessions/OREO, net $ - $ - $ 5,724 $ 5,724
Level 3 inputs for assets measured on a nonrecurring basis	Quantitative Information about Level 3 Fair Value Measurements March 31, December 31, Valuation Unobservable Range 2016 2015 Techniques Input (2) (Weighted Average) OREO,Repossessions $ 5,359 $ 5,724 Appraisal of collateral (1) Appraisal adjustments 0% to 45% (13%) Liquidation expenses 0% to 10% (9%) Impaired loans $ 7,083 $ 7,098 Fair value of collateral –real estate (1), (3) Appraisal adjustments 0% to 10% (9%) Fair value of collateral –equipment, inventory, other (1), (3) Appraisal adjustments 25% to 50% (33%) Liquidation expenses 0% to 10% (9%)
Carrying amounts and fair values of financial instruments	March 31, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value Cash and cash equivalents $ 49,898 $ 49,898 $ 46,891 $ 46,891 Securities available for sale 83,599 83,599 79,860 79,860 Other investments 6,611 6,611 6,592 6,592 Loans, net 422,327 415,371 426,429 419,907 Deposits (493,097) (477,851) (494,912) (472,197) Other short-term borrowings (20,051) (20,898) (20,052) (21,970) Long-term debt (47,686) (50,575) (47,698) (50,313)

9. Investment Securities Avai25

9. Investment Securities Available For Sale (Tables)	3 Months Ended
	Mar. 31, 2016
Maximum amount of all loan relationships review in addition to annual loan relationship
Schedule of amortized cost and market value of securities available-for-sale	March 31, 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value State and political subdivisions $ 6,900 $ 111 $ - $ 7,011 Mortgage backed securities 66,193 441 85 66,549 SBA Pools 10,036 21 18 10,039 $ 83,129 $ 573 $ 103 $ 83,599 December 31, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value State and political subdivisions $ 6,834 $ 124 $ - $ 6,958 Mortgage backed securities 62,911 160 478 62,593 SBA Pools 10,494 9 194 10,309 $ 80,239 $ 293 $ 672 $ 79,860
Age of gross unrealized losses and fair value by investment category	March 31, 2016 Less Than 12 months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses State and political subdivisions $ - $ - $ - $ - $ - $ - Mortgage-backed securities 2,601 12 9,427 73 12,028 85 SBA Pools 130 2 4,672 16 4,802 18 Total $ 2,731 $ 14 $ 14,099 $ 89 $16,830 $ 103 December 31, 2015 Less Than 12 months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses State and political subdivisions $ - $ - $ - $ - $ - $ - Mortgage-backed securities 45,790 363 4,589 115 50,379 478 SBA Pools 157 3 9,110 191 9,267 194 Total $ 45,947 $ 366 $ 13,699 $ 306 $59,646 $ 672
Amortized cost and estimated fair value of securities available-for-sale by contractual maturity	Amortized Cost Approximate Market Value Due in one year or less $ 1,060 $ 1,066 Due after one year through five years 2,932 2,997 Due after five years through ten years 6 6 Due after ten years 12,938 12,981 16,936 17,050 Mortgage-backed securities 66,193 66,549 $ 83,129 $ 83,599

2. Loans and Allowance for Lo26

2. Loans and Allowance for Loan Losses (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	$ 428,933	$ 432,870
Allowance for loan losses	5,825	5,654
Net deferred fees	781	787
Total allowances and net deferred fees	6,606	6,441
Loans, net	422,327	426,429
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	4,114	5,823
60 to 89 Days Past Due	720	2,528
Greater Than 90 Days	9,493	8,450
Total Past Due	14,327	16,801
Current	414,606	416,069
Total Financing Receivables	428,933	432,870
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	9,493	9,456
Real Estate Secured [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	370,698	373,853
Real Estate Secured [Member] | Residential 1-4 Family [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	197,778	194,287
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	2,616	4,193
60 to 89 Days Past Due	437	1,580
Greater Than 90 Days	1,792	2,545
Total Past Due	4,845	8,318
Current	192,933	185,969
Total Financing Receivables	197,778	194,287
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	1,792	2,675
Real Estate Secured [Member] | Multifamily [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	22,884	23,895
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	0	0
60 to 89 Days Past Due	0	0
Greater Than 90 Days	0	0
Total Past Due	0	0
Current	22,884	23,895
Total Financing Receivables	22,884	23,895
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	0	0
Real Estate Secured [Member] | Construction, Land Development, Other Land Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	17,793	19,163
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	250	49
60 to 89 Days Past Due	75	61
Greater Than 90 Days	46	37
Total Past Due	371	147
Current	17,422	19,016
Total Financing Receivables	17,793	19,163
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	46	71
Real Estate Secured [Member] | Commercial Owner Occupied [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	72,072	73,031
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	195	514
60 to 89 Days Past Due	127	485
Greater Than 90 Days	6,653	5,014
Total Past Due	6,975	6,013
Current	65,097	67,018
Total Financing Receivables	72,072	73,031
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	6,653	5,856
Real Estate Secured [Member] | Commercial Non Owner Occupied [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	33,327	38,025
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	0	0
60 to 89 Days Past Due	0	0
Greater Than 90 Days	0	0
Total Past Due	0	0
Current	33,327	38,025
Total Financing Receivables	33,327	38,025
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	0	0
Real Estate Secured [Member] | Second Mortgage [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	8,186	8,169
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	134	88
60 to 89 Days Past Due	0	37
Greater Than 90 Days	68	5
Total Past Due	202	130
Current	7,984	8,039
Total Financing Receivables	8,186	8,169
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	68	5
Real Estate Secured [Member] | Equity Line of Credit [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	6,280	6,000
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	4	24
60 to 89 Days Past Due	0	0
Greater Than 90 Days	50	17
Total Past Due	54	41
Current	6,226	5,959
Total Financing Receivables	6,280	6,000
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	50	17
Real Estate Secured [Member] | Farmland [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	12,378	11,283
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	380	56
60 to 89 Days Past Due	0	7
Greater Than 90 Days	246	303
Total Past Due	626	366
Current	11,752	10,917
Total Financing Receivables	12,378	11,283
Recorded Investment > 90 Days and Accruing	0	0
Non-accrual loans	246	303
Non Real Estate Secured [Member] | Personal [Member]
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	133	264
60 to 89 Days Past Due	29	141
Greater Than 90 Days	114	163
Total Past Due	276	568
Current	20,201	20,346
Total Financing Receivables	20,477	20,914
Recorded Investment > 90 Days and Accruing	0	0
Non Real Estate Secured [Member] | Commercial [Member]
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	381	590
60 to 89 Days Past Due	52	217
Greater Than 90 Days	524	366
Total Past Due	957	1,173
Current	33,736	33,971
Total Financing Receivables	34,693	35,144
Recorded Investment > 90 Days and Accruing	0	0
Non Real Estate Secured [Member] | Agricultural [Member]
Analysis of past due loans [Abstract]
30 to 59 Days Past Due	21	45
60 to 89 Days Past Due	0	0
Greater Than 90 Days	0	0
Total Past Due	21	45
Current	3,044	2,914
Total Financing Receivables	3,065	2,959
Recorded Investment > 90 Days and Accruing	0	0
Secured (other) and unsecured [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	58,042	58,878
Secured (other) and unsecured [Member] | Personal [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	20,284	20,775
Analysis of past due loans [Abstract]
Non-accrual loans	114	163
Secured (other) and unsecured [Member] | Commercial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	34,693	35,144
Analysis of past due loans [Abstract]
Non-accrual loans	524	366
Secured (other) and unsecured [Member] | Agricultural [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	3,065	2,959
Analysis of past due loans [Abstract]
Non-accrual loans	0	0
Secured (other) and unsecured [Member] | Overdrafts [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, gross	$ 193	$ 139

2. Loans and Allowance for Lo27

2. Loans and Allowance for Loan Losses, Foreclosed (Details) $ in Thousands	Mar. 31, 2016USD ($)Contract
Residential real estate in the process of foreclosure [Member]
Number | Contract	4
Value of Property | $	$ 371
Foreclosed residential real estate [Member]
Number | Contract	8
Value of Property | $	$ 1,130

2. Loans and Allowance for Lo28

2. Loans and Allowance for Loan Losses, Credit Risk Profile (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Residential 1-4 Family [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	$ 197,778	$ 194,287
Residential 1-4 Family [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	25,624	25,939
Residential 1-4 Family [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	114,859	109,993
Residential 1-4 Family [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	46,160	46,639
Residential 1-4 Family [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	3,277	3,133
Residential 1-4 Family [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	7,858	8,583
Residential 1-4 Family [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Multifamily [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	22,884	23,895
Multifamily [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Multifamily [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	19,762	20,271
Multifamily [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	1,331	1,811
Multifamily [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	782	792
Multifamily [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	1,009	1,021
Multifamily [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Farmland [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	12,378	11,283
Farmland [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	24	25
Farmland [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	7,439	6,323
Farmland [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	3,910	3,922
Farmland [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	193	195
Farmland [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	812	818
Farmland [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Construction, Land Development, Other Land Loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	17,793	19,163
Construction, Land Development, Other Land Loans [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	3,144	3,036
Construction, Land Development, Other Land Loans [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	5,955	7,406
Construction, Land Development, Other Land Loans [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	6,337	6,420
Construction, Land Development, Other Land Loans [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	388	397
Construction, Land Development, Other Land Loans [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	1,969	1,904
Construction, Land Development, Other Land Loans [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Commercial Real Estate- Owner Occupied [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	72,072	73,031
Commercial Real Estate- Owner Occupied [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	2,513	2,870
Commercial Real Estate- Owner Occupied [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	35,879	38,926
Commercial Real Estate- Owner Occupied [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	24,350	21,671
Commercial Real Estate- Owner Occupied [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	2,340	2,552
Commercial Real Estate- Owner Occupied [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	6,990	7,012
Commercial Real Estate- Owner Occupied [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Commercial Real Estate - Non Owner Occupied [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	33,327	38,025
Commercial Real Estate - Non Owner Occupied [Member] | Quality [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	491	1,481
Commercial Real Estate - Non Owner Occupied [Member] | Satisfactory [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	15,724	19,979
Commercial Real Estate - Non Owner Occupied [Member] | Acceptable [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	12,872	12,157
Commercial Real Estate - Non Owner Occupied [Member] | Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	2,362	2,523
Commercial Real Estate - Non Owner Occupied [Member] | Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	1,878	1,885
Commercial Real Estate - Non Owner Occupied [Member] | Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	0	0
Consumer Non Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	20,477	20,914
Consumer Non Real Estate [Member] | Performing [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	20,363	20,751
Consumer Non Real Estate [Member] | Nonperforming (>90 days past due) [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	114	163
Equity Line of Credit Second Mortgages [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	14,466	14,169
Equity Line of Credit Second Mortgages [Member] | Performing [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	14,348	14,147
Equity Line of Credit Second Mortgages [Member] | Nonperforming (>90 days past due) [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	118	22
Commercial Non Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	34,693	35,144
Commercial Non Real Estate [Member] | Performing [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	34,169	34,778
Commercial Non Real Estate [Member] | Nonperforming (>90 days past due) [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	524	366
Agricultural - Non Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	3,065	2,959
Agricultural - Non Real Estate [Member] | Performing [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	3,065	2,959
Agricultural - Non Real Estate [Member] | Nonperforming (>90 days past due) [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans	$ 0	$ 0

2. Loans and Allowance for Lo29

2. Loans and Allowance for Loan Losses, Impaired Loans (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Recorded Investment [Abstract]
With No Related Allowance	$ 15,999	$ 16,863
With Related Allowance	7,083	7,098
Unpaid Principal Balance [Abstract]
With No Related Allowance	15,999	16,863
With Related Allowance	7,083	7,098
Related Allowance	2,157	1,937
Average Recorded Investment [Abstract]
With No Related Allowance	16,430	19,466
With Related Allowance	7,092	7,498
Interest Income Recognized [Abstract]
With No Related Allowance	137	602
With Related Allowance	53	216
Real Estate Secured [Member] | Residential 1-4 Family [Member]
Recorded Investment [Abstract]
With No Related Allowance	6,660	7,078
With Related Allowance	1,409	1,846
Unpaid Principal Balance [Abstract]
With No Related Allowance	6,660	7,078
With Related Allowance	1,409	1,846
Related Allowance	228	249
Average Recorded Investment [Abstract]
With No Related Allowance	6,869	7,533
With Related Allowance	1,628	2,497
Interest Income Recognized [Abstract]
With No Related Allowance	77	247
With Related Allowance	23	93
Real Estate Secured [Member] | Equity Line of Credit [Member]
Recorded Investment [Abstract]
With No Related Allowance	50	51
With Related Allowance	0	0
Unpaid Principal Balance [Abstract]
With No Related Allowance	50	51
With Related Allowance	0	0
Related Allowance	0	0
Average Recorded Investment [Abstract]
With No Related Allowance	50	38
With Related Allowance	0	0
Interest Income Recognized [Abstract]
With No Related Allowance	0	2
With Related Allowance	0	0
Real Estate Secured [Member] | Multifamily [Member]
Recorded Investment [Abstract]
With No Related Allowance	1,009	1,021
With Related Allowance	0	0
Unpaid Principal Balance [Abstract]
With No Related Allowance	1,009	1,021
With Related Allowance	0	0
Related Allowance	0	0
Real Estate Secured [Member] | Farmland [Member]
Recorded Investment [Abstract]
With No Related Allowance	812	816
With Related Allowance	0	0
Unpaid Principal Balance [Abstract]
With No Related Allowance	812	816
With Related Allowance	0	0
Related Allowance	0	0
Average Recorded Investment [Abstract]
With No Related Allowance	814	829
With Related Allowance	0	0
Interest Income Recognized [Abstract]
With No Related Allowance	8	38
With Related Allowance	0	0
Real Estate Secured [Member] | Construction, Land Development, Other Land Loans [Member]
Recorded Investment [Abstract]
With No Related Allowance	1,550	1,547
With Related Allowance	445	446
Unpaid Principal Balance [Abstract]
With No Related Allowance	1,550	1,547
With Related Allowance	445	446
Related Allowance	21	32
Average Recorded Investment [Abstract]
With No Related Allowance	1,548	1,643
With Related Allowance	445	406
Interest Income Recognized [Abstract]
With No Related Allowance	23	92
With Related Allowance	7	25
Real Estate Secured [Member] | Commercial Real Estate- Owner Occupied [Member]
Recorded Investment [Abstract]
With No Related Allowance	5,523	5,569
With Related Allowance	2,206	2,119
Unpaid Principal Balance [Abstract]
With No Related Allowance	5,523	5,569
With Related Allowance	2,206	2,119
Related Allowance	925	799
Average Recorded Investment [Abstract]
With No Related Allowance	5,546	7,379
With Related Allowance	2,163	1,761
Interest Income Recognized [Abstract]
With No Related Allowance	12	132
With Related Allowance	0	9
Real Estate Secured [Member] | Commercial Real Estate - Non Owner Occupied [Member]
Recorded Investment [Abstract]
With No Related Allowance	0	0
With Related Allowance	1,878	1,885
Unpaid Principal Balance [Abstract]
With No Related Allowance	0	0
With Related Allowance	1,878	1,885
Related Allowance	283	290
Average Recorded Investment [Abstract]
With No Related Allowance	0	0
With Related Allowance	1,882	1,901
Interest Income Recognized [Abstract]
With No Related Allowance	0	0
With Related Allowance	15	56
Real Estate Secured [Member] | Second Mortgage [Member]
Recorded Investment [Abstract]
With No Related Allowance	211	398
With Related Allowance	216	18
Unpaid Principal Balance [Abstract]
With No Related Allowance	211	398
With Related Allowance	216	18
Related Allowance	59	10
Average Recorded Investment [Abstract]
With No Related Allowance	305	508
With Related Allowance	117	9
Interest Income Recognized [Abstract]
With No Related Allowance	2	14
With Related Allowance	2	1
Real Estate Secured [Member] | Multifamily [Member]
Average Recorded Investment [Abstract]
With No Related Allowance	1,015	1,137
With Related Allowance	0	0
Interest Income Recognized [Abstract]
With No Related Allowance	13	60
With Related Allowance	0	0
Non Real Estate Secured [Member] | Personal [Member]
Recorded Investment [Abstract]
With No Related Allowance	67	68
With Related Allowance	80	114
Unpaid Principal Balance [Abstract]
With No Related Allowance	67	68
With Related Allowance	80	114
Related Allowance	42	45
Average Recorded Investment [Abstract]
With No Related Allowance	67	61
With Related Allowance	97	184
Interest Income Recognized [Abstract]
With No Related Allowance	1	4
With Related Allowance	0	4
Non Real Estate Secured [Member] | Commercial [Member]
Recorded Investment [Abstract]
With No Related Allowance	117	315
With Related Allowance	849	670
Unpaid Principal Balance [Abstract]
With No Related Allowance	117	315
With Related Allowance	849	670
Related Allowance	599	512
Average Recorded Investment [Abstract]
With No Related Allowance	216	338
With Related Allowance	760	736
Interest Income Recognized [Abstract]
With No Related Allowance	1	13
With Related Allowance	6	28
Non Real Estate Secured [Member] | Agricultural [Member]
Recorded Investment [Abstract]
With No Related Allowance	0	0
With Related Allowance	0	0
Unpaid Principal Balance [Abstract]
With No Related Allowance	0	0
With Related Allowance	0	0
Related Allowance	0	0
Average Recorded Investment [Abstract]
With No Related Allowance	0	0
With Related Allowance	0	4
Interest Income Recognized [Abstract]
With No Related Allowance	0	0
With Related Allowance	$ 0	$ 0

2. Loans and Allowance for Lo30

2. Loans and Allowance for Loan Losses, Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Allowance for Credit Losses [Roll Forward]
Beginning Balance	$ 5,654	$ 5,477
Provision for Credit Losses	224	100
Charge-offs	189	583
Recoveries	(136)	295
Net Charge-offs	53	288
Ending Balance	5,825	5,289
Ending Balance: Individually evaluated for impairment	2,157	1,655
Ending Balance: Collectively evaluated for impairment	3,668	3,634
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	23,082	27,599
Ending balance: Collectively Evaluated for Impairment	405,851	382,209
Ending Balance	428,933	409,808
Residential 1-4 Family [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	654	995
Provision for Credit Losses	(33)	42
Charge-offs	27	47
Recoveries	(1)	0
Net Charge-offs	26	47
Ending Balance	595	990
Ending Balance: Individually evaluated for impairment	228	567
Ending Balance: Collectively evaluated for impairment	367	423
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	8,069	11,731
Ending balance: Collectively Evaluated for Impairment	189,709	177,512
Ending Balance	197,778	189,243
Multifamily [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	0	20
Provision for Credit Losses	0	(20)
Charge-offs	0	0
Recoveries	0	0
Net Charge-offs	0	0
Ending Balance	0	0
Ending Balance: Individually evaluated for impairment	0	0
Ending Balance: Collectively evaluated for impairment	0	0
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	1,009	1,260
Ending balance: Collectively Evaluated for Impairment	21,875	19,013
Ending Balance	22,884	20,273
Construction and Land Loans [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	37	87
Provision for Credit Losses	(18)	(19)
Charge-offs	0	0
Recoveries	(2)	7
Net Charge-offs	(2)	(7)
Ending Balance	21	75
Ending Balance: Individually evaluated for impairment	21	20
Ending Balance: Collectively evaluated for impairment	0	55
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	1,995	2,123
Ending balance: Collectively Evaluated for Impairment	15,798	15,302
Ending Balance	17,793	17,425
Commercial Owner Occupied [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	1,012	409
Provision for Credit Losses	97	42
Charge-offs	0	392
Recoveries	0	275
Net Charge-offs	0	117
Ending Balance	1,109	334
Ending Balance: Individually evaluated for impairment	925	0
Ending Balance: Collectively evaluated for impairment	184	334
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	7,729	7,964
Ending balance: Collectively Evaluated for Impairment	64,343	62,376
Ending Balance	72,072	70,340
Commercial Non Owner Occupied [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	748	1,063
Provision for Credit Losses	(130)	(29)
Charge-offs	0	0
Recoveries	0	0
Net Charge-offs	0	0
Ending Balance	618	1,034
Ending Balance: Individually evaluated for impairment	283	320
Ending Balance: Collectively evaluated for impairment	335	714
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	1,878	1,999
Ending balance: Collectively Evaluated for Impairment	31,449	30,279
Ending Balance	33,327	32,278
Second Mortgage [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	43	67
Provision for Credit Losses	40	3
Charge-offs	0	3
Recoveries	0	0
Net Charge-offs	0	3
Ending Balance	83	67
Ending Balance: Individually evaluated for impairment	59	0
Ending Balance: Collectively evaluated for impairment	24	67
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	427	242
Ending balance: Collectively Evaluated for Impairment	7,759	7,632
Ending Balance	8,186	7,874
Equity Line of Credit [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	20	74
Provision for Credit Losses	(3)	(6)
Charge-offs	0	0
Recoveries	(1)	0
Net Charge-offs	(1)	0
Ending Balance	18	68
Ending Balance: Individually evaluated for impairment	0	0
Ending Balance: Collectively evaluated for impairment	18	68
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	50	74
Ending balance: Collectively Evaluated for Impairment	6,230	6,165
Ending Balance	6,280	6,239
Farmland [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	7	12
Provision for Credit Losses	(1)	1
Charge-offs	0	0
Recoveries	0	0
Net Charge-offs	0	0
Ending Balance	6	13
Ending Balance: Individually evaluated for impairment	0	0
Ending Balance: Collectively evaluated for impairment	6	13
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	812	826
Ending balance: Collectively Evaluated for Impairment	11,566	8,435
Ending Balance	12,378	9,261
Personal and Overdrafts [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	704	665
Provision for Credit Losses	(94)	31
Charge-offs	139	77
Recoveries	(131)	12
Net Charge-offs	8	65
Ending Balance	602	631
Ending Balance: Individually evaluated for impairment	42	144
Ending Balance: Collectively evaluated for impairment	560	487
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	147	226
Ending balance: Collectively Evaluated for Impairment	20,330	20,550
Ending Balance	20,477	20,776
Commercial and Agricultural [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	886	982
Provision for Credit Losses	60	177
Charge-offs	23	64
Recoveries	(1)	1
Net Charge-offs	22	63
Ending Balance	924	1,096
Ending Balance: Individually evaluated for impairment	599	604
Ending Balance: Collectively evaluated for impairment	325	492
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	966	1,154
Ending balance: Collectively Evaluated for Impairment	36,792	34,945
Ending Balance	37,758	36,099
Unallocated [Member]
Allowance for Credit Losses [Roll Forward]
Beginning Balance	1,543	1,103
Provision for Credit Losses	306	(122)
Charge-offs	0	0
Recoveries	0	0
Net Charge-offs	0	0
Ending Balance	1,849	981
Ending Balance: Individually evaluated for impairment	0	0
Ending Balance: Collectively evaluated for impairment	1,849	981
Loans: [Abstract]
Ending Balance: Individually Evaluated for Impairment	0	0
Ending balance: Collectively Evaluated for Impairment	0	0
Ending Balance	$ 0	$ 0

2. Loans and Allowance for Lo31

2. Loans and Allowance for Loan Losses, Troubled Debt Resturcturing (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016USD ($)Contract	Mar. 31, 2015USD ($)Contract
Interest only [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	2	2
Pre-Modification Outstanding Recorded Investment	$ 149	$ 2,203
Post-Modification Recorded Investment	$ 149	$ 2,203
Interest only [Member] | Farmland [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	1
Pre-Modification Outstanding Recorded Investment	$ 57
Post-Modification Recorded Investment	$ 57
Interest only [Member] | Commercial Real Estate- Owner Occupied [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	1	2
Pre-Modification Outstanding Recorded Investment	$ 92	$ 2,203
Post-Modification Recorded Investment	$ 92	$ 2,203
Below Market Rate [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	1	2
Pre-Modification Outstanding Recorded Investment	$ 848	$ 2,410
Post-Modification Recorded Investment	$ 848	$ 2,410
Below Market Rate [Member] | Residential 1-4 Family [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	1	1
Pre-Modification Outstanding Recorded Investment	$ 848	$ 863
Post-Modification Recorded Investment	$ 848	$ 863
Below Market Rate [Member] | Commercial Real Estate- Owner Occupied [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract		1
Pre-Modification Outstanding Recorded Investment		$ 1,547
Post-Modification Recorded Investment		$ 1,547
Troubled Debt Restructurings [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	3	4
Pre-Modification Outstanding Recorded Investment	$ 997	$ 4,613
Post-Modification Recorded Investment	$ 997	$ 4,613
Subsequently defaulted [Member]
Troubled Debt Restructurings Interest Only [Abstract]
Number of Contracts | Contract	0
Pre-Modification Outstanding Recorded Investment	$ 0
Post-Modification Recorded Investment	$ 0

3. Income Taxes (Details)

3. Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Loan originated from sales of other real estate owned
Tax expense at statutory rate	$ 245	$ 257
Reduction in taxes from:
Tax-exempt interest	(26)	(37)
Other, net	(28)	(43)
Income tax benefit	$ 191	$ 177

4. Capital Requirements (Detail

4. Capital Requirements (Details) - Highlands Union Bank [Member]	Mar. 31, 2016	Dec. 31, 2015
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items]
Tier 1	11.84%	11.28%
Total Risk Based	13.11%	12.55%
Leverage	7.60%	7.33%
CET 1	11.84%	11.28%

6. Per Share Amounts (Details)

6. Per Share Amounts (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
One to Four Family Residential, real estate secured impaired loans, fair value disclosure
Income available to common stockholders	$ 530	$ 580
Weighted average shares outstanding	8,089	7,851
Shares outstanding including assumed conversion	10,205	9,943
Basic earnings per common share	$ 0.07	$ 0.07
Fully diluted earnings per share (including convertible preferred shares oustanding)	$ 0.05	$ 0.06

6. Per Share Amounts (Details N

6. Per Share Amounts (Details Narrative)	12 Months Ended
	Dec. 31, 2014shares
NotesToFinancialStatementsAbstract
Preferred stock shares issued	2,092,287

7. Commitments and Contingenc36

7. Commitments and Contingencies (Details Narrative) $ in Thousands	Mar. 31, 2016USD ($)
Standby Letters of Credit [Member]
Loss Contingencies [Line Items]
Commitments, maximum exposure	$ 255
Equity Line of Credit [Member]
Loss Contingencies [Line Items]
Commitments, maximum exposure	7,818
Credit Card Lines of Credit [Member]
Loss Contingencies [Line Items]
Commitments, maximum exposure	6,561
Construction and land development commitments [Member]
Loss Contingencies [Line Items]
Commitments, maximum exposure	3,051
Unused Commitments to Fund Interest Earning Assets [Member]
Loss Contingencies [Line Items]
Commitments, maximum exposure	$ 27,138

8. Fair Value (Details)

8. Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale	$ 83,599	$ 79,860
Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
State and Political Subdivisions	7,011	6,958
Mortgage Backed Securities	66,549	62,593
SBA Pools	10,039	10,309
Securities available-for-sale	83,599	79,860
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
State and Political Subdivisions	0	0
Mortgage Backed Securities	0	0
SBA Pools	0	0
Securities available-for-sale	0	0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
State and Political Subdivisions	7,011	6,958
Mortgage Backed Securities	66,549	62,593
SBA Pools	10,039	10,309
Securities available-for-sale	83,599	79,860
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
State and Political Subdivisions	0	0
Mortgage Backed Securities	0	0
SBA Pools	0	0
Securities available-for-sale	$ 0	$ 0

8. Fair Value, Loans (Details)

8. Fair Value, Loans (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Loans	$ 7,083	$ 7,098
Repossessions/OREO, net	5,359	5,724
Fair Value, Inputs, Level 1 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Loans	0	0
Repossessions/OREO, net	0	0
Fair Value, Inputs, Level 2 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Loans	0	0
Repossessions/OREO, net	0	0
Fair Value, Inputs, Level 3 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Loans	7,083	7,098
Repossessions/OREO, net	$ 5,359	$ 5,724

8. Fair Value, Off-Balance Shee

8. Fair Value, Off-Balance Sheet Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available-for-sale	$ 83,599	$ 79,860
Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	49,898	46,891
Securities available-for-sale	83,599	79,860
Other investments	6,611	6,592
Loans, net	422,327	426,429
Deposits	(493,097)	(494,912)
Other short-term borrowings	(20,051)	(20,052)
Long-term debt	(47,686)	(47,698)
Fair Value [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	49,898	46,891
Securities available-for-sale	83,599	79,860
Other investments	6,611	6,592
Loans, net	415,371	419,907
Deposits	(477,851)	(472,197)
Other short-term borrowings	(20,898)	(21,970)
Long-term debt	$ (50,575)	$ (50,313)

9. Investment Securities Avai40

9. Investment Securities Available For Sale (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 83,129	$ 80,239
Gross Unrealized Gains	573	293
Gross Unrealized Losses	103	672
Securities available-for-sale	83,599	79,860
Age of gross unrealized losses and fair value by investment category [Abstract]
Less Than 12 months, Fair Value	2,731	45,947
Less Than 12 months, Unrealized Losses	14	366
12 Months or More, Fair value	14,099	13,699
12 Months or More, Unrealized Losses	89	306
Fair Value	16,830	59,646
Unrealized Losses	103	672
Fiscal Year Maturity - Amortized Cost [Abstract]
Amortized cost - due in one year or less	1,060
Amortized cost - due after one year through five years	2,932
Amortized cost - due after five years through ten years	6
Amortized cost - due after ten years	12,938
Amortized cost - total	16,936
Mortgage-backed securities	66,193
Amortized cost - sub-total	83,129	80,239
Fiscal Year Maturity - Fair Value [Abstract]
Fair value - due in one year or less	1,066
Fair value - due after one year through five years	2,997
Fair value - due after five years through ten years	6
Fair value - after ten years	12,981
Fair value - sub total	17,050
Mortgage-backed securities	66,549
Fair value - grand total	83,599
State and political subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	6,900	6,834
Gross Unrealized Gains	111	124
Gross Unrealized Losses	0	0
Securities available-for-sale	7,011	6,958
Age of gross unrealized losses and fair value by investment category [Abstract]
Less Than 12 months, Fair Value	0	0
Less Than 12 months, Unrealized Losses	0	0
12 Months or More, Fair value	0	0
12 Months or More, Unrealized Losses	0	0
Fair Value	0	0
Unrealized Losses	0	0
Fiscal Year Maturity - Amortized Cost [Abstract]
Amortized cost - sub-total	6,900	6,834
Mortgage-backed securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	66,193	62,911
Gross Unrealized Gains	441	160
Gross Unrealized Losses	85	478
Securities available-for-sale	66,549	62,593
Age of gross unrealized losses and fair value by investment category [Abstract]
Less Than 12 months, Fair Value	2,601	45,790
Less Than 12 months, Unrealized Losses	12	363
12 Months or More, Fair value	9,427	4,589
12 Months or More, Unrealized Losses	73	115
Fair Value	12,028	50,379
Unrealized Losses	85	478
Fiscal Year Maturity - Amortized Cost [Abstract]
Amortized cost - sub-total	66,193	62,911
SBA Pools [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	10,036	10,494
Gross Unrealized Gains	21	9
Gross Unrealized Losses	18	194
Securities available-for-sale	10,039	10,309
Age of gross unrealized losses and fair value by investment category [Abstract]
Less Than 12 months, Fair Value	130	157
Less Than 12 months, Unrealized Losses	2	3
12 Months or More, Fair value	4,672	9,110
12 Months or More, Unrealized Losses	16	191
Fair Value	4,802	9,267
Unrealized Losses	18	194
Fiscal Year Maturity - Amortized Cost [Abstract]
Amortized cost - sub-total	$ 10,036	$ 10,494

9. Investment Securities Avai41

9. Investment Securities Available For Sale (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Investment Securities Available For Sale Details Narrative
Investment securities available for sale	$ 36,105	$ 31,422
Investment securities pledged as collateral on public deposits	$ 36,278	$ 31,355

10. Formal Written Agreement (D

10. Formal Written Agreement (Details Narrative) $ in Thousands	3 Months Ended
	Mar. 31, 2016USD ($)
Formal Written Agreement
Loan and other assets amount requiring improvement	$ 500
Past due days	90 days