Document_and_Entity_Informatio
Document and Entity Information (USD $) | 3 Months Ended | |
Mar. 31, 2014 | 13-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'First Federal of Northern Michigan Bancorp, Inc. | ' |
Entity Central Index Key | '0001128227 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Document Fiscal Year Focus | '2014 | ' |
Trading Symbol | 'FFNM | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Par Value Per Share | $0.01 | ' |
Entity Common Stock, Shares Outstanding | ' | 2,884,049 |
Consolidated_Balance_Sheet_Una
Consolidated Balance Sheet (Unaudited) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
ASSETS | ' | ' |
Cash on hand and due from banks | $2,868,380 | $2,760,010 |
Overnight deposits with FHLB | 278,575 | 5,823 |
Total cash and cash equivalents | 3,146,955 | 2,765,833 |
Securities available for sale | 56,442,499 | 50,358,175 |
Securities held to maturity | 2,255,000 | 2,255,000 |
Loans held for sale | 235,500 | 175,400 |
Loans receivable, net of allowance for loan losses of $1,458,130 and $1,471,622 as of March 31, 2014 and December 31, 2013, respectively | 135,326,174 | 136,314,964 |
Foreclosed real estate and other repossessed assets | 1,938,058 | 1,780,058 |
Federal Home Loan Bank stock, at cost | 3,266,100 | 3,266,100 |
Premises and equipment | 5,159,558 | 5,203,301 |
Accrued interest receivable | 828,205 | 744,730 |
Intangible assets | 10,087 | 39,732 |
Deferred tax asset | 657,705 | 798,163 |
Originated mortgage servicing rights | 812,421 | 860,024 |
Bank owned life insurance | 4,638,674 | 4,610,070 |
Other assets | 549,713 | 485,234 |
Total assets | 215,266,649 | 209,656,784 |
Liabilities: | ' | ' |
Deposits | 165,719,953 | 160,029,115 |
Advances from borrowers for taxes and insurance | 321,427 | 151,254 |
Advances from Federal Home Loan Bank | 24,232,904 | 24,813,409 |
Accrued expenses and other liabilities | 1,031,238 | 1,138,324 |
Total liabilities | 191,305,522 | 186,132,102 |
Stockholders' equity: | ' | ' |
Common stock ($0.01 par value 20,000,000 shares authorized, 3,191,799 shares issued) | 31,918 | 31,918 |
Additional paid-in capital | 23,853,891 | 23,853,891 |
Retained earnings | 2,927,034 | 2,763,242 |
Treasury stock at cost (307,750 shares) | -2,963,918 | -2,963,918 |
Accumulated other comprehensive (loss) income (loss) | 112,202 | -160,451 |
Total stockholders' equity | 23,961,127 | 23,524,682 |
Total liabilities and stockholders' equity | $215,266,649 | $209,656,784 |
Consolidated_Balance_Sheet_Una1
Consolidated Balance Sheet (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Allowance for loan losses | $1,458,130 | $1,471,622 |
Common stock, par value per share | $0.01 | $0.01 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 3,191,799 | 3,191,799 |
Treasury stock, shares | 307,750 | 307,750 |
Consolidated_Statement_of_Inco
Consolidated Statement of Income and Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Interest income: | ' | ' |
Interest and fees on loans | $1,710,414 | $1,816,613 |
Interest and dividends on investments | ' | ' |
Taxable | 150,676 | 115,329 |
Tax-exempt | 41,456 | 37,695 |
Interest on mortgage-backed securities | 142,294 | 115,371 |
Total interest income | 2,044,840 | 2,085,008 |
Interest expense: | ' | ' |
Interest on deposits | 186,527 | 221,902 |
Interest on borrowings | 62,766 | 99,441 |
Total interest expense | 249,293 | 321,343 |
Net Interest Income | 1,795,547 | 1,763,665 |
Provision for loan losses | 15,765 | 144,074 |
Net Interest Income after provision for loan losses | 1,779,782 | 1,619,591 |
Non-interest income: | ' | ' |
Service charges and other fees | 181,092 | 192,440 |
Mortgage banking activities | 95,838 | 170,432 |
Net income (loss) on sale of premises and equipment, real estate owned and other repossessed assets | -4,813 | 6,479 |
Other | 64,118 | 70,992 |
Total other income | 336,235 | 440,343 |
Operating Expenses | ' | ' |
Compensation and employee benefits | 1,109,043 | 1,159,257 |
FDIC Insurance Premiums | 45,544 | 45,699 |
Advertising | 27,635 | 38,919 |
Occupancy | 236,375 | 233,446 |
Amortization of intangible assets | 29,646 | 29,646 |
Service bureau charges | 62,386 | 77,494 |
Professional services | 129,258 | 72,863 |
Collection activity | 18,205 | 42,173 |
Real estate owned & other repossessed assets | 16,949 | 33,266 |
Other | 219,503 | 259,527 |
Total operating expenses | 1,894,544 | 1,992,290 |
Income before income tax expense | 221,473 | 67,644 |
Net income | 221,473 | 67,644 |
Other Comprehensive Income (Loss): | ' | ' |
Unrealized (loss) gain on investment securities - available for sale securities - net of tax | 272,653 | -99,797 |
Comprehensive Income (Loss) | $494,126 | ($32,153) |
Net Income per share | ' | ' |
Basic | $0.08 | $0.02 |
Diluted | $0.08 | $0.02 |
Weighted average number of shares outstanding | ' | ' |
Basic | 2,884,049 | 2,884,049 |
Including dilutive stock options | 2,884,049 | 2,884,049 |
Dividends per common share | $0.02 | ' |
Consolidated_Statement_of_Chan
Consolidated Statement of Changes in Stockholders' Equity (Unaudited) (USD $) | Common Stock | Treasury Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total |
Balance, beginning at Dec. 31, 2013 | $31,918 | ($2,963,918) | $23,853,891 | $2,763,242 | ($160,451) | $23,524,682 |
Net income | ' | ' | ' | 221,473 | ' | 221,473 |
Change in unrealized gain on available-for-sale securities (net of tax of $140,458) | ' | ' | ' | ' | 272,653 | 272,653 |
Dividends declared | ' | ' | ' | -57,681 | ' | -57,681 |
Balance, ending at Mar. 31, 2014 | $31,918 | ($2,963,918) | $23,853,891 | $2,927,034 | $112,202 | $23,961,127 |
Consolidated_Statement_of_Chan1
Consolidated Statement of Changes in Stockholders' Equity (Parenthetical) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Statement of Stockholders' Equity [Abstract] | ' |
Tax on change in unrealized gain on available-for-sale securities | $140,458 |
Consolidated_Statement_of_Cash
Consolidated Statement of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Cash Flows from Operating Activities: | ' | ' |
Net income | $221,473 | $67,644 |
Adjustments to reconcile net income to net cash from operating activities: | ' | ' |
Depreciation and amortization | 101,720 | 100,605 |
Provision for loan loss | 15,765 | 144,074 |
Amortization and accretion on securities | 97,569 | 152,447 |
Gain on sale of loans held for sale | -41,739 | -70,471 |
Originations of loans held for sale | -2,524,403 | -4,427,961 |
Proceeds from sale of loans held for sale | 2,506,042 | 4,462,144 |
Gain on sale of fixed assets | -1,725 | ' |
(Gain) loss on sale of real estate owned and other repossessed assets | 6,538 | -6,479 |
Net change in: | ' | ' |
Accrued interest receivable | -83,475 | -63,960 |
Other assets | -16,876 | 76,000 |
Prepaid FDIC insurance premiums | ' | 42,573 |
Bank owned life insurance | -28,604 | -33,079 |
Accrued expenses and other liabilities | -107,086 | -129,826 |
Net cash provided by operating activities | 145,199 | 313,711 |
Cash Flows from Investing Activities: | ' | ' |
Net decrease in loans | 728,025 | 975,988 |
Proceeds from maturities and calls of available-for-sale securities | 2,336,150 | 3,990,226 |
Proceeds from sale of real estate owned and other repossessed assets | 80,462 | 196,645 |
Proceeds from sale of property and equipment | 1,725 | ' |
Purchase of securities | -8,104,932 | -5,433,778 |
Purchase of premises and equipment | -28,332 | ' |
Net cash used in investing activities | -4,986,902 | -270,919 |
Cash Flows from Financing Activities: | ' | ' |
Dividends paid on common stock | -57,681 | ' |
Net (decrease) increase in deposits | 5,690,838 | -172,334 |
Net increase in Repo Sweep accounts | ' | 682,630 |
Net increase in advances from borrowers | 170,173 | 171,815 |
Advances from Federal Home Loan Bank | 6,980,000 | 13,930,000 |
Repayments of Federal Home Loan Bank advances | -7,560,505 | -15,425,077 |
Net cash provided by (used in) financing activities | 5,222,825 | -812,966 |
Net decrease in cash and cash equivalents | 381,122 | -770,174 |
Cash and cash equivalents at beginning of period | 2,765,833 | 2,751,810 |
Cash and cash equivalents at end of period | 3,146,955 | 1,981,636 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid during the period for interest | 251,505 | 332,503 |
Transfers of loans to foreclosed real estate and repossessed assets | $245,000 | $208,000 |
BASIS_OF_FINANCIAL_STATEMENT_P
BASIS OF FINANCIAL STATEMENT PRESENTATION | 3 Months Ended |
Mar. 31, 2014 | |
Basis Of Financial Statement Presentation | ' |
BASIS OF FINANCIAL STATEMENT PRESENTATION | ' |
Note 1—BASIS OF FINANCIAL STATEMENT PRESENTATION | |
The accompanying unaudited condensed consolidated interim financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and with the instructions to Form 10-Q. Accordingly, certain information and disclosures required by accounting principles generally accepted in the United States of America for complete financial statements are not included herein. The interim financial statements should be read in conjunction with the financial statements of First Federal of Northern Michigan Bancorp, Inc. and Subsidiaries and the notes thereto included in the Company’s annual report on Form 10-K for the year ended December, 31, 2013. | |
All adjustments, consisting only of normal recurring adjustments, which in the opinion of management are necessary for a fair presentation of financial position, results of operations and cash flows, have been made. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. |
PRINCIPLES_OF_CONSOLIDATION
PRINCIPLES OF CONSOLIDATION | 3 Months Ended |
Mar. 31, 2014 | |
Principles Of Consolidation | ' |
PRINCIPLES OF CONSOLIDATION | ' |
Note 2— PRINCIPLES OF CONSOLIDATION | |
The consolidated financial statements include the accounts of First Federal of Northern Michigan Bancorp, Inc., First Federal of Northern Michigan, and the Bank’s wholly owned subsidiaries, Financial Services & Mortgage Corporation (“FSMC”) and FFNM Agency, Inc. FSMC invests in real estate, which includes leasing, selling, developing, and maintaining real estate properties. The main activity of FFNM Agency is to collect the stream of income associated with the sale of the Blue Cross/Blue Shield override to the Grotenhuis Group (as discussed further below). All significant intercompany balances and transactions have been eliminated in the consolidation. |
PROPOSED_BUSINESS_COMBINATION
PROPOSED BUSINESS COMBINATION | 3 Months Ended |
Mar. 31, 2014 | |
Proposed Business Combination | ' |
PROPOSED BUSINESS COMBINATION | ' |
Note 3— PROPOSED BUSINESS COMBINATION | |
On January 23, 2014, the Company entered into a definitive merger agreement with Alpena Banking Corporation, the Michigan corporation and the bank holding company for Bank of Alpena. Under the terms of the merger agreement, each share of Alpena Banking Corporation will be converted into 1.549 shares of the Company’s common stock. As of March 31, 2014, Bank of Alpena operated one office in Alpena, Michigan and had assets of $69.9 million, deposits of $62.7 million, other liabilities of $269,000 and stockholders’ equity of $7.0 million. The merger agreement has been approved by the boards of directors of each company and is subject to the approvals of shareholders of the Company and of Alpena Banking Corporation, for which each company will hold a special meeting of shareholders, expected, in the third quarter of 2014. The merger is also subject to the requisite regulatory approvals and other customary closing conditions. As the merger has not been completed, the transaction is not reflected in the balance sheet or results of operation for the periods presented in this document. |
SECURITIES
SECURITIES | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Securities | ' | ||||||||||||||||
SECURITIES | ' | ||||||||||||||||
Note 4—SECURITIES | |||||||||||||||||
Investment securities have been classified according to management’s intent. The carrying value and estimated fair value of securities are as follows: | |||||||||||||||||
31-Mar-14 | |||||||||||||||||
Amortized | Gross Unrealized Gains | Gross Unrealized (Losses) | Market | ||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Securities Available for Sale | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 10,345 | $ | 34 | $ | (94 | ) | 10,285 | |||||||||
Municipal obligations | 14,568 | 258 | (181 | ) | 14,645 | ||||||||||||
Corporate bonds & other obligations | 1,072 | 10 | — | 1,082 | |||||||||||||
Mortgage-backed securities | 30,284 | 343 | (207 | ) | 30,420 | ||||||||||||
Equity securities | 3 | 7 | — | 10 | |||||||||||||
Total | $ | 56,272 | $ | 652 | $ | (482 | ) | $ | 56,442 | ||||||||
Securities Held to Maturity | |||||||||||||||||
Municipal obligations | $ | 2,255 | $ | 140 | $ | — | $ | 2,395 | |||||||||
31-Dec-13 | |||||||||||||||||
Amortized | Gross Unrealized Gains | Gross Unrealized (Losses) | Market | ||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Securities Available for Sale | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 7,111 | $ | 36 | $ | (105 | ) | 7,042 | |||||||||
Municipal obligations | 13,694 | 216 | (301 | ) | 13,609 | ||||||||||||
Corporate bonds & other obligations | 1,085 | 12 | — | 1,097 | |||||||||||||
Mortgage-backed securities | 28,708 | 279 | (384 | ) | 28,603 | ||||||||||||
Equity securities | 3 | 4 | — | 7 | |||||||||||||
Total | $ | 50,601 | $ | 547 | $ | (790 | ) | $ | 50,358 | ||||||||
Securities Held to Maturity | |||||||||||||||||
Municipal obligations | $ | 2,255 | $ | 145 | $ | — | $ | 2,400 | |||||||||
The amortized cost and estimated market value of securities at March 31, 2014, by contract maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities with no specified maturity date are separately stated. | |||||||||||||||||
31-Mar-14 | |||||||||||||||||
Amortized | Market | ||||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Available For Sale: | |||||||||||||||||
Due in one year or less | $ | 2,401 | $ | 2,414 | |||||||||||||
Due after one year through five years | 15,508 | 15,585 | |||||||||||||||
Due in five year through ten years | 6,841 | 6,705 | |||||||||||||||
Due after ten years | 1,235 | 1,308 | |||||||||||||||
Subtotal | 25,985 | 26,012 | |||||||||||||||
Equity securities | 3 | 10 | |||||||||||||||
Mortgage-backed securities | 30,284 | 30,420 | |||||||||||||||
Total | $ | 56,272 | $ | 56,442 | |||||||||||||
Held To Maturity: | |||||||||||||||||
Due in one year or less | $ | 90 | $ | 91 | |||||||||||||
Due after one year through five years | 490 | 512 | |||||||||||||||
Due in five year through ten years | 700 | 749 | |||||||||||||||
Due after ten years | 975 | 1,043 | |||||||||||||||
Total | $ | 2,255 | $ | 2,395 | |||||||||||||
At March 31, 2014 and December, 31, 2013, securities with a carrying value and fair value of $34,122,000 and $36,000,000, respectively, were pledged to secure our REPO sweep accounts, FHLB advances and our line of credit at the Federal Reserve. | |||||||||||||||||
There were no security sales in either the three months ended March 31, 2014 or 2013. | |||||||||||||||||
The Company held 33 securities with unrealized losses totaling $482,000 and 39 securities with unrealized losses totaling $790,000 at March 31, 2014 and December 31, 2013, respectively. The unrealized losses on the securities held in the portfolio are not considered other than temporary and have not been recognized into income. This decision is based on the Company’s ability and intent to hold any potentially impaired security until maturity. The performance of the security is based on the contractual terms of the agreement, the extent of the impairment and the financial condition and credit quality of the issuer. The decline in market value is considered temporary and a result of changes in interest rates and other market variables. |
LOANS_AND_ALLOWANCE_FOR_LOAN_L
LOANS AND ALLOWANCE FOR LOAN LOSSES | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||||||
Loans And Allowance For Loan Losses | ' | ||||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | ||||||||||||||||||||||||||||||||
Note 5—LOANS AND ALLOWANCE FOR LOAN LOSSES | |||||||||||||||||||||||||||||||||
The following table sets forth the composition of our loan portfolio by loan type at the dates indicated. | |||||||||||||||||||||||||||||||||
At March 31, | At December 31, | ||||||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Real estate loans: | |||||||||||||||||||||||||||||||||
Residential mortgage | $ | 63,576 | $ | 63,839 | |||||||||||||||||||||||||||||
Commercial loans: | |||||||||||||||||||||||||||||||||
Construction - real estate | 173 | 173 | |||||||||||||||||||||||||||||||
Secured by real estate | 51,382 | 51,726 | |||||||||||||||||||||||||||||||
Other | 12,252 | 12,451 | |||||||||||||||||||||||||||||||
Total commercial loans | 63,807 | 64,350 | |||||||||||||||||||||||||||||||
Consumer loans: | |||||||||||||||||||||||||||||||||
Secured by real estate | 8,490 | 8,730 | |||||||||||||||||||||||||||||||
Other | 1,171 | 1,165 | |||||||||||||||||||||||||||||||
Total consumer loans | 9,661 | 9,895 | |||||||||||||||||||||||||||||||
Total gross loans | $ | 137,044 | $ | 138,084 | |||||||||||||||||||||||||||||
Less: | |||||||||||||||||||||||||||||||||
Net deferred loan fees | (260 | ) | (297 | ) | |||||||||||||||||||||||||||||
Allowance for loan losses | (1,458 | ) | (1,472 | ) | |||||||||||||||||||||||||||||
Total loans, net | $ | 135,326 | $ | 136,315 | |||||||||||||||||||||||||||||
The following table illustrates the contractual aging of the recorded investment in past due loans by class of loans as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
30 - 59 Days Past Due | 60 - 89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total Loans | Recorded Investment > 90 Days and Accruing | |||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | — | $ | — | $ | 173 | $ | 173 | $ | — | $ | 173 | $ | — | |||||||||||||||||||
Commercial Real Estate - other | 2,203 | 12 | 1,441 | 3,656 | 47,726 | 51,382 | — | ||||||||||||||||||||||||||
Commercial - non real estate | 18 | — | — | 18 | 12,234 | 12,252 | — | ||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - Real Estate | 83 | 2 | — | 85 | 8,405 | 8,490 | — | ||||||||||||||||||||||||||
Consumer - Other | 6 | — | — | 6 | 1,165 | 1,171 | — | ||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 1,304 | — | 159 | 1,463 | 62,113 | 63,576 | — | ||||||||||||||||||||||||||
Total | $ | 3,614 | $ | 14 | $ | 1,773 | $ | 5,401 | $ | 131,643 | $ | 137,044 | $ | — | |||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
30 - 59 Days Past Due | 60 - 89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total Loans | Recorded Investment > 90 Days and Accruing | |||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | — | $ | — | $ | 173 | $ | 173 | $ | — | $ | 173 | $ | — | |||||||||||||||||||
Commercial Real Estate - other | — | 521 | 1,441 | 1,962 | 49,764 | 51,726 | — | ||||||||||||||||||||||||||
Commercial - non real estate | 33 | 20 | — | 53 | 12,398 | 12,451 | — | ||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - Real Estate | 54 | 55 | — | 109 | 8,621 | 8,730 | — | ||||||||||||||||||||||||||
Consumer - Other | — | 4 | 2 | 6 | 1,159 | 1,165 | 2 | ||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 1,973 | 393 | 353 | 2,719 | 61,120 | 63,839 | 24 | ||||||||||||||||||||||||||
Total | $ | 2,060 | $ | 993 | $ | 1,969 | $ | 5,022 | $ | 133,062 | $ | 138,084 | $ | 26 | |||||||||||||||||||
The Bank uses an eight tier risk rating system to grade its commercial loans. The grade of a loan may change during the life of the loans. The risk ratings are described as follows: | |||||||||||||||||||||||||||||||||
Risk Grade 1 (Excellent) - Prime loans based on liquid collateral, with adequate margin or supported by strong financial statements. Probability of serious financial deterioration is unlikely. High liquidity, minimum risk, strong ratios, and low handling costs are common to these loans. This classification also includes all loans secured by certificates of deposit or cash equivalents. | |||||||||||||||||||||||||||||||||
Risk Grade 2 (Good) - Desirable loans of somewhat less stature than Grade 1, but with strong financial statements. Probability of serious financial deterioration is unlikely. These loans possess a sound repayment source (and/or a secondary source). These loans represent less than the normal degree of risk associated with the type of financing contemplated. | |||||||||||||||||||||||||||||||||
Risk Grade 3 (Satisfactory) - Satisfactory loans of average risk – may have some minor deficiency or vulnerability to changing economic conditions, but still fully collectible. There may be some minor weakness but with offsetting features or other support readily available. These loans present a normal degree of risk associated with the type of financing. Actual and projected indicators and market conditions provide satisfactory assurance that the credit shall perform in accordance with agreed terms. | |||||||||||||||||||||||||||||||||
Risk Grade 4 (Acceptable) - Loans considered satisfactory, but which are of slightly “below average” credit risk due to financial weaknesses or uncertainty. The loans warrant a somewhat higher than average level of monitoring to insure that weaknesses do not advance. The level of risk is considered acceptable and within normal underwriting guidelines, so long as the loan is given the proper level of management supervision. | |||||||||||||||||||||||||||||||||
Risk Grade 4.5 (Monitored) - Loans are considered “below average” and monitored more closely due to some credit deficiency that poses additional risk but is not considered adverse to the point of being a “classified” credit. Possible reasons for additional monitoring may include characteristics such as temporary negative debt service coverage due to weak economic conditions; borrower may have experienced recent losses from operations, declining equity and/or increasing leverage, or marginal liquidity that may affect long-term sustainability. Loans of this grade have a higher degree of risk and warrant close monitoring to insure against further deterioration. | |||||||||||||||||||||||||||||||||
Risk Grade 5 (Other Assets Especially Mentioned) (OAEM) - Loans which possess some credit deficiency or potential weakness, which deserve close attention, but which do not yet warrant substandard classification. Such loans pose unwarranted financial risk that, if not corrected, could weaken the loan and increase risk in the future. | |||||||||||||||||||||||||||||||||
Risk Grade 6 (Substandard) - Loans are “substandard” whose full, final collectability does not appear to be a matter of serious doubt, but which nevertheless portray some form of well defined weakness that requires close supervision by Bank management. The noted weaknesses involve more than normal banking risk. One or more of the following characteristics may be exhibited in loans classified Substandard: (1) Loans possess a defined credit weakness and the likelihood that the loan shall be paid from the primary source of repayment is uncertain; (2) Loans are not adequately protected by the current net worth and/or paying capacity of the obligor; (3) primary source of repayment is gone, and the Bank is forced to rely on a secondary source of repayment such as collateral liquidation or guarantees; (4) distinct possibility that the Bank shall sustain some loss if deficiencies are not corrected; (5) unusual courses of action are needed to maintain a high probability of repayment; (6) the borrower is not generating enough cash flow to repay loan principal, however, continues to make interest payments; (7) the Bank is forced into a subordinated or unsecured position due to flaws in documentation; (8) loans have been restructured so that payment schedules, terms, and collateral represent concessions to the borrower when compared to normal loan terms; (9) the Bank is contemplating foreclosure or legal action due to the apparent deterioration in the loan; or (10) there is a significant deterioration in the market conditions and the borrower is highly vulnerable to these conditions. | |||||||||||||||||||||||||||||||||
Grade 7 (Doubtful) - Loans have all the weaknesses of those classified Substandard. Additionally, however, these weaknesses make collection or liquidation in full, based on existing conditions, improbable. Loans in this category are typically not performing in conformance with established terms and conditions. Full repayment is considered “Doubtful”, but extent of loss is not currently determinable. | |||||||||||||||||||||||||||||||||
Risk Grade 8 (Loss) - Loans are considered uncollectible and of such little value, that continuing to carry them as an asset on the Bank’s financial statements is not feasible. | |||||||||||||||||||||||||||||||||
The following table presents the risk category of loans by class of loans based on the most recent analysis performed and the contractual aging as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial Real Estate | Commercial Real Estate | ||||||||||||||||||||||||||||||||
Loan Grade | Construction | Other | Commercial | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
2-Jan | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||
3 | — | 16,028 | 5,831 | ||||||||||||||||||||||||||||||
4 | — | 22,926 | 5,761 | ||||||||||||||||||||||||||||||
4.5 | — | 5,001 | 481 | ||||||||||||||||||||||||||||||
5 | — | 4,531 | 17 | ||||||||||||||||||||||||||||||
6 | 173 | 2,896 | 162 | ||||||||||||||||||||||||||||||
7 | — | — | — | ||||||||||||||||||||||||||||||
8 | — | — | — | ||||||||||||||||||||||||||||||
Total | $ | 173 | $ | 51,382 | $ | 12,252 | |||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial Real Estate | Commercial Real Estate | ||||||||||||||||||||||||||||||||
Loan Grade | Construction | Other | Commercial | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
2-Jan | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||
3 | — | 16,187 | 5,602 | ||||||||||||||||||||||||||||||
4 | — | 24,237 | 6,528 | ||||||||||||||||||||||||||||||
4.5 | — | 3,462 | 171 | ||||||||||||||||||||||||||||||
5 | — | 4,835 | 45 | ||||||||||||||||||||||||||||||
6 | 173 | 2,915 | 105 | ||||||||||||||||||||||||||||||
7 | — | — | — | ||||||||||||||||||||||||||||||
8 | — | — | — | ||||||||||||||||||||||||||||||
Total | $ | 173 | $ | 51,726 | $ | 12,451 | |||||||||||||||||||||||||||
For residential real estate and other consumer credit the Company evaluates credit quality based on the aging status of the loan and by payment activity. Loans 60 or more days past due are monitored by the collection committee. | |||||||||||||||||||||||||||||||||
The following tables present the risk category of loans by class based on the most recent analysis performed as of March 31, 2014 and December, 31, 2013. | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||||||||||
Loan Grade: | |||||||||||||||||||||||||||||||||
Pass | $ | 63,247 | |||||||||||||||||||||||||||||||
Special Mention | — | ||||||||||||||||||||||||||||||||
Substandard | 329 | ||||||||||||||||||||||||||||||||
Total | $ | 63,576 | |||||||||||||||||||||||||||||||
Consumer - | |||||||||||||||||||||||||||||||||
Real Estate | Consumer - Other | ||||||||||||||||||||||||||||||||
Performing | $ | 8,484 | $ | 1,171 | |||||||||||||||||||||||||||||
Nonperforming | 6 | — | |||||||||||||||||||||||||||||||
Total | $ | 8,490 | $ | 1,171 | |||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||||||||||
Loan Grade: | |||||||||||||||||||||||||||||||||
Pass | $ | 63,164 | |||||||||||||||||||||||||||||||
Special Mention | — | ||||||||||||||||||||||||||||||||
Substandard | 675 | ||||||||||||||||||||||||||||||||
Total | $ | 63,839 | |||||||||||||||||||||||||||||||
Consumer - | |||||||||||||||||||||||||||||||||
Real Estate | Consumer - Other | ||||||||||||||||||||||||||||||||
Performing | $ | 8,723 | $ | 1,163 | |||||||||||||||||||||||||||||
Nonperforming | 7 | 2 | |||||||||||||||||||||||||||||||
Total | $ | 8,730 | $ | 1,165 | |||||||||||||||||||||||||||||
The following table presents the recorded investment in non-accrual loans by class as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | 173 | $ | 173 | |||||||||||||||||||||||||||||
Commercial Real Estate - other | 1,453 | 1,454 | |||||||||||||||||||||||||||||||
Commercial | — | — | |||||||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - real estate | 6 | 7 | |||||||||||||||||||||||||||||||
Consumer - other | — | — | |||||||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 329 | 651 | |||||||||||||||||||||||||||||||
Total | $ | 1,961 | $ | 2,285 | |||||||||||||||||||||||||||||
The key features of the Company’s loan modifications are determined on a loan-by-loan basis. Generally, our restructurings have related to interest rate reductions and loan term extensions. In the past the Company has granted reductions in interest rates, payment extensions and short-term payment forbearances as a means to maximize collectability of troubled credits. The Company has not forgiven principal to date, although this would be considered if necessary to ensure the long-term collectability of the loan. The Company’s loan modifications are typically short-term in nature, although the Company would consider a long-term modification to ensure the long-term collectability of the credit. In general, a borrower must make at least six consecutive timely payments before the Company would consider a return of a restructured loan to accruing status in accordance with Federal Deposit Insurance Corporation guidelines regarding restoration of credits to accrual status. | |||||||||||||||||||||||||||||||||
The Bank has classified approximately $2.4 million of its impaired loans as troubled debt restructurings as of March 31, 2014. For the three months ended March 31, 2014, the Bank did not classify any loans as troubled debt restructurings; nor were there any troubled debt restructures that subsequently defaulted. | |||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | Troubled Debt Restructurings | ||||||||||||||||||||||||||||||||
that Subsequently Defaulted | |||||||||||||||||||||||||||||||||
For the three months ended | For the three months ended | ||||||||||||||||||||||||||||||||
31-Mar-13 | 31-Mar-13 | ||||||||||||||||||||||||||||||||
Number of Loans | Pre-modification outstanding recorded investment | Post-modification outstanding recorded investment | Number of Loans | Recorded Investment | |||||||||||||||||||||||||||||
(dollars in thousands) | (dollars in thousands) | ||||||||||||||||||||||||||||||||
Commerical Real Estate - Construction | — | $ | — | $ | — | — | $ | — | |||||||||||||||||||||||||
Commercial Real Estate - Other | 1 | 412 | 410 | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 2 | 331 | 270 | 1 | 190 | ||||||||||||||||||||||||||||
Total | 3 | $ | 743 | $ | 680 | 1 | $ | 190 | |||||||||||||||||||||||||
For the majority of the Bank’s impaired loans, the Bank will apply the observable market price methodology. However, the Bank may also utilize a measurement incorporating the present value of expected future cash flows discounted at the loan’s effective rate of interest. To determine observable market price, collateral asset values securing an impaired loan are periodically evaluated. Maximum time of re-evaluation is every 12 months. In this process, third party evaluations are obtained and heavily relied upon. Until such time that updated evaluations are received, the Bank may discount the collateral value used. | |||||||||||||||||||||||||||||||||
The Bank uses the following guidelines as stated in policy to determine when to realize a charge-off, whether a partial or full loan balance. A charge down in whole or in part is realized when unsecured consumer loans, credit card credits and overdraft lines of credit reach 90 days delinquency. At 120 days delinquent, secured consumer loans are charged down to the value of collateral, if repossession of the collateral is assured and/or in the process of repossession. Consumer mortgage loan deficiencies are charged down upon the sale of the collateral or sooner upon the recognition of collateral deficiency. Commercial credits are charged down at 90 days delinquency, unless an established and approved work-out plan is in place or litigation of the credit will likely result in recovery of the loan balance. Upon notification of bankruptcy, unsecured debt is charged off. Additional charge-off may be realized as further unsecured positions are recognized. | |||||||||||||||||||||||||||||||||
The following table presents the loans individually evaluated for impairment by class of loans as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
Impaired Loans | March 31, | ||||||||||||||||||||||||||||||||
As of March 31, 2014 | 2014 | ||||||||||||||||||||||||||||||||
Unpaid Principal | Recorded | Related | Average | Interest | |||||||||||||||||||||||||||||
Recorded | Income | ||||||||||||||||||||||||||||||||
Balance | Investment | Allowance | Investment | Recognized | |||||||||||||||||||||||||||||
(dollars in thousands) | (dollars in thousands) | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 1,478 | 1,477 | — | 1,595 | 21 | ||||||||||||||||||||||||||||
Consumer - Real Estate | 7 | 6 | — | 6 | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 485 | 375 | — | 382 | 1 | ||||||||||||||||||||||||||||
With a specific allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Construction | 1,589 | 173 | 48 | 173 | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 2,426 | 1,838 | 137 | 1,840 | 4 | ||||||||||||||||||||||||||||
Consumer - Real Estate | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 53 | 30 | 5 | 30 | — | ||||||||||||||||||||||||||||
Totals: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | $ | 1,589 | $ | 173 | $ | 48 | $ | 173 | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Other | $ | 3,904 | $ | 3,315 | $ | 137 | $ | 3,435 | $ | 25 | |||||||||||||||||||||||
Consumer - Real Estate | $ | 7 | $ | 6 | $ | — | $ | 6 | $ | — | |||||||||||||||||||||||
Consumer - Other | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Residential | $ | 538 | $ | 405 | $ | 5 | $ | 412 | $ | 1 | |||||||||||||||||||||||
Impaired Loans | December 31, | ||||||||||||||||||||||||||||||||
As of December 31, 2013 | 2013 | ||||||||||||||||||||||||||||||||
Unpaid Principal | Recorded | Related | Average | Interest | |||||||||||||||||||||||||||||
Recorded | Income | ||||||||||||||||||||||||||||||||
Balance | Investment | Allowance | Investment | Recognized | |||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 1,789 | 1,788 | — | 1,894 | 104 | ||||||||||||||||||||||||||||
Consumer - Real Estate | 8 | 7 | — | 7 | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 954 | 722 | — | 727 | 6 | ||||||||||||||||||||||||||||
With a specific allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Construction | 1,589 | 173 | 48 | 173 | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 3,980 | 3,391 | 182 | 3,397 | 94 | ||||||||||||||||||||||||||||
Consumer - Real Estate | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 53 | 30 | 5 | 30 | — | ||||||||||||||||||||||||||||
Totals: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | $ | 1,589 | $ | 173 | $ | 48 | $ | 173 | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Other | $ | 5,769 | $ | 5,179 | $ | 182 | $ | 5,291 | $ | 198 | |||||||||||||||||||||||
Consumer - Real Estate | $ | 8 | $ | 7 | $ | — | $ | 7 | $ | — | |||||||||||||||||||||||
Consumer - Other | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Residential | $ | 1,007 | $ | 752 | $ | 5 | $ | 757 | $ | 6 | |||||||||||||||||||||||
The Allowance for Loan and Lease Losses has a direct impact on the provision expense. An increase in the ALLL is funded through recoveries and provision expense. | |||||||||||||||||||||||||||||||||
Activity in the allowance for loan and lease losses was as follows for the quarters ended March 31, 2014 and 2013, respectively: | |||||||||||||||||||||||||||||||||
Allowance for Credit Losses and Recorded Investment in Financing Receivables | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||
Beginning Balance | $ | 48 | $ | 444 | $ | 63 | $ | 62 | $ | 21 | $ | 784 | $ | 50 | $ | 1,472 | |||||||||||||||||
Charge-offs | — | (16 | ) | — | (11 | ) | (6 | ) | (35 | ) | — | (68 | ) | ||||||||||||||||||||
Recoveries | — | 19 | — | 9 | — | 10 | — | 38 | |||||||||||||||||||||||||
Provision | — | (55 | ) | (2 | ) | (11 | ) | 1 | 33 | 50 | 16 | ||||||||||||||||||||||
Ending Balance | $ | 48 | $ | 392 | $ | 61 | $ | 49 | $ | 16 | $ | 792 | $ | 100 | $ | 1,458 | |||||||||||||||||
Loan Balances Individually Evaluated for Impairment | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 48 | $ | 137 | $ | — | $ | — | $ | — | $ | 5 | $ | — | $ | 190 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | — | $ | 255 | $ | 61 | $ | 49 | $ | 16 | $ | 787 | $ | 100 | $ | 1,268 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 173 | $ | 51,382 | $ | 12,252 | $ | 8,490 | $ | 1,171 | $ | 63,576 | $ | — | $ | 137,044 | |||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 173 | $ | 3,315 | $ | — | $ | 6 | $ | — | $ | 405 | $ | — | $ | 3,899 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | — | $ | 48,067 | $ | 12,252 | $ | 8,484 | $ | 1,171 | $ | 63,171 | $ | — | $ | 133,145 | |||||||||||||||||
For the Three Months Ended March 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||
Beginning Balance | $ | 64 | $ | 579 | $ | 69 | $ | 99 | $ | 33 | $ | 906 | $ | — | $ | 1,750 | |||||||||||||||||
Charge-offs | — | (85 | ) | — | (7 | ) | (6 | ) | (162 | ) | — | (260 | ) | ||||||||||||||||||||
Recoveries | — | 10 | — | 15 | 4 | 12 | — | 41 | |||||||||||||||||||||||||
Provision | 25 | 5 | 18 | (20 | ) | (5 | ) | 121 | — | 144 | |||||||||||||||||||||||
Ending Balance | $ | 89 | $ | 509 | $ | 87 | $ | 87 | $ | 26 | $ | 877 | $ | — | $ | 1,675 | |||||||||||||||||
Loan Balances Individually Evaluated for Impairment | |||||||||||||||||||||||||||||||||
As of March 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 48 | $ | — | $ | — | $ | — | $ | 89 | $ | — | $ | 137 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | 89 | $ | 461 | $ | 87 | $ | 87 | $ | 26 | $ | 788 | $ | — | $ | 1,538 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 2,618 | $ | 50,156 | $ | 9,473 | $ | 9,813 | $ | 1,156 | $ | 66,364 | $ | — | $ | 139,580 | |||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 173 | $ | 6,703 | $ | — | $ | 9 | $ | — | $ | 1,910 | $ | — | $ | 8,795 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | 2,445 | $ | 43,453 | $ | 9,473 | $ | 9,804 | $ | 1,156 | $ | 64,454 | $ | — | $ | 130,785 |
DIVIDENDS
DIVIDENDS | 3 Months Ended |
Mar. 31, 2014 | |
Dividends [Abstract] | ' |
DIVIDENDS | ' |
Note 6—DIVIDENDS | |
We are dependent primarily upon the Bank for our earnings and funds to pay dividends on our common stock. The payment of dividends also is subject to legal and regulatory restrictions. Any payment of dividends in the future will depend, in large part, on the Bank’s earnings, capital requirements, financial condition and other factors considered by our Board of Directors. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
STOCK-BASED COMPENSATION | ' | ||||||||||||||||
Note 7—STOCK-BASED COMPENSATION | |||||||||||||||||
Effective January 1, 2006, the Company adopted ASC 718-10, “Shareholder Based Payments”, which requires that the grant-date fair value of awarded stock options be expensed over the requisite service period. The Company’s 1996 Stock Option Plan (the “1996 Plan”), which was approved by shareholders, permits the grant of share options to its employees for up to 127,491 shares of common stock (retroactively adjusted for the exchange ratio applied in the Company’s 2005 stock offering and related second-step conversion). The Company’s 2006 Stock-Based Incentive Plan (the “2006 Plan”), which was approved by shareholders on May 17, 2006, permits the award of up to 242,740 shares of common stock of which the maximum number to be granted as Stock Options is 173,386 and the maximum that can be granted as Restricted Stock Awards is 69,354. Option awards are granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Those option awards generally vest based on five years of continual service and have ten year contractual terms. Certain options provide for accelerated vesting if there is a change in control (as defined in the Plans). | |||||||||||||||||
During the three months ended March 31, 2014 no shares were awarded under either the 1996 Plan or the 2006 Plan. Shares issued under the plans and exercised pursuant to the exercise of the stock options awarded under the plans may be either authorized but unissued shares or reacquired shares held by the Company as treasury stock. | |||||||||||||||||
Stock Options - A summary of option activity under the Plans during the three months ended March 31, 2014 is presented below: | |||||||||||||||||
Weighted-Average | |||||||||||||||||
Weighted- | Remaining | ||||||||||||||||
Average | Contractual Term | Aggregate | |||||||||||||||
Options | Shares | Exercise Price | (Years) | Intrinsic Value | |||||||||||||
Outstanding at January 1, 2014 | 150,030 | $ | 9.52 | 2.4 | $ | 0 | |||||||||||
Granted | 0 | N/A | |||||||||||||||
Exercised | 0 | N/A | |||||||||||||||
Forfeited or expired | (1,200 | ) | $ | 7.6 | |||||||||||||
Outstanding at March 31, 2014 | 148,830 | $ | 9.54 | 2.1 | $ | 0 | |||||||||||
Options Exercisable at March 31, 2014 | 148,830 | $ | 9.54 | 2.1 | $ | 0 | |||||||||||
The aggregate intrinsic value of outstanding options shown in the table above represents the total pretax intrinsic value (i.e. the difference between the Company’s closing stock price of $5.00 on March 31, 2014 and the exercise price times the number of shares) that would have been received by the option holder had all option holders exercised their options on March 31, 2014. The amount changes based on the fair market value of the stock. | |||||||||||||||||
As of March 31, 2014 the Company had no unrecognized compensation cost related to nonvested options under the Plan. There were no shares which vested during the quarter ended March 31, 2014. In addition, there were no non-vested options as of March 31, 2014. | |||||||||||||||||
Restricted Stock Awards - As of March 31, 2014 all restricted stock awards have vested; therefore the Company had no unrecognized compensation cost under the Plans. |
COMMITMENTS_TO_EXTEND_CREDIT
COMMITMENTS TO EXTEND CREDIT | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Commitments To Extend Credit | ' | ||||
COMMITMENTS TO EXTEND CREDIT | ' | ||||
Note 8— COMMITMENTS TO EXTEND CREDIT | |||||
The Company is a party to credit-related financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, stand by letters of credit, and commercial lines of credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the consolidated balance sheet. The Company’s exposure to credit loss is represented by the contracted amount of these commitments. The Company follows the same credit policies in making commitments as it does for on-balance sheet instruments. | |||||
At March 31, 2014, the Company had outstanding commitments to originate loans of $19.2 million. These commitments included the following: | |||||
As of | |||||
31-Mar-14 | |||||
(in thousands) | |||||
Commitments to grant loans | $ | 6,544 | |||
Unfunded commitments under lines of credit | 12,631 | ||||
Commercial and standby letters of credit | 59 |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | ||||||||||||||||||||
Note 9— FAIR VALUE MEASUREMENTS | |||||||||||||||||||||
The fair value of financial assets and liabilities recorded at fair value is categorized in three levels. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. These levels are as follows: | |||||||||||||||||||||
Level 1 — Valuations based on quoted prices in active markets, such as the New York Stock Exchange. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. | |||||||||||||||||||||
Level 2 — Valuations of assets and liabilities traded in less active dealer or broker markets. Valuations include quoted prices for similar assets and liabilities traded in the same market; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Valuations may be obtained from, or corroborated by, third-party pricing services. | |||||||||||||||||||||
Level 3 — Assets and liabilities with valuations that include methodologies and assumptions that may not be readily observable, including option pricing models, discounted cash flow models, yield curves and similar techniques. Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities, but in all cases are corroborated by external data, which may include third-party pricing services. | |||||||||||||||||||||
The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2014 and December, 31, 2013, and the valuation techniques used by the Company to determine those fair values. | |||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis at March 31, 2014 | |||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Balance at March 31, 2014 | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities- available-for-sale: | |||||||||||||||||||||
US Treasury securities and obligations of U.S. government corporations and agencies | $ | — | $ | 10,285 | $ | — | $ | 10,285 | |||||||||||||
Municipal obligations | — | 14,645 | — | 14,645 | |||||||||||||||||
Corporate bonds & other obligations | — | 1,082 | — | 1,082 | |||||||||||||||||
Mortgage-backed securities | — | 30,420 | — | 30,420 | |||||||||||||||||
Equity securities | — | 10 | — | 10 | |||||||||||||||||
Total investment securities - available-for-sale | $ | — | $ | 56,442 | $ | — | $ | 56,442 | |||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis at December 31, 2013 | |||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Fair Value as of December 31, 2013 | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities - available-for-sale: | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | — | $ | 7,042 | $ | — | $ | 7,042 | |||||||||||||
Municipal obligations | — | 13,609 | — | 13,609 | |||||||||||||||||
Corporate bonds & other obligations | — | 1,097 | — | 1,097 | |||||||||||||||||
Mortgage-backed securities | — | 28,603 | — | 28,603 | |||||||||||||||||
Equity securities | — | 7 | — | 7 | |||||||||||||||||
Total investment securities - available-for-sale | $ | — | $ | 50,358 | $ | — | $ | 50,358 | |||||||||||||
Fair value measurements of U.S. Government agencies and mortgage backed securities use pricing models that vary and may consider various assumptions, including time value, yield curves, volatility factors, prepayment speeds, default rates, loss severity, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures. | |||||||||||||||||||||
There were no transfers between Levels 1 and 2 of the fair value hierarchy from December, 31, 2013 to March 31, 2014. For the available for sale securities, the Company obtains fair value measurements from an independent third-party service. | |||||||||||||||||||||
The Company has assets that, under certain conditions, are subject to measurement at fair value on a nonrecurring basis. At March 31, 2014 and December, 31, 2013, such assets consist primarily of impaired loans and other real estate owned. The Company has estimated the fair values of these assets using Level 3 inputs, specifically discounted cash flow projections. | |||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at March 31, 2014 | |||||||||||||||||||||
Balance at March 31, 2014 | Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Impaired loans accounted for under FASB ASC 310-10 | $ | 3,488 | $ | — | $ | — | $ | 3,488 | |||||||||||||
Other real estate owned -residential mortgages | 443 | — | — | 443 | |||||||||||||||||
Other Real estate owned - commercial | 472 | — | — | 472 | |||||||||||||||||
Other repossessed assets | 1,023 | — | — | 1,023 | |||||||||||||||||
Total assets at fair value on a non-recurring basis | $ | 5,426 | |||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2013 | |||||||||||||||||||||
Balance at December 31, 2013 | Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Impaired loans accounted for under FASB ASC 310-10 | $ | 5,352 | $ | — | $ | — | $ | 5,352 | |||||||||||||
Other real estate owned -residential mortgages | 285 | — | — | 285 | |||||||||||||||||
Other real estate owned - commercial | 472 | — | — | 472 | |||||||||||||||||
Other repossessed assets | 1,023 | — | — | 1,023 | |||||||||||||||||
Total assets at fair value on a non-recurring basis | $ | 7,132 | |||||||||||||||||||
A loan is considered impaired when, based on current information and events it is probable the Company will be unable to collect all amounts due (both principal and interest) according to the contractual terms of the original loan agreement. Loans identified as impaired are measured using one of three methods: the loan’s observable market price; the fair value of collateral; or the present value of expected future cash flows. For each period presented, no loans were measured using the loan’s observable market price. Collateral may be in the form of real estate and/or business assets such as accounts receivable, inventory or business equipment. | |||||||||||||||||||||
Real estate is the collateral for the vast majority of our secured lending. The real estate’s value is based on observable market prices and market values provided by independent, third-party licensed or certified appraisers, selected from a list of Company-approved appraisers. Appraisals for all types of collateral-dependent loans are typically requested within 30 days of a loan being deemed impaired. The fair value of impaired loans with specific allocations is essentially based on recent real estate appraisals less costs to sell. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Appraised collateral values may be further discounted based on management’s historical knowledge of the property and/or changes in market conditions from the time of valuation or management’s plan for disposal. Subsequent evaluations of collateral are performed on a loan by loan basis as additional facts and circumstances related to the individual credit require, but not less than annually. | |||||||||||||||||||||
The following methods and assumptions were used by the Company in estimating fair value disclosures for financial instruments: | |||||||||||||||||||||
Cash and Cash Equivalents - The carrying amounts of cash and short-term instruments approximate fair values. | |||||||||||||||||||||
Investment Securities - Fair value for the Bank’s investment securities was determined using the market value in active markets, where available. When not available, fair values are estimated using the fair value hierarchy. In the fair value hierarchy, Level 2 fair values are determined using observable inputs other than Level 1 market prices, such as quoted prices for similar assets. Level 3 values are determined using unobservable inputs, such as discounted cash flow projections. | |||||||||||||||||||||
Loans Receivable - For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. Fair values for certain mortgage loans (e.g., one- to four-family residential), credit card loans, and other consumer loans are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. Fair values for other loans (e.g., commercial real estate and investment property mortgage loans, commercial, and industrial loans) are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Fair values for nonperforming loans are estimated using discounted cash flow analyses or underlying collateral values, where applicable. | |||||||||||||||||||||
Loans Held For Sale - Fair values of mortgage loans held for sale are based on commitments on hand from investors or prevailing market prices. | |||||||||||||||||||||
Federal Home Loan Bank Stock - The carrying value of Federal Home Loan Bank stock approximates fair value based on the redemption provisions of the Federal Home Loan Bank. | |||||||||||||||||||||
Deposit Liabilities - The fair values disclosed for demand deposits (e.g., interest and noninterest checking, passbook savings, and certain types of money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The carrying amounts of variable-rate, fixed-term money market accounts and certificates of deposit approximate their fair values at the reporting date. Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits. | |||||||||||||||||||||
Federal Home Loan Bank Advances - The estimated fair value of the fixed and variable rate Federal Home Loan Bank advances are estimated by discounting the related cash flows using the rates currently available for similarly structured borrowings with similar maturities. | |||||||||||||||||||||
Accrued Interest - The carrying amounts of accrued interest approximate fair value. | |||||||||||||||||||||
The estimated fair values and related carrying or notional amounts of the Company’s financial instruments are as follows: | |||||||||||||||||||||
31-Mar-14 | Carrying | Level 1 | Level 2 | Level 3 | Total Estimated Fair Value | ||||||||||||||||
Value | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 3,147 | $ | 3,147 | $ | — | $ | — | $ | 3,147 | |||||||||||
Securities available for sale | 56,442 | — | 56,442 | — | 56,442 | ||||||||||||||||
Securities held to maturity | 2,255 | — | 2,395 | — | 2,395 | ||||||||||||||||
Loans held for sale | 236 | — | — | 240 | 240 | ||||||||||||||||
Loans receivable - net | 135,326 | — | — | 134,043 | 134,043 | ||||||||||||||||
Federal Home Loan Bank stock | 3,266 | — | 3,266 | — | 3,266 | ||||||||||||||||
Accrued interest receivable | 828 | — | — | 828 | 828 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Customer deposits | 165,720 | — | 166,214 | — | 166,214 | ||||||||||||||||
Federal Home Loan Bank advances | 24,233 | — | 23,927 | — | 23,927 | ||||||||||||||||
Accrued interest payable | 88 | — | — | 88 | 88 | ||||||||||||||||
31-Dec-13 | Carrying | Level 1 | Level 2 | Level 3 | Total Estimated Fair Value | ||||||||||||||||
Value | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 2,766 | $ | 2,766 | $ | — | $ | — | $ | 2,766 | |||||||||||
Securities available for sale | 50,358 | — | 50,358 | — | 50,358 | ||||||||||||||||
Securities held to maturity | 2,255 | — | 2,400 | — | 2,400 | ||||||||||||||||
Loans held for sale | 175 | — | — | 178 | 178 | ||||||||||||||||
Loans receivable - net | 136,315 | — | — | 135,172 | 135,172 | ||||||||||||||||
Federal Home Loan Bank stock | 3,266 | — | 3,266 | — | 3,266 | ||||||||||||||||
Accrued interest receivable | 745 | — | — | 745 | 745 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Customer deposits | 160,029 | — | 160,784 | — | 160,784 | ||||||||||||||||
Federal Home Loan Bank advances | 24,813 | — | 24,458 | — | 24,458 | ||||||||||||||||
Accrued interest payable | 89 | — | — | 89 | 89 |
SECURITIES_Tables
SECURITIES (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Securities Tables | ' | ||||||||||||||||
Schedule of carrying value and estimated fair value of securities | ' | ||||||||||||||||
Investment securities have been classified according to management’s intent. The carrying value and estimated fair value of securities are as follows: | |||||||||||||||||
31-Mar-14 | |||||||||||||||||
Amortized | Gross Unrealized Gains | Gross Unrealized (Losses) | Market | ||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Securities Available for Sale | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 10,345 | $ | 34 | $ | (94 | ) | 10,285 | |||||||||
Municipal obligations | 14,568 | 258 | (181 | ) | 14,645 | ||||||||||||
Corporate bonds & other obligations | 1,072 | 10 | — | 1,082 | |||||||||||||
Mortgage-backed securities | 30,284 | 343 | (207 | ) | 30,420 | ||||||||||||
Equity securities | 3 | 7 | — | 10 | |||||||||||||
Total | $ | 56,272 | $ | 652 | $ | (482 | ) | $ | 56,442 | ||||||||
Securities Held to Maturity | |||||||||||||||||
Municipal obligations | $ | 2,255 | $ | 140 | $ | — | $ | 2,395 | |||||||||
31-Dec-13 | |||||||||||||||||
Amortized | Gross Unrealized Gains | Gross Unrealized (Losses) | Market | ||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Securities Available for Sale | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 7,111 | $ | 36 | $ | (105 | ) | 7,042 | |||||||||
Municipal obligations | 13,694 | 216 | (301 | ) | 13,609 | ||||||||||||
Corporate bonds & other obligations | 1,085 | 12 | — | 1,097 | |||||||||||||
Mortgage-backed securities | 28,708 | 279 | (384 | ) | 28,603 | ||||||||||||
Equity securities | 3 | 4 | — | 7 | |||||||||||||
Total | $ | 50,601 | $ | 547 | $ | (790 | ) | $ | 50,358 | ||||||||
Securities Held to Maturity | |||||||||||||||||
Municipal obligations | $ | 2,255 | $ | 145 | $ | — | $ | 2,400 | |||||||||
Schedule of amortized cost and market value of securities by maturity | ' | ||||||||||||||||
The amortized cost and estimated market value of securities at March 31, 2014, by contract maturity, are shown below. | |||||||||||||||||
31-Mar-14 | |||||||||||||||||
Amortized | Market | ||||||||||||||||
Cost | Value | ||||||||||||||||
(in thousands) | |||||||||||||||||
Available For Sale: | |||||||||||||||||
Due in one year or less | $ | 2,401 | $ | 2,414 | |||||||||||||
Due after one year through five years | 15,508 | 15,585 | |||||||||||||||
Due in five year through ten years | 6,841 | 6,705 | |||||||||||||||
Due after ten years | 1,235 | 1,308 | |||||||||||||||
Subtotal | 25,985 | 26,012 | |||||||||||||||
Equity securities | 3 | 10 | |||||||||||||||
Mortgage-backed securities | 30,284 | 30,420 | |||||||||||||||
Total | $ | 56,272 | $ | 56,442 | |||||||||||||
Held To Maturity: | |||||||||||||||||
Due in one year or less | $ | 90 | $ | 91 | |||||||||||||
Due after one year through five years | 490 | 512 | |||||||||||||||
Due in five year through ten years | 700 | 749 | |||||||||||||||
Due after ten years | 975 | 1,043 | |||||||||||||||
Total | $ | 2,255 | $ | 2,395 | |||||||||||||
Summary schedule of temporily impaired investments | ' | ||||||||||||||||
The following is a summary of temporarily impaired investments that have been impaired for less than and more than twelve months as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||
31-Mar-14 | |||||||||||||||||
Gross Unrealized Losses | Gross Unrealized Losses | ||||||||||||||||
Fair Value | <12 months | Fair Value | > 12 months | ||||||||||||||
(in thousands) | |||||||||||||||||
Available For Sale: | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 2,236 | $ | (13 | ) | $ | 918 | $ | (81 | ) | |||||||
Municipal obligations | 6,014 | (134 | ) | 1,220 | (47 | ) | |||||||||||
Mortgage-backed securities | 10,391 | (158 | ) | 2,404 | (49 | ) | |||||||||||
Equity securities | — | — | — | — | |||||||||||||
Total | $ | 18,641 | $ | (305 | ) | $ | 4,542 | $ | (177 | ) | |||||||
Held to Maturity: | |||||||||||||||||
Municipal obligations | $ | — | $ | — | $ | — | $ | — | |||||||||
31-Dec-13 | |||||||||||||||||
Gross Unrealized Losses | Gross Unrealized Losses | ||||||||||||||||
Fair Value | <12 months | Fair Value | > 12 months | ||||||||||||||
(in thousands) | |||||||||||||||||
Available For Sale: | |||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | — | $ | — | $ | 894 | $ | (105 | ) | ||||||||
Municipal obligations | 7,902 | (243 | ) | 1,668 | (58 | ) | |||||||||||
Mortgage-backed securities | 14,471 | (334 | ) | 2,052 | (50 | ) | |||||||||||
Equity securities | — | — | — | — | |||||||||||||
Total | $ | 22,373 | $ | (577 | ) | $ | 4,614 | $ | (213 | ) |
LOANS_AND_ALLOWANCE_FOR_LOAN_L1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||||||
Loans And Allowance For Loan Losses Tables | ' | ||||||||||||||||||||||||||||||||
Schedule of composition of loans categorized by the type of loan | ' | ||||||||||||||||||||||||||||||||
The following table sets forth the composition of our loan portfolio by loan type at the dates indicated. | |||||||||||||||||||||||||||||||||
At March 31, | At December 31, | ||||||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||
Real estate loans: | |||||||||||||||||||||||||||||||||
Residential mortgage | $ | 63,576 | $ | 63,839 | |||||||||||||||||||||||||||||
Commercial loans: | |||||||||||||||||||||||||||||||||
Construction - real estate | 173 | 173 | |||||||||||||||||||||||||||||||
Secured by real estate | 51,382 | 51,726 | |||||||||||||||||||||||||||||||
Other | 12,252 | 12,451 | |||||||||||||||||||||||||||||||
Total commercial loans | 63,807 | 64,350 | |||||||||||||||||||||||||||||||
Consumer loans: | |||||||||||||||||||||||||||||||||
Secured by real estate | 8,490 | 8,730 | |||||||||||||||||||||||||||||||
Other | 1,171 | 1,165 | |||||||||||||||||||||||||||||||
Total consumer loans | 9,661 | 9,895 | |||||||||||||||||||||||||||||||
Total gross loans | $ | 137,044 | $ | 138,084 | |||||||||||||||||||||||||||||
Less: | |||||||||||||||||||||||||||||||||
Net deferred loan fees | (260 | ) | (297 | ) | |||||||||||||||||||||||||||||
Allowance for loan losses | (1,458 | ) | (1,472 | ) | |||||||||||||||||||||||||||||
Total loans, net | $ | 135,326 | $ | 136,315 | |||||||||||||||||||||||||||||
Schedule of past due loans | ' | ||||||||||||||||||||||||||||||||
The following table illustrates the contractual aging of the recorded investment in past due loans by class of loans as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
30 - 59 Days Past Due | 60 - 89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total Loans | Recorded Investment > 90 Days and Accruing | |||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | — | $ | — | $ | 173 | $ | 173 | $ | — | $ | 173 | $ | — | |||||||||||||||||||
Commercial Real Estate - other | 2,203 | 12 | 1,441 | 3,656 | 47,726 | 51,382 | — | ||||||||||||||||||||||||||
Commercial - non real estate | 18 | — | — | 18 | 12,234 | 12,252 | — | ||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - Real Estate | 83 | 2 | — | 85 | 8,405 | 8,490 | — | ||||||||||||||||||||||||||
Consumer - Other | 6 | — | — | 6 | 1,165 | 1,171 | — | ||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 1,304 | — | 159 | 1,463 | 62,113 | 63,576 | — | ||||||||||||||||||||||||||
Total | $ | 3,614 | $ | 14 | $ | 1,773 | $ | 5,401 | $ | 131,643 | $ | 137,044 | $ | — | |||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
30 - 59 Days Past Due | 60 - 89 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Total Loans | Recorded Investment > 90 Days and Accruing | |||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | — | $ | — | $ | 173 | $ | 173 | $ | — | $ | 173 | $ | — | |||||||||||||||||||
Commercial Real Estate - other | — | 521 | 1,441 | 1,962 | 49,764 | 51,726 | — | ||||||||||||||||||||||||||
Commercial - non real estate | 33 | 20 | — | 53 | 12,398 | 12,451 | — | ||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - Real Estate | 54 | 55 | — | 109 | 8,621 | 8,730 | — | ||||||||||||||||||||||||||
Consumer - Other | — | 4 | 2 | 6 | 1,159 | 1,165 | 2 | ||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 1,973 | 393 | 353 | 2,719 | 61,120 | 63,839 | 24 | ||||||||||||||||||||||||||
Total | $ | 2,060 | $ | 993 | $ | 1,969 | $ | 5,022 | $ | 133,062 | $ | 138,084 | $ | 26 | |||||||||||||||||||
Schedule of loans by risk category | ' | ||||||||||||||||||||||||||||||||
The following table presents the risk category of loans by class of loans based on the most recent analysis performed and the contractual aging as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial Real Estate | Commercial Real Estate | ||||||||||||||||||||||||||||||||
Loan Grade | Construction | Other | Commercial | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
2-Jan | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||
3 | — | 16,028 | 5,831 | ||||||||||||||||||||||||||||||
4 | — | 22,926 | 5,761 | ||||||||||||||||||||||||||||||
4.5 | — | 5,001 | 481 | ||||||||||||||||||||||||||||||
5 | — | 4,531 | 17 | ||||||||||||||||||||||||||||||
6 | 173 | 2,896 | 162 | ||||||||||||||||||||||||||||||
7 | — | — | — | ||||||||||||||||||||||||||||||
8 | — | — | — | ||||||||||||||||||||||||||||||
Total | $ | 173 | $ | 51,382 | $ | 12,252 | |||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial Real Estate | Commercial Real Estate | ||||||||||||||||||||||||||||||||
Loan Grade | Construction | Other | Commercial | ||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
2-Jan | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||
3 | — | 16,187 | 5,602 | ||||||||||||||||||||||||||||||
4 | — | 24,237 | 6,528 | ||||||||||||||||||||||||||||||
4.5 | — | 3,462 | 171 | ||||||||||||||||||||||||||||||
5 | — | 4,835 | 45 | ||||||||||||||||||||||||||||||
6 | 173 | 2,915 | 105 | ||||||||||||||||||||||||||||||
7 | — | — | — | ||||||||||||||||||||||||||||||
8 | — | — | — | ||||||||||||||||||||||||||||||
Total | $ | 173 | $ | 51,726 | $ | 12,451 | |||||||||||||||||||||||||||
The following tables present the risk category of loans by class based on the most recent analysis performed as of March 31, 2014 and December, 31, 2013. | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||||||||||
Loan Grade: | |||||||||||||||||||||||||||||||||
Pass | $ | 63,247 | |||||||||||||||||||||||||||||||
Special Mention | — | ||||||||||||||||||||||||||||||||
Substandard | 329 | ||||||||||||||||||||||||||||||||
Total | $ | 63,576 | |||||||||||||||||||||||||||||||
Consumer - | |||||||||||||||||||||||||||||||||
Real Estate | Consumer - Other | ||||||||||||||||||||||||||||||||
Performing | $ | 8,484 | $ | 1,171 | |||||||||||||||||||||||||||||
Nonperforming | 6 | — | |||||||||||||||||||||||||||||||
Total | $ | 8,490 | $ | 1,171 | |||||||||||||||||||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Residential | |||||||||||||||||||||||||||||||||
Loan Grade: | |||||||||||||||||||||||||||||||||
Pass | $ | 63,164 | |||||||||||||||||||||||||||||||
Special Mention | — | ||||||||||||||||||||||||||||||||
Substandard | 675 | ||||||||||||||||||||||||||||||||
Total | $ | 63,839 | |||||||||||||||||||||||||||||||
Consumer - | |||||||||||||||||||||||||||||||||
Real Estate | Consumer - Other | ||||||||||||||||||||||||||||||||
Performing | $ | 8,723 | $ | 1,163 | |||||||||||||||||||||||||||||
Nonperforming | 7 | 2 | |||||||||||||||||||||||||||||||
Total | $ | 8,730 | $ | 1,165 | |||||||||||||||||||||||||||||
Schedule of recorded investment in non-accrual loans by class | ' | ||||||||||||||||||||||||||||||||
The following table presents the recorded investment in non-accrual loans by class as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
As of | |||||||||||||||||||||||||||||||||
March 31, | December 31, | ||||||||||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Commercial Real Estate: | |||||||||||||||||||||||||||||||||
Commercial Real Estate - construction | $ | 173 | $ | 173 | |||||||||||||||||||||||||||||
Commercial Real Estate - other | 1,453 | 1,454 | |||||||||||||||||||||||||||||||
Commercial | — | — | |||||||||||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||
Consumer - real estate | 6 | 7 | |||||||||||||||||||||||||||||||
Consumer - other | — | — | |||||||||||||||||||||||||||||||
Residential: | |||||||||||||||||||||||||||||||||
Residential | 329 | 651 | |||||||||||||||||||||||||||||||
Total | $ | 1,961 | $ | 2,285 | |||||||||||||||||||||||||||||
Schedule of troubled debt restructurings | ' | ||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | Troubled Debt Restructurings | ||||||||||||||||||||||||||||||||
that Subsequently Defaulted | |||||||||||||||||||||||||||||||||
For the three months ended | For the three months ended | ||||||||||||||||||||||||||||||||
31-Mar-13 | 31-Mar-13 | ||||||||||||||||||||||||||||||||
Number of Loans | Pre-modification outstanding recorded investment | Post-modification outstanding recorded investment | Number of Loans | Recorded Investment | |||||||||||||||||||||||||||||
(dollars in thousands) | (dollars in thousands) | ||||||||||||||||||||||||||||||||
Commerical Real Estate - Construction | — | $ | — | $ | — | — | $ | — | |||||||||||||||||||||||||
Commercial Real Estate - Other | 1 | 412 | 410 | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 2 | 331 | 270 | 1 | 190 | ||||||||||||||||||||||||||||
Total | 3 | $ | 743 | $ | 680 | 1 | $ | 190 | |||||||||||||||||||||||||
Schedule of loans individually evaluated for impairment | ' | ||||||||||||||||||||||||||||||||
The following table presents the loans individually evaluated for impairment by class of loans as of March 31, 2014 and December, 31, 2013: | |||||||||||||||||||||||||||||||||
Impaired Loans | March 31, | ||||||||||||||||||||||||||||||||
As of March 31, 2014 | 2014 | ||||||||||||||||||||||||||||||||
Unpaid Principal | Recorded | Related | Average | Interest | |||||||||||||||||||||||||||||
Recorded | Income | ||||||||||||||||||||||||||||||||
Balance | Investment | Allowance | Investment | Recognized | |||||||||||||||||||||||||||||
(dollars in thousands) | (dollars in thousands) | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 1,478 | 1,477 | — | 1,595 | 21 | ||||||||||||||||||||||||||||
Consumer - Real Estate | 7 | 6 | — | 6 | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 485 | 375 | — | 382 | 1 | ||||||||||||||||||||||||||||
With a specific allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Construction | 1,589 | 173 | 48 | 173 | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 2,426 | 1,838 | 137 | 1,840 | 4 | ||||||||||||||||||||||||||||
Consumer - Real Estate | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 53 | 30 | 5 | 30 | — | ||||||||||||||||||||||||||||
Totals: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | $ | 1,589 | $ | 173 | $ | 48 | $ | 173 | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Other | $ | 3,904 | $ | 3,315 | $ | 137 | $ | 3,435 | $ | 25 | |||||||||||||||||||||||
Consumer - Real Estate | $ | 7 | $ | 6 | $ | — | $ | 6 | $ | — | |||||||||||||||||||||||
Consumer - Other | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Residential | $ | 538 | $ | 405 | $ | 5 | $ | 412 | $ | 1 | |||||||||||||||||||||||
Impaired Loans | December 31, | ||||||||||||||||||||||||||||||||
As of December 31, 2013 | 2013 | ||||||||||||||||||||||||||||||||
Unpaid Principal | Recorded | Related | Average | Interest | |||||||||||||||||||||||||||||
Recorded | Income | ||||||||||||||||||||||||||||||||
Balance | Investment | Allowance | Investment | Recognized | |||||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
With no related allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 1,789 | 1,788 | — | 1,894 | 104 | ||||||||||||||||||||||||||||
Consumer - Real Estate | 8 | 7 | — | 7 | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 954 | 722 | — | 727 | 6 | ||||||||||||||||||||||||||||
With a specific allowance recorded: | |||||||||||||||||||||||||||||||||
Commercial | — | — | — | — | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Construction | 1,589 | 173 | 48 | 173 | — | ||||||||||||||||||||||||||||
Commercial Real Estate - Other | 3,980 | 3,391 | 182 | 3,397 | 94 | ||||||||||||||||||||||||||||
Consumer - Real Estate | — | — | — | — | — | ||||||||||||||||||||||||||||
Consumer - Other | — | — | — | — | — | ||||||||||||||||||||||||||||
Residential | 53 | 30 | 5 | 30 | — | ||||||||||||||||||||||||||||
Totals: | |||||||||||||||||||||||||||||||||
Commercial | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Construction | $ | 1,589 | $ | 173 | $ | 48 | $ | 173 | $ | — | |||||||||||||||||||||||
Commercial Real Estate - Other | $ | 5,769 | $ | 5,179 | $ | 182 | $ | 5,291 | $ | 198 | |||||||||||||||||||||||
Consumer - Real Estate | $ | 8 | $ | 7 | $ | — | $ | 7 | $ | — | |||||||||||||||||||||||
Consumer - Other | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||
Residential | $ | 1,007 | $ | 752 | $ | 5 | $ | 757 | $ | 6 | |||||||||||||||||||||||
Schedule of activity in the allowance for loan losses | ' | ||||||||||||||||||||||||||||||||
Activity in the allowance for loan and lease losses was as follows for the quarters ended March 31, 2014 and 2013, respectively: | |||||||||||||||||||||||||||||||||
Allowance for Credit Losses and Recorded Investment in Financing Receivables | |||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||
Beginning Balance | $ | 48 | $ | 444 | $ | 63 | $ | 62 | $ | 21 | $ | 784 | $ | 50 | $ | 1,472 | |||||||||||||||||
Charge-offs | — | (16 | ) | — | (11 | ) | (6 | ) | (35 | ) | — | (68 | ) | ||||||||||||||||||||
Recoveries | — | 19 | — | 9 | — | 10 | — | 38 | |||||||||||||||||||||||||
Provision | — | (55 | ) | (2 | ) | (11 | ) | 1 | 33 | 50 | 16 | ||||||||||||||||||||||
Ending Balance | $ | 48 | $ | 392 | $ | 61 | $ | 49 | $ | 16 | $ | 792 | $ | 100 | $ | 1,458 | |||||||||||||||||
Loan Balances Individually Evaluated for Impairment | |||||||||||||||||||||||||||||||||
As of March 31, 2014 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 48 | $ | 137 | $ | — | $ | — | $ | — | $ | 5 | $ | — | $ | 190 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | — | $ | 255 | $ | 61 | $ | 49 | $ | 16 | $ | 787 | $ | 100 | $ | 1,268 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 173 | $ | 51,382 | $ | 12,252 | $ | 8,490 | $ | 1,171 | $ | 63,576 | $ | — | $ | 137,044 | |||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 173 | $ | 3,315 | $ | — | $ | 6 | $ | — | $ | 405 | $ | — | $ | 3,899 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | — | $ | 48,067 | $ | 12,252 | $ | 8,484 | $ | 1,171 | $ | 63,171 | $ | — | $ | 133,145 | |||||||||||||||||
For the Three Months Ended March 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||||||||||
Beginning Balance | $ | 64 | $ | 579 | $ | 69 | $ | 99 | $ | 33 | $ | 906 | $ | — | $ | 1,750 | |||||||||||||||||
Charge-offs | — | (85 | ) | — | (7 | ) | (6 | ) | (162 | ) | — | (260 | ) | ||||||||||||||||||||
Recoveries | — | 10 | — | 15 | 4 | 12 | — | 41 | |||||||||||||||||||||||||
Provision | 25 | 5 | 18 | (20 | ) | (5 | ) | 121 | — | 144 | |||||||||||||||||||||||
Ending Balance | $ | 89 | $ | 509 | $ | 87 | $ | 87 | $ | 26 | $ | 877 | $ | — | $ | 1,675 | |||||||||||||||||
Loan Balances Individually Evaluated for Impairment | |||||||||||||||||||||||||||||||||
As of March 31, 2013 | |||||||||||||||||||||||||||||||||
Commercial | Commercial | Consumer | |||||||||||||||||||||||||||||||
Construction | Real Estate | Commercial | Real Estate | Consumer | Residential | Unallocated | Total | ||||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 48 | $ | — | $ | — | $ | — | $ | 89 | $ | — | $ | 137 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | 89 | $ | 461 | $ | 87 | $ | 87 | $ | 26 | $ | 788 | $ | — | $ | 1,538 | |||||||||||||||||
Loans: | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 2,618 | $ | 50,156 | $ | 9,473 | $ | 9,813 | $ | 1,156 | $ | 66,364 | $ | — | $ | 139,580 | |||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 173 | $ | 6,703 | $ | — | $ | 9 | $ | — | $ | 1,910 | $ | — | $ | 8,795 | |||||||||||||||||
Ending balance: loans collectively evaluated for impairment | $ | 2,445 | $ | 43,453 | $ | 9,473 | $ | 9,804 | $ | 1,156 | $ | 64,454 | $ | — | $ | 130,785 |
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Stock-Based Compensation Tables | ' | ||||||||||||||||
Schedule of option activity | ' | ||||||||||||||||
A summary of option activity under the Plans during the three months ended March 31, 2014 is presented below: | |||||||||||||||||
Weighted-Average | |||||||||||||||||
Weighted- | Remaining | ||||||||||||||||
Average | Contractual Term | Aggregate | |||||||||||||||
Options | Shares | Exercise Price | (Years) | Intrinsic Value | |||||||||||||
Outstanding at January 1, 2014 | 150,030 | $ | 9.52 | 2.4 | $ | 0 | |||||||||||
Granted | 0 | N/A | |||||||||||||||
Exercised | 0 | N/A | |||||||||||||||
Forfeited or expired | (1,200 | ) | $ | 7.6 | |||||||||||||
Outstanding at March 31, 2014 | 148,830 | $ | 9.54 | 2.1 | $ | 0 | |||||||||||
Options Exercisable at March 31, 2014 | 148,830 | $ | 9.54 | 2.1 | $ | 0 |
COMMITMENTS_TO_EXTEND_CREDIT_T
COMMITMENTS TO EXTEND CREDIT (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Commitments To Extend Credit Tables | ' | ||||
Schedule of outstanding commitments | ' | ||||
At March 31, 2014, the Company had outstanding commitments to originate loans of $19.2 million. These commitments included the following: | |||||
As of | |||||
31-Mar-14 | |||||
(in thousands) | |||||
Commitments to grant loans | $ | 6,544 | |||
Unfunded commitments under lines of credit | 12,631 | ||||
Commercial and standby letters of credit | 59 |
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | ||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||
Fair Value Measurements Tables | ' | ||||||||||||||||||||
Schedule of assets and liabilities measured at fair value on a recurring basis | ' | ||||||||||||||||||||
The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2014 and December, 31, 2013, and the valuation techniques used by the Company to determine those fair values. | |||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis at March 31, 2014 | |||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Balance at March 31, 2014 | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities- available-for-sale: | |||||||||||||||||||||
US Treasury securities and obligations of U.S. government corporations and agencies | $ | — | $ | 10,285 | $ | — | $ | 10,285 | |||||||||||||
Municipal obligations | — | 14,645 | — | 14,645 | |||||||||||||||||
Corporate bonds & other obligations | — | 1,082 | — | 1,082 | |||||||||||||||||
Mortgage-backed securities | — | 30,420 | — | 30,420 | |||||||||||||||||
Equity securities | — | 10 | — | 10 | |||||||||||||||||
Total investment securities - available-for-sale | $ | — | $ | 56,442 | $ | — | $ | 56,442 | |||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis at December 31, 2013 | |||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | Fair Value as of December 31, 2013 | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Assets | |||||||||||||||||||||
Investment securities - available-for-sale: | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | — | $ | 7,042 | $ | — | $ | 7,042 | |||||||||||||
Municipal obligations | — | 13,609 | — | 13,609 | |||||||||||||||||
Corporate bonds & other obligations | — | 1,097 | — | 1,097 | |||||||||||||||||
Mortgage-backed securities | — | 28,603 | — | 28,603 | |||||||||||||||||
Equity securities | — | 7 | — | 7 | |||||||||||||||||
Total investment securities - available-for-sale | $ | — | $ | 50,358 | $ | — | $ | 50,358 | |||||||||||||
Schedule of assets measured at fair value on a nonrecurring basis | ' | ||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at March 31, 2014 | |||||||||||||||||||||
Balance at March 31, 2014 | Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Impaired loans accounted for under FASB ASC 310-10 | $ | 3,488 | $ | — | $ | — | $ | 3,488 | |||||||||||||
Other real estate owned -residential mortgages | 443 | — | — | 443 | |||||||||||||||||
Other Real estate owned - commercial | 472 | — | — | 472 | |||||||||||||||||
Other repossessed assets | 1,023 | — | — | 1,023 | |||||||||||||||||
Total assets at fair value on a non-recurring basis | $ | 5,426 | |||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis at December 31, 2013 | |||||||||||||||||||||
Balance at December 31, 2013 | Quoted Prices in Active Markets for Identical Assets | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Impaired loans accounted for under FASB ASC 310-10 | $ | 5,352 | $ | — | $ | — | $ | 5,352 | |||||||||||||
Other real estate owned -residential mortgages | 285 | — | — | 285 | |||||||||||||||||
Other real estate owned - commercial | 472 | — | — | 472 | |||||||||||||||||
Other repossessed assets | 1,023 | — | — | 1,023 | |||||||||||||||||
Total assets at fair value on a non-recurring basis | $ | 7,132 | |||||||||||||||||||
Schedule of carrying value and estimated fair values of Financial Instruments | ' | ||||||||||||||||||||
The estimated fair values and related carrying or notional amounts of the Company’s financial instruments are as follows: | |||||||||||||||||||||
31-Mar-14 | Carrying | Level 1 | Level 2 | Level 3 | Total Estimated Fair Value | ||||||||||||||||
Value | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 3,147 | $ | 3,147 | $ | — | $ | — | $ | 3,147 | |||||||||||
Securities available for sale | 56,442 | — | 56,442 | — | 56,442 | ||||||||||||||||
Securities held to maturity | 2,255 | — | 2,395 | — | 2,395 | ||||||||||||||||
Loans held for sale | 236 | — | — | 240 | 240 | ||||||||||||||||
Loans receivable - net | 135,326 | — | — | 134,043 | 134,043 | ||||||||||||||||
Federal Home Loan Bank stock | 3,266 | — | 3,266 | — | 3,266 | ||||||||||||||||
Accrued interest receivable | 828 | — | — | 828 | 828 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Customer deposits | 165,720 | — | 166,214 | — | 166,214 | ||||||||||||||||
Federal Home Loan Bank advances | 24,233 | — | 23,927 | — | 23,927 | ||||||||||||||||
Accrued interest payable | 88 | — | — | 88 | 88 | ||||||||||||||||
31-Dec-13 | Carrying | Level 1 | Level 2 | Level 3 | Total Estimated Fair Value | ||||||||||||||||
Value | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 2,766 | $ | 2,766 | $ | — | $ | — | $ | 2,766 | |||||||||||
Securities available for sale | 50,358 | — | 50,358 | — | 50,358 | ||||||||||||||||
Securities held to maturity | 2,255 | — | 2,400 | — | 2,400 | ||||||||||||||||
Loans held for sale | 175 | — | — | 178 | 178 | ||||||||||||||||
Loans receivable - net | 136,315 | — | — | 135,172 | 135,172 | ||||||||||||||||
Federal Home Loan Bank stock | 3,266 | — | 3,266 | — | 3,266 | ||||||||||||||||
Accrued interest receivable | 745 | — | — | 745 | 745 | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Customer deposits | 160,029 | — | 160,784 | — | 160,784 | ||||||||||||||||
Federal Home Loan Bank advances | 24,813 | — | 24,458 | — | 24,458 | ||||||||||||||||
Accrued interest payable | 89 | — | — | 89 | 89 |
PROPOSED_BUSINESS_COMBINATION_
PROPOSED BUSINESS COMBINATION (Details Narrative) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Jan. 23, 2014 |
Alpena Banking Corporation [Member] | Alpena Banking Corporation [Member] | |||
Share conversion ratio | ' | ' | ' | $1.55 |
Assets of Bank of Alpena | ' | ' | $69,900,000 | ' |
Deposits of Bank of Alpena | ' | ' | 62,700,000 | ' |
Other liabilities | ' | ' | 269,000 | ' |
Total stockholders' equity | $23,961,127 | $23,524,682 | $7,000,000 | ' |
SECURITIES_Details_Narrative
SECURITIES (Details Narrative) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Securities | Securities | |
Securities Details Narrative | ' | ' |
Securities pledged as collateral | $34,122,000 | $36,000,000 |
Number of securities with an unrealized loss | 33 | 39 |
Unrealized loss on securities | ($482,000) | ($790,000) |
SECURITIES_Details
SECURITIES (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | $56,272,000 | $50,601,000 |
Available for Sale, Gross Unrealized Gains | 652,000 | 547,000 |
Available for Sale, Gross Unrealized (Losses) | -482,000 | -790,000 |
Available for Sale, Market Value | 56,442,499 | 50,358,175 |
Held to Maturity | ' | ' |
Held to Maturity, Amortized Cost | 2,255,000 | 2,255,000 |
Held to Maturity Securities, Gross Unrealized Gains | 140,000 | 145,000 |
Held to Maturity, Market Value | 2,395,000 | 2,400,000 |
US Treasury Securities and Obligations of US Government Corporations and Agencies [Member] | ' | ' |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | 10,345,000 | 7,111,000 |
Available for Sale, Gross Unrealized Gains | 34,000 | 36,000 |
Available for Sale, Gross Unrealized (Losses) | -94,000 | -105,000 |
Available for Sale, Market Value | 10,285,000 | 7,042,000 |
Municipal Obligations [Member] | ' | ' |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | 14,568,000 | 13,694,000 |
Available for Sale, Gross Unrealized Gains | 258,000 | 216,000 |
Available for Sale, Gross Unrealized (Losses) | -181,000 | -301,000 |
Available for Sale, Market Value | 14,645,000 | 13,609,000 |
Held to Maturity | ' | ' |
Held to Maturity, Amortized Cost | 2,255,000 | 2,255,000 |
Held to Maturity Securities, Gross Unrealized Gains | 140,000 | 145,000 |
Held to Maturity, Market Value | 2,395,000 | 2,400,000 |
Corporate Bonds and Other Obligations [Member] | ' | ' |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | 1,072,000 | 1,085,000 |
Available for Sale, Gross Unrealized Gains | 10,000 | 12,000 |
Available for Sale, Market Value | 1,082,000 | 1,097,000 |
Mortgage Backed Securities [Member] | ' | ' |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | 30,284,000 | 28,708,000 |
Available for Sale, Gross Unrealized Gains | 343,000 | 279,000 |
Available for Sale, Gross Unrealized (Losses) | -207,000 | -384,000 |
Available for Sale, Market Value | 30,420,000 | 28,603,000 |
Equity Securities [Member] | ' | ' |
Available for Sale | ' | ' |
Available for Sale, Amortized Cost | 3,000 | 3,000 |
Available for Sale, Gross Unrealized Gains | 7,000 | 4,000 |
Available for Sale, Market Value | $10,000 | $7,000 |
SECURITIES_Details_1
SECURITIES (Details 1) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Amortized cost: | ' | ' |
Total | $56,272,000 | ' |
Fair Value: | ' | ' |
Total | 56,442,000 | ' |
Amortized Cost: | ' | ' |
Due in one year or less | 90,000 | ' |
Due after one year through five years | 490,000 | ' |
Due after five years through ten years | 700,000 | ' |
Due after ten years | 975,000 | ' |
Total | 2,255,000 | ' |
Fair Value: | ' | ' |
Due in one year or less | 91,000 | ' |
Due after one year through five years | 512,000 | ' |
Due after five years through ten years | 749,000 | ' |
Due after ten years | 1,043,000 | ' |
Total | 2,395,000 | 2,400,000 |
Available-for-sale Securities [Member] | ' | ' |
Amortized cost: | ' | ' |
Due in one year or less | 2,401,000 | ' |
Due after one year through five years | 15,508,000 | ' |
Due after five years through ten years | 6,841,000 | ' |
Due after ten years | 1,235,000 | ' |
Total | 25,985,000 | ' |
Fair Value: | ' | ' |
Due in one year or less | 2,414,000 | ' |
Due after one year through five years | 15,585,000 | ' |
Due after five years through ten years | 6,705,000 | ' |
Due after ten years | 1,308,000 | ' |
Total | 26,012,000 | ' |
Mortgage Backed Securities [Member] | ' | ' |
Amortized cost: | ' | ' |
Total | 3,000 | ' |
Fair Value: | ' | ' |
Total | 10,000 | ' |
Equity Securities [Member] | ' | ' |
Amortized cost: | ' | ' |
Total | 30,284,000 | ' |
Fair Value: | ' | ' |
Total | $30,420,000 | ' |
SECURITIES_Details_2
SECURITIES (Details 2) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Securities available for sale | ' | ' |
Fair Value Less Than 12 Months | $18,641,000 | $22,373,000 |
Unrealized Loss Less Than 12 Months | -305,000 | -577,000 |
Fair Value Less Than 12 Months or Longer | 4,542,000 | 4,614,000 |
Unrealized Loss Less Than 12 Months or Longer | -177,000 | -213,000 |
US Treasury Securities and Obligations of US Government Corporations and Agencies [Member] | ' | ' |
Securities available for sale | ' | ' |
Fair Value Less Than 12 Months | 2,236,000 | ' |
Unrealized Loss Less Than 12 Months | -13,000 | ' |
Fair Value Less Than 12 Months or Longer | 918,000 | 894,000 |
Unrealized Loss Less Than 12 Months or Longer | -81,000 | -105,000 |
Municipal Obligations [Member] | ' | ' |
Securities available for sale | ' | ' |
Fair Value Less Than 12 Months | 6,014,000 | 7,902,000 |
Unrealized Loss Less Than 12 Months | -134,000 | -243,000 |
Fair Value Less Than 12 Months or Longer | 1,220,000 | 1,668,000 |
Unrealized Loss Less Than 12 Months or Longer | -47,000 | -58,000 |
Mortgage Backed Securities [Member] | ' | ' |
Securities available for sale | ' | ' |
Fair Value Less Than 12 Months | 10,391,000 | 14,471,000 |
Unrealized Loss Less Than 12 Months | -158,000 | -334,000 |
Fair Value Less Than 12 Months or Longer | 2,404,000 | 2,052,000 |
Unrealized Loss Less Than 12 Months or Longer | ($49,000) | ($50,000) |
LOANS_AND_ALLOWANCE_FOR_LOAN_L2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details Narrative) (USD $) | Mar. 31, 2014 |
Loans And Allowance For Loan Losses Details Narrative | ' |
Impaired loans - TDRs | $2,400,000 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
Gross loans | $137,044,000 | $138,084,000 | $139,580,000 | ' |
Net deferred loan fees | -260,000 | -297,000 | ' | ' |
Allowance for loan losses | -1,458,130 | -1,471,622 | -1,675,000 | -1,750,000 |
Loans receivable, net | 135,326,174 | 136,314,964 | ' | ' |
Residential Mortgage [Member] | ' | ' | ' | ' |
Gross loans | 63,576,000 | 63,839,000 | 66,364,000 | ' |
Allowance for loan losses | -792,000 | -784,000 | -877,000 | -906,000 |
Commercial Real Estate Construction [Member] | ' | ' | ' | ' |
Gross loans | 173,000 | 173,000 | 2,618,000 | ' |
Allowance for loan losses | -48,000 | -48,000 | -89,000 | -64,000 |
Commercial Secured by Real Estate [Member] | ' | ' | ' | ' |
Gross loans | 51,382,000 | 51,726,000 | 50,156,000 | ' |
Allowance for loan losses | -392,000 | -444,000 | -509,000 | -579,000 |
Commercial Real Estate Other [Member] | ' | ' | ' | ' |
Gross loans | 12,252,000 | 12,451,000 | 9,473,000 | ' |
Allowance for loan losses | -61,000 | -63,000 | -87,000 | -69,000 |
Total Commercial Loans [Member] | ' | ' | ' | ' |
Gross loans | 63,807,000 | 64,350,000 | ' | ' |
Consumer Real Estate [Member] | ' | ' | ' | ' |
Gross loans | 8,490,000 | 8,730,000 | 9,813,000 | ' |
Allowance for loan losses | -49,000 | -62,000 | -87,000 | -99,000 |
Consumer Other [Member] | ' | ' | ' | ' |
Gross loans | 1,171,000 | 1,165,000 | 1,156,000 | ' |
Allowance for loan losses | -16,000 | -21,000 | -26,000 | -33,000 |
Total Consumer Loans [Member] | ' | ' | ' | ' |
Gross loans | $9,661,000 | $9,895,000 | ' | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 1) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
30-59 Days past due | $3,614,000 | $2,060,000 | ' |
60-89 Days past due | 14,000 | 993,000 | ' |
Greater than 90 days past due | 1,773,000 | 1,969,000 | ' |
Total past due | 5,401,000 | 5,022,000 | ' |
Current | 131,643,000 | 133,062,000 | ' |
Gross loans | 137,044,000 | 138,084,000 | 139,580,000 |
Recorded investment > 90 days and accruing | ' | 26,000 | ' |
Commercial Real Estate Construction [Member] | ' | ' | ' |
Greater than 90 days past due | 173,000 | 173,000 | ' |
Total past due | 173,000 | 173,000 | ' |
Gross loans | 173,000 | 173,000 | 2,618,000 |
Commercial Secured by Real Estate [Member] | ' | ' | ' |
30-59 Days past due | 2,203,000 | ' | ' |
60-89 Days past due | 12,000 | 521,000 | ' |
Greater than 90 days past due | 1,441,000 | 1,441,000 | ' |
Total past due | 3,656,000 | 1,962,000 | ' |
Current | 47,726,000 | 49,764,000 | ' |
Gross loans | 51,382,000 | 51,726,000 | 50,156,000 |
Commercial Real Estate Other [Member] | ' | ' | ' |
30-59 Days past due | 18,000 | 33,000 | ' |
60-89 Days past due | ' | 20,000 | ' |
Total past due | 18,000 | 53,000 | ' |
Current | 12,234,000 | 12,398,000 | ' |
Gross loans | 12,252,000 | 12,451,000 | 9,473,000 |
Consumer Real Estate [Member] | ' | ' | ' |
30-59 Days past due | 83,000 | 54,000 | ' |
60-89 Days past due | 2,000 | 55,000 | ' |
Total past due | 85,000 | 109,000 | ' |
Current | 8,405,000 | 8,621,000 | ' |
Gross loans | 8,490,000 | 8,730,000 | 9,813,000 |
Consumer Other [Member] | ' | ' | ' |
30-59 Days past due | 6,000 | ' | ' |
60-89 Days past due | ' | 4,000 | ' |
Greater than 90 days past due | ' | 2,000 | ' |
Total past due | 6,000 | 6,000 | ' |
Current | 1,165,000 | 1,159,000 | ' |
Gross loans | 1,171,000 | 1,165,000 | 1,156,000 |
Recorded investment > 90 days and accruing | ' | 2,000 | ' |
Residential Mortgage [Member] | ' | ' | ' |
30-59 Days past due | 1,304,000 | 1,973,000 | ' |
60-89 Days past due | ' | 393,000 | ' |
Greater than 90 days past due | 159,000 | 353,000 | ' |
Total past due | 1,463,000 | 2,719,000 | ' |
Current | 62,113,000 | 61,120,000 | ' |
Gross loans | 63,576,000 | 63,839,000 | 66,364,000 |
Recorded investment > 90 days and accruing | ' | $24,000 | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
Gross loans | $137,044,000 | $138,084,000 | $139,580,000 |
Commercial Real Estate Construction [Member] | ' | ' | ' |
Gross loans | 173,000 | 173,000 | 2,618,000 |
Commercial Real Estate Construction [Member] | Risk Grade 6 (Substandard) [Member] | ' | ' | ' |
Gross loans | 173,000 | 173,000 | ' |
Commercial Secured by Real Estate [Member] | ' | ' | ' |
Gross loans | 51,382,000 | 51,726,000 | 50,156,000 |
Commercial Secured by Real Estate [Member] | Risk Grade 3 (Satisfactory) [Member] | ' | ' | ' |
Gross loans | 16,028,000 | 16,187,000 | ' |
Commercial Secured by Real Estate [Member] | Risk Grade 4.5 (Monitored) [Member] | ' | ' | ' |
Gross loans | 5,001,000 | 3,462,000 | ' |
Commercial Secured by Real Estate [Member] | Risk Grade 4 (Acceptable) [Member] | ' | ' | ' |
Gross loans | 22,926,000 | 24,327,000 | ' |
Commercial Secured by Real Estate [Member] | Risk Grade 5 (Other Assets Especially Mentioned) [Member] | ' | ' | ' |
Gross loans | 4,531,000 | 4,835,000 | ' |
Commercial Secured by Real Estate [Member] | Risk Grade 6 (Substandard) [Member] | ' | ' | ' |
Gross loans | 2,896,000 | 2,915,000 | ' |
Commercial Real Estate Other [Member] | ' | ' | ' |
Gross loans | 12,252,000 | 12,451,000 | 9,473,000 |
Commercial Real Estate Other [Member] | Risk Grade 3 (Satisfactory) [Member] | ' | ' | ' |
Gross loans | 5,831,000 | 5,602,000 | ' |
Commercial Real Estate Other [Member] | Risk Grade 4.5 (Monitored) [Member] | ' | ' | ' |
Gross loans | 481,000 | 171,000 | ' |
Commercial Real Estate Other [Member] | Risk Grade 4 (Acceptable) [Member] | ' | ' | ' |
Gross loans | 5,761,000 | 6,528,000 | ' |
Commercial Real Estate Other [Member] | Risk Grade 5 (Other Assets Especially Mentioned) [Member] | ' | ' | ' |
Gross loans | 17,000 | 45,000 | ' |
Commercial Real Estate Other [Member] | Risk Grade 6 (Substandard) [Member] | ' | ' | ' |
Gross loans | $162,000 | $105,000 | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
Gross loans | $137,044,000 | $138,084,000 | $139,580,000 |
Residential Mortgage [Member] | ' | ' | ' |
Gross loans | 63,576,000 | 63,839,000 | 66,364,000 |
Residential Mortgage [Member] | Pass [Member] | ' | ' | ' |
Gross loans | 63,247,000 | 63,164,000 | ' |
Residential Mortgage [Member] | Risk Grade 6 (Substandard) [Member] | ' | ' | ' |
Gross loans | 329,000 | 675,000 | ' |
Consumer Real Estate [Member] | ' | ' | ' |
Gross loans | 8,490,000 | 8,730,000 | 9,813,000 |
Consumer Real Estate [Member] | Performing [Member] | ' | ' | ' |
Gross loans | 8,484,000 | 8,723,000 | ' |
Consumer Real Estate [Member] | Nonperforming [Member] | ' | ' | ' |
Gross loans | 6,000 | 7,000 | ' |
Consumer Other [Member] | ' | ' | ' |
Gross loans | 1,171,000 | 1,165,000 | 1,156,000 |
Consumer Other [Member] | Performing [Member] | ' | ' | ' |
Gross loans | 1,171,000 | 1,163,000 | ' |
Consumer Other [Member] | Nonperforming [Member] | ' | ' | ' |
Gross loans | ' | $2,000 | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Recorded investment in non-accrual loans | $1,961,000 | $2,285,000 |
Commercial Real Estate Construction [Member] | ' | ' |
Recorded investment in non-accrual loans | 173,000 | 173,000 |
Commercial Secured by Real Estate [Member] | ' | ' |
Recorded investment in non-accrual loans | 1,453,000 | 1,454,000 |
Consumer Real Estate [Member] | ' | ' |
Recorded investment in non-accrual loans | 6,000 | 7,000 |
Residential Mortgage [Member] | ' | ' |
Recorded investment in non-accrual loans | $329,000 | $651,000 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) (USD $) | 3 Months Ended |
Mar. 31, 2013 | |
Loans | |
Troubled Debt Restructuring | ' |
Number of loans | 3 |
Pre-modification outstanding recorded investment | $743,000 |
Post-modification outstanding recorded investment | 680,000 |
Subsequent Default | ' |
Number of loans subsequently defaulted | 1 |
Recorded investment of contracts subsequently defaulted | 190,000 |
Commercial Secured by Real Estate [Member] | ' |
Troubled Debt Restructuring | ' |
Number of loans | 1 |
Pre-modification outstanding recorded investment | 412,000 |
Post-modification outstanding recorded investment | 410,000 |
Residential Mortgage [Member] | ' |
Troubled Debt Restructuring | ' |
Number of loans | 2 |
Pre-modification outstanding recorded investment | 331,000 |
Post-modification outstanding recorded investment | 270,000 |
Subsequent Default | ' |
Number of loans subsequently defaulted | 1 |
Recorded investment of contracts subsequently defaulted | $190,000 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Commercial Real Estate Construction [Member] | ' | ' |
With an allowance recorded: | ' | ' |
Unpaid Principal | $1,589,000 | $1,589,000 |
Recorded Investment | 173,000 | 173,000 |
Related allowance | 48,000 | 48,000 |
Average Recorded Investment | 173,000 | 173,000 |
Total | ' | ' |
Unpaid Principal | 1,589,000 | 1,589,000 |
Recorded Investment | 173,000 | 173,000 |
Average Recorded Investment | 173,000 | 173,000 |
Commercial Secured by Real Estate [Member] | ' | ' |
With no related allowance recorded: | ' | ' |
Unpaid Principal | 1,478,000 | 1,789,000 |
Recorded Investment | 1,477,000 | 1,788,000 |
Average Recorded Investment | 1,595,000 | 1,894,000 |
Interest income recognized | 21,000 | 104,000 |
With an allowance recorded: | ' | ' |
Unpaid Principal | 2,426,000 | 3,980,000 |
Recorded Investment | 1,838,000 | 3,391,000 |
Related allowance | 137,000 | 182,000 |
Average Recorded Investment | 1,840,000 | 3,397,000 |
Interest income recognized | 4,000 | 94,000 |
Total | ' | ' |
Unpaid Principal | 3,904,000 | 5,769,000 |
Recorded Investment | 3,315,000 | 5,179,000 |
Average Recorded Investment | 3,435,000 | 5,291,000 |
Interest income recognized | 25,000 | 198,000 |
Consumer Real Estate [Member] | ' | ' |
With no related allowance recorded: | ' | ' |
Unpaid Principal | 7,000 | 8,000 |
Recorded Investment | 6,000 | 7,000 |
Average Recorded Investment | 6,000 | 7,000 |
Total | ' | ' |
Unpaid Principal | 7,000 | 8,000 |
Recorded Investment | 6,000 | 7,000 |
Average Recorded Investment | 6,000 | 7,000 |
Residential Mortgage [Member] | ' | ' |
With no related allowance recorded: | ' | ' |
Unpaid Principal | 485,000 | 954,000 |
Recorded Investment | 375,000 | 722,000 |
Average Recorded Investment | 382,000 | 727,000 |
Interest income recognized | 1,000 | 6,000 |
With an allowance recorded: | ' | ' |
Unpaid Principal | 53,000 | 53,000 |
Recorded Investment | 30,000 | 30,000 |
Related allowance | 5,000 | 5,000 |
Average Recorded Investment | 30,000 | 30,000 |
Total | ' | ' |
Unpaid Principal | 538,000 | 1,007,000 |
Recorded Investment | 405,000 | 752,000 |
Average Recorded Investment | 412,000 | 757,000 |
Interest income recognized | $1,000 | $6,000 |
Recovered_Sheet1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 7) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | $1,471,622 | $1,750,000 | ' |
Charge offs | -68,000 | -260,000 | ' |
Recoveries | 38,000 | 41,000 | ' |
Provision | 15,765 | 144,074 | ' |
Ending balance | 1,458,130 | 1,675,000 | ' |
Individually evaluated for impairment | 190,000 | 137,000 | ' |
Collectively evaluated for impairment | 1,268,000 | 1,538,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 137,044,000 | 139,580,000 | 138,084,000 |
Individually evaluated for impairment | 3,899,000 | 8,795,000 | ' |
Collectively evaluated for impairment | 133,145,000 | 130,785,000 | ' |
Commercial Real Estate Construction [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | ' | 64,000 | 48,000 |
Provision | ' | 25,000 | ' |
Ending balance | 48,000 | 89,000 | 48,000 |
Individually evaluated for impairment | 48,000 | ' | ' |
Collectively evaluated for impairment | ' | 89,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 173,000 | 2,618,000 | 173,000 |
Individually evaluated for impairment | 173,000 | 173,000 | ' |
Collectively evaluated for impairment | ' | 2,445,000 | ' |
Commercial Secured by Real Estate [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 444,000 | 579,000 | ' |
Charge offs | -16,000 | -85,000 | ' |
Recoveries | 19,000 | 10,000 | ' |
Provision | -55,000 | 5,000 | ' |
Ending balance | 392,000 | 509,000 | ' |
Individually evaluated for impairment | 137,000 | 48,000 | ' |
Collectively evaluated for impairment | 255,000 | 461,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 51,382,000 | 50,156,000 | 51,726,000 |
Individually evaluated for impairment | 3,315,000 | 6,703,000 | ' |
Collectively evaluated for impairment | 48,067,000 | 43,453,000 | ' |
Commercial Real Estate Other [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 63,000 | 69,000 | ' |
Provision | -2,000 | 18,000 | ' |
Ending balance | 61,000 | 87,000 | ' |
Collectively evaluated for impairment | 61,000 | 87,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 12,252,000 | 9,473,000 | 12,451,000 |
Collectively evaluated for impairment | 12,252,000 | 9,473,000 | ' |
Consumer Real Estate [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 62,000 | 99,000 | ' |
Charge offs | -11,000 | -7,000 | ' |
Recoveries | 9,000 | 15,000 | ' |
Provision | -11,000 | -20,000 | ' |
Ending balance | 49,000 | 87,000 | ' |
Collectively evaluated for impairment | 49,000 | 87,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 8,490,000 | 9,813,000 | 8,730,000 |
Individually evaluated for impairment | 6,000 | 9,000 | ' |
Collectively evaluated for impairment | 8,484,000 | 9,804,000 | ' |
Consumer Other [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 21,000 | 33,000 | ' |
Charge offs | -6,000 | -6,000 | ' |
Recoveries | ' | 4,000 | ' |
Provision | 1,000 | -5,000 | ' |
Ending balance | 16,000 | 26,000 | ' |
Collectively evaluated for impairment | 16,000 | 26,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 1,171,000 | 1,156,000 | 1,165,000 |
Collectively evaluated for impairment | 1,171,000 | 1,156,000 | ' |
Residential Mortgage [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 784,000 | 906,000 | ' |
Charge offs | -35,000 | -162,000 | ' |
Recoveries | 10,000 | 12,000 | ' |
Provision | 33,000 | 121,000 | ' |
Ending balance | 792,000 | 877,000 | ' |
Individually evaluated for impairment | 5,000 | 89,000 | ' |
Collectively evaluated for impairment | 787,000 | 788,000 | ' |
Loans receivable (gross): | ' | ' | ' |
Gross loans | 63,576,000 | 66,364,000 | 63,839,000 |
Individually evaluated for impairment | 405,000 | 1,910,000 | ' |
Collectively evaluated for impairment | 63,171,000 | 64,454,000 | ' |
Unallocated [Member] | ' | ' | ' |
Allowance for loan losses: | ' | ' | ' |
Beginning Balance | 50,000 | ' | ' |
Provision | 50,000 | ' | ' |
Ending balance | 100,000 | ' | ' |
Collectively evaluated for impairment | $100,000 | ' | ' |
STOCKBASED_COMPENSATION_Detail
STOCK-BASED COMPENSATION (Details Narrative) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Share Price | 5 |
Stock Options [Member] | ' |
Vesting term | '5 years |
Contractual term | '10 years |
2006 Stock-Based Incentive Plan [Member] | ' |
Number of awards authorized | 242,740 |
2006 Stock-Based Incentive Plan [Member] | Stock Options [Member] | ' |
Number of awards authorized | 173,386 |
2006 Stock-Based Incentive Plan [Member] | Restricted Stock [Member] | ' |
Number of awards authorized | 69,354 |
STOCKBASED_COMPENSATION_Detail1
STOCK-BASED COMPENSATION (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Number of Options | ' | ' |
Outstanding, Beginning balance | 150,030 | ' |
Forfeited or expired | -1,200 | ' |
Outstanding, Ending balance | 148,830 | 150,030 |
Options Exercisable | 148,830 | ' |
Weighted Average Exercise Price | ' | ' |
Outstanding, Beginning Balance | $9.52 | ' |
Forfeited or expired | $7.60 | ' |
Outstanding, Ending Balance | $9.54 | $9.52 |
Options Exercisable | $9.54 | ' |
Weighted Average Remaining Contractual Term | ' | ' |
Outstanding, ending | '2 years 1 month 6 days | '2 years 4 months 24 days |
Options exercisable | '2 years 1 month 6 days | ' |
COMMITMENTS_TO_EXTEND_CREDIT_D
COMMITMENTS TO EXTEND CREDIT (Details Narrative) (USD $) | Mar. 31, 2014 |
Commitments To Extend Credit Details Narrative | ' |
Obligations to extend credit for loan commitments | $19,200,000 |
COMMITMENTS_TO_EXTEND_CREDIT_D1
COMMITMENTS TO EXTEND CREDIT (Details) (USD $) | Mar. 31, 2014 |
Obligations to extend credit for loan commitments | $19,200,000 |
Commitments to grant loans [Member] | ' |
Obligations to extend credit for loan commitments | 6,544,000 |
Unfunded commitments under lines of credit [Member] | ' |
Obligations to extend credit for loan commitments | 12,631,000 |
Commercial and standby letters of credit [Member] | ' |
Obligations to extend credit for loan commitments | $59,000 |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Securities available for sale | $56,442,499 | $50,358,175 |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 56,442,000 | 50,358,000 |
Fair Value [Member] | ' | ' |
Securities available for sale | 56,442,000 | 50,358,000 |
US Treasury Securities and Obligations of US Government Corporations and Agencies [Member] | ' | ' |
Securities available for sale | 10,285,000 | 7,042,000 |
Municipal Obligations [Member] | ' | ' |
Securities available for sale | 14,645,000 | 13,609,000 |
Corporate Bonds and Other Obligations [Member] | ' | ' |
Securities available for sale | 1,082,000 | 1,097,000 |
Mortgage Backed Securities [Member] | ' | ' |
Securities available for sale | 30,420,000 | 28,603,000 |
Equity Securities [Member] | ' | ' |
Securities available for sale | 10,000 | 7,000 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 56,442,000 | 50,358,000 |
Recurring [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | 56,442,000 | 50,358,000 |
Recurring [Member] | US Treasury Securities and Obligations of US Government Corporations and Agencies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 10,285,000 | 7,042,000 |
Recurring [Member] | US Treasury Securities and Obligations of US Government Corporations and Agencies [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | 10,285,000 | 7,042,000 |
Recurring [Member] | Municipal Obligations [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 14,645,000 | 13,609,000 |
Recurring [Member] | Municipal Obligations [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | 14,645,000 | 13,609,000 |
Recurring [Member] | Corporate Bonds and Other Obligations [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 1,082,000 | 1,097,000 |
Recurring [Member] | Corporate Bonds and Other Obligations [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | 1,082,000 | 1,097,000 |
Recurring [Member] | Mortgage Backed Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 30,420,000 | 28,603,000 |
Recurring [Member] | Mortgage Backed Securities [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | 30,420,000 | 28,603,000 |
Recurring [Member] | Equity Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Securities available for sale | 10,000 | 7,000 |
Recurring [Member] | Equity Securities [Member] | Fair Value [Member] | ' | ' |
Securities available for sale | $10,000 | $7,000 |
FAIR_VALUE_MEASUREMENTS_Detail1
FAIR VALUE MEASUREMENTS (Details 1) (Nonrecurring [Member], USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Fair Value [Member] | ' | ' |
Fair Value Assets Measured on a Nonrecurring Basis | ' | ' |
Impaired loans | $3,488,000 | $5,352,000 |
Other real estate owned - residential mortgages | 443,000 | 285,000 |
Other real estate owned - commercial | 472,000 | 472,000 |
Other repossessed assets | 1,023,000 | 1,023,000 |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Fair Value Assets Measured on a Nonrecurring Basis | ' | ' |
Impaired loans | 3,488,000 | 5,352,000 |
Other real estate owned - residential mortgages | 443,000 | 285,000 |
Other real estate owned - commercial | 472,000 | 472,000 |
Other repossessed assets | 1,023,000 | 1,023,000 |
Total assets measured at fair value on a non-recurring basis | $5,426,000 | $7,132,000 |
FAIR_VALUE_MEASUREMENTS_Detail2
FAIR VALUE MEASUREMENTS (Details 2) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Financial assets: | ' | ' |
Securities available for sale | $56,442,499 | $50,358,175 |
Securities held to maturity | 2,395,000 | 2,400,000 |
Carrying Value [Member] | ' | ' |
Financial assets: | ' | ' |
Cash and cash equivalents | 3,147,000 | 2,766,000 |
Securities available for sale | 56,442,000 | 50,358,000 |
Securities held to maturity | 2,255,000 | 22,555,000 |
Loans held for sale | 236,000 | 175,000 |
Loans receivable - net | 135,326,000 | 136,315,000 |
Federal Home Loan Bank stock | 3,266,000 | 3,266,000 |
Accrued interest receivable | 828,000 | 745,000 |
Financial liabilities: | ' | ' |
Customer deposits | 165,720,000 | 160,029,000 |
Federal Home Loan Bank advances | 24,233,000 | 24,813,000 |
Accrued interest payable | 88,000 | 89,000 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' |
Financial assets: | ' | ' |
Cash and cash equivalents | 3,147,000 | 2,766,000 |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Financial assets: | ' | ' |
Securities available for sale | 56,442,000 | 50,358,000 |
Securities held to maturity | 2,540,000 | 2,400,000 |
Federal Home Loan Bank stock | 3,266,000 | 3,266,000 |
Accrued interest receivable | 828,000 | ' |
Financial liabilities: | ' | ' |
Customer deposits | 166,214,000 | 160,784,000 |
Federal Home Loan Bank advances | 23,927,000 | 24,458,000 |
Accrued interest payable | 88,000 | ' |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Financial assets: | ' | ' |
Loans held for sale | 236,000 | 178,000 |
Loans receivable - net | 134,043,000 | 135,172,000 |
Accrued interest receivable | ' | 745,000 |
Financial liabilities: | ' | ' |
Accrued interest payable | ' | 89,000 |
Fair Value [Member] | ' | ' |
Financial assets: | ' | ' |
Cash and cash equivalents | 3,147,000 | 2,766,000 |
Securities available for sale | 56,442,000 | 50,358,000 |
Securities held to maturity | 2,540,000 | 2,400,000 |
Loans held for sale | 236,000 | 178,000 |
Loans receivable - net | 134,043,000 | 135,712,000 |
Federal Home Loan Bank stock | 3,266,000 | 3,266,000 |
Accrued interest receivable | 828,000 | 745,000 |
Financial liabilities: | ' | ' |
Customer deposits | 166,214,000 | 160,784,000 |
Federal Home Loan Bank advances | 23,927,000 | 24,458,000 |
Accrued interest payable | $88,000 | $89,000 |