American River Bancshares (AMRB) 10-Q5 Aug 152015 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2015	Aug. 05, 2015
Document and Entity Information:
Entity Registrant Name	AMERICAN RIVER BANKSHARES
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Entity Central Index Key	1,108,236
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		7,570,157
Entity Filer Category	Non-accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2

CONSOLIDATED BALANCE SHEET (Una

CONSOLIDATED BALANCE SHEET (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
ASSETS
Cash and due from banks	$ 18,009	$ 22,449
Interest-bearing deposits in banks	1,000	1,000
Investment securities:
Available-for-sale, at fair value	276,211	289,064
Held-to-maturity, at amortized cost	740	862
Loans and leases, less allowance for loan and lease losses of $5,359 at June 30, 2015 and $5,301 at December 31, 2014	275,353	258,057
Premises and equipment, net	1,461	1,518
Federal Home Loan Bank stock	3,779	3,686
Goodwill and other intangible assets	16,321	16,321
Other real estate owned	3,781	4,647
Bank owned life insurance	14,326	14,167
Accrued interest receivable and other assets	5,909	5,983
Total Assets	616,890	617,754
Deposits:
Noninterest bearing	173,324	155,698
Interest-bearing	338,659	354,995
Total deposits	511,983	510,693
Short-term borrowings	3,500	3,500
Long-term borrowings	7,500	7,500
Accrued interest payable and other liabilities	5,716	6,414
Total liabilities	$ 528,699	$ 528,107
Commitments and contingencies
Shareholders' equity:
Preferred stock, no par value: 2,000,000 shares authorized: none Outstanding	$ 0	$ 0
Common stock, no par value; 20,000,000 shares authorized; issued and outstanding - 7,730,157 shares at June 30, 2015 and 8,089,615 shares at December 31, 2014	53,307	57,126
Retained earnings	31,492	29,150
Accumulated other comprehensive income, net of taxes	3,392	3,371
Total shareholders' equity	88,191	89,647
Total liabilities and shareholders' euity	$ 616,890	$ 617,754

CONSOLIDATED BALANCE SHEET (Par

CONSOLIDATED BALANCE SHEET (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
ASSETS
Allowance for loan and lease losses (in dollars)	$ 5,359	$ 5,301
Preferred stock, no par value (in dollars per share)	$ 0	$ 0
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, no par value (in dollars per share)	$ 0	$ 0
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	7,730,157	8,089,615
Common stock, shares outstanding	7,730,157	8,089,615

CONSOLIDATED STATEMENT OF INCOM

CONSOLIDATED STATEMENT OF INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Interest income:
Interest and fees on loans	$ 3,424	$ 3,520	$ 6,719	$ 6,975
Interest on deposits in banks	1	1	2	2
Interest and dividends on investment securities:
Taxable	1,657	1,340	3,073	2,678
Exempt from Federal income taxes	191	200	381	402
Dividends	10	6	10	6
Total interest income	5,283	5,067	10,185	10,063
Interest expense:
Interest on deposits	208	254	422	516
Interest on borrowings	36	37	70	79
Total interest expense	244	291	492	595
Net interest income	5,039	4,776	9,693	9,468
Provision for loan and lease losses	0	0	0	0
Net interest income after provision for loan and lease losses	5,039	4,776	9,693	9,468
Noninterest income:
Service charges on deposit accounts	127	149	244	305
Gain on sale of securities	51	17	218	17
Rental income from OREO properties	90	105	161	212
Other noninterest income	239	237	469	476
Total noninterest income	507	508	1,092	1,010
Noninterest expense:
Salaries and employee benefits	2,045	2,117	4,315	4,237
Occupancy	301	296	594	603
Furniture and equipment	179	188	356	366
Federal Deposit Insurance Corporation assessments	76	91	156	194
Expenses related to other real estate owned	55	123	202	122
Other expense	759	884	1,605	1,830
Total noninterest expense	3,415	3,699	7,228	7,352
Income before provision for income taxes	2,131	1,585	3,557	3,126
Provision for income taxes	745	550	1,215	1,085
Net income	$ 1,386	$ 1,035	$ 2,342	$ 2,041
Basic earnings per share	$ 0.18	$ 0.13	$ 0.3	$ 0.25
Diluted earnings per share	0.18	0.13	0.3	0.25
Cash dividends per share	$ 0	$ 0	$ 0	$ 0

CONSOLIDATED STATEMENT OF COMPR

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Statement of Comprehensive Income [Abstract]
Net income	$ 1,386	$ 1,035	$ 2,342	$ 2,041
Other comprehensive (loss) income:
Unrealized holding (losses) gains on investment securities arising during the period	(1,847)	2,479	254	4,316
Deferred tax benefit (expense)	739	(991)	(102)	(1,726)
Unrealized holding (losses) gains on investment securities arising during the period, net of tax	(1,108)	1,488	152	2,590
Reclassification adjustment for realized gains included in net income	(51)	(17)	(218)	(17)
Tax effect	20	7	87	7
Realized gains, net of tax	(31)	(10)	(131)	(10)
Total other comprehensive (loss) income	(1,139)	1,478	21	2,580
Comprehensive income	$ 247	$ 2,512	$ 2,363	$ 4,621

CONSOLIDATED STATEMENT OF CHANG

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Retained Earnings	Accumulated Other Comprehensive Income	Total
Begining Balance, Amount at Dec. 31, 2013	$ 61,108	$ 24,789	$ 1,123	$ 87,020
Begining Balance, Shares at Dec. 31, 2013	8,489,247
Net income		4,361		4,361
Net change in unrealized gains on available-for-sale investment securities			2,248	2,248
Net restricted stock awarded and related compensation expense, Amount	$ 147			147
Net restricted stock awarded and related compensation expense, Shares	24,830
Stock option compensation expense, Amount	$ 19			19
Retirement of common stock, Amount	$ (4,148)			(4,148)
Retirement of common stock, Shares	(424,462)
Ending Balance, Amount at Dec. 31, 2014	$ 57,126	29,150	3,371	89,647
Ending Balance, Shares at Dec. 31, 2014	8,089,615
Net income		2,342
Net change in unrealized gains on available-for-sale investment securities			21
Net restricted stock awarded and related compensation expense, Amount	$ 111
Net restricted stock awarded and related compensation expense, Shares	45,023
Stock option compensation expense, Amount	$ 15
Retirement of common stock, Amount	$ (3,945)
Retirement of common stock, Shares	(404,481)
Ending Balance, Amount at Jun. 30, 2015	$ 53,307	$ 31,492	$ 3,392	$ 88,191
Ending Balance, Shares at Jun. 30, 2015	7,730,157

CONSOLIDATED STATEMENT OF CASH

CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities:
Net income	$ 2,342	$ 2,041
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan and lease losses	0	0
Decrease in deferred loan origination fees, net	(29)	(65)
Depreciation and amortization	212	226
Gain on sale and call of investment securities	(218)	(17)
Amortization of investment security premiums and discounts, net	1,798	2,451
Increase in cash surrender values of life insurance policies	(159)	(129)
Stock based compensation expense	126	71
Loss (gain) on sale and write-down of other real estate owned	68	(106)
Decrease in accrued interest receivable and other assets	61	162
Decrease in accrued interest payable and other liabilities	(698)	(731)
Net cash provided by operating activities	3,503	3,903
Cash flows from investing activities:
Proceeds from the sale of available-for-sale investment securities	15,383	2,632
Proceeds from matured available-for-sale investment securities	0	105
Proceeds from called available-for-sale investment securities	0	270
Purchases of available-for-sale investment securities	(28,393)	(27,600)
Proceeds from principal repayments for available-for-sale investment securities	24,317	19,262
Proceeds from principal repayments for held-to-maturity investment securities	122	171
Net (increase) decrease in loans	(17,267)	5,103
Proceeds from sale of other real estate	924	106
Capitalized additions to other real estate	(126)	(54)
Net increase in FHLB stock	(93)	(438)
Purchases of equipment	(155)	(321)
Net cash used in investing activities	(5,288)	(764)
Cash flows from financing activities:
Net increase in demand, interest-bearing and savings deposits	1,343	10,604
Net decrease in time deposits	(53)	(3,436)
Net decrease in short-term borrowings	0	(6,500)
Net increase in long-term borrowings	0	1,500
Cash paid to repurchase common stock	(3,945)	(4,148)
Net cash used in financing activities	(2,655)	(1,980)
(Decrease) increase in cash and cash equivalents	(4,440)	1,159
Cash and cash equivalents at beginning of year	22,449	17,948
Cash and cash equivalents at end of period	$ 18,009	$ 19,107

1. CONSOLIDATED FINANCIAL STATE

1. CONSOLIDATED FINANCIAL STATEMENTS	6 Months Ended
1. CONSOLIDATED FINANCIAL STATEMENTS	Jun. 30, 2015
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED FINANCIAL STATEMENTS	In the opinion of management, the unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the consolidated financial position of American River Bankshares (the Company:) at June 30, 2015 and December 31, 2014, the results of its operations and statement of comprehensive income for the three-month and six-month periods ended June 30, 2015 and 2014, its cash flows for the six-month periods ended June 30, 2015 and 2014 and its statement of changes in shareholders equity for the year ended December 31, 2014 and the six months ended June 30, 2015 in conformity with accounting principles generally accepted in the United States of America. Certain disclosures normally presented in the notes to the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted. The Company believes that the disclosures are adequate to make the information not misleading. These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Companys 2014 annual report on Form 10-K. The results of operations for the three-month and six-month periods ended June 30, 2015 may not necessarily be indicative of the operating results for the full year. In preparing such financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near term relate to the determination of the allowance for loan and lease losses, the provision for taxes, the valuation of goodwill and the estimated fair value of investment securities, impaired loans and other real estate owned. Management has determined that since all of the banking products and services offered by the Company are available in each branch office of American River Bank, all branch offices are located within the same economic environment and management does not allocate resources based on the performance of different lending or transaction activities, it is appropriate to aggregate all of the branch offices and report them as a single operating segment. No client accounts for more than ten percent (10%) of revenues for the Company or American River Bank.

2. STOCK-BASED COMPENSATION

2. STOCK-BASED COMPENSATION	6 Months Ended
2. STOCK-BASED COMPENSATION	Jun. 30, 2015
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION	Equity Plans On March 17, 2010, the Board of Directors adopted the 2010 Equity Incentive Plan (the 2010 Plan). The 2010 Plan was approved by the Companys shareholders on May 20, 2010. In 2000, the Board of Directors adopted and the Companys shareholders approved a stock option plan (the 2000 Plan), under which 198,281 options remain outstanding at June 30, 2015. At June 30, 2015, under the 2010 Plan, there were 76,461 stock options and 60,790 restricted shares outstanding and the total number of authorized shares that remain available for issuance was 1,399,259. The 2010 Plan provides for the following types of stock-based awards: incentive stock options; nonqualified stock options; stock appreciation rights; restricted stock; restricted performance stock; unrestricted Company stock; and performance units. Awards under the 2000 Plan were either incentive stock options or nonqualified stock options. Under the 2010 Plan, the awards may be granted to employees and directors under incentive and nonqualified option agreements, restricted stock agreements, and other awards agreements. The 2010 Plan and the 2000 Plan (collectively the Plans) require that the option price may not be less than the fair market value of the stock at the date the option is awarded. The option awards under the Plans expire on dates determined by the Board of Directors, but not later than ten years from the date of award. The vesting period is generally five years; however, the vesting period can be modified at the discretion of the Companys Board of Directors. Outstanding option awards under the Plans are exercisable until their expiration, however, no new options will be awarded under the 2000 Plan. New shares are issued upon exercise of an option. The award date fair value of awards is determined by the market price of the Companys common stock on the date of award and is recognized ratably as compensation expense or director expense over the vesting periods. The shares of common stock awarded pursuant to such agreements vest in increments over one to five years from the date of award. The shares awarded to employees and directors under the restricted stock agreements vest on the applicable vesting dates only to the extent the recipient of the shares is then an employee or a director of the Company or one of its subsidiaries, and each recipient will forfeit all of the shares that have not vested on the date his or her employment or service is terminated. Equity Compensation For the three-month periods ended June 30, 2015 and 2014, the compensation cost recognized for equity compensation was $71,000 and $38,000, respectively. The recognized tax benefit for equity compensation expense was $25,000 and $13,000, respectively, for the three-month periods ended June 30, 2015 and 2014. For the six-month periods ended June 30, 2015 and 2014, the compensation cost recognized for equity compensation was $126,000 and $71,000, respectively. The recognized tax benefit for equity compensation expense was $45,000 and $25,000, respectively, for the six-month periods ended June 30, 2015 and 2014. At June 30, 2015, the total compensation cost related to nonvested stock option awards not yet recorded was $159,000. This amount will be recognized over the next 5.0 years and the weighted average period of recognizing these costs is expected to be 2.5 years. At June 30, 2015, the total compensation cost related to restricted stock awards not yet recorded was $484,000. This amount will be recognized over the next 5.0 years and the weighted average period of recognizing these costs is expected to be 2.0 years. Equity Plans Activity Stock Options There were 26,427 stock options awarded during the three-month and six-month periods ended June 30, 2015 at an average exercise price of $9.56. There were 32,705 stock options awarded during the three-month and six-month periods ended June 30, 2014 at an average exercise price of $8.85. The weighted average award date fair value of options awarded for the three-month and six-month periods ended June 30, 2015 was $3.24. The weighted average award date fair value of options awarded for the three-month and six-month periods ended June 30, 2014 was $2.44. A summary of option activity under the Plans as of June 30, 2015 and changes during the period then ended is presented below: Options Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value ($000) Outstanding at January 1, 2015 271,700 $ 16.27 3.1 years $ 82 Awarded 26,427 9.56 Exercised Cancelled 23,385 18.11 Outstanding at June 30, 2015 274,742 $ 15.47 3.8 years $ 90 Vested at June 30, 2015 215,205 $ 17.27 2.4 years $ 62 Non-vested at June 30, 2015 59,537 $ 8.96 9.1 years $ 28 Restricted Stock There were 24,491 and 45,023 shares of restricted stock awarded during the three-month and six-month periods ended June 30, 2015, respectively. There were 24,830 shares of restricted stock awarded during the three-month and six-month periods ended June 30, 2014. Of the restricted shares awarded in 2015, 12,552 restricted shares vest one year from the date of the award, 11,939 vest over five years at 20% per year from the date of the award, and 20,532 are performance based awards and must meet minimum performance criteria before they begin to vest. If the performance metrics are not met, up to 100% of the award may be forfeited and if the performance metrics are exceeded, the awards may be increased by up to 150% of the original award. Of the restricted shares awarded in 2014, 13,560 restricted shares vested one year from the date of the award and 11,270 shares vest over five years at 20% per year from the date of the award. Award date fair value is determined by the market price of the Companys common stock on the date of award ($9.41 on March 18, 2015, $9.56 on May 22, 2015 and $8.85 on May 22, 2014). There were 17,071 restricted share awards that were fully vested during the three-month and six-month periods ended June 30, 2015 and there were 12,710 restricted share awards that were fully vested during the three-month and six-month periods ended June 30, 2014. There were zero restricted share awards that had been forfeited during the three-month and six-month periods ended June 30, 2015 and June 30, 2014. Restricted Stock Shares Weighted Nonvested at January 1, 2015 32,838 $ 8.31 Awarded 45,023 9.49 Less: Vested 17,071 8.72 Less: Cancelled Nonvested at June 30, 2015 60,790 $ 9.07 Other Equity Awards There were no stock appreciation rights; restricted performance stock; unrestricted Company stock; or performance units awarded during the three-month or six-month month periods ended June 30, 2015 or 2014. The intrinsic value used for stock options and restricted stock awards was derived from the market price of the Companys common stock of $9.32 as of June 30, 2015.

3. COMMITMENTS AND CONTINGENCIE

3. COMMITMENTS AND CONTINGENCIES	6 Months Ended
3. COMMITMENTS AND CONTINGENCIES	Jun. 30, 2015
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	In the normal course of business there are outstanding various commitments to extend credit which are not reflected in the financial statements, including loan commitments of approximately $33,016,000 and standby letters of credit of approximately $363,000 at June 30, 2015 and loan commitments of approximately $32,639,000 and standby letters of credit of approximately $356,000 at December 31, 2014. Such commitments relate primarily to real estate construction loans, revolving lines of credit and other commercial loans. However, all such commitments will not necessarily culminate in actual extensions of credit by the Company during 2015 as some of these are expected to expire without being fully drawn upon. Standby letters of credit are commitments issued to guarantee the performance or financial obligation of a client to a third party. These guarantees are issued primarily relating to purchases of inventory, insurance programs, performance obligations to government agencies, or as security for real estate rents by commercial clients and are typically short-term in nature. Credit risk is similar to that involved in extending loan commitments to clients and accordingly, evaluation and collateral requirements similar to those for loan commitments are used. The majority of all such commitments are collateralized. The fair value of the liability related to these standby letters of credit, which represents the fees received for issuing the guarantees, was not significant at June 30, 2015 or December 31, 2014.

4. EARNINGS PER SHARE COMPUTATI

4. EARNINGS PER SHARE COMPUTATION	6 Months Ended
4. EARNINGS PER SHARE COMPUTATION	Jun. 30, 2015
EARNINGS PER SHARE COMPUTATION
EARNINGS PER SHARE COMPUTATION	Basic earnings per share is computed by dividing net income by the weighted average common shares outstanding for the period (7,659,883 and 7,740,320 shares for the three-month and six-month periods ended June 30, 2015, and 8,082,638 and 8,201,383 for the three-month and six-month periods ended June 30, 2014). Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock, such as stock options or restricted stock, result in the issuance of common stock. Diluted earnings per share is computed by dividing net income by the weighted average common shares outstanding for the period plus the dilutive effect of stock based awards. There were 14,828 and 13,999, respectively, dilutive shares for the three-month and six-month periods ended June 30, 2015 and 9,276 and 10,515, respectively, dilutive shares for the three-month and six-month periods ended June 30, 2014. For the three-month periods ended June 30, 2015 and 2014, there were 214,066 and 211,024 stock options, respectively, that were excluded from the calculation as they were considered antidilutive. For the six-month periods ended June 30, 2015 and 2014, there were 214,066 and 211,024 stock options, respectively, that were excluded from the calculation as they were considered antidilutive. Earnings per share is retroactively adjusted for stock dividends and stock splits, if applicable, for all periods presented.

5. INVESTMENT SECURITIES

5. INVESTMENT SECURITIES	6 Months Ended
5. INVESTMENT SECURITIES	Jun. 30, 2015
INVESTMENTS SECURITIES (Tables)
INVESTMENT SECURITIES	The amortized cost and estimated fair values of investment securities at June 30, 2015 and December 31, 2014 consisted of the following (dollars in thousands): Available-for-Sale June 30, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Debt securities: U.S. Government Agencies and Sponsored Agencies $ 244,244 $ 4,686 $ (327 ) $ 248,603 Obligations of states and political subdivisions 24,756 1,226 (30 ) 25,952 Corporate bonds 1,503 72 1,575 Equity securities: Corporate stock 54 27 81 $ 270,557 $ 6,011 $ (357 ) $ 276,211 December 31, 2014 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Debt securities: U.S. Government Agencies and Sponsored Agencies $ 257,002 $ 4,715 $ (602 ) $ 261,115 Obligations of states and political subdivisions 24,886 1,423 (20 ) 26,289 Corporate bonds 1,504 79 1,583 Equity securities: Corporate stock 54 23 77 $ 283,446 $ 6,240 $ (622 ) $ 289,064 Net unrealized gains on available-for-sale investment securities totaling $5,654,000 were recorded, net of $2,262,000 in tax liabilities, as accumulated other comprehensive income within shareholders equity at June 30, 2015. Proceeds and gross realized gains from the sale and call of available-for-sale investment securities for the three-month period ended June 30, 2015 totaled $5,473,000 and $51,000, respectively, and for the six-month period ended June 30, 2015 totaled $15,383,000 and $218,000, respectively. There were no transfers of available-for-sale investment securities for the three-month and six-month periods ended June 30, 2015. Net unrealized gains on available-for-sale investment securities totaling $5,618,000 were recorded, net of $2,247,000 in tax liabilities, as accumulated other comprehensive income within shareholders equity at December 31, 2014. Proceeds and gross realized gains from the sale and call of available-for-sale investment securities for the three-month period ended June 30, 2014 totaled $2,615,000 and $17,000, respectively, and for the six-month period ended June 30, 2014 totaled $2,885,000 and $17,000, respectively. There were no transfers of available-for-sale investment securities for the three-month and six-month periods ended June 30, 2014. Held-to-Maturity June 30, 2015 Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value Debt securities: U.S. Government Agencies and Sponsored Agencies $ 740 $ 56 $ $ 796 December 31, 2014 Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value Debt securities: U.S. Government Agencies and Sponsored Agencies $ 862 $ 60 $ $ 922 There were no sales or transfers of held-to-maturity investment securities for the periods ended June 30, 2015 and June 30, 2014. Investment securities with unrealized losses at June 30, 2015 and December 31, 2014 are summarized and classified according to the duration of the loss period as follows (dollars in thousands): June 30, 2015 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Available-for-Sale Debt securities: U.S. Government Agencies and Sponsored Agencies $ 38,764 $ (289 ) 3,746 (38 ) $ 42,510 $ (327 ) Obligations of states and political subdivisions 755 (9 ) 640 (21 ) 1,395 (30 ) $ 39,519 $ (298 ) $ 4,386 $ (59 ) $ 43,905 $ (357 ) December 31, 2014 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Available-for-Sale Debt securities: U.S. Government Agencies and Sponsored Agencies $ 57,145 $ (503 ) $ 10,006 $ (99 ) $ 67,151 $ (602 ) Obligations of states and political subdivisions 649 (20 ) 649 (20 ) $ 57,145 $ (503 ) $ 10,655 $ (119 ) $ 67,800 $ (622 ) There were no held-to-maturity investment securities with unrealized losses as of June 30, 2015 or December 31, 2014. At June 30, 2015, the Company held 222 securities of which 20 were in a loss position for less than twelve months and three were in a loss position for twelve months or more. Of the 20 securities in a loss position for less than twelve months, 19 were U.S. Government Agencies and Sponsored Agencies securities and one was obligations of states or political subdivisions and of the three securities that were in a loss position for greater than twelve months, two were U.S. Government Agencies and Sponsored Agencies securities and one was an obligation of a states or political subdivisions. At December 31, 2014, the Company held 223 securities of which 25 were in a loss position for less than twelve months and six were in a loss position for twelve months or more. Of the 25 securities in a loss position for less than twelve months, 22 were US Government Agencies and Sponsored Agencies securities and three were obligations of states or political subdivisions and of the six securities that were in a loss position for greater than twelve months, five were U.S. Government Agencies and Sponsored Agencies securities and one was an obligation of a states or political subdivisions. The unrealized loss on the Companys investments in mortgage-backed securities, obligations of states and political subdivisions, and corporate bonds, is primarily driven by interest rates. Because the decline in market value is attributable to a change in interest rates and not credit quality, and because the Company has the ability and intent to hold these investments until recovery of fair value, which may be until maturity, management does not consider these investments to be other-than-temporarily impaired. The amortized cost and estimated fair values of investment securities at June 30, 2015 by contractual maturity are shown below (dollars in thousands). Available-for-Sale Held-to-Maturity Amortized Estimated Amortized Estimated Within one year $ 175 $ 176 After one year through five years 3,810 3,960 After five years through ten years 13,405 14,051 After ten years 8,869 9,340 26,259 27,527 Investment securities not due at a single maturity date: Mortgage-backed securities 244,244 248,603 $ 740 $ 796 Corporate stock 54 81 $ 270,557 $ 276,211 $ 740 $ 796 Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations with or without call or prepayment penalties.

6. IMPAIRED AND NONPERFORMING L

6. IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED	6 Months Ended
	Jun. 30, 2015
IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED
IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED	At June 30, 2015 and December 31, 2014, the recorded investment in nonperforming loans and leases was approximately $2,454,000 and $1,653,000, respectively. Nonperforming loans and leases include all such loans and leases that are either placed on nonaccrual status or are 90 days past due as to principal or interest but still accrue interest because such loans are well-secured and in the process of collection. The Company considers a loan to be impaired when, based on current information and events, it is probable that it will be unable to collect all amounts due (principal and interest) according to the contractual terms of the original loan agreement. At June 30, 2015, the recorded investment in loans and leases that were considered to be impaired totaled $23,816,000, which includes $2,369,000 in nonaccrual loans and leases and $21,447,000 in performing loans and leases. Of the total impaired loans of $23,816,000, loans totaling $12,325,000 were deemed to require no specific reserve and loans totaling $11,491,000 were deemed to require a related valuation allowance of $1,453,000. At December 31, 2014, the recorded investment in loans and leases that were considered to be impaired totaled $25,120,000 and had a related valuation allowance of $1,603,000. If interest had been accruing on the nonperforming loans, such income would have approximated $46,000 and $15,000 for the three months ended June 30, 2015 and 2014, respectively, and approximated $69,000 and $54,000 for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015 and December 31, 2014, the balance in other real estate owned (OREO) was $3,781,000 and $4,647,000, respectively. At June 30, 2015, the Company did not own any residential OREO properties and there were $338,000 of residential properties in the process of foreclosure. During the first quarter of 2015, the Company sold two adjoining parcels of land in Sacramento County that did not result in a gain or loss at the time of sale; however, prior to sale, the book value of this property was adjusted by $76,000 with a charge to expense during the first quarter of 2015. The Company did not add any properties to OREO during the first quarter of 2015. During the second quarter of 2015, the Company did not foreclose on any property and an OREO property in Amador County consisting of unimproved land was sold. No gain or loss was recorded as a result of the sale. The Company periodically obtains property valuations to determine whether the recorded book value is considered fair value. During the second quarter of 2015, this valuation process did not result in the Company adjusting any book values. The June 30, 2015, the OREO balance of $3,781,000 consisted of four properties including two commercial real estate properties in the total amount of $2,522,000 and two commercial unimproved land properties totaling $1,259,000. Nonperforming assets at June 30, 2015 and December 31, 2014 are summarized as follows: (in thousands) June 30, 2015 December 31, 2014 Nonaccrual loans and leases that are current to terms (less than 30 days past due) $ 96 $ 13 Nonaccrual loans and leases that are past due 2,358 1,640 Loans and leases past due 90 days and accruing interest Other assets 878 878 Other real estate owned 3,781 4,647 Total nonperforming assets $ 7,113 $ 7,178 Nonperforming loans and leases to total loans and leases 0.87 % 0.63 % Total nonperforming assets to total assets 1.15 % 1.16 % Impaired loans and leases as of and for the periods ended June 30, 2015 and December 31, 2014 are summarized as follows: (in thousands) As of June 30, 2015 As of December 31, 2014 Recorded Investment Unpaid Principal Balance Related Allowance Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial $ 36 $ 36 $ $ $ $ Real estate-commercial 11,951 12,584 10,684 11,398 Real estate-residential 338 425 338 425 Consumer 37 37 Subtotal $ 12,325 $ 13,045 $ $ 11,059 $ 11,860 $ With an allowance recorded: Commercial $ 728 $ 728 $ 540 $ 769 $ 769 $ 344 Real estate-commercial 7,287 7,386 630 9,773 9,857 949 Real estate-multi-family 492 492 7 496 496 38 Real estate-residential 2,496 2,609 232 2,524 2,637 237 Agriculture 376 376 11 381 381 13 Consumer 112 112 33 118 118 22 Subtotal $ 11,491 $ 11,703 $ 1,453 $ 14,061 $ 14,258 $ 1,603 Total: Commercial $ 764 $ 764 $ 540 $ 769 $ 769 $ 344 Real estate-commercial 19,238 19,970 630 20,457 21,255 949 Real estate-multi-family 492 492 7 496 496 38 Real estate-residential 2,834 3,034 232 2,862 3,062 237 Agriculture 376 376 11 381 381 13 Consumer 112 112 33 155 155 22 $ 23,816 $ 24,748 $ 1,453 $ 25,120 $ 26,118 $ 1,603 The following table presents the average balance related to impaired loans and leases for the periods indicated (in thousands): Average Recorded Investments Average Recorded Investments June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Commercial $ 757 $ 1,610 $ 794 $ 1,517 Real estate-commercial 19,796 19,218 19,383 19,029 Real estate-multi-family 492 1,644 494 1,642 Real estate-construction 246 245 Real estate-residential 2,840 2,912 2,848 2,908 Agriculture 377 194 378 389 Consumer 132 164 115 164 Total $ 24,394 $ 25,988 $ 24,012 $ 25,894 The following table presents the interest income recognized on impaired loans and leases for the periods indicated (in thousands): Interest Income Recognized Interest Income Recognized June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Commercial $ 3 $ 9 $ 5 $ 22 Real estate-commercial 216 237 472 484 Real estate-multi-family 7 19 12 38 Real estate-construction 3 6 Real estate-residential 32 29 63 67 Agriculture 5 10 8 10 Consumer 1 2 Total $ 263 $ 307 $ 561 $ 629

7. TROUBLED DEBT RESTRUCTURINGS

7. TROUBLED DEBT RESTRUCTURINGS	6 Months Ended
7. TROUBLED DEBT RESTRUCTURINGS	Jun. 30, 2015
TROUBLED DEBT RESTRUCTURINGS
TROUBLED DEBT RESTRUCTURINGS	At June 30, 2015, there were 17 loans and leases that were considered to be troubled debt restructurings. Of these loans and leases, 11 are currently performing (less than ninety days past due) totaling $8,893,000 and six are considered nonperforming (and included in the $2,454,000 discussed in Note 6), totaling $1,871,000. Of the six troubled debt restructurings considered nonperforming, one is current to the modified terms. At June 30, 2015 and December 31, 2014, there were no unfunded commitments on those loans considered troubled debt restructures. The Company has allocated $734,000 and $829,000 of specific reserves to loans whose terms have been modified as troubled debt restructurings as of June 30, 2015 and December 31, 2014. During the six-month period ended June 30, 2015, the terms of seven loans were modified as a troubled debt restructuring. The modifications of the terms of these loans were a line of credit converted to a term loan, extensions of the maturity date and/or interest rates lower than the original loan rate. The following table presents loans by class modified as troubled debt restructurings during the three months ended June 30, 2015 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Commercial 1 $ 47 $ 47 Real estate commercial 2 1,650 1,650 Real estate residential 1 255 255 Consumer 1 23 23 Total 5 $ 1,975 $ 1,975 The following table presents loans by class modified as troubled debt restructurings during the six months ended June 30, 2015 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Commercial 1 $ 47 $ 47 Real estate commercial 4 2,167 2,167 Real estate residential 1 255 255 Consumer 1 23 23 Total 7 $ 2,492 $ 2,492 The troubled debt restructurings described above increased the allowance for loan and lease losses by $170,000 and resulted in no charge-offs during the six months ended June 30, 2015. The following table presents loans by class modified as troubled debt restructurings during the three months ended June 30, 2014 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Real estate commercial 1 $ 213 $ 213 Consumer 1 46 46 Total 2 $ 259 $ 259 The following table presents loans by class modified as troubled debt restructurings during the six months ended June 30, 2014 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Real estate commercial 5 $ 5,109 $ 5,109 Consumer 1 46 46 Total 6 $ 5,155 $ 5,155 The troubled debt restructurings described above increased the allowance for loan and lease losses by $151,000 and resulted in no charge-offs during the six months ended June 30, 2014. There were no payment defaults on troubled debt restructurings within 12 months following the modification for the three-month and six-month periods ended June 30, 2014 and June 30, 2015.

8. ALLOWANCE FOR LOAN AND LEASE

8. ALLOWANCE FOR LOAN AND LEASE LOSSES	6 Months Ended
8. ALLOWANCE FOR LOAN AND LEASE LOSSES	Jun. 30, 2015
Schedule of Troubled Debt Restructurings on Financing Receivables (Tables)
ALLOWANCE FOR LOAN AND LEASE LOSSES	The Companys loan and lease portfolio allocated by managements internal risk ratings as of June 30, 2015 and December 31, 2014 are summarized below: June 30, 2015 Credit Risk Profile by Internally Assigned Grade (dollars in thousands) Real Estate Commercial Commercial Multi-family Construction Residential Grade: Pass $ 27,183 $ 169,711 $ 16,922 $ 6,838 $ 9,243 Watch 1,247 12,853 498 5,114 2,305 Special mention 14,031 325 743 Substandard 3,604 1,800 833 Doubtful Total $ 32,034 $ 198,395 $ 17,420 $ 12,277 $ 13,124 Credit Risk Profile by Internally Assigned Grade Other Credit Exposure Leases Agriculture Consumer Total Grade: Pass $ 981 $ 2,063 $ 2,775 $ 235,716 Watch 1,124 23,141 Special mention 376 229 15,704 Substandard 172 6,409 Doubtful Total $ 981 $ 2,439 $ 4,300 $ 280,970 December 31, 2014 Credit Risk Profile by Internally Assigned Grade (dollars in thousands) Real Estate Commercial Commercial Multi-family Construction Residential Grade: Pass $ 20,179 $ 163,091 $ 13,663 $ 3,327 $ 9,364 Watch 1,280 13,724 504 4,372 2,504 Special mention 101 13,583 329 603 Substandard 3,626 3,473 838 Doubtful or loss Total $ 25,186 $ 193,871 $ 14,167 $ 8,028 $ 13,309 Credit Risk Profile by Internally Assigned Grade Other Credit Exposure Leases Agriculture Consumer Total Grade: Pass $ 1,286 $ 2,501 $ 3,424 $ 216,835 Watch 1,041 23,425 Special mention 381 268 15,265 Substandard 183 8,120 Doubtful or loss Total $ 1,286 $ 2,882 $ 4,916 $ 263,645 The allocation of the Companys allowance for loan and lease losses and by portfolio segment and by impairment methodology are summarized below: June 30, 2015 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Allowance for Loan and Lease Losses Beginning balance, January 1, 2015 $ 1,430 $ 2,317 $ 130 $ 583 $ 399 $ 2 $ 62 $ 124 $ 254 $ 5,301 Provision for loan losses 199 (389 ) (23 ) 224 (14 ) (12 ) 2 13 Loans charged off (1 ) (6 ) (7 ) Recoveries 23 40 2 65 Ending balance, June 30, 2015 $ 1,652 $ 1,968 $ 107 $ 807 $ 385 $ 1 $ 50 $ 122 $ 267 $ 5,359 Ending balance: Individually evaluated for impairment $ 540 $ 630 $ 7 $ $ 232 $ $ 11 $ 33 $ $ 1,453 Ending balance: Collectively evaluated for impairment $ 1,112 $ 1,338 $ 100 $ 807 $ 153 $ 1 $ 39 $ 89 $ 267 $ 3,906 Loans Ending balance $ 32,034 $ 198,395 $ 17,420 $ 12,277 $ 13,124 $ 981 $ 2,439 $ 4,300 $ $ 280,970 Ending balance: Individually evaluated for impairment $ 764 $ 19,238 $ 492 $ $ 2,834 $ $ 376 $ 112 $ $ 23,816 Ending balance: Collectively evaluated for impairment $ 31,270 $ 179,157 $ 16,928 $ 12,277 $ 10,290 $ 981 $ 2,063 $ 4,188 $ $ 257,154 Allowance for Loan and Lease Losses Beginning balance, March 31, 2015 $ 1,403 $ 2,284 $ 120 $ 680 $ 392 $ 1 $ 55 $ 132 $ 241 $ 5,308 Provision for loan losses 232 (355 ) (13 ) 127 (7 ) 1 (5 ) (6 ) 26 Loans charged off (1 ) (4 ) (5 ) Recoveries 17 39 56 Ending balance, June 30, 2015 $ 1,652 $ 1,968 $ 107 $ 807 $ 385 $ 1 $ 50 $ 122 $ 267 $ 5,359 December 31, 2014 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Ending balance: Individually evaluated for impairment $ 344 $ 949 $ 38 $ $ 237 $ $ 13 $ 22 $ $ 1,603 Ending balance: Collectively evaluated for impairment $ 1,086 $ 1,368 $ 92 $ 583 $ 162 $ 2 $ 49 $ 102 $ 254 $ 3,698 Loans Ending balance $ 25,186 $ 193,871 $ 14,167 $ 8,028 $ 13,309 $ 1,286 $ 2,882 $ 4,916 $ $ 263,645 Ending balance: Individually evaluated for impairment $ 769 $ 20,457 $ 496 $ $ 2,862 $ $ 381 $ 155 $ $ 25,120 Ending balance: Collectively evaluated for impairment $ 24,417 $ 173,414 $ 13,671 $ 8,028 $ 10,447 $ 1,286 $ 2,501 $ 4,761 $ $ 238,525 June 30, 2014 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Allowance for Loan and Lease Losses Beginning balance, January 1, 2014 $ 885 $ 2,401 $ 242 $ 542 $ 825 $ 4 $ 80 $ 161 $ 206 $ 5,346 Provision for loan losses 365 (291 ) 20 (103 ) (122 ) (5 ) (11 ) 44 103 Loans charged off (74 ) (74 ) Recoveries 141 39 2 5 3 190 Ending balance, June 30, 2014 $ 1,391 $ 2,149 $ 262 $ 441 $ 708 $ 2 $ 69 $ 131 $ 309 $ 5,462 Allowance for Loan and Lease Losses Beginning balance, March 31, 2014 $ 781 $ 2,476 $ 241 $ 485 $ 883 $ 3 $ 73 $ 156 $ 275 $ 5,373 Provision for loan losses 489 (365 ) 21 (45 ) (177 ) (1 ) (4 ) 48 34 Loans charged off (73 ) (73 ) Recoveries 121 38 1 2 162 Ending balance, June 30, 2014 $ 1,391 $ 2,149 $ 262 $ 441 $ 708 $ 2 $ 69 $ 131 $ 309 $ 5,462 The Companys aging analysis of the loan and lease portfolio at June 30, 2015 and December 31, 2014 are summarized below: June 30, 2015 (dollars in thousands) Past Due Greater Than 30-59 Days 60-89 Days Greater Than Total Past Past Due 90 Days and Past Due Past Due 90 Days Due Current Total Loans Accruing Nonaccrual Commercial: Commercial $ $ 30 $ 622 $ 652 $ 31,382 $ 32,034 $ 652 Real estate: Commercial 860 833 1,693 196,702 198,395 1,332 Multi-family 17,420 17,420 Construction 12,277 12,277 Residential 338 338 12,786 13,124 338 Other: Leases 981 981 Agriculture 2,439 2,439 Consumer 6 36 42 4,258 4,300 132 Total $ 866 $ 66 $ 1,793 $ 2,725 $ 278,245 $ 280,970 $ $ 2,454 December 31, 2014 Past Due (dollars in thousands) Past Due Greater Than 30-59 Days 60-89 Days Greater Than Total Past 90 Days and Past Due Past Due 90 Days Due Current Total Loans Accruing Nonaccrual Commercial: Commercial $ 513 $ $ 666 $ 1,179 $ 24,007 $ 25,186 $ 666 Real estate: Commercial 507 507 1,014 192,857 193,871 507 Multi-family 14,167 14,167 Construction 8,028 8,028 Residential 338 338 12,971 13,309 338 Other: Leases 1,286 1,286 Agriculture 2,882 2,882 Consumer 135 135 4,781 4,916 142 Total $ 1,155 $ $ 1,511 $ 2,666 $ 260,979 $ 263,645 $ $ 1,653

9. BORROWING ARRANGEMENTS

9. BORROWING ARRANGEMENTS	6 Months Ended
9. BORROWING ARRANGEMENTS	Jun. 30, 2015
Borrowing Arrangements
BORROWING ARRANGEMENTS	At June 30, 2015, the Company had $17,000,000 of unsecured short-term borrowing arrangements with two of its correspondent banks. There were no advances under the borrowing arrangements as of June 30, 2015 or December 31, 2014. The Company has a line of credit available with the Federal Home Loan Bank of San Francisco (the FHLB) which is secured by pledged mortgage loans and investment securities. Borrowings may include overnight advances as well as loans with terms of up to thirty years. Advances (both short-term and long-term) totaling $11,000,000 were outstanding from the FHLB at June 30, 2015, bearing interest rates ranging from 0.45% to 1.91% and maturing between July 20, 2015 and July 12, 2019. Advances totaling $11,000,000 were outstanding from the FHLB at December 31, 2014, bearing interest rates ranging from 0.24% to 1.91% and maturing between March 16, 2015 and July 12, 2019. Remaining amounts available under the borrowing arrangement with the FHLB at June 30, 2015 and December 31, 2014 totaled $75,971,000 and $67,228,000, respectively. In addition, the Company has a secured borrowing agreement with the Federal Reserve Bank of San Francisco. The borrowing can be secured by pledging selected loans and investment securities. Borrowings generally are short-term including overnight advances as well as loans with terms up to ninety days. Amounts available under this borrowing arrangement at June 30, 2015 and December 31, 2014 were $16,244,000 and $17,335,000, respectively. There were no advances outstanding under this borrowing arrangement as of June 30, 2015 and December 31, 2014.

10. INCOME TAXES

10. INCOME TAXES	6 Months Ended
10. INCOME TAXES	Jun. 30, 2015
INCOME TAXES
INCOME TAXES	The Company files its income taxes on a consolidated basis with its subsidiaries. The allocation of income tax expense (benefit) represents each entitys proportionate share of the consolidated provision for (benefit from) income taxes. The Company accounts for income taxes using the balance sheet method, under which deferred tax assets and liabilities are recognized for the tax consequences of temporary differences between the reported amounts of assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. On the consolidated balance sheet, net deferred tax assets are included in accrued interest receivable and other assets. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if applicable, is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if applicable, as a component of interest expense in the consolidated statement of income. There have been no unrecognized tax benefits or accrued interest and penalties for the three-month and six-month periods ended June 30, 2015 and 2014. The combined federal and state effective tax rate for the quarter ended June 30, 2015 was 35.0%, an increase from 34.7% for the second quarter of 2014. For the six months ended June 30, 2015, the combined federal and state effective tax rate was 34.2% compared to 34.7% for the six months ended June 30, 2014. The higher effective tax rate in the second quarter of 2015 compared to the second quarter of 2014 resulted from an increase in pre-tax income and the lower effective tax rate in the first six months of 2015 compared to the first six months of 2014 results from an increase in tax benefits related to tax exempt loan interest. Pre-tax income increased from $1,585,000 in the second quarter of 2014 to $2,131,000 in the second quarter of 2015 and interest on tax exempt loans increased from $3,000 in the first six months of 2014 to $130,000 in the first six months of 2015.

11. FAIR VALUE MEASUREMENTS

11. FAIR VALUE MEASUREMENTS	6 Months Ended
11. FAIR VALUE MEASUREMENTS	Jun. 30, 2015
Assets and liabilities measured at fair value on a recurring and non-recurring basis are presented in the following table
FAIR VALUE MEASUREMENTS	The following tables present information about the Companys assets and liabilities measured at fair value on a recurring and nonrecurring basis as of June 30, 2015 and December 31, 2014. They indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Companys assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Estimated fair values are disclosed for financial instruments for which it is practicable to estimate fair value. These estimates are made at a specific point in time based on relevant market data and information about the financial instruments. These estimates do not reflect any premium or discount that could result from offering the Companys entire holdings of a particular financial instrument for sale at one time, nor do they attempt to estimate the value of anticipated future business related to the instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates. The carrying amounts and estimated fair values of the Companys financial instruments are as follows (dollars in thousands): Carrying Fair Value Measurements Using: June 30, 2015 Amount Level 1 Level 2 Level 3 Total Financial assets: Cash and due from banks $ 18,009 $ 18,009 $ 18,009 Interest-bearing deposits in banks 1,000 $ 1,004 1,004 Available-for-sale securities 276,211 32 276,179 276,211 Held-to-maturity securities 740 796 796 FHLB stock 3,779 N/A N/A N/A N/A Net loans and leases 275,353 $ 280,014 280,014 Accrued interest receivable 1,837 1,092 745 1,837 Financial liabilities: Deposits: Noninterest-bearing $ 173,324 $ 173,324 $ 173,324 Savings 57,120 57,120 57,120 Money market 132,551 132,551 132,551 NOW accounts 61,353 61,353 61,353 Time, $100,000 or more 66,626 $ 67,164 67,164 Other time 21,009 21,182 21,182 Short-term borrowings 3,500 3,500 3,500 Long-term borrowings 7,500 7,566 7,566 Accrued interest payable 58 2 56 58 Carrying Fair Value Measurements Using: December 31, 2014 Amount Level 1 Level 2 Level 3 Total Financial assets: Cash and due from banks $ 22,449 $ 22,449 $ $ $ 22,449 Interest-bearing deposits in banks 1,000 1,002 1,002 Available-for-sale securities 289,064 28 289,036 289,064 Held-to-maturity securities 862 922 922 FHLB stock 3,686 N/A N/A N/A N/A Net loans and leases 258,057 261,421 261,421 Accrued interest receivable 1,858 1,150 708 1,858 Financial liabilities: Deposits: Noninterest-bearing $ 155,698 $ 155,698 $ $ $ 155,698 Savings 58,820 58,820 58,820 Money market 147,625 147,625 147,625 NOW accounts 60,862 60,862 60,862 Time, $100,000 or more 65,569 66,203 66,203 Other time 22,119 22,282 22,282 Short-term borrowings 3,500 3,500 3,500 Long-term borrowings 7,500 7,567 7,567 Accrued interest payable 59 59 59 Because no market exists for a significant portion of the Companys financial instruments, fair value estimates are based on judgments regarding current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the fair values presented. The following methods and assumptions were used by the Company to estimate the fair values of its financial instruments at June 30, 2015 and December 31, 2014: Cash and due from banks Interest-bearing deposits in banks Investment securities FHLB stock Loans and leases Deposits Short-term and long-term borrowings Accrued interest receivable and payable Off-balance sheet instruments Assets and liabilities measured at fair value on a recurring and non-recurring basis along with any related gain or loss recognized in the income statement due to fair value changes are presented in the following table: Description Fair Value Measurements Using Total Gains (dollars in thousands) Fair Value Level 1 Level 2 Level 3 (Losses) June 30, 2015 Assets and liabilities measured on a recurring basis: Available-for-sale securities: Mortgage-backed securities $ 248,603 $ $ 248,603 $ $ Obligations of states and political subdivisions 25,952 25,952 Corporate bonds 1,575 1,575 Corporate stock 81 32 49 Total recurring $ 276,211 $ 32 $ 276,179 $ $ Assets and liabilities measured on a nonrecurring basis: Impaired loans: Commercial $ 623 $ $ $ 623 $ 176 Real estate: Commercial 4,467 4,467 (165 ) Multi-family Construction Residential 338 338 Other: Agriculture Consumer Other real estate owned 3,781 3,781 Total nonrecurring $ 9,209 $ $ $ 9,209 $ 11 Description Fair Value Measurements Using Total Gains (dollars in thousands) Fair Value Level 1 Level 2 Level 3 (Losses) December 31, 2014 Assets and liabilities measured on a recurring basis: Available-for-sale securities: U.S.Government Agencies and Sponsored Agencies $ 261,115 $ $ 261,115 $ $ Corporate Debt securities 1,583 1,583 Obligations of states and political subdivisions 26,289 26,289 Corporate stock 77 28 49 Total recurring $ 289,064 $ 28 $ 289,036 $ $ Assets and liabilities measured on a nonrecurring basis: Impaired loans: Commercial Real estate: $ 666 $ $ $ 666 $ 14 Commercial 286 286 Other real estate owned 4,404 4,404 66 Total nonrecurring $ 5,356 $ $ $ 5,356 $ 80 There were no significant transfers between Levels 1 and 2 during the three-month and six-month periods ended June 30, 2015 or the twelve months ended December 31, 2014. The following methods were used to estimate the fair value of each class of financial instrument above: Available-for-sale securities Impaired loans Other real estate owned

2. STOCK BASED COMPENSATION (Ta

2. STOCK BASED COMPENSATION (Tables)	6 Months Ended
2. STOCK BASED COMPENSATION (Tables)	Jun. 30, 2015
STOCK BASED COMPENSATION. (Tables)
Schedule of Share-based Compensation, Stock Options, Activity	Options Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value ($000) Outstanding at January 1, 2015 271,700 $ 16.27 3.1 years $ 82 Awarded 26,427 9.56 Exercised Cancelled 23,385 18.11 Outstanding at June 30, 2015 274,742 $ 15.47 3.8 years $ 90 Vested at June 30, 2015 215,205 $ 17.27 2.4 years $ 62 Non-vested at June 30, 2015 59,537 $ 8.96 9.1 years $ 28
Schedule of Nonvested Share Activity	Restricted Stock Shares Weighted Nonvested at January 1, 2015 32,838 $ 8.31 Awarded 45,023 9.49 Less: Vested 17,071 8.72 Less: Cancelled Nonvested at June 30, 2015 60,790 $ 9.07

5. INVESTMENTS SECURITIES (Tabl

5. INVESTMENTS SECURITIES (Tables)	6 Months Ended
5. INVESTMENTS SECURITIES (Tables)	Jun. 30, 2015
INVESTMENTS SECURITIES (Tables)
Available-for-sale Securities	Available-for-Sale June 30, 2015 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Debt securities: U.S. Government Agencies and Sponsored Agencies $ 244,244 $ 4,686 $ (327 ) $ 248,603 Obligations of states and political subdivisions 24,756 1,226 (30 ) 25,952 Corporate bonds 1,503 72 1,575 Equity securities: Corporate stock 54 27 81 $ 270,557 $ 6,011 $ (357 ) $ 276,211 December 31, 2014 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Debt securities: U.S. Government Agencies and Sponsored Agencies $ 257,002 $ 4,715 $ (602 ) $ 261,115 Obligations of states and political subdivisions 24,886 1,423 (20 ) 26,289 Corporate bonds 1,504 79 1,583 Equity securities: Corporate stock 54 23 77 $ 283,446 $ 6,240 $ (622 ) $ 289,064
Held-to-maturity Securities	Held-to-Maturity June 30, 2015 Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value Debt securities: U.S. Government Agencies and Sponsored Agencies $ 740 $ 56 $ $ 796 December 31, 2014 Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value Debt securities: U.S. Government Agencies and Sponsored Agencies $ 862 $ 60 $ $ 922
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	June 30, 2015 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-Sale Debt securities: U.S. Government Agencies and Sponsored Agencies $ 38,764 $ (289 ) 3,746 (38 ) $ 42,510 $ (327 ) Obligations of states and political subdivisions 755 (9 ) 640 (21 ) 1,395 (30 ) $ 39,519 $ (298 ) $ 4,386 $ (59 ) $ 43,905 $ (357 ) December 31, 2014 Less than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-Sale Debt securities: U.S. Government Agencies and Sponsored Agencies $ 57,145 $ (503 ) $ 10,006 $ (99 ) $ 67,151 $ (602 ) Obligations of states and political subdivisions 649 (20 ) 649 (20 ) $ 57,145 $ (503 ) $ 10,655 $ (119 ) $ 67,800 $ (622 )
Available-for-sale Securities, Debt Maturities, Basis of Allocation	Available-for-Sale Held-to-Maturity Amortized Estimated Amortized Estimated Within one year $ 175 $ 176 After one year through five years 3,810 3,960 After five years through ten years 13,405 14,051 After ten years 8,869 9,340 26,259 27,527 Investment securities not due at a single maturity date: Mortgage-backed securities 244,244 248,603 $ 740 $ 796 Corporate stock 54 81 $ 270,557 $ 276,211 $ 740 $ 796

6. IMPAIRED AND NONPERFORMING21

6. IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED (Tables)	6 Months Ended
	Jun. 30, 2015
Impaired And Nonperforming Loans And Leases And Other Real Estate Owned Tables
Schedule of Nonperforming loans and leases and other assets and OREO	(in thousands) June 30, 2015 December 31, 2014 Nonaccrual loans and leases that are current to terms (less than 30 days past due) $ 96 $ 13 Nonaccrual loans and leases that are past due 2,358 1,640 Loans and leases past due 90 days and accruing interest Other assets 878 878 Other real estate owned 3,781 4,647 Total nonperforming assets $ 7,113 $ 7,178 Nonperforming loans and leases to total loans and leases 0.87 % 0.63 % Total nonperforming assets to total assets 1.15 % 1.16 %
Schedule of Impaired Financing Receivables	(in thousands) As of June 30, 2015 As of December 31, 2014 Recorded Investment Unpaid Principal Balance Related Allowance Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Commercial $ 36 $ 36 $ $ $ $ Real estate-commercial 11,951 12,584 10,684 11,398 Real estate-residential 338 425 338 425 Consumer 37 37 Subtotal $ 12,325 $ 13,045 $ $ 11,059 $ 11,860 $ With an allowance recorded: Commercial $ 728 $ 728 $ 540 $ 769 $ 769 $ 344 Real estate-commercial 7,287 7,386 630 9,773 9,857 949 Real estate-multi-family 492 492 7 496 496 38 Real estate-residential 2,496 2,609 232 2,524 2,637 237 Agriculture 376 376 11 381 381 13 Consumer 112 112 33 118 118 22 Subtotal $ 11,491 $ 11,703 $ 1,453 $ 14,061 $ 14,258 $ 1,603 Total: Commercial $ 764 $ 764 $ 540 $ 769 $ 769 $ 344 Real estate-commercial 19,238 19,970 630 20,457 21,255 949 Real estate-multi-family 492 492 7 496 496 38 Real estate-residential 2,834 3,034 232 2,862 3,062 237 Agriculture 376 376 11 381 381 13 Consumer 112 112 33 155 155 22 $ 23,816 $ 24,748 $ 1,453 $ 25,120 $ 26,118 $ 1,603
Schedule of Average Balance Recorded to Imapired Loans and Leases	Average Recorded Investments Average Recorded Investments June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Commercial $ 757 $ 1,610 $ 794 $ 1,517 Real estate-commercial 19,796 19,218 19,383 19,029 Real estate-multi-family 492 1,644 494 1,642 Real estate-construction 246 245 Real estate-residential 2,840 2,912 2,848 2,908 Agriculture 377 194 378 389 Consumer 132 164 115 164 Total $ 24,394 $ 25,988 $ 24,012 $ 25,894
Schedule of interest income recognized on impaired loans and leases	Interest Income Recognized Interest Income Recognized June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Commercial $ 3 $ 9 $ 5 $ 22 Real estate-commercial 216 237 472 484 Real estate-multi-family 7 19 12 38 Real estate-construction 3 6 Real estate-residential 32 29 63 67 Agriculture 5 10 8 10 Consumer 1 2 Total $ 263 $ 307 $ 561 $ 629

7. TROUBLED DEBT RESTRUCTURIN22

7. TROUBLED DEBT RESTRUCTURINGS (Tables)	6 Months Ended
7. TROUBLED DEBT RESTRUCTURINGS (Tables)	Jun. 30, 2015
Troubled Debt Restructurings Tables
TROUBLED DEBT RESTRUCTURINGS	The following table presents loans by class modified as troubled debt restructurings during the three months ended June 30, 2015 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Commercial 1 $ 47 $ 47 Real estate commercial 2 1,650 1,650 Real estate residential 1 255 255 Consumer 1 23 23 Total 5 $ 1,975 $ 1,975 The following table presents loans by class modified as troubled debt restructurings during the six months ended June 30, 2015 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Commercial 1 $ 47 $ 47 Real estate commercial 4 2,167 2,167 Real estate residential 1 255 255 Consumer 1 23 23 Total 7 $ 2,492 $ 2,492 The following table presents loans by class modified as troubled debt restructurings during the three months ended June 30, 2014 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Real estate commercial 1 $ 213 $ 213 Consumer 1 46 46 Total 2 $ 259 $ 259 The following table presents loans by class modified as troubled debt restructurings during the six months ended June 30, 2014 (dollars in thousands): Pre- Post- Modification Modification Outstanding Outstanding Number Recorded Recorded of Loans Investment Investment Troubled debt restructurings: Real estate commercial 5 $ 5,109 $ 5,109 Consumer 1 46 46 Total 6 $ 5,155 $ 5,155

8. ALLOWANCE FOR LOAN AND LEA23

8. ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables)	6 Months Ended
8. ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables)	Jun. 30, 2015
Allowance For Loan And Lease Losses Tables
Schedule Of Recorded Investment Evaluated Based On Internal Risk Ratings	June 30, 2015 Credit Risk Profile by Internally Assigned Grade (dollars in thousands) Real Estate Commercial Commercial Multi-family Construction Residential Grade: Pass $ 27,183 $ 169,711 $ 16,922 $ 6,838 $ 9,243 Watch 1,247 12,853 498 5,114 2,305 Special mention 14,031 325 743 Substandard 3,604 1,800 833 Doubtful Total $ 32,034 $ 198,395 $ 17,420 $ 12,277 $ 13,124 Credit Risk Profile by Internally Assigned Grade Other Credit Exposure Leases Agriculture Consumer Total Grade: Pass $ 981 $ 2,063 $ 2,775 $ 235,716 Watch 1,124 23,141 Special mention 376 229 15,704 Substandard 172 6,409 Doubtful Total $ 981 $ 2,439 $ 4,300 $ 280,970 December 31, 2014 Credit Risk Profile by Internally Assigned Grade (dollars in thousands) Real Estate Commercial Commercial Multi-family Construction Residential Grade: Pass $ 20,179 $ 163,091 $ 13,663 $ 3,327 $ 9,364 Watch 1,280 13,724 504 4,372 2,504 Special mention 101 13,583 329 603 Substandard 3,626 3,473 838 Doubtful or loss Total $ 25,186 $ 193,871 $ 14,167 $ 8,028 $ 13,309 Credit Risk Profile by Internally Assigned Grade Other Credit Exposure Leases Agriculture Consumer Total Grade: Pass $ 1,286 $ 2,501 $ 3,424 $ 216,835 Watch 1,041 23,425 Special mention 381 268 15,265 Substandard 183 8,120 Doubtful or loss Total $ 1,286 $ 2,882 $ 4,916 $ 263,645
Summary Of Analysis Of Allowance For Loan Losses	June 30, 2015 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Allowance for Loan and Lease Losses Beginning balance, January 1, 2015 $ 1,430 $ 2,317 $ 130 $ 583 $ 399 $ 2 $ 62 $ 124 $ 254 $ 5,301 Provision for loan losses 199 (389 ) (23 ) 224 (14 ) (12 ) 2 13 Loans charged off (1 ) (6 ) (7 ) Recoveries 23 40 2 65 Ending balance, June 30, 2015 $ 1,652 $ 1,968 $ 107 $ 807 $ 385 $ 1 $ 50 $ 122 $ 267 $ 5,359 Ending balance: Individually evaluated for impairment $ 540 $ 630 $ 7 $ $ 232 $ $ 11 $ 33 $ $ 1,453 Ending balance: Collectively evaluated for impairment $ 1,112 $ 1,338 $ 100 $ 807 $ 153 $ 1 $ 39 $ 89 $ 267 $ 3,906 Loans Ending balance $ 32,034 $ 198,395 $ 17,420 $ 12,277 $ 13,124 $ 981 $ 2,439 $ 4,300 $ $ 280,970 Ending balance: Individually evaluated for impairment $ 764 $ 19,238 $ 492 $ $ 2,834 $ $ 376 $ 112 $ $ 23,816 Ending balance: Collectively evaluated for impairment $ 31,270 $ 179,157 $ 16,928 $ 12,277 $ 10,290 $ 981 $ 2,063 $ 4,188 $ $ 257,154 Allowance for Loan and Lease Losses Beginning balance, March 31, 2015 $ 1,403 $ 2,284 $ 120 $ 680 $ 392 $ 1 $ 55 $ 132 $ 241 $ 5,308 Provision for loan losses 232 (355 ) (13 ) 127 (7 ) 1 (5 ) (6 ) 26 Loans charged off (1 ) (4 ) (5 ) Recoveries 17 39 56 Ending balance, June 30, 2015 $ 1,652 $ 1,968 $ 107 $ 807 $ 385 $ 1 $ 50 $ 122 $ 267 $ 5,359 December 31, 2014 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Ending balance: Individually evaluated for impairment $ 344 $ 949 $ 38 $ $ 237 $ $ 13 $ 22 $ $ 1,603 Ending balance: Collectively evaluated for impairment $ 1,086 $ 1,368 $ 92 $ 583 $ 162 $ 2 $ 49 $ 102 $ 254 $ 3,698 Loans Ending balance $ 25,186 $ 193,871 $ 14,167 $ 8,028 $ 13,309 $ 1,286 $ 2,882 $ 4,916 $ $ 263,645 Ending balance: Individually evaluated for impairment $ 769 $ 20,457 $ 496 $ $ 2,862 $ $ 381 $ 155 $ $ 25,120 Ending balance: Collectively evaluated for impairment $ 24,417 $ 173,414 $ 13,671 $ 8,028 $ 10,447 $ 1,286 $ 2,501 $ 4,761 $ $ 238,525 June 30, 2014 (dollars in thousands) Real Estate Other Commercial Commercial Multi-Family Construction Residential Leases Agriculture Consumer Unallocated Total Allowance for Loan and Lease Losses Beginning balance, January 1, 2014 $ 885 $ 2,401 $ 242 $ 542 $ 825 $ 4 $ 80 $ 161 $ 206 $ 5,346 Provision for loan losses 365 (291 ) 20 (103 ) (122 ) (5 ) (11 ) 44 103 Loans charged off (74 ) (74 ) Recoveries 141 39 2 5 3 190 Ending balance, June 30, 2014 $ 1,391 $ 2,149 $ 262 $ 441 $ 708 $ 2 $ 69 $ 131 $ 309 $ 5,462 Allowance for Loan and Lease Losses Beginning balance, March 31, 2014 $ 781 $ 2,476 $ 241 $ 485 $ 883 $ 3 $ 73 $ 156 $ 275 $ 5,373 Provision for loan losses 489 (365 ) 21 (45 ) (177 ) (1 ) (4 ) 48 34 Loans charged off (73 ) (73 ) Recoveries 121 38 1 2 162 Ending balance, June 30, 2014 $ 1,391 $ 2,149 $ 262 $ 441 $ 708 $ 2 $ 69 $ 131 $ 309 $ 5,462
Summary Of Activity In Allowance For Loan Losses By Loan Class	June 30, 2015 (dollars in thousands) Past Due Greater Than 30-59 Days 60-89 Days Greater Than Total Past Past Due 90 Days and Past Due Past Due 90 Days Due Current Total Loans Accruing Nonaccrual Commercial: Commercial $ $ 30 $ 622 $ 652 $ 31,382 $ 32,034 $ 652 Real estate: Commercial 860 833 1,693 196,702 198,395 1,332 Multi-family 17,420 17,420 Construction 12,277 12,277 Residential 338 338 12,786 13,124 338 Other: Leases 981 981 Agriculture 2,439 2,439 Consumer 6 36 42 4,258 4,300 132 Total $ 866 $ 66 $ 1,793 $ 2,725 $ 278,245 $ 280,970 $ $ 2,454 December 31, 2014 Past Due (dollars in thousands) Past Due Greater Than 30-59 Days 60-89 Days Greater Than Total Past 90 Days and Past Due Past Due 90 Days Due Current Total Loans Accruing Nonaccrual Commercial: Commercial $ 513 $ $ 666 $ 1,179 $ 24,007 $ 25,186 $ 666 Real estate: Commercial 507 507 1,014 192,857 193,871 507 Multi-family 14,167 14,167 Construction 8,028 8,028 Residential 338 338 12,971 13,309 338 Other: Leases 1,286 1,286 Agriculture 2,882 2,882 Consumer 135 135 4,781 4,916 142 Total $ 1,155 $ $ 1,511 $ 2,666 $ 260,979 $ 263,645 $ $ 1,653

11. FAIR VALUE MEASUREMENTS (Ta

11. FAIR VALUE MEASUREMENTS (Tables)	6 Months Ended
11. FAIR VALUE MEASUREMENTS (Tables)	Jun. 30, 2015
Assets and liabilities measured at fair value on a recurring and non-recurring basis are presented in the following table
Schedule of Assets and Associated Liabilities Accounted for as Secured Borrowings	Carrying Fair Value Measurements Using: June 30, 2015 Amount Level 1 Level 2 Level 3 Total Financial assets: Cash and due from banks $ 18,009 $ 18,009 $ 18,009 Interest-bearing deposits in banks 1,000 $ 1,004 1,004 Available-for-sale securities 276,211 32 276,179 276,211 Held-to-maturity securities 740 796 796 FHLB stock 3,779 N/A N/A N/A N/A Net loans and leases 275,353 $ 280,014 280,014 Accrued interest receivable 1,837 1,092 745 1,837 Financial liabilities: Deposits: Noninterest-bearing $ 173,324 $ 173,324 $ 173,324 Savings 57,120 57,120 57,120 Money market 132,551 132,551 132,551 NOW accounts 61,353 61,353 61,353 Time, $100,000 or more 66,626 $ 67,164 67,164 Other time 21,009 21,182 21,182 Short-term borrowings 3,500 3,500 3,500 Long-term borrowings 7,500 7,566 7,566 Accrued interest payable 58 2 56 58 Carrying Fair Value Measurements Using: December 31, 2014 Amount Level 1 Level 2 Level 3 Total Financial assets: Cash and due from banks $ 22,449 $ 22,449 $ $ $ 22,449 Interest-bearing deposits in banks 1,000 1,002 1,002 Available-for-sale securities 289,064 28 289,036 289,064 Held-to-maturity securities 862 922 922 FHLB stock 3,686 N/A N/A N/A N/A Net loans and leases 258,057 261,421 261,421 Accrued interest receivable 1,858 1,150 708 1,858 Financial liabilities: Deposits: Noninterest-bearing $ 155,698 $ 155,698 $ $ $ 155,698 Savings 58,820 58,820 58,820 Money market 147,625 147,625 147,625 NOW accounts 60,862 60,862 60,862 Time, $100,000 or more 65,569 66,203 66,203 Other time 22,119 22,282 22,282 Short-term borrowings 3,500 3,500 3,500 Long-term borrowings 7,500 7,567 7,567 Accrued interest payable 59 59 59
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques	Description Fair Value Measurements Using Total Gains (dollars in thousands) Fair Value Level 1 Level 2 Level 3 (Losses) June 30, 2015 Assets and liabilities measured on a recurring basis: Available-for-sale securities: Mortgage-backed securities $ 248,603 $ $ 248,603 $ $ Obligations of states and political subdivisions 25,952 25,952 Corporate bonds 1,575 1,575 Corporate stock 81 32 49 Total recurring $ 276,211 $ 32 $ 276,179 $ $ Assets and liabilities measured on a nonrecurring basis: Impaired loans: Commercial $ 623 $ $ $ 623 $ 176 Real estate: Commercial 4,467 4,467 (165 ) Multi-family Construction Residential 338 338 Other: Agriculture Consumer Other real estate owned 3,781 3,781 Total nonrecurring $ 9,209 $ $ $ 9,209 $ 11 Description Fair Value Measurements Using Total Gains (dollars in thousands) Fair Value Level 1 Level 2 Level 3 (Losses) December 31, 2014 Assets and liabilities measured on a recurring basis: Available-for-sale securities: U.S.Government Agencies and Sponsored Agencies $ 261,115 $ $ 261,115 $ $ Corporate Debt securities 1,583 1,583 Obligations of states and political subdivisions 26,289 26,289 Corporate stock 77 28 49 Total recurring $ 289,064 $ 28 $ 289,036 $ $ Assets and liabilities measured on a nonrecurring basis: Impaired loans: Commercial Real estate: $ 666 $ $ $ 666 $ 14 Commercial 286 286 Other real estate owned 4,404 4,404 66 Total nonrecurring $ 5,356 $ $ $ 5,356 $ 80

2. STOCK-BASED COMPENSATION - O

2. STOCK-BASED COMPENSATION - Option activity (Details) - 6 months ended Jun. 30, 2015 - Options Shares - USD ($) $ / shares in Units, $ in Thousands	Total
Outstanding	271,700
Granted	26,427
Exercised	0
Cancelled	23,385
Outstanding	274,742
Number of options vested	215,205
Nonvested, Shares	59,537
Weighted average exercise price, outstanding beginning	$ 16.27
Granted	9.56
Exercised	0
Cancelled	18.11
Weighted average exercise price, outstanding ending	15.47
Weighted average exercise price of vested stock options (in dollars per share)	17.27
Weighted average exercise price of nonvested stock options (in dollars per share)	$ 8.96
Weighted years to maturity outstanding beginning	3 years 1 month 6 days
Weighted years to maturity outstanding Ending	3 years 9 months 18 days
Weighted average remaining contractual term in years, vested	2 years 4 months 24 days
Weighted average remaining contractual term in years, non-vested	9 years 1 month 6 days
Aggregate Intrinsic Value, options outstanding, beginning	$ 82
Aggregate Intrinsic Value, options outstanding, ending	90
Aggregate Intrinsic Value, options vested	62
Aggregate Intrinsic Value, options non-vested	$ 28

2. STOCK-BASED COMPENSATION - R

2. STOCK-BASED COMPENSATION - Restricted Stock (Details) - 6 months ended Jun. 30, 2015 - Restricted stock - $ / shares	Total
Restricted Stock Nonvested beginning balance	32,838
Awarded	45,023
Less: Vested	17,071
Less: Cancelled	0
Restricted Stock Nonvested ending balance	60,790
Weighted Average Grant Date Fair Value Nonvested beginning balance	$ 8.31
Awarded	9.49
Less: Vested	8.72
Less: Cancelled	0
Weighted Average Grant Date Fair Value Nonvested ending balance	$ 9.07

2. STOCK-BASED COMPENSATION - E

2. STOCK-BASED COMPENSATION - Equity Plans and Compensation (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Share based compensation	$ 71	$ 38	$ 126	$ 71
Tax benefit of equity compensation expense			45	$ 25
Compensation cost related to nonvested stock option awards not yet recorded	159		159
Compensation cost related to restricted stock awards not yet recorded	$ 484		$ 484
2000 Plan
Stock options outstanding under Equity Incentive Plan	198,281		198,281
2010 Plan
Stock options outstanding under Equity Incentive Plan	76,461		76,461
Authorized shares that remain available for issuance under the 2010 Plan	1,399,259		1,399,259
Options Shares
Stock options outstanding under Equity Incentive Plan	274,742		274,742		271,700
Period for recognition			5 years
Weighted average costs is expected period			2 years 6 months
Restricted stock
Period for recognition			5 years
Weighted average costs is expected period			2 years

3. COMMITMENTS AND CONTINGENC28

3. COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Commitments
Loan commitments
Commitments	$ 33,016	$ 32,639
Standby letters of credit
Commitments	$ 363	$ 356

4. EARNINGS PER SHARE COMPUTA29

4. EARNINGS PER SHARE COMPUTATION (Details Narrative) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Earnings Per Share Computation Details Narrative
Weighted average common shares outstanding	7,659,883	8,082,638	7,740,320	8,201,383
Dilutive effect of stock based awards	14,828	9,276	13,999	10,515
Antidilutive stock option excluded from earnings per share			214,066	211,024

5. INVESTMENT SECURITIES - Amor

5. INVESTMENT SECURITIES - Amortized Cost, Unrealized Gains, Unrealized Losses And Estimated Fair Values (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Available for sale securities, Amortized Cost	$ 270,557	$ 283,446
Available for sale securities, Unrealized Gains	6,011	6,240
Available for sale securities, Unrealized Losses	(357)	(622)
Available for sale securities, Estimated Fair Value	276,211	289,064
Held-to-Maturity Debt securities Amortized Cost	740
Held-to-Maturity Debt securities Estimated Fair Value	796	922
US Government Agencies and Sponsored Agencies
Available for sale securities, Amortized Cost	244,244	257,002
Available for sale securities, Unrealized Gains	4,686	4,715
Available for sale securities, Unrealized Losses	(327)	(602)
Available for sale securities, Estimated Fair Value	248,603	261,115
Held-to-Maturity Debt securities Amortized Cost	740	862
Held-to-Maturity Debt securities Gross Unrealized Gains	56	60
Held-to-Maturity Debt securities Gross Unrealized Losses	0	0
Held-to-Maturity Debt securities Estimated Fair Value	796	922
Obligations of states and political subdivisions
Available for sale securities, Amortized Cost	24,756	24,886
Available for sale securities, Unrealized Gains	1,226	1,423
Available for sale securities, Unrealized Losses	(30)	(20)
Available for sale securities, Estimated Fair Value	25,952	26,289
Corporate Bonds
Available for sale securities, Amortized Cost	1,503	1,504
Available for sale securities, Unrealized Gains	72	79
Available for sale securities, Unrealized Losses	0	0
Available for sale securities, Estimated Fair Value	1,575	1,583
Equity Securities - Corporate Stock
Available for sale securities, Amortized Cost	54	54
Available for sale securities, Unrealized Gains	27	23
Available for sale securities, Unrealized Losses	0	0
Available for sale securities, Estimated Fair Value	81	$ 77
Held-to-Maturity Debt securities Amortized Cost	0
Held-to-Maturity Debt securities Estimated Fair Value	$ 0

5. INVESTMENT SECURITIES - Inve

5. INVESTMENT SECURITIES - Investment securities with unrealized losses (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Less than 12 months, Estimated Fair Value	$ 39,519	$ 57,145
Less than 12 months, Unrealized Loss	(298)	(503)
12 months or more, Estimated Fair Value	4,386	10,655
12 months or more, Unrealized Loss	(59)	(119)
Total Estimated Fair Value	43,905	67,800
Total Unrealized Loss	(357)	(622)
US Government Agencies and Sponsored Agencies
Less than 12 months, Estimated Fair Value	38,764	57,145
Less than 12 months, Unrealized Loss	(289)	(503)
12 months or more, Estimated Fair Value	3,746	10,006
12 months or more, Unrealized Loss	(38)	(99)
Total Estimated Fair Value	42,510	67,151
Total Unrealized Loss	(327)	(602)
Obligations of states and political subdivisions
Less than 12 months, Estimated Fair Value	755	0
Less than 12 months, Unrealized Loss	(9)	0
12 months or more, Estimated Fair Value	640	649
12 months or more, Unrealized Loss	(21)	(20)
Total Estimated Fair Value	1,395	649
Total Unrealized Loss	$ (30)	$ (20)

5. INVESTMENT SECURITIES - Am32

5. INVESTMENT SECURITIES - Amortized cost and estimated fair values (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Within one year, Amortized Cost	$ 175
After one through five years, Amortized Cost	3,810
After five through ten years, Amortized Cost	13,405
After ten years, Amortized Cost	8,869
Total Amortized Cost	26,259
Within one year, Estimated Fair Value	176
After one through five years, Estimated Fair Value	3,960
After five through ten years, Estimated Fair Value	14,051
After ten years, Estimated Fair Value	9,340
Total Estimated Fair Value	27,527
Equity securities, Amortized Cost	270,557
Equity securities, Estimated Fair Value	276,211
Held-to-Maturity Amortized Cost	740
Held-to-Maturity Estimated Fair Value	796	$ 922
US Government Agencies and Sponsored Agencies
Equity securities, Amortized Cost	244,244
Equity securities, Estimated Fair Value	248,603
Held-to-Maturity Amortized Cost	740	862
Held-to-Maturity Estimated Fair Value	796	$ 922
Equity Securities - Corporate Stock
Equity securities, Amortized Cost	54
Equity securities, Estimated Fair Value	81
Held-to-Maturity Amortized Cost	0
Held-to-Maturity Estimated Fair Value	$ 0

6. IMPAIRED AND NONPERFORMING33

6. IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED - Nonaccrual loans (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Total nonperforming assets	$ 7,113	$ 7,178
Nonperforming loans and leases to total loans and leases	0.87%	0.63%
Total nonperforming assets to total assets	1.15%	1.16%
Nonaccrual loans and leases that are current to terms (less than 30 days past due)
Total nonperforming assets	$ 96	$ 13
Nonaccrual loans and leases that are past due
Total nonperforming assets	2,358	1,640
Loans and leases past due 90 days and accruing interest
Total nonperforming assets	0	0
Other assets
Total nonperforming assets	878	878
Other real estate owned
Total nonperforming assets	$ 3,781	$ 4,647

6. IMPAIRED AND NONPERFORMING34

6. IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED - Nonperforming assets (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
With no related allowance recorded: Recorded Investment	$ 12,325	$ 11,059
With no related allowance recorded: Unpaid Principal Balance	13,045	11,860
With an allowance recorded: Recorded Investment	11,491	14,061
With an allowance recorded: Unpaid Principal Balance	11,703	14,258
With an allowance recorded: Related Allowance	1,453	1,603
Recorded Investment	23,816	25,120
Unpaid Principal Balance	24,748	26,118
Related Allowance	1,453	1,603
Commercial
With no related allowance recorded: Recorded Investment	36	0
With no related allowance recorded: Unpaid Principal Balance	36	0
With an allowance recorded: Recorded Investment	728	769
With an allowance recorded: Unpaid Principal Balance	728	769
With an allowance recorded: Related Allowance	540	344
Recorded Investment	764	769
Unpaid Principal Balance	764	769
Related Allowance	540	344
Real estate-commercial
With no related allowance recorded: Recorded Investment	11,951	10,684
With no related allowance recorded: Unpaid Principal Balance	12,584	11,398
With an allowance recorded: Recorded Investment	7,287	9,773
With an allowance recorded: Unpaid Principal Balance	7,386	9,857
With an allowance recorded: Related Allowance	630	949
Recorded Investment	19,238	20,457
Unpaid Principal Balance	19,970	21,255
Related Allowance	630	949
Real estate-multi-family
With an allowance recorded: Recorded Investment	492	496
With an allowance recorded: Unpaid Principal Balance	492	496
With an allowance recorded: Related Allowance	7	38
Recorded Investment	492	496
Unpaid Principal Balance	492	496
Related Allowance	7	38
Real Estate Residential
With no related allowance recorded: Recorded Investment	338	338
With no related allowance recorded: Unpaid Principal Balance	425	425
With an allowance recorded: Recorded Investment	2,496	2,524
With an allowance recorded: Unpaid Principal Balance	2,609	2,637
With an allowance recorded: Related Allowance	232	237
Recorded Investment	2,834	2,862
Unpaid Principal Balance	3,034	3,062
Related Allowance	232	237
Agriculture
With an allowance recorded: Recorded Investment	376	381
With an allowance recorded: Unpaid Principal Balance	376	381
With an allowance recorded: Related Allowance	11	13
Recorded Investment	376	381
Unpaid Principal Balance	376	381
Related Allowance	11	13
Consumer
With no related allowance recorded: Recorded Investment		37
With no related allowance recorded: Unpaid Principal Balance		37
With an allowance recorded: Recorded Investment	112	118
With an allowance recorded: Unpaid Principal Balance	112	118
With an allowance recorded: Related Allowance	33	22
Recorded Investment	112	155
Unpaid Principal Balance	112	155
Related Allowance	$ 33	$ 22

6. IMPAIRED AND NONPERFORMING35

6. IMPAIRED AND NONPERFORMING LOANS AND LEASES AND OTHER REAL ESTATE OWNED - Impaired loans and leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Impaired Loans and Leases	$ 24,394	$ 25,988	$ 24,012	$ 25,894
Interest income recognized on impaired loans and leases	263	307	561	629
Commercial
Impaired Loans and Leases	757	1,610	794	1,517
Interest income recognized on impaired loans and leases	3	9	5	22
Real estate-commercial
Impaired Loans and Leases	19,796	19,218	19,383	19,029
Interest income recognized on impaired loans and leases	216	237	472	484
Real estate-multi-family
Impaired Loans and Leases	492	1,644	494	1,642
Interest income recognized on impaired loans and leases	7	19	12	38
Real estate-construction
Impaired Loans and Leases	0	246	0	245
Interest income recognized on impaired loans and leases	0	3	0	6
Real Estate Residential
Impaired Loans and Leases	2,840	2,912	2,848	2,908
Interest income recognized on impaired loans and leases	32	29	63	67
Agriculture
Impaired Loans and Leases	377	194	378	389
Interest income recognized on impaired loans and leases	5	10	8	10
Consumer
Impaired Loans and Leases	132	164	115	164
Interest income recognized on impaired loans and leases	$ 0	$ 0	$ 1	$ 2

7. TROUBLED DEBT RESTRUCTURIN36

7. TROUBLED DEBT RESTRUCTURINGS (Details) $ in Thousands	3 Months Ended		6 Months Ended
7. TROUBLED DEBT RESTRUCTURINGS (Details) $ in Thousands	Jun. 30, 2015USD ($)Integer	Jun. 30, 2014USD ($)Integer	Jun. 30, 2015USD ($)Integer	Jun. 30, 2014USD ($)Integer	Dec. 31, 2014USD ($)
Number of loans \| Integer	5	2	7	6
Premodification outstanding recorded investment	$ 1,975	$ 259	$ 2,492	$ 5,155
Post-modification outstanding recorded investment	1,975	$ 259	2,492	$ 5,155
Modified troubled debt restructurings	$ 734		$ 734		$ 829
Commercial
Number of loans \| Integer	1		1
Premodification outstanding recorded investment	$ 47		$ 47
Post-modification outstanding recorded investment	$ 47		$ 47
Real estate-commercial
Number of loans \| Integer	2	1	4	5
Premodification outstanding recorded investment	$ 1,650	$ 213	$ 2,167	$ 5,109
Post-modification outstanding recorded investment	$ 1,650	$ 213	$ 2,167	$ 5,109
Real Estate Residential
Number of loans \| Integer	1		1
Premodification outstanding recorded investment	$ 255		$ 255
Post-modification outstanding recorded investment	$ 255		$ 255
Consumer
Number of loans \| Integer	1	1	1	1
Premodification outstanding recorded investment	$ 23	$ 46	$ 23	$ 46
Post-modification outstanding recorded investment	$ 23	$ 46	$ 23	$ 46

8. ALLOWANCE FOR LOAN AND LEA37

8. ALLOWANCE FOR LOAN AND LEASE LOSSES - Internal risk ratings (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Total	$ 280,970	$ 263,645
Real estate-commercial
Total	198,395	193,871
Real estate-multi-family
Total	17,420	14,167
Leases
Total	981	1,286
Agriculture
Total	2,439	2,882
Commercial
Total	32,034	25,186
Real estate-construction
Total	12,277	8,028
Real Estate Residential
Total	13,124	13,309
Consumer
Total	4,300	4,916
Pass
Total	235,716	216,835
Pass \| Commercial
Total	27,183	20,179
Pass \| Real estate-commercial
Total	169,711	163,091
Pass \| Real estate-multi-family
Total	16,922	13,663
Pass \| Real Estate Construction
Total	6,838	3,327
Pass \| Real Estate Residential
Total	9,243	9,364
Pass \| Leases
Total	981	1,286
Pass \| Agriculture
Total	2,063	2,501
Pass \| Consumer
Total	2,775	3,424
Watch
Total	23,141	23,425
Watch \| Commercial
Total	1,247	1,280
Watch \| Real estate-commercial
Total	12,853	13,724
Watch \| Real estate-multi-family
Total	498	504
Watch \| Real Estate Construction
Total	5,114	4,372
Watch \| Real Estate Residential
Total	2,305	2,504
Watch \| Leases
Total	0	0
Watch \| Agriculture
Total	0	0
Watch \| Consumer
Total	1,124	1,041
Special mention
Total	15,704	15,265
Special mention \| Commercial
Total	0	101
Special mention \| Real estate-commercial
Total	14,031	13,583
Special mention \| Real estate-multi-family
Total	0	0
Special mention \| Real Estate Construction
Total	325	329
Special mention \| Real Estate Residential
Total	743	603
Special mention \| Leases
Total	0	0
Special mention \| Agriculture
Total	376	381
Special mention \| Consumer
Total	229	268
Substandard
Total	6,409	8,120
Substandard \| Commercial
Total	3,604	3,626
Substandard \| Real estate-commercial
Total	1,800	3,473
Substandard \| Real estate-multi-family
Total	0	0
Substandard \| Real Estate Construction
Total	0	0
Substandard \| Real Estate Residential
Total	833	838
Substandard \| Leases
Total	0	0
Substandard \| Agriculture
Total	0	0
Substandard \| Consumer
Total	172	183
Doubtful or loss
Total	0	0
Doubtful or loss \| Commercial
Total	0	0
Doubtful or loss \| Real estate-commercial
Total	0	0
Doubtful or loss \| Real estate-multi-family
Total	0	0
Doubtful or loss \| Real Estate Construction
Total	0	0
Doubtful or loss \| Real Estate Residential
Total	0	0
Doubtful or loss \| Leases
Total	0	0
Doubtful or loss \| Agriculture
Total	0	0
Doubtful or loss \| Consumer
Total	$ 0	$ 0

8. ALLOWANCE FOR LOAN AND LEA38

8. ALLOWANCE FOR LOAN AND LEASE LOSSES - Allowance Roll-forward (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Allowance for Loan and Lease Losses Beginning balance	$ 5,308	$ 5,373	$ 5,301	$ 5,346
Provision for loan losses	0	0	0	0
Loans charged off	(5)	(73)	(7)	(74)
Recoveries	56	162	65	190
Allowance for Loan and Lease Losses Ending balance	5,359	5,462	5,359	5,462
Allowance related to: Loans individually evaluated for impairment	(1,453)		(1,453)		$ (1,603)
Allowance related to: Loans collectively evaluated for impairment	3,906		3,906		3,698
Loans	280,970		280,970		263,645
Loans individually evaluated for impairment	23,816		23,816		25,120
Loans collectively evaluated for impairment	257,154		257,154		238,525
Commercial
Allowance for Loan and Lease Losses Beginning balance	1,403	781	1,430	885
Provision for loan losses	232	489	199	365
Loans charged off	0	0	0	0
Recoveries	17	121	23	141
Allowance for Loan and Lease Losses Ending balance	1,652	1,391	1,652	1,391
Allowance related to: Loans individually evaluated for impairment	(540)		(540)		(344)
Allowance related to: Loans collectively evaluated for impairment	1,112		1,112		1,086
Loans	32,034		32,034		25,186
Loans individually evaluated for impairment	764		764		769
Loans collectively evaluated for impairment	31,270		31,270		24,417
Real estate-commercial
Allowance for Loan and Lease Losses Beginning balance	2,284	2,476	2,317	2,401
Provision for loan losses	(355)	(365)	(389)	(291)
Loans charged off	0	0	0	0
Recoveries	39	38	40	39
Allowance for Loan and Lease Losses Ending balance	1,968	2,149	1,968	2,149
Allowance related to: Loans individually evaluated for impairment	(630)		(630)		(949)
Allowance related to: Loans collectively evaluated for impairment	1,338		1,338		1,368
Loans	198,395		198,395		193,871
Loans individually evaluated for impairment	19,238		19,238		20,457
Loans collectively evaluated for impairment	179,157		179,157		173,414
Real estate-multi-family
Allowance for Loan and Lease Losses Beginning balance	120	241	130	242
Provision for loan losses	(13)	21	(23)	20
Loans charged off	0	0	0	0
Recoveries	0	0	0	0
Allowance for Loan and Lease Losses Ending balance	107	262	107	262
Allowance related to: Loans individually evaluated for impairment	(7)		(7)		(38)
Allowance related to: Loans collectively evaluated for impairment	100		100		92
Loans	17,420		17,420		14,167
Loans individually evaluated for impairment	492		492		496
Loans collectively evaluated for impairment	16,928		16,928		13,671
Real estate-construction
Allowance for Loan and Lease Losses Beginning balance	680	485	583	542
Provision for loan losses	127	(45)	224	(103)
Loans charged off	0	0	0	0
Recoveries	0	1	0	2
Allowance for Loan and Lease Losses Ending balance	807	441	807	441
Allowance related to: Loans individually evaluated for impairment	0		0		0
Allowance related to: Loans collectively evaluated for impairment	807		807		583
Loans	12,277		12,277		8,028
Loans individually evaluated for impairment	0		0		0
Loans collectively evaluated for impairment	12,277		12,277		8,028
Real Estate Residential
Allowance for Loan and Lease Losses Beginning balance	392	883	399	825
Provision for loan losses	(7)	(177)	(14)	(122)
Loans charged off	0	0	0	0
Recoveries	0	2	0	5
Allowance for Loan and Lease Losses Ending balance	385	708	385	708
Allowance related to: Loans individually evaluated for impairment	(232)		(232)		(237)
Allowance related to: Loans collectively evaluated for impairment	153		153		162
Loans	13,124		13,124		13,309
Loans individually evaluated for impairment	2,834		2,834		2,862
Loans collectively evaluated for impairment	10,290		10,290		10,447
Leases
Allowance for Loan and Lease Losses Beginning balance	1	3	2	4
Provision for loan losses	1	(1)	0	(5)
Loans charged off	(1)	0	(1)	0
Recoveries	0	0	0	3
Allowance for Loan and Lease Losses Ending balance	1	2	1	2
Allowance related to: Loans individually evaluated for impairment	0		0		0
Allowance related to: Loans collectively evaluated for impairment	1		1		2
Loans	981		981		1,286
Loans individually evaluated for impairment	0		0		0
Loans collectively evaluated for impairment	981		981		1,286
Agriculture
Allowance for Loan and Lease Losses Beginning balance	55	73	62	80
Provision for loan losses	(5)	(4)	(12)	(11)
Loans charged off	0	0	0	0
Recoveries	0	0	0	0
Allowance for Loan and Lease Losses Ending balance	50	69	50	69
Allowance related to: Loans individually evaluated for impairment	(11)		(11)		(13)
Allowance related to: Loans collectively evaluated for impairment	39		39		49
Loans	2,439		2,439		2,882
Loans individually evaluated for impairment	376		376		381
Loans collectively evaluated for impairment	2,063		2,063		2,501
Consumer
Allowance for Loan and Lease Losses Beginning balance	132	156	124	161
Provision for loan losses	(6)	48	2	44
Loans charged off	(4)	(73)	(6)	(74)
Recoveries	0	0	2	0
Allowance for Loan and Lease Losses Ending balance	122	131	122	131
Allowance related to: Loans individually evaluated for impairment	(33)		(33)		(22)
Allowance related to: Loans collectively evaluated for impairment	89		89		102
Loans	4,300		4,300		4,916
Loans individually evaluated for impairment	112		112		155
Loans collectively evaluated for impairment	4,188		4,188		4,761
Unallocated
Allowance for Loan and Lease Losses Beginning balance	241	275	254	206
Provision for loan losses	26	34	13	103
Loans charged off	0	0	0	0
Recoveries	0	0	0	0
Allowance for Loan and Lease Losses Ending balance	267	$ 309	267	$ 309
Allowance related to: Loans individually evaluated for impairment	0		0		0
Allowance related to: Loans collectively evaluated for impairment	267		267		254
Loans	0		0		0
Loans individually evaluated for impairment	0		0		0
Loans collectively evaluated for impairment	$ 0		$ 0		$ 0

8. ALLOWANCE FOR LOAN AND LEA39

8. ALLOWANCE FOR LOAN AND LEASE LOSSES - Aging analysis (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Total Past Due	$ 2,725	$ 2,666
Current	278,245	260,979
Total Loans	280,970	263,645
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	2,454	1,653
Commercial
Total Past Due	652	1,179
Current	31,382	24,007
Total Loans	32,034	25,186
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	652	666
Commercial \| 30 -59 Days Past Due
Total Past Due	0	513
Commercial \| 60 -89 Days Past Due
Total Past Due	30	0
Commercial \| Past Due Greater Than 90 Days
Total Past Due	622	666
Real estate-commercial
Total Past Due	1,693	1,014
Current	196,702	192,857
Total Loans	198,395	193,871
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	1,332	507
Real estate-commercial \| 30 -59 Days Past Due
Total Past Due	860	507
Real estate-commercial \| 60 -89 Days Past Due
Total Past Due	0	0
Real estate-commercial \| Past Due Greater Than 90 Days
Total Past Due	833	507
Real estate-multi-family
Total Past Due	0	0
Current	17,420	14,167
Total Loans	17,420	14,167
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	0	0
Real estate-multi-family \| 30 -59 Days Past Due
Total Past Due	0	0
Real estate-multi-family \| 60 -89 Days Past Due
Total Past Due	0	0
Real estate-multi-family \| Past Due Greater Than 90 Days
Total Past Due	0	0
Real estate-construction
Total Past Due	0	0
Current	12,277	8,028
Total Loans	12,277	8,028
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	0	0
Real estate-construction \| 30 -59 Days Past Due
Total Past Due	0	0
Real estate-construction \| 60 -89 Days Past Due
Total Past Due	0	0
Real estate-construction \| Past Due Greater Than 90 Days
Total Past Due	0	0
Real Estate Residential
Total Past Due	338	338
Current	12,786	12,971
Total Loans	13,124	13,309
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	338	338
Real Estate Residential \| 30 -59 Days Past Due
Total Past Due	0	0
Real Estate Residential \| 60 -89 Days Past Due
Total Past Due	0	0
Real Estate Residential \| Past Due Greater Than 90 Days
Total Past Due	338	338
Leases
Total Past Due	0	0
Current	981	1,286
Total Loans	981	1,286
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	0	0
Leases \| 30 -59 Days Past Due
Total Past Due	0	0
Leases \| 60 -89 Days Past Due
Total Past Due	0	0
Leases \| Past Due Greater Than 90 Days
Total Past Due	0	0
Agriculture
Total Past Due	0	0
Current	2,439	2,882
Total Loans	2,439	2,882
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	0	0
Agriculture \| 30 -59 Days Past Due
Total Past Due	0	0
Agriculture \| 60 -89 Days Past Due
Total Past Due	0	0
Agriculture \| Past Due Greater Than 90 Days
Total Past Due	0	0
Consumer
Total Past Due	42	135
Current	4,258	4,781
Total Loans	4,300	4,916
Past Due Greater Than 90 Days and Accruing	0	0
Nonaccrual	132	142
Consumer \| 30 -59 Days Past Due
Total Past Due	6	135
Consumer \| 60 -89 Days Past Due
Total Past Due	36	0
Consumer \| Past Due Greater Than 90 Days
Total Past Due	$ 0	$ 0

9. BORROWING ARRANGEMENTS (Deta

9. BORROWING ARRANGEMENTS (Details Narrative) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Borrowing Arrangements
Unsecured short-term borrowing arrangements with two of its correspondent banks	$ 17,000
FHLB advances	$ 11,000	$ 11,000
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate, Minimum	0.45%	0.24%
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate, Maximum	1.91%	1.91%
Remaining amounts available under the borrowing arrangement with the FHLB	$ 75,971	$ 67,228
Secured borrowing agreement with the Federal Reserve Bank of San Francisco	$ 16,244	$ 17,335

11. FAIR VALUE MEASUREMENTS - C

11. FAIR VALUE MEASUREMENTS - Carrying amounts and estimated fair values (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financial assets:
Cash and due from banks	$ 18,009	$ 22,449
Interest-bearing deposits in banks	1,000	1,000
Available-for-sale securities	276,211	289,064
Held-to-maturity securities	796	922
FHLB stock	3,779	3,686
Net loans and leases:	280,014	261,421
Accrued interest receivable	1,837	1,858
Deposits:
Noninterest-bearing	173,324	155,698
Savings	57,120	58,820
Money market	132,551	147,625
NOW accounts	61,353	60,862
Time, $100,000 or more	67,164	66,203
Other time	21,182	22,282
Short-term borrowings	3,500	3,500
Long-term borrowings	7,566	7,567
Accrued interest payable	58	59
Level 1
Financial assets:
Cash and due from banks	18,009	22,449
Available-for-sale securities	32	28
Deposits:
Noninterest-bearing	173,324	155,698
Savings	57,120	58,820
Money market	132,551	147,625
NOW accounts	61,353	60,862
Short-term borrowings	3,500	3,500
Accrued interest payable	2
Level 2
Financial assets:
Interest-bearing deposits in banks	1,004	1,002
Available-for-sale securities	276,179	289,036
Held-to-maturity securities	796	922
Accrued interest receivable	1,092	1,150
Deposits:
Time, $100,000 or more	67,164	66,203
Other time	21,182	22,282
Long-term borrowings	7,566	7,567
Accrued interest payable	56	59
Level 3
Financial assets:
Net loans and leases:	280,014	261,421
Accrued interest receivable	745	708
Carrying Amount
Financial assets:
Cash and due from banks	18,009	22,449
Interest-bearing deposits in banks	1,000	1,000
Available-for-sale securities	276,211	289,064
Held-to-maturity securities	740	862
FHLB stock	3,779	3,686
Net loans and leases:	275,353	258,057
Accrued interest receivable	1,837	1,858
Deposits:
Noninterest-bearing	173,324	155,698
Savings	57,120	58,820
Money market	132,551	147,625
NOW accounts	61,353	60,862
Time, $100,000 or more	66,626	65,569
Other time	21,009	22,119
Short-term borrowings	3,500	3,500
Long-term borrowings	7,500	7,500
Accrued interest payable	$ 58	$ 59

11. FAIR VALUE MEASUREMENTS - A

11. FAIR VALUE MEASUREMENTS - Assets and liabilities measured at fair value on recurring and non-recurring basis (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Non Recurring
Impaired loans:
Total gain (losses)	$ 11	$ 80
US Government Agencies and Sponsored Agencies \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring	248,603	261,115
US Government Agencies and Sponsored Agencies \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring	248,603	261,115
Obligations of states and political subdivisions \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring	25,952	26,289
Obligations of states and political subdivisions \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring	25,952	26,289
Corporate bonds \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring	1,575
Corporate bonds \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring	1,575
Corporate stock \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring	81	77
Corporate stock \| Level 1
Available-for-sale securities:
Asset fair value disclosure recurring	32	28
Corporate stock \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring	49	49
Commercial
Impaired loans:
Total gain (losses)	176	14
Commercial \| Fair Value
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	623	666
Commercial \| Level 3
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	623	666
Real estate-commercial
Impaired loans:
Total gain (losses)	(165)
Real estate-commercial \| Fair Value
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	4,467	286
Real estate-commercial \| Level 3
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	4,467	286
Other real estate owned
Impaired loans:
Total gain (losses)		66
Other real estate owned \| Fair Value
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	3,781	4,404
Other real estate owned \| Level 3
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	3,781	4,404
Corporate Debt securities \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring		1,583
Corporate Debt securities \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring		1,583
Recurring \| Fair Value
Available-for-sale securities:
Asset fair value disclosure recurring	276,211	289,064
Recurring \| Level 1
Available-for-sale securities:
Asset fair value disclosure recurring	32	28
Recurring \| Level 2
Available-for-sale securities:
Asset fair value disclosure recurring	276,179	289,036
Non Recurring \| Fair Value
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	9,209	5,356
Non Recurring \| Level 3
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	9,209	$ 5,356
Real Estate Residential \| Fair Value
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	338
Real Estate Residential \| Level 3
Impaired loans:
Assets, Fair Value Disclosure, Nonrecurring	$ 338