FNB Bancorp 10-Q/A 7 Nov 16 2016 Q3 Quarterly report (amended) Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 20, 2016
Document and Entity Information:
Entity Registrant Name	FNB BANCORP/CA/
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Entity Central Index Key	1,163,199
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		4,616,901
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

CONSOLIDATED BALANCE SHEETS (UN

CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
ASSETS
Cash and due from banks	$ 17,342	$ 12,314
Interest-bearing time deposits with financial institutions	204	205
Securities available-for-sale, at fair value	358,877	329,207
Other equity securities	7,206	6,748
Loans, net of allowance for loan losses of $10,092 and $9,970 on September 30, 2016 and December 31, 2015	741,407	722,747
Bank premises, equipment, and leasehold improvements, net	9,918	10,202
Bank owned life insurance, net	16,145	15,845
Accrued interest receivable	4,544	4,511
Other real estate owned, net	1,346	1,026
Goodwill	4,580	4,580
Prepaid expenses	670	997
Other assets	15,309	15,967
Total assets	1,177,548	1,124,349
Deposits
Demand, noninterest bearing	285,767	263,822
Demand, interest bearing	110,147	102,304
Savings and money market	491,047	491,633
Time	116,496	125,430
Total deposits	1,003,457	983,189
Federal Home Loan Bank advances	37,000	17,000
Note Payable	4,500	4,950
Accrued expenses and other liabilities	18,847	15,048
Total liabilities	1,063,804	1,020,187
Stockholders' equity
Common stock, no par value, authorized 10,000,000 shares; issued and outstanding 4,616,076 shares at September 30, 2016 and 4,541,680 shares at December 31, 2015	76,065	74,805
Retained earnings	33,123	27,816
Accumulated other comprehensive income, net of tax	4,556	1,541
Total stockholders' equity	113,744	104,162
Total liabilities and stockholders' equity	$ 1,177,548	$ 1,124,349

CONSOLIDATED BALANCE SHEETS (U3

CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets:
Allowance for loan losses	$ 10,092	$ 9,970
Common Stock, shares authorized	10,000,000	10,000,000
Common Stock, shares issued	4,616,076	4,541,680
Common Stock, shares outstanding	4,616,076	4,541,680

CONSOLIDATED STATEMENTS OF EARN

CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Interest income:
Interest and fees on loans	$ 9,301	$ 8,309	$ 28,735	$ 23,874
Interest on taxable securities	1,065	924	3,044	2,597
Interest on tax-exempt securities	750	651	2,187	1,754
Interest time deposits with other financial institutions	1	9	3	36
Total interest income	11,117	9,893	33,969	28,261
Interest expense:
Interest on deposits	657	635	2,149	1,625
Interest on FHLB advances	10	1	19	2
Interest on note payable	54	57	167	173
Total interest expense	721	693	2,335	1,800
Net interest income	10,396	9,200	31,634	26,461
Provision for loan losses	0	75	150	225
Net interest income after provision for loan losses	10,396	9,125	31,484	26,236
Noninterest income:
Service charges	623	618	1,862	1,854
Net gain on sale of available-for-sale securities	140	29	381	250
Bank-owned life insurance earnings	95	90	300	261
Other income	249	287	763	1,002
Total noninterest income	1,107	1,024	3,306	3,367
Noninterest expense:
Salaries and employee benefits	4,821	4,100	14,635	12,513
Occupancy expense	645	592	1,893	1,906
Equipment expense	445	718	1,317	1,533
Professional fees	298	334	979	1,075
FDIC assessment	150	150	450	450
Telephone, postage and supplies	300	237	901	782
Advertising	104	112	404	381
Data processing expense	147	659	479	940
Low income housing expense	71	70	213	212
Surety insurance	88	122	262	298
Directors expense	72	72	216	216
Other real estate owned - expense (income), net	0	0	(10)	(6)
Other expense	372	313	1,210	911
Total noninterest expense	7,513	7,479	22,949	21,211
Earnings before provision for income tax expense	3,990	2,670	11,841	8,392
Provision for income tax expense	1,546	431	4,382	2,283
Net earnings	$ 2,444	$ 2,239	$ 7,459	$ 6,109
Earnings per share data:
Basic	$ 0.53	$ 0.49	$ 1.63	$ 1.36
Diluted	$ 0.52	$ 0.48	$ 1.59	$ 1.32
Weighted average shares outstanding:
Basic	4,612	4,524	4,582	4,508
Diluted	4,717	4,643	4,700	4,635

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues [Abstract]
Net earnings	$ 2,444	$ 2,239	$ 7,459	$ 6,109
Unrealized holding gain on available-for-sale securities, net of tax expense of $399 and $2,251 for three and nine months ended September 30, 2016, and net of tax expense of $988 and $953 for three and nine months ended September 30, 2015, respectively	574	1,422	3,240	1,372
Reclassification adjustment for gain on available-for-sale securities sold, net of tax benefit of $57 and $156 for three and nine months ended September 30, 2016, and $12 and $103 for three and nine months ended September 30, 2015, respectively	(83)	(17)	(225)	(147)
Other comprehensive earnings	491	1,405	3,015	1,225
Total comprehensive earnings	$ 2,935	$ 3,644	$ 10,474	$ 7,334

CONSOLIDATED STATEMENTS OF COM6

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (UNAUDITED) (Parentheticals) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Other Comprehensive Earnings Parentheticals
Tax (expense) benefit on unrealized holding gain (loss) on available-for-sale securities	$ 399	$ 988	$ 2,251	$ 953
Tax on reclassification adjustment for gain on available-for-sale	$ 57	$ 12	$ 156	$ 103

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollar amounts in thousands) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flow from operating activities:
Net earnings	$ 7,459	$ 6,109
Adjustments to reconcile net earnings to net cash provided by operating activities:
Net gain on sale of securities available-for-sale	(381)	(250)
Depreciation, amortization and accretion	2,872	2,553
Stock-based compensation expense	227	183
Earnings on bank owned life insurance	(300)	(261)
Increase in net deferred loan fees	254	51
Provision for loan losses	150	225
Increase in accrued interest receivable	(33)	(288)
Decrease in prepaid expense	327	1,976
Decrease in other assets	658	2,888
Increase (decrease) in accrued expenses and other liabilities	967	(5,027)
Net cash provided by operating activities	12,200	8,159
Cash flows from investing activities
Purchase of securities available-for-sale	(79,862)	(90,590)
Proceeds from matured/called/sold securities available-for-sale	53,606	40,514
Net (investment) in other equity securities	(458)	(300)
Acquisition, net of cash paid	0	(18,481)
Maturities of time deposits of other banks	1	9,374
Net investment in other real estate owned	(320)	(75)
Net increase in loans	(19,064)	(20,480)
Purchases of bank premises, equipment, leasehold improvements	(512)	(144)
Net cash used in investing activities	(46,609)	(80,182)
Cash flows from financing activities
Net increase in demand and savings deposits	29,202	109,085
Net decrease in time deposits	(8,934)	(2,040)
Increase (decrease) in FHLB advances	20,000	(9,000)
Principal repayment on note payable	(450)	(450)
Dividends paid on common stock	(1,414)	(1,146)
Exercise of stock options	1,033	878
Net cash provided by financing activities	39,437	97,327
NET INCREASE IN CASH AND CASH EQUIVALENTS	5,028	25,304
Cash and cash equivalents at beginning of period	12,314	14,978
Cash and cash equivalents at end of period	17,342	40,282
Additional cash flow information:
Interest paid	2,284	1,745
Income taxes paid	4,215	1,938
Tax benefit on exercise of stock options	0	154
Non-cash investing and financing activities:
Accrued dividends	738	646
Change in unrealized gain in available for-sale securities, net of tax	3,015	1,224
Acquisitions:
Fair value of assets acquired	0	115,127
Fair value of liabilities assumed	$ 0	$ 93,627

A. BASIS OF PRESENTATION

A. BASIS OF PRESENTATION	9 Months Ended
	Sep. 30, 2016
BASIS OF PRESENTATION
BASIS OF PRESENTATION	FNB Bancorp (the “Company”) is a bank holding company registered under the Bank Holding Company Act of 1956, as amended. The Company was incorporated under the laws of the State of California on February 28, 2001. The consolidated financial statements include the accounts of FNB Bancorp and its wholly-owned subsidiary, First National Bank of Northern California (the “Bank”). The Bank provides traditional banking services in San Francisco, San Mateo, and Santa Clara counties. All intercompany transactions and balances have been eliminated in consolidation. The financial statements include all adjustments of a normal and recurring nature, which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented. The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes normally included in annual financial statements prepared in conformity with accounting principles generally accepted in the United States of America. Accordingly, these consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto for the year ended December 31, 2015. Results of operations for interim periods are not necessarily indicative of results for the full year. Certain prior year information has been reclassified to conform to current year presentation. The reclassifications had no impact on consolidated net earnings or stockholders’ equity.

B. STOCK OPTION PLANS

B. STOCK OPTION PLANS	9 Months Ended
	Sep. 30, 2016
Share-based Compensation [Abstract]
STOCK OPTION PLANS	Stock option expense is recorded based on the fair value of option contracts issued. The fair value is determined using an option pricing model that considers the expected contract term, the risk free interest rate, the volatility of the Company’s stock price and the level of dividends the Company is expected to pay. Measurement of the cost of the stock options granted is based on the grant-date fair value of each stock option using the Black-Scholes valuation model. The cost is then amortized over each option’s requisite service period. The expected term of options granted is derived from the period of time the options are expected to be outstanding. The risk free rate is based on the yield of an equivalent maturity U.S. Treasury note. Volatility is calculated using historical price changes on a monthly basis over the option’s expected life. The amount of compensation expense for options recorded in the quarters ended September 30, 2016 and 2015was $70,000 and $61,000 respectively. There was no income tax benefit for the quarter ended September 30, 2016, and 2015, respectively. The amount of compensation expense for options recorded in the nine months ended September 30, 2016 and September 30, 2015 was $227,000 and $183,000, respectively. There was an income tax benefit of $0 and $154,000 recorded for the nine months ended September 30, 2016 and 2015, respectively. There were no options granted for the first nine months ended September 30, 2016 and 2015 respectively. The intrinsic value of options exercised during the nine months ended September 30, 2016 was $1,151,000 and $671,000, respectively.. The intrinsic value for options exercised during the nine months ended September 30, 2015 was $671,000. The intrinsic value for options exercisable at September 30, 2016 and 2015 was $3,994,000 and $3,042,000, respectively. The amount of total unrecognized compensation expense related to non-vested options at September 30, 2016 was $817,000, and the weighted average period over which it will be amortized is 3 .

C. EARNINGS PER SHARE CALCULATI

C. EARNINGS PER SHARE CALCULATION	9 Months Ended
	Sep. 30, 2016
Earnings per share data:
EARNINGS PER SHARE CALCULATION	Earnings per common share (EPS) are computed based on the weighted average number of common shares outstanding during the period. Basic EPS excludes dilution and is computed by dividing net earnings available to common stockholders (after deducting dividends and related accretion on preferred stock) by the weighted average of common shares outstanding. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of potential common shares included in the quarterly diluted EPS is computed using the average market price during the three months included in the reporting period under the treasury stock method. The number of potential common shares included in year-to-date diluted EPS is a year-to-date weighted average of potential shares included in each quarterly diluted EPS computation. All common stock equivalents are anti-dilutive when a net loss occurs. A 5% stock dividend was declared and paid in the fourth quarter of 2015. Prior per share amounts have been adjusted to reflect the 5% stock dividend. Earnings per share have been computed based on the following: (Dollar amounts in thousands) Three months ended Nine months ended September 30, September 30, 2016 2015 2016 2015 Net earnings $ 2,444 $ 2,239 $ 7,459 $ 6,109 Average number of shares outstanding 4,612 4,524 4,582 4,508 Effect of dilutive options 105 119 118 127 Average number of shares outstanding used to calculate diluted earnings per share 4,717 4,643 4,700 4,635 Anti-dilutive options not included 68 103 70 104

D. SECURITIES AVAILABLE FOR SAL

D. SECURITIES AVAILABLE FOR SALE	9 Months Ended
	Sep. 30, 2016
SECURITIES AVAILABLE FOR SALE
SECURITIES AVAILABLE FOR SALE	The amortized cost and fair values of securities available-for-sale are as follows: (Dollar amounts in thousands) Amortized Unrealized Unrealized Fair cost gains losses value September 30, 2016 U.S. Treasury securities $ 975 $ 28 $ — $ 1,003 Obligations of U.S. government agencies 60,724 974 (1 ) 61,697 Mortgage-backed securities 98,933 2,219 (118 ) 101,034 Obligations of states and political subdivisions 154,304 4,344 (131 ) 158,517 Corporate debt 36,219 412 (5 ) 36,626 $ 351,155 $ 7,977 $ (255 ) $ 358,877 December 31, 2015 U.S. Treasury securities $ 7,004 $ 14 $ (18 ) $ 7,000 Obligations of U.S. government agencies 84,842 168 (401 ) 84,609 Mortgage-backed securities 61,579 641 (557 ) 61,663 Obligations of states and political subdivisions 132,125 3,148 (83 ) 135,190 Corporate debt 41,045 50 (350 ) 40,745 $ 326,595 $ 4,021 $ (1,409 ) $ 329,207 An analysis of gross unrealized losses of the available-for-sale investment securities portfolio as of September 30, 2016 and December 31, 2015 follows: (Dollar amounts in thousands) Less than 12 Months Total 12 Months Total or Longer Total Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses September 30, 2016 Obligations of U.S. $ — $ — $ 1,008 $ (1 ) $ 1,008 $ (1 ) Mortgage-backed securities 18,864 (114 ) 2,627 (4 ) 21,491 (118 ) Obligations of states and political subdivisions 13,679 (126 ) 1,810 (5 ) 15,489 (131 ) Corporate debt 2,015 (3 ) 1,000 (2 ) 3,015 (5 ) Total $ 34,558 $ (243 ) $ 6,445 $ (12 ) $ 41,003 $ (255 ) Total 12 Months Total or Longer Total Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses December 31, 2015 U. S. Treasury securities $ 5,042 $ (18 ) $ — $ — $ 5,042 $ (18 ) Obligations of U.S. 55,382 (338 ) 4,976 (62 ) 60,358 (401 ) Mortgage-backed securities 19,458 (193 ) 16,714 (365 ) 36,172 (557 ) Obligations of states and political subdivisions 14,988 (74 ) 1,856 (10 ) 16,844 (83 ) Corporate debt 27,130 (300 ) 4,449 (50 ) 31,579 (350 ) Total $ 122,000 $ (923 ) $ 27,995 $ (487 ) $ 149,995 $ (1,409 ) At September 30, 2016, there were 6 securities in an unrealized loss position for twelve consecutive months or more. At the same time, there were 33 securities in an unrealized loss position for less than twelve consecutive months. Management periodically evaluates each security in an unrealized loss position to determine if the impairment is temporary or other-than-temporary. Management reviews market rates, the entity’s financial condition and any relevant news items or legal/tax/regulatory changes. The unrealized losses are due solely to interest rate changes and the Company does not intend to sell nor expects it will be required to sell investment securities identified with impairments prior to the earliest of forecasted recovery or the maturity of the underlying investment security. Management has determined that no investment security was other-than-temporarily impaired at September 30, 2016 and December 31, 2015. The amortized cost and carrying value of available-for-sale debt securities as of September 30, 2016 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. September 30, 2016: (Dollar amounts in thousands) Amortized Fair Cost Value Available-for-sale: Due in one year or less $ 12,725 $ 12,755 Due after one through five years 146,953 150,017 Due after five years through ten years 138,771 142,744 Due after ten years 52,706 53,361 $ 351,155 $ 358,877 For the nine months ended September 30, 2016, gross realized gains amounted to $381,000 on securities sold or called for $35,400,000. For the nine months ended September 30, 2015, gross realized gains amounted to $250,000 on securities sold for $11,463,000. For the nine months ended September 30, 2016 and September 30, 2015, respectively, there were no gross realized losses on securities sold. For the three months ended September 30, 2016, gross realized gains amounted to $140,000 on securities sold for $14,178,000. For the three months ended September 30, 2015, gross realized gains were $29,000 on securities sold for $3,187,000. For the three months ended September 30, 2016 and September 30, 2015, respectively, there were no gross realized losses on securities sold. At September 30, 2016, securities with an amortized cost of $102,449,000 and fair value of $104,857,000 were pledged as collateral for public deposits and for other purposes required by law.

E. LOANS

E. LOANS	9 Months Ended
	Sep. 30, 2016
LOANS
LOANS	Loans are summarized as follows at September 30, 2016 and December 31, 2015: (Dollar amounts in thousands) Total FNB Balance Bancorp September 30, September 30, 2016 Originated PNCI PCI 2016 Commercial real estate $ 331,392 $ 72,339 $ 1,233 $ 404,964 Real estate construction 36,654 1,509 — 38,163 Real estate multi-family 74,712 9,232 — 83,944 Real estate 1 to 4 family 148,993 24,448 — 173,441 Commercial & industrial 42,839 8,031 — 50,870 Consumer 1,630 — — 1,630 Gross loans 636,220 115,559 1,233 753,012 Net deferred loan fees (1,513 ) — — (1,513 ) Allowance for loan losses (10,092 ) — (10,092 ) Net loans $ 624,615 $ 115,559 $ 1,233 $ 741,407 (Dollar amounts in thousands) Total FNB Balance Bancorp December 31, December 31, 2015 Originated PNCI PCI 2015 Commercial real estate $ 314,141 $ 84,548 $ 1,304 $ 399,993 Real estate construction 38,909 5,907 — 44,816 Real estate multi-family 47,607 15,990 — 63,597 Real estate 1 to 4 family 153,872 18,092 — 171,964 Commercial & industrial 39,894 12,139 — 52,033 Consumer 1,574 — — 1,574 Gross loans 595,997 136,676 1,304 733,977 Net deferred loan fees (1,260 ) — — (1,260 ) Allowance for loan losses (9,970 ) — — (9,970 ) Net loans $ 584,767 $ 136,676 $ 1,304 $ 722,747 Note: PNCI means Purchased, Not Credit Impaired. PCI means Purchased, Credit Impaired. Recorded Investment in Loans at September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction family family & industrial Consumer Total Loans: Ending balance $ 404,964 $ 38,163 $ 83,944 $ 173,441 $ 50,871 $ 1,630 $ 753,013 Ending balance: individually evaluated for impairment $ 10,214 $ 2,072 $ — $ 3,620 $ 1,236 $ — $ 17,142 Ending balance: collectively evaluated for impairment $ 394,750 $ 36,091 $ 83,944 $ 169,821 $ 49,635 $ 1,630 $ 735,871 Recorded Investment in Loans at December 31, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction Family Family & industrial Consumer Total Loans: Ending balance $ 399,993 $ 44,816 $ 63,597 $ 171,964 $ 52,033 $ 1,574 $ 733,977 Ending balance: individually evaluated for impairment $ 11,292 $ 2,154 $ — $ 4,218 $ 1,782 $ — $ 19,446 Ending balance: collectively evaluated for impairment $ 388,701 $ 42,662 $ 63,597 $ 167,746 $ 50,251 $ 1,574 $ 714,531 Recorded Investment in Loans at September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction family family & industrial Consumer Total Loans: Ending balance $ 394,090 $ 35,868 $ 63,928 $ 172,280 $ 39,843 $ 1,497 $ 707,506 Ending balance: individually evaluated for impairment $ 9,501 $ 2,162 $ — $ 4,857 $ 1,813 $ — $ 18,333 Ending balance: collectively evaluated for impairment $ 384,589 $ 33,706 $ 63,928 $ 167,423 $ 38,030 $ 1,497 $ 689,173 Impaired Loans As of and for the three months ended September 30, 2016 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,554 $ 9,676 $ — $ 8,449 $ 95 Commercial real estate construction 2,072 2,259 — 2,090 — Residential- 1 to 4 family 605 605 — 834 — Commercial and industrial 116 116 — 316 6 Total 11,347 12,656 — 11,689 101 With an allowance recorded Commercial real estate $ 1,660 $ 1,660 $ 72 $ 1,664 $ 17 Residential- 1 to 4 family 3,015 2,618 453 3,019 13 Commercial and industrial 1,120 1,326 101 1,087 — Total 5,795 5,604 626 5,770 30 Total Commercial real estate $ 10,214 $ 11,336 $ 72 $ 10,113 $ 112 Commercial real estate construction 2,072 2,259 — 2,090 — Residential- 1 to 4 family 3,620 3,223 453 3,853 13 Commercial and industrial 1,236 1,442 101 1,403 6 Grand total $ 17,142 $ 18,260 $ 626 $ 17,459 $ 131 Impaired Loans As of and for the nine months ended September 30, 2016 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,554 $ 9,676 $ — $ 8,637 $ 520 Commercial real estate construction 2,072 2,259 — 2,118 104 Residential- 1 to 4 family 605 605 — 303 21 Commercial and industrial 116 116 — 320 20 Total 11,347 12,656 — 11,378 665 With an allowance recorded Commercial real estate $ 1,660 $ 1,660 $ 72 $ 1,675 $ 68 Residential- 1 to 4 family 3,015 2,618 453 3,032 80 Commercial and industrial 1,120 1,326 101 1,107 4 Total 5,795 5,604 626 5,814 152 Total Commercial real estate $ 10,214 $ 11,336 $ 72 $ 10,312 $ 588 Commercial real estate construction 2,072 2,259 — 2,118 104 Residential- 1 to 4 family 3,620 3,223 453 3,335 101 Commercial and industrial 1,236 1,442 101 1,427 24 Grand total $ 17,142 $ 18,260 $ 626 $ 17,192 $ 817 Impaired Loans As of and for the year ended December 31, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,169 $ 9,271 $ — $ 8,379 $ 282 Commercial real estate construction 2,154 2,337 — 2,264 130 Residential- 1 to 4 family 457 457 — 460 36 Commercial and industrial 524 524 — 731 27 Total 11,304 12,589 — 11,834 475 With an allowance recorded Commercial real estate $ 2,634 $ 2,638 $ 96 $ 2,664 $ 160 Residential- 1 to 4 family 3,761 3,782 479 3,786 149 Commercial and industrial 1,258 1,497 182 1,484 7 Total 7,653 7,917 757 7,934 316 Total Commercial real estate $ 10,803 $ 11,909 $ 96 $ 11,043 $ 442 Commercial real estate construction 2,154 2,337 — 2,264 130 Residential- 1 to 4 family 4,218 4,239 479 4,246 185 Commercial and industrial 1,782 2,021 182 2,215 34 Grand total $ 18,957 $ 20,506 $ 757 $ 19,768 $ 791 Impaired Loans As of and for the three months ended September 30, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 4,392 $ 5,271 $ — $ 4,402 $ 92 Commercial real estate construction 2,162 2,345 — 2,341 32 Residential- 1 to 4 family 1,475 1,476 — 1,479 18 Commercial and industrial 528 782 — 537 9 Total 8,557 9,874 — 8,758 151 With an allowance recorded Commercial real estate $ 5,109 $ 5,113 $ 126 $ 5,121 $ 66 Residential- 1 to 4 family 3,382 2,972 522 3,374 27 Commercial and industrial 1,285 1,539 224 1,339 — Total 9,776 9,624 872 9,834 93 Total Commercial real estate $ 9,501 $ 10,384 $ 126 $ 9,523 $ 158 Commercial real estate construction 2,162 2,345 — 2,341 32 Residential- 1 to 4 family 4,857 4,448 522 4,853 45 Commercial and industrial 1,813 2,321 224 1,876 9 Grand total $ 18,333 $ 19,498 $ 872 $ 18,593 $ 244 Impaired Loans As of and for the nine months ended September 30, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 4,392 $ 5,271 $ — $ 4,867 $ 217 Commercial real estate construction 2,162 2,345 — 2,359 100 Residential - 1 to 4 family 1,475 1,476 — 1,482 49 Commercial and industrial 528 782 — 4,410 27 Total 8,557 9,874 — 13,118 393 With an allowance recorded Commercial real estate $ 5,109 $ 5,113 $ 126 $ 5,162 $ 196 Residential - 1 to 4 family 3,382 2,972 522 3,202 96 Commercial and industrial 1,285 1,539 224 1,489 5 Total 9,776 9,624 872 9,853 297 Total Commercial real estate $ 9,501 $ 10,384 $ 126 $ 10,029 $ 413 Commercial real estate construction 2,162 2,345 — 2,359 100 Residential - 1 to 4 family 4,857 4,448 522 4,684 145 Commercial and industrial 1,813 2,321 224 5,899 32 Grand total $ 18,333 $ 19,498 $ 872 $ 22,971 $ 690 Nonaccrual loans totaled $6,903,000 and $7,915,000 as of September 30, 2015 and December 31, 2015. The difference between impaired loans and nonaccrual loans represents loans that are restructured, are performing under modified loan agreements, and accruing interest. Loans on Nonaccrual Status as of (Dollar amounts in thousands) September 30, December 31, 2016 2015 Commercial real estate $ 5,707 $ 6,021 Real estate 1 to 4 family 76 636 Commercial and industrial 1,120 1,258 Total $ 6,903 $ 7,915 Interest income on impaired loans of $817,000 and $690,000 was recognized for cash payments received during the nine months ended September 30, 2016 and 2015 respectively. $791,000 was recognized for cash payments received during the year ended December 31, 2015. Interest income recognized for cash payments received for the three months ended September 30, 2016 and 2015 was $131,000 and $244,000 respectively. The amount of interest on impaired loans not collected for the three and nine months ended September 30, 2016 was $164,313 and $439,579 respectively, and for the year ended December 31, 2015 was $460,390. For the three and nine months ended September 30, 2015, the amount of interest on impaired loans not collected was $86,430 and $284,198, respectively. The cumulative amount of unpaid interest on impaired loans was $3,844,000 for the nine months ended September 30, 2016, and $3,405,000 for the year ended December 31, 2015. Troubled Debt Restructurings Total troubled debt restructured loans outstanding at (dollars in thousands) September 30, 2016 December 31, 2015 Non- Non- Accrual accrual Total Accrual accrual Total status status modifications status status modifications Commercial real estate $ 4,625 $ 1,233 $ 5,858 $ 4,775 $ — $ 4,775 Real Estate construction 1,212 — 1,212 1,283 — 1,283 Real estate 1 to 4 family 3,543 — 3,543 3,583 2,060 5,643 Commercial & industrial — 929 929 524 1,043 1,567 Total $ 9,380 $ 2,162 $ 11,542 $ 10,165 $ 3,103 $ 13,268 Modification Categories The Company offers a variety of modifications to borrowers. The modification categories offered can generally be described in the following categories. Rate Modification Term modification Interest Only Modification Payment Modification There were no commitments for additional funding of troubled debt restructured loans as of September 30, 2016. There was one loan modified during the nine months ended September 30, 2015. There were no payment defaults during the three and nine month period ended September 30, 2016 or September 30, 2015 that were related to receivables modified as TDRs in the last twelve months. The following table details modifications for the nine months ended September 30, 2015: Modifications For the nine months ended September 30, 2015 Pre- Post- Modification Modification Outstanding Outstanding Number of Recorded Recorded Contracts Investment Investment (Dollar amounts in thousands) Real estate 1 to 4 family 1 $ 474 $ 474 Total 1 $ 474 $ 474 The restructuring total above was a modification of interest rate, and as a result, payment. There was no principal reduction granted. Allowance for Credit Losses For the Three Months Ended September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,206 $ 404 $ 335 $ 2,261 $ 799 $ 33 $ 10,038 Charge-offs — — — — — (8 ) (8 ) Recoveries 2 — — 23 37 — 62 Provision (63 ) 138 (3 ) (77 ) (47 ) 52 — Ending balance $ 6,145 $ 542 $ 332 $ 2,207 $ 789 $ 77 $ 10,092 Ending balance: individually evaluated for impairment $ 72 $ — $ — $ 453 $ 101 $ — $ 626 Ending balance: collectively evaluated for impairment $ 6,073 $ 542 $ 332 $ 1,754 $ 688 $ 77 $ 9,466 Allowance for Credit Losses For the Nine Months Ended September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction Family Family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,059 $ 589 $ 243 $ 2,176 $ 853 $ 50 $ 9,970 Charge-offs — — — (12 ) (165 ) (18 ) (195 ) Recoveries 6 — — 42 119 — 167 Provision 80 (46 ) 89 1 (19 ) 45 150 Ending balance $ 6,145 $ 543 $ 332 $ 2,207 $ 788 $ 77 $ 10,092 Ending balance: individually evaluated for impairment $ 72 $ — $ — $ 453 $ 101 $ — $ 626 Ending balance: collectively evaluated for impairment $ 6,073 $ 542 $ 332 $ 1,754 $ 688 $ 77 $ 9,466 Allowance for Credit Losses As of and For the Year Ended December 31, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 5,549 $ 849 $ 206 $ 1,965 $ 1,073 $ 58 $ 9,700 Charge-offs — — — (45 ) — (36 ) (81 ) Recoveries 576 — — 15 60 5 656 Provision (66 ) (260 ) 37 241 (280 ) 23 (305 ) Ending balance $ 6,059 $ 589 $ 243 $ 2,176 $ 853 $ 50 $ 9,970 Ending balance: individually evaluated for impairment $ 96 $ — $ — $ 479 $ 182 $ — $ 757 Ending balance: collectively evaluated for impairment $ 5,963 $ 589 $ 243 $ 1,697 $ 671 $ 50 $ 9,213 Allowance for Credit Losses For the Three Months Ended September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,027 $ 697 $ 198 $ 2,014 $ 848 $ 52 $ 9,836 Charge-offs — — — — (23 ) — (23 ) Recoveries 15 — — 7 26 4 52 Provision (67 ) (49 ) (10 ) 289 (73 ) (15 ) 75 Ending balance $ 5,975 $ 648 $ 188 $ 2,310 $ 778 $ 41 $ 9,940 Ending balance: individually evaluated for impairment $ 126 $ — $ — $ 522 $ 224 $ — $ 872 Ending balance: collectively evaluated for impairment $ 5,849 $ 648 $ 188 $ 1,788 $ 554 $ 41 $ 9,068 Allowance for Credit Losses For the Nine Months Ended September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 5,549 $ 849 $ 206 $ 1,965 $ 1,073 $ 58 $ 9,700 Charge-offs — — — (45 ) (23 ) (11 ) (79 ) Recoveries 37 — — 8 45 4 94 Provision 389 (201 ) (18 ) 382 (317 ) (10 ) 225 Ending balance $ 5,975 $ 648 $ 188 $ 2,310 $ 778 $ 41 $ 9,940 Ending balance: individually evaluated for impairment $ 126 $ — $ — $ 522 $ 224 $ — $ 872 Ending balance: collectively evaluated for impairment $ 5,849 $ 648 $ 188 $ 1,788 $ 554 $ 41 $ 9,068 Risk rating system Loans to borrowers graded as pass or pooled loans represent loans to borrowers of acceptable or better credit quality. They demonstrate sound financial positions, repayment capacity and credit history. They have an identifiable and stable source of repayment. Special mention loans have potential weaknesses that deserve management’s attention. If left uncorrected these potential weaknesses may result in a deterioration of the repayment prospects for the asset or in the Bank’s credit position at some future date. These assets are “not adversely classified” and do not expose the Bank to sufficient risk to warrant adverse classification. Substandard loans are inadequately protected by current sound net worth, paying capacity of the borrower, or pledged collateral. Loans are normally classified as Substandard when there are unsatisfactory characteristics causing more than acceptable levels of risk. A substandard loan normally has one or more well-defined weaknesses that could jeopardize the repayment of the debt. These well-defined weaknesses may include a) cash flow deficiency, which may jeopardize future payments; b) sale of non-collateral assets has become primary source of repayment; c) the borrower is bankrupt; or d) for any other reason, future repayment is dependent on court action. Doubtful loans represent credits with weakness inherent in the substandard classification and where collection or liquidation in full is highly questionable. To be classified doubtful, there must be specific pending factors which prevent the Loan Review Officer from determining the amount of loss contained in the credit. When the amount of loss can be reasonably estimated, that amount is classified as “loss” and the remainder is classified as Substandard. Real Estate – Multi-Family Our multi-family commercial real estate loans are secured by multi-family properties located primarily in San Mateo and San Francisco Counties. These loans are made to investors where our primary source of repayment is from cash flows generated by the properties, through rent collections. The borrowers’ promissory notes are secured with recorded liens on the underlying properties. The borrowers would normally also be required to personally guarantee repayment of the loans. The bank uses conservative underwriting standards in reviewing applications for credit. Generally, our borrowers have multiple sources of income, so if cash flow generated from the property declines, at least in the short term, the borrowers can normally cover these short term cash flow deficiencies from their available cash reserves. Risk of loss to the Bank is increased when there are cash flow decreases sufficiently large and for such a prolonged period of time that loan payments can no longer be made by the borrowers. Commercial Real Estate Loans Other commercial real estate loans consist of loans secured by non-farm, non-residential properties, including, but not limited to industrial, hotel, assisted care, retail, office and mixed use buildings. Our commercial real estate loans are made primarily to investors or small businesses where our primary source of repayment is from cash flows generated by the properties, either through rent collection or business profits. The borrower’s promissory notes are secured with recorded liens on the underlying property. The borrowers would normally also be required to personally guarantee repayment of the loan. The Bank uses conservative underwriting standards in reviewing applications for credit. Generally, our borrowers have multiple sources of income, so if cash flow generated from the property declines, at least in the short term, the borrowers can normally cover these short term cash flow deficiencies from their available cash reserves. Risk of loss to the Bank is increased when there are cash flow decreases sufficiently large and for such a prolonged period of time that loan payments can no longer be made by the borrowers. Real Estate Construction Loans Our real estate construction loans are generally made to borrowers who are rehabilitating a building, converting a building use from one type of use to another, or developing land and building residential or commercial structures for sale or lease. The borrower’s promissory notes are secured with recorded liens on the underlying property. The borrowers would normally also be required to personally guarantee repayment of the loan. The Bank uses conservative underwriting standards in reviewing applications for credit. Generally, our borrowers have sufficient resources to make the required construction loan payments during the construction and absorption or lease-up period. After construction is complete, the loans are normally paid off from proceeds from the sale of the building or through a refinance to a commercial real estate loan. Risk of loss to the Bank is increased when there are material construction cost overruns, significant delays in the time to complete the project and/or there has been a material drop in the value of the projects in the marketplace since the inception of the loan. Real Estate-1 to 4 family Loans Our residential real estate loans are generally made to borrowers who are buying or refinancing their primary personal residence or a rental property of 1-4 single family residential units. The Bank uses conservative underwriting standards in reviewing applications for credit. Risk of loss to the Bank is increased when borrowers lose their primary source of income and/or property values decline significantly. Commercial and Industrial Loans Our commercial and industrial loans are generally made to small businesses to provide them with at least some of the working capital necessary to fund their daily business operations. These loans are generally either unsecured or secured by fixed assets, accounts receivable and/or inventory. The borrowers would normally also be required to personally guarantee repayment of the loan. The Bank uses conservative underwriting standards in reviewing applications for credit. Risk of loss to the Bank is increased when our small business customers experience a significant business downturn, incur significant financial losses, or file for relief from creditors through bankruptcy proceedings. Consumer Loans Our consumer and installment loans generally consist of personal loans, credit card loans, automobile loans or other loans secured by personal property. The Bank uses conservative underwriting standards in reviewing applications for credit. Risk of loss to the Bank is increased if borrowers lose their primary source of income, or file for relief from creditors through bankruptcy proceedings. Age Analysis of Past Due Loans As of September 30, 2016 (Dollar amounts in thousands) 30-59 60-89 Days Days Over Total Past Past 90 Past Total Originated Due Due Days Due Current Loans Commercial real estate $ — $ — $ — $ — $ 331,392 $ 331,392 Real estate construction — — 140 140 36,514 36,654 Real estate multi family — — — — 74,712 74,712 Real estate-1 to 4 family — — 76 76 148,917 148,993 Commercial and industrial 845 23 1,120 1,988 40,852 42,840 Consumer — — — — 1,630 1,630 Total $ 845 $ 23 $ 1,336 $ 2,204 $ 634,017 $ 636,221 Purchased Not credit impaired Commercial real estate $ — $ — $ 550 $ 550 $ 71,789 $ 72,339 Real estate construction — — — — 1,509 1,509 Real estate multi-family — — — — 9,232 9,232 Real estate-1 to 4 family — 2,150 — 2,150 22,298 24,448 Commercial and industrial — — — — 8,031 8,031 Total $ — $ 2,150 $ 550 $ 2,700 $ 112,859 $ 115,559 Purchased Credit impaired Commercial real estate $ — $ — $ — $ — $ 1,233 $ 1,233 Total $ — $ — $ — $ — $ 1,233 $ 1,233 At September 30, 2016, there were no loans 90 days or more past due where interest was still accruing. The over 90 days column includes nonaccruals that were over 90 days, but does not include loans that are in nonaccrual status for reasons other than past due. Age Analysis of Past Due Loans As of December 31, 2015 (Dollar amounts in thousands) 30-59 60-89 Days Days Over Total Past Past 90 Past Total Originated Due Due Days Due Current Loans Commercial real estate $ 1,541 $ — $ — $ 1,541 $ 312,600 $ 314,141 Real estate construction 706 725 — 1,431 37,478 38,909 Real estate multi family — — — — 47,607 47,607 Real estate 1 to 4 family 1,363 737 71 2,171 151,701 153,872 Commercial & industrial — — 1,258 1,258 38,636 39,894 Consumer — — — — 1,574 1,574 Total $ 3,610 $ 1,462 $ 1,329 $ 6,401 $ 589,596 $ 595,997 Purchased Not credit impaired Commercial real estate $ — $ — $ 3,810 $ 3,810 $ 80,738 $ 84,548 Real estate construction — — — — 5,907 5,907 Real estate multi-family — — — — 15,990 15,990 Real estate 1 to 4 family 175 — — 175 17,917 18,092 Commercial & industrial 70 — — 70 12,069 12,139 Total $ 245 $ — $ 3,810 $ 4,055 $ 132,621 $ 136,676 Purchased Credit impaired Commercial real estate $ — $ — $ — $ — $ 1,304 $ 1,304 Total $ — $ — $ — $ — $ 1,304 $ 1,304 At December 31, 2015 there were no loans that were 90 days or more past due where interest was still accruing. The over 90 days column includes nonaccrual loans that were over 90 days, but does not include loans that are in nonaccrual status for reasons other than past due. Credit Quality Indicators As of September 30, 2016 (Dollar amounts in thousands) Special Sub- Total Originated Pass mention standard Doubtful loans Commercial real estate $ 328,230 $ — $ 3,162 $ — $ 331,392 Real estate construction 35,654 — 1,000 — 36,654 Real estate multi-family 74,712 — — — 74,712 Real estate-1 to 4 family 148,917 — 76 — 148,993 Commercial and industrial 42,447 — 387 6 42,840 Consumer loans 1,630 — — — 1,630 Total $ 631,590 $ — $ 4,625 $ 6 $ 636,221 Purchased Not credit impaired Commercial real estate $ 62,236 $ 895 $ 9,208 $ — $ 72,339 Real estate construction 1,509 — — — 1,509 Real estate multi-family 9,232 — — — 9,232 Real estate-1 to 4 family 24,448 — — — 24,448 Commercial and industrial 7,939 — 92 — 8,031 Total $ 105,364 $ 895 $ 9,300 $ — $ 115,559 Purchased Credit impaired Commercial real estate $ 1,233 Total $ 1,233 Credit Quality Indicators As of December 31, 2015 (Dollar amounts in thousands) Special Sub- Total Originated Pass mention standard Doubtful loans Commercial real estate $ 308,164 $ 1,857 $ 4,120 $ — $ 314,141 Real estate construction 37,850 — 1,059 — 38,909 Real estate multi-family 47,607 — — — 47,607 Real estate 1 to 4 family 153,285 — 587 — 153,872 Commercial & industrial 39,287 — 451 156 39,894 Consumer loans 1,574 — — — 1,574 Totals $ 587,767 $ 1,857 $ 6,217 $ 156 $ 595,997 Purchased Not credit impaired Commercial real estate $ 68,936 $ 3,455 $ 12,145 $ 12 $ 84,548 Real estate construction 5,907 — — — 5,907 Real estate multi-family 15,990 — — — 15,990 Real estate 1 to 4 family 18,092 — — — 18,092 Commercial & industrial 12,044 — 95 — 12,139 Total $ 120,969 $ 3,455 $ 12,240 $ 12 $ 136,676 Purchased Credit impaired Commercial real estate $ 1,304 Total $ 1,304

F. BORROWINGS

F. BORROWINGS	9 Months Ended
	Sep. 30, 2016
BORROWINGS
BORROWINGS	Federal Home Loan Bank advances As of September 30, 2016 there were $37,000,000 Federal Home Loan Bank Advances outstanding, consisting of $8,000,000 on an overnight basis at 0.38%, $7,000,000 at 0.40% due October 6, 2016, $8,000,000 at 0.35% due October 24, 2016 $6,000,000 at 0.26% due October 26, 2016 and $8,000,000 at 0.35% due October 31, 2016. Corporate loan On March 27, 2014, FNB Bancorp received funding under a $6,000,000 term loan credit facility. This loan carries a variable rate of interest that fluctuates on a monthly basis. The interest rate is based on the 3 month LIBOR rate plus 4%. Payments of $50,000 in principal plus accrued interest are payable monthly. The first loan payment was due May 1, 2014. The maturity date on this credit facility is March 26, 2019. On the maturity date, all outstanding principal plus accrued interest shall become due and payable. FNB Bancorp has pledged its stock ownership in First National Bank of Northern California as collateral subject to the terms and conditions contained in the Loan Agreement and the Pledge and Security Agreement. FNB Bancorp retains the right to prepay this debt at any time upon not less than 7 days’ prior written notice to Lender. The proceeds from this loan were contributed to the Bank as an additional capital contribution. This capital contribution qualified as Tier 1 capital for the Bank under regulatory capital guidelines.

G. FAIR VALUE MEASUREMENT

G. FAIR VALUE MEASUREMENT	9 Months Ended
	Sep. 30, 2016
FAIR VALUE MEASUREMENT TABLES
FAIR VALUE MEASUREMENT	The following tables present information about the Company’s assets and liabilities measured at fair value as of September 30, 2016 and December 31, 2015, and indicate the fair value techniques used by the Company to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally corresponds with the Company’s quarterly valuation process. During the first nine months of 2016 and 2015, there were no transfers between levels of fair value hierarchy. The following table presents the recorded amounts of assets measured at fair value on a recurring basis: Fair Value Measurements at December 31, 2015, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 12/31/2015 (Level 1) (Level 2) (Level 3) U. S. Treasury securities $ 7,000 $ 7,000 $ — $ — Obligations of U.S. 84,609 — 84,609 — Mortgage-backed securities 61,663 — 61,663 — Obligations of states and political subdivisions 135,190 — 135,190 — Corporate debt 40,745 — 40,745 — Total assets measured at fair value $ 329,207 $ 7,000 $ 322,207 $ — The following tables present the recorded amounts of assets measured at fair value on a non-recurring ba Fair Value Measurements at September 30, 2016, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 9/30/2016 (Level 1) (Level 2) (Level 3) Impaired loans: Commercial and industrial $ 984 $ — $ — $ 984 Total impaired loans measured at fair value $ 984 $ — $ — $ 984 Fair Value Measurements at December 31, 2015, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 12/31/2015 (Level 1) (Level 2) (Level 3) Impaired loans: Commercial real estate loans $ 136 $ — $ — $ 136 Residential-1 to 4 family loans 301 — — 301 Commercial and industrial loans 1,065 — — 1,065 Total impaired loans measured at fair value $ 1,502 $ — $ — $ 1,502 The Bank does not record loans at fair value. However, from time to time, if a loan is considered impaired, a specific allocation within the allowance for loan losses may be required. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. The fair value of impaired loans is estimated using one of several methods, including collateral value, market value of similar debt, enterprise value, liquidation value and cash flows. Those impaired loans not requiring an allowance represent loans for which the value of the expected repayments or collateral exceed the recorded investments in such loans. Impaired loans where an allowance is established based on the fair value of collateral or when the impaired loan has been written down to fair value require classification in the fair value hierarchy. If the fair value of the collateral is based on an observable market price or a current appraised value, the Bank records the impaired loans as nonrecurring Level 3. When an appraised value is not available, or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Bank also records the impaired loans as nonrecurring Level 3. Other real estate owned is carried at the lower of historical cost or fair value less costs to sell. An appraisal (a Level 3 valuation) is obtained at the time the Bank acquires property through the foreclosure process. Any loan balance outstanding that exceeds the appraised value of the property is charged off against the allowance for loan loss at the time the property is acquired. Subsequent to acquisition, the Bank updates the property’s appraised value on at least an annual basis. If the value of the property has declined during the year, a loss due to valuation impairment charge is recorded along with a corresponding reduction in the book carrying value of the property. The Bank obtains third party appraisals on its impaired loans held-for-investment and foreclosed assets to determine fair value. When the appraisals are received, Management reviews the assumptions and methodology utilized in the appraisal, as well as the overall resulting value in conjunction with independent data sources such as recent market data and industry-wide statistics. We generally use a 6% discount for selling costs which is applied to all properties, regardless of size. Generally, the third party appraisals apply the “market approach,” which is a valuation technique that uses prices and other relevant information generated by market transactions involving identical or comparable (that is, similar) assets, liabilities, or a group of assets and liabilities, such as a business. Adjustments are then made based on the type of property, age of appraisal, current status of property and other related factors to estimate the current value of collateral. The value of OREO is determined based on independent appraisals, similar to the process used for impaired loans, discussed above, and is generally classified as Level 3. Fair Values of Financial Instruments. The following methods and assumptions were used by the Company in estimating the fair value disclosures for financial instruments. Cash and Cash Equivalents including Interest Bearing Time Deposits with Financial Institutions. The carrying amounts reported in the balance sheet for cash and short-term instruments are a reasonable estimate of fair value, which will approximate their historical cost. Securities Available-for-Sale. Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. Loans Receivable. For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values and credit risk factors. For fixed rate loans, fair values are based on discounted cash flows, credit risk factors, and liquidity factors. Other Equity Securities. These are mostly Federal Reserve Bank stock and Federal Home Loan Bank stock, carried in Other Equity Securities. They are not traded, and not available for sale, and have no fair market value. Deposit liabilities. The fair values disclosed for demand deposits (e.g., interest and non-interest checking, savings, and money market accounts) are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). The fair values for fixed-rate certificates of deposit are based on discounted cash flows. Federal Home Loan Bank Advances. The fair values of Federal Home Loan Bank Advances are based on discounted cash flows. The discount rate is equal to the market rate currently offered on similar products. Note payable. Fair value is equal to the current balance. They represent a corporate loan with a monthly variable rate, based on the 3-month LIBOR rate plus 4%. Accrued Interest Receivable and Payable The interest receivable and payable balances approximate their fair value due to the short-term nature of their settlement dates. Undisbursed loan commitments, lines of credit, Mastercard line and standby letters of credit. The fair value of these off-balance sheet items are based on discounted cash flows of expected fundings. The Bank has excluded non-financial assets and non-financial liabilities defined by the Codification (ASC 820-10-15-A), such as Bank premises and equipment, deferred taxes and other liabilities. In addition, the Bank has not disclosed the fair value of financial instruments specifically excluded from disclosure requirements of the Financial Instruments Topic of the Codification (ASC 825-10-50-8), such as Bank-owned life insurance policies. The following table provides summary information on the estimated fair value of financial instruments at September 30, 2016: September 30, 2016 Carrying Fair Fair value measurements (Dollar amounts in thousands) amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 17,342 $ 17,342 $ 17,342 — — Interest-bearing time deposits with financial institutions 204 204 — $ 204 — Securities available for sale 358,877 358,877 1,003 357,874 — Loans 753,013 748,688 — — $ 748,688 Other equity securities 7,206 7,206 — — 7,206 Accrued interest receivable 4,544 4,544 4,544 — — Financial liabilities: Deposits 1,003,457 1,002,771 885,864 116,907 — Federal Home Loan Bank advances 37,000 37,000 — 37,000 — Note payable 4,500 4,500 — 4,500 — Accrued interest payable 287 287 287 — — Off-balance-sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit — 1,702 — — 1,702 The carrying amount of loans includes $6,972,000 of nonaccrual loans (loans that are not accruing interest) as of September 30, 2016. The fair value of nonaccrual loans is based on the collateral values that secure the loans or the cash flows expected to be received. The following table provides summary information on the estimated fair value of financial instruments at December 31, 2015: December 31, 2015 Carrying Fair Fair value measurements (Dollar amounts in thousands) amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 12,314 $ 12,314 $ 12,314 — — Interest-bearing time deposits with financial institutions 205 205 — $ 205 — Securities available for sale 329,207 329,207 7,000 322,207 — Loans 733,977 725,196 — — $ 725,196 Other equity securities 6,748 6,748 — — 6,748 Accrued interest receivable 4,511 4,511 4,511 — Financial liabilities: Deposits 983,199 983,771 857,759 125,430 — Federal Home Loan Bank advances 17,000 17,000 — 17,000 — Note payable 4,950 4,950 — 4,950 — Accrued interest payable 236 236 236 — — Off-balance-sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit — 1,673 — — 1,673 The carrying amount of loans includes $7,915,000 of nonaccrual loans (loans that are not accruing interest) as of December 31, 2015. The fair value of nonaccrual loans is based on the collateral values that secure the loans or the cash flows expected to be received.

C. EARNINGS PER SHARE CALCULA15

C. EARNINGS PER SHARE CALCULATION (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings per share data:
Earnings per common share (EPS) computed	(Dollar amounts in thousands) Three months ended Nine months ended September 30, September 30, 2016 2015 2016 2015 Net earnings $ 2,444 $ 2,239 $ 7,459 $ 6,109 Average number of shares outstanding 4,612 4,524 4,582 4,508 Effect of dilutive options 105 119 118 127 Average number of shares outstanding used to calculate diluted earnings per share 4,717 4,643 4,700 4,635 Anti-dilutive options not included 68 103 70 104

D. SECURITIES AVAILABLE FOR S16

D. SECURITIES AVAILABLE FOR SALE (Tables)	9 Months Ended
	Sep. 30, 2016
SECURITIES AVAILABLE FOR SALE TABLES
Schedule of amortized cost and carrying values of securities available-for-sale	(Dollar amounts in thousands) Amortized Unrealized Unrealized Fair cost gains losses value September 30, 2016 U.S. Treasury securities $ 975 $ 28 $ — $ 1,003 Obligations of U.S. government agencies 60,724 974 (1 ) 61,697 Mortgage-backed securities 98,933 2,219 (118 ) 101,034 Obligations of states and political subdivisions 154,304 4,344 (131 ) 158,517 Corporate debt 36,219 412 (5 ) 36,626 $ 351,155 $ 7,977 $ (255 ) $ 358,877 December 31, 2015 U.S. Treasury securities $ 7,004 $ 14 $ (18 ) $ 7,000 Obligations of U.S. government agencies 84,842 168 (401 ) 84,609 Mortgage-backed securities 61,579 641 (557 ) 61,663 Obligations of states and political subdivisions 132,125 3,148 (83 ) 135,190 Corporate debt 41,045 50 (350 ) 40,745 $ 326,595 $ 4,021 $ (1,409 ) $ 329,207
Schedule analysis of gross unrealized losses of the available-for-sale investment securities	(Dollar amounts in thousands) Less than 12 Months Total 12 Months Total or Longer Total Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses September 30, 2016 Obligations of U.S. Government agencies $ — $ — $ 1,008 $ (1 ) $ 1,008 $ (1 ) Mortgage-backed securities 18,864 (114 ) 2,627 (4 ) 21,491 (118 ) Obligations of states and political subdivisions 13,679 (126 ) 1,810 (5 ) 15,489 (131 ) Corporate debt 2,015 (3 ) 1,000 (2 ) 3,015 (5 ) Total $ 34,558 $ (243 ) $ 6,445 $ (12 ) $ 41,003 $ (255 ) Total 12 Months Total or Longer Total Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses December 31, 2015 U. S. Treasury securities $ 5,042 $ (18 ) $ — $ — $ 5,042 $ (18 ) Obligations of U.S. Government agencies 55,382 (338 ) 4,976 (62 ) 60,358 (401 ) Mortgage-backed securities 19,458 (193 ) 16,714 (365 ) 36,172 (557 ) Obligations of states and political subdivisions 14,988 (74 ) 1,856 (10 ) 16,844 (83 ) Corporate debt 27,130 (300 ) 4,449 (50 ) 31,579 (350 ) Total $ 122,000 $ (923 ) $ 27,995 $ (487 ) $ 149,995 $ (1,409 )
Schedule of amortized cost and carrying value of available-for-sale debt securities by contractual maturity	September 30, 2016: (Dollar amounts in thousands) Amortized Fair Cost Value Available-for-sale: Due in one year or less $ 12,725 $ 12,755 Due after one through five years 146,953 150,017 Due after five years through ten years 138,771 142,744 Due after ten years 52,706 53,361 $ 351,155 $ 358,877

E. LOANS (Tables)

E. LOANS (Tables)	9 Months Ended
	Sep. 30, 2016
LOANS TABLES
Schedule Of Loans Outstanding	(Dollar amounts in thousands) Total FNB Balance Bancorp September 30, September 30, 2016 Originated PNCI PCI 2016 Commercial real estate $ 331,392 $ 72,339 $ 1,233 $ 404,964 Real estate construction 36,654 1,509 — 38,163 Real estate multi-family 74,712 9,232 — 83,944 Real estate 1 to 4 family 148,993 24,448 — 173,441 Commercial & industrial 42,839 8,031 — 50,870 Consumer 1,630 — — 1,630 Gross loans 636,220 115,559 1,233 753,012 Net deferred loan fees (1,513 ) — — (1,513 ) Allowance for loan losses (10,092 ) — (10,092 ) Net loans $ 624,615 $ 115,559 $ 1,233 $ 741,407 (Dollar amounts in thousands) Total FNB Balance Bancorp December 31, December 31, 2015 Originated PNCI PCI 2015 Commercial real estate $ 314,141 $ 84,548 $ 1,304 $ 399,993 Real estate construction 38,909 5,907 — 44,816 Real estate multi-family 47,607 15,990 — 63,597 Real estate 1 to 4 family 153,872 18,092 — 171,964 Commercial & industrial 39,894 12,139 — 52,033 Consumer 1,574 — — 1,574 Gross loans 595,997 136,676 1,304 733,977 Net deferred loan fees (1,260 ) — — (1,260 ) Allowance for loan losses (9,970 ) — — (9,970 ) Net loans $ 584,767 $ 136,676 $ 1,304 $ 722,747
Schedule of Recorded Investment in Loans	Recorded Investment in Loans at September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction family family & industrial Consumer Total Loans: Ending balance $ 404,964 $ 38,163 $ 83,944 $ 173,441 $ 50,871 $ 1,630 $ 753,013 Ending balance: individually evaluated for impairment $ 10,214 $ 2,072 $ — $ 3,620 $ 1,236 $ — $ 17,142 Ending balance: collectively evaluated for impairment $ 394,750 $ 36,091 $ 83,944 $ 169,821 $ 49,635 $ 1,630 $ 735,871 Recorded Investment in Loans at December 31, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction Family Family & industrial Consumer Total Loans: Ending balance $ 399,993 $ 44,816 $ 63,597 $ 171,964 $ 52,033 $ 1,574 $ 733,977 Ending balance: individually evaluated for impairment $ 11,292 $ 2,154 $ — $ 4,218 $ 1,782 $ — $ 19,446 Ending balance: collectively evaluated for impairment $ 388,701 $ 42,662 $ 63,597 $ 167,746 $ 50,251 $ 1,574 $ 714,531 Recorded Investment in Loans at September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction family family & industrial Consumer Total Loans: Ending balance $ 394,090 $ 35,868 $ 63,928 $ 172,280 $ 39,843 $ 1,497 $ 707,506 Ending balance: individually evaluated for impairment $ 9,501 $ 2,162 $ — $ 4,857 $ 1,813 $ — $ 18,333 Ending balance: collectively evaluated for impairment $ 384,589 $ 33,706 $ 63,928 $ 167,423 $ 38,030 $ 1,497 $ 689,173
Schedule of Impaired Loans Allowance	Impaired Loans As of and for the three months ended September 30, 2016 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,5544 $ 9,676 $ — $ 8,449 $ 95 Commercial real estate construction 2,072 2,259 — 2,090 — Residential- 1 to 4 family 605 605 — 834 — Commercial and industrial 116 116 — 316 6 Total 11,347 12,656 — 11,689 101 With an allowance recorded Commercial real estate $ 1,660 $ 1,660 $ 72 $ 1,664 $ 17 Residential- 1 to 4 family 3,015 2,618 453 3,019 13 Commercial and industrial 1,120 1,326 101 1,087 — Total 5,795 5,604 626 5,770 30 Total Commercial real estate $ 10,214 $ 11,336 $ 72 $ 10,113 $ 112 Commercial real estate construction 2,072 2,259 — 2,090 — Residential- 1 to 4 family 3,620 3,223 453 3,853 13 Commercial and industrial 1,236 1,442 101 1,403 6 Grand total $ 17,142 $ 18,260 $ 626 $ 17,459 $ 131 Impaired Loans As of and for the nine months ended September 30, 2016 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,554 $ 9,676 $ — $ 8,637 $ 520 Commercial real estate construction 2,072 2,259 — 2,118 104 Residential- 1 to 4 family 605 605 — 303 21 Commercial and industrial 116 116 — 320 20 Total 11,347 12,656 — 11,378 665 With an allowance recorded Commercial real estate $ 1,660 $ 1,660 $ 72 $ 1,675 $ 68 Residential- 1 to 4 family 3,015 2,618 453 3,032 80 Commercial and industrial 1,120 1,326 101 1,107 4 Total 5,795 5,604 626 5,814 152 Total Commercial real estate $ 10,214 $ 11,336 $ 72 $ 10,312 $ 588 Commercial real estate construction 2,072 2,259 — 2,118 104 Residential- 1 to 4 family 3,620 3,223 453 3,335 101 Commercial and industrial 1,236 1,442 101 1,427 24 Grand total $ 17,142 $ 18,260 $ 626 $ 17,192 $ 817 Impaired Loans As of and for the year ended December 31, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 8,169 $ 9,271 $ — $ 8,379 $ 282 Commercial real estate construction 2,154 2,337 — 2,264 130 Residential- 1 to 4 family 457 457 — 460 36 Commercial and industrial 524 524 — 731 27 Total 11,304 12,589 — 11,834 475 With an allowance recorded Commercial real estate $ 2,634 $ 2,638 $ 96 $ 2,664 $ 160 Residential- 1 to 4 family 3,761 3,782 479 3,786 149 Commercial and industrial 1,258 1,497 182 1,484 7 Total 7,653 7,917 757 7,934 316 Total Commercial real estate $ 10,803 $ 11,909 $ 96 $ 11,043 $ 442 Commercial real estate construction 2,154 2,337 — 2,264 130 Residential- 1 to 4 family 4,218 4,239 479 4,246 185 Commercial and industrial 1,782 2,021 182 2,215 34 Grand total $ 18,957 $ 20,506 $ 757 $ 19,768 $ 791 Impaired Loans As of and for the three months ended September 30, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 4,392 $ 5,271 $ — $ 4,402 $ 92 Commercial real estate construction 2,162 2,345 — 2,341 32 Residential- 1 to 4 family 1,475 1,476 — 1,479 18 Commercial and industrial 528 782 — 537 9 Total 8,557 9,874 — 8,758 151 With an allowance recorded Commercial real estate $ 5,109 $ 5,113 $ 126 $ 5,121 $ 66 Residential- 1 to 4 family 3,382 2,972 522 3,374 27 Commercial and industrial 1,285 1,539 224 1,339 — Total 9,776 9,624 872 9,834 93 Total Commercial real estate $ 9,501 $ 10,384 $ 126 $ 9,523 $ 158 Commercial real estate construction 2,162 2,345 — 2,341 32 Residential- 1 to 4 family 4,857 4,448 522 4,853 45 Commercial and industrial 1,813 2,321 224 1,876 9 Grand total $ 18,333 $ 19,498 $ 872 $ 18,593 $ 244 Impaired Loans As of and for the nine months ended September 30, 2015 Unpaid Average (Dollar amounts in thousands) Recorded Principal Related Recorded Income Investment Balance Allowance Investment Recognized With no related allowance recorded Commercial real estate $ 4,392 $ 5,271 $ — $ 4,867 $ 217 Commercial real estate construction 2,162 2,345 — 2,359 100 Residential - 1 to 4 family 1,475 1,476 — 1,482 49 Commercial and industrial 528 782 — 4,410 27 Total 8,557 9,874 — 13,118 393 With an allowance recorded Commercial real estate $ 5,109 $ 5,113 $ 126 $ 5,162 $ 196 Residential - 1 to 4 family 3,382 2,972 522 3,202 96 Commercial and industrial 1,285 1,539 224 1,489 5 Total 9,776 9,624 872 9,853 297 Total Commercial real estate $ 9,501 $ 10,384 $ 126 $ 10,029 $ 413 Commercial real estate construction 2,162 2,345 — 2,359 100 Residential - 1 to 4 family 4,857 4,448 522 4,684 145 Commercial and industrial 1,813 2,321 224 5,899 32 Grand total $ 18,333 $ 19,498 $ 872 $ 22,971 $ 690
Schedule of Loans On Nonaccrual Status	Loans on Nonaccrual Status as of (Dollar amounts in thousands) September 30, December 31, 2016 2015 Commercial real estate $ 5,707 $ 6,021 Real estate 1 to 4 family 76 636 Commercial and industrial 1,120 1,258 Total $ 6,903 $ 7,915
Troubled Debt Restructurings	Total troubled debt restructured loans outstanding at (dollars in thousands) September 30, 2016 December 31, 2015 Non- Non- Accrual accrual Total Accrual accrual Total status status modifications status status modifications Commercial real estate $ 4,625 $ 1,233 $ 5,858 $ 4,775 $ — $ 4,775 Real Estate construction 1,212 — 1,212 1,283 — 1,283 Real estate 1 to 4 family 3,543 — 3,543 3,583 2,060 5,643 Commercial & industrial — 929 929 524 1,043 1,567 Total $ 9,380 $ 2,162 $ 11,542 $ 10,165 $ 3,103 $ 13,268
Schedule of Short-term Debt Modifications	Modifications For the nine months ended September 30, 2015 Pre- Post- Modification Modification Outstanding Outstanding Number of Recorded Recorded Contracts Investment Investment (Dollar amounts in thousands) Real estate 1 to 4 family 1 $ 474 $ 474 Total 1 $ 474 $ 474
Schedule of Allowance for Credit Losses	Allowance for Credit Losses For the Three Months Ended September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,206 $ 404 $ 335 $ 2,261 $ 799 $ 33 $ 10,038 Charge-offs — — — — — (8 ) (8 ) Recoveries 2 — — 23 37 — 62 Provision (63 ) 138 (3 ) (77 ) (47 ) 52 — Ending balance $ 6,145 $ 542 $ 332 $ 2,207 $ 789 $ 77 $ 10,092 Ending balance: individually evaluated for impairment $ 72 $ — $ — $ 453 $ 101 $ — $ 626 Ending balance: collectively evaluated for impairment $ 6,073 $ 542 $ 332 $ 1,754 $ 688 $ 77 $ 9,466 Allowance for Credit Losses For the Nine Months Ended September 30, 2016 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real Estate Construction Family Family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,059 $ 589 $ 243 $ 2,176 $ 853 $ 50 $ 9,970 Charge-offs — — — (12 ) (165 ) (18 ) (195 ) Recoveries 6 — — 42 119 — 167 Provision 80 (47 ) 89 1 (19 ) 45 150 Ending balance $ 6,145 $ 543 $ 332 $ 2,207 $ 788 $ 77 $ 10,092 Ending balance: individually evaluated for impairment $ 72 $ — $ — $ 453 $ 101 $ — $ 626 Ending balance: collectively evaluated for impairment $ 6,073 $ 542 $ 332 $ 1,754 $ 688 $ 77 $ 9,466 Allowance for Credit Losses As of and For the Year Ended December 31, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 5,549 $ 849 $ 206 $ 1,965 $ 1,073 $ 58 $ 9,700 Charge-offs — — — (45 ) — (36 ) (81 ) Recoveries 576 — — 15 60 5 656 Provision (66 ) (260 ) 37 241 (280 ) 23 (305 ) Ending balance $ 6,059 $ 589 $ 243 $ 2,176 $ 853 $ 50 $ 9,970 Ending balance: individually evaluated for impairment $ 96 $ — $ — $ 479 $ 182 $ — $ 757 Ending balance: collectively evaluated for impairment $ 5,963 $ 589 $ 243 $ 1,697 $ 671 $ 50 $ 9,213 Allowance for Credit Losses For the Three Months Ended September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 6,027 $ 697 $ 198 $ 2,014 $ 848 $ 52 $ 9,836 Charge-offs — — — — (23 ) — (23 ) Recoveries 15 — — 7 26 4 52 Provision (67 ) (49 ) (10 ) 289 (73 ) (15 ) 75 Ending balance $ 5,975 $ 648 $ 188 $ 2,310 $ 778 $ 41 $ 9,940 Ending balance: individually evaluated for impairment $ 126 $ — $ — $ 522 $ 224 $ — $ 872 Ending balance: collectively evaluated for impairment $ 5,849 $ 648 $ 188 $ 1,788 $ 554 $ 41 $ 9,068 Allowance for Credit Losses For the Nine Months Ended September 30, 2015 (Dollar amounts in thousands) Real Real Estate Estate Commercial Real Estate Multi 1 to 4 Commercial Real estate Construction family family & industrial Consumer Total Allowance for credit losses Beginning balance $ 5,549 $ 849 $ 206 $ 1,965 $ 1,073 $ 58 $ 9,700 Charge-offs — — — (45 ) (23 ) (11 ) (79 ) Recoveries 37 — — 8 45 4 94 Provision 389 (201 ) (18 ) 382 (317 ) (10 ) 225 Ending balance $ 5,975 $ 648 $ 188 $ 2,310 $ 778 $ 41 $ 9,940 Ending balance: individually evaluated for impairment $ 126 $ — $ — $ 522 $ 224 $ — $ 872 Ending balance: collectively evaluated for impairment $ 5,849 $ 648 $ 188 $ 1,788 $ 554 $ 41 $ 9,068
Schedule Age Analysis Of Past Due Loans	Age Analysis of Past Due Loans As of September 30, 2016 (Dollar amounts in thousands) 30-59 60-89 Days Days Over Total Past Past 90 Past Total Originated Due Due Days Due Current Loans Commercial real estate $ — $ — $ — $ — $ 331,392 $ 331,392 Real estate construction — — 140 140 36,514 36,654 Real estate multi family — — — — 74,712 74,712 Real estate-1 to 4 family — — 76 76 148,917 148,993 Commercial and industrial 845 23 1,120 1,988 40,852 42,840 Consumer — — — — 1,630 1,630 Total $ 845 $ 23 $ 1,336 $ 2,204 $ 634,017 $ 636,221 Purchased Not credit impaired Commercial real estate $ — $ — $ 550 $ 550 $ 71,789 $ 72,339 Real estate construction — — — — 1,509 1,509 Real estate multi-family — — — — 9,232 9,232 Real estate-1 to 4 family — 2,150 — 2,150 22,298 24,448 Commercial and industrial — — — — 8,031 8,031 Total $ — $ 2,150 $ 550 $ 2,700 $ 112,859 $ 115,559 Purchased Credit impaired Commercial real estate $ — $ — $ — $ — $ 1,233 $ 1,233 Total $ — $ — $ — $ — $ 1,233 $ 1,233 Age Analysis of Past Due Loans As of December 31, 2015 (Dollar amounts in thousands) 30-59 60-89 Days Days Over Total Past Past 90 Past Total Originated Due Due Days Due Current Loans Commercial real estate $ 1,541 $ — $ — $ 1,541 $ 312,600 $ 314,141 Real estate construction 706 725 — 1,431 37,478 38,909 Real estate multi family — — — — 47,607 47,607 Real estate 1 to 4 family 1,363 737 71 2,171 151,701 153,872 Commercial & industrial — — 1,258 1,258 38,636 39,894 Consumer — — — — 1,574 1,574 Total $ 3,610 $ 1,462 $ 1,329 $ 6,401 $ 589,596 $ 595,997 Purchased Not credit impaired Commercial real estate $ — $ — $ 3,810 $ 3,810 $ 80,738 $ 84,548 Real estate construction — — — — 5,907 5,907 Real estate multi-family — — — — 15,990 15,990 Real estate 1 to 4 family 175 — — 175 17,917 18,092 Commercial & industrial 70 — — 70 12,069 12,139 Total $ 245 $ — $ 3,810 $ 4,055 $ 132,621 $ 136,676 Purchased Credit impaired Commercial real estate $ — $ — $ — $ — $ 1,304 $ 1,304 Total $ — $ — $ — $ — $ 1,304 $ 1,304
Schedule Credit Quality Indicators	Credit Quality Indicators As of September 30, 2016 (Dollar amounts in thousands) Special Sub- Total Originated Pass mention standard Doubtful loans Commercial real estate $ 328,230 $ — $ 3,162 $ — $ 331,392 Real estate construction 35,654 — 1,000 — 36,654 Real estate multi-family 74,712 — — — 74,712 Real estate-1 to 4 family 148,917 — 76 — 148,993 Commercial and industrial 42,447 — 387 6 42,840 Consumer loans 1,630 — — — 1,630 Total $ 631,590 $ — $ 4,625 $ 6 $ 636,221 Purchased Not credit impaired Commercial real estate $ 62,236 $ 895 $ 9,208 $ — $ 72,339 Real estate construction 1,509 — — — 1,509 Real estate multi-family 9,232 — — — 9,232 Real estate-1 to 4 family 24,448 — — — 24,448 Commercial and industrial 7,939 — 92 — 8,031 Total $ 105,364 $ 895 $ 9,300 $ — $ 115,559 Purchased Credit impaired Commercial real estate $ 1,233 Total $ 1,233 Credit Quality Indicators As of December 31, 2015 (Dollar amounts in thousands) Special Sub- Total Originated Pass mention standard Doubtful loans Commercial real estate $ 308,164 $ 1,857 $ 4,120 $ — $ 314,141 Real estate construction 37,850 — 1,059 — 38,909 Real estate multi-family 47,607 — — — 47,607 Real estate 1 to 4 family 153,285 — 587 — 153,872 Commercial & industrial 39,287 — 451 156 39,894 Consumer loans 1,574 — — — 1,574 Totals $ 587,767 $ 1,857 $ 6,217 $ 156 $ 595,997 Purchased Not credit impaired Commercial real estate $ 68,936 $ 3,455 $ 12,145 $ 12 $ 84,548 Real estate construction 5,907 — — — 5,907 Real estate multi-family 15,990 — — — 15,990 Real estate 1 to 4 family 18,092 — — — 18,092 Commercial & industrial 12,044 — 95 — 12,139 Total $ 120,969 $ 3,455 $ 12,240 $ 12 $ 136,676 Purchased Credit impaired Commercial real estate $ 1,304 Total $ 1,304

G. FAIR VALUE MEASUREMENT (Tabl

G. FAIR VALUE MEASUREMENT (Tables)	9 Months Ended
	Sep. 30, 2016
FAIR VALUE MEASUREMENT TABLES {1}
Schedule of assets measured at fair value on a recurring basis	Fair Value Measurements at December 31, 2015, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 12/31/2015 (Level 1) (Level 2) (Level 3) U. S. Treasury securities $ 7,000 $ 7,000 $ — $ — Obligations of U.S. Government agencies 84,609 — 84,609 — Mortgage-backed securities 61,663 — 61,663 — Obligations of states and political subdivisions 135,190 — 135,190 — Corporate debt 40,745 — 40,745 — Total assets measured at fair value $ 329,207 $ 7,000 $ 322,207 $ —
Schedule of assets measured at fair value on a non-recurring basis	Fair Value Measurements at September 30, 2016, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 9/30/2016 (Level 1) (Level 2) (Level 3) Impaired loans: Commercial and industrial $ 984 $ — $ — $ 984 Total impaired loans measured at fair value $ 984 $ — $ — $ 984 Fair Value Measurements at December 31, 2015, Using Quoted Prices in Active Markets Other Significant (Dollar amounts in thousands) for Identical Observable Unobservable Fair Value Assets Inputs Inputs Description 12/31/2015 (Level 1) (Level 2) (Level 3) Impaired loans: Commercial real estate loans $ 136 $ — $ — $ 136 Residential-1 to 4 family loans 301 — — 301 Commercial and industrial loans 1,065 — — 1,065 Total impaired loans measured at fair value $ 1,502 $ — $ — $ 1,502
Schedule of estimated fair value of financial instruments	September 30, 2016 Carrying Fair Fair value measurements (Dollar amounts in thousands) amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 17,342 $ 17,342 $ 17,342 — — Interest-bearing time deposits with financial institutions 204 204 — $ 204 — Securities available for sale 358,877 358,877 1,003 357,874 — Loans 753,013 748,688 — — $ 748,688 Other equity securities 7,206 7,206 — — 7,206 Accrued interest receivable 4,544 4,544 4,544 — — Financial liabilities: Deposits 1,003,457 1,002,771 885,864 116,907 — Federal Home Loan Bank advances 37,000 37,000 — 37,000 — Note payable 4,500 4,500 — 4,500 — Accrued interest payable 287 287 287 — — Off-balance-sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit — 1,702 — — 1,702 December 31, 2015 Carrying Fair Fair value measurements (Dollar amounts in thousands) amount value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 12,314 $ 12,314 $ 12,314 — — Interest-bearing time deposits with financial institutions 205 205 — $ 205 — Securities available for sale 329,207 329,207 7,000 322,207 — Loans 733,977 725,196 — — $ 725,196 Other equity securities 6,748 6,748 — — 6,748 Accrued interest receivable 4,511 4,511 4,511 — Financial liabilities: Deposits 983,199 983,771 857,759 125,430 — Federal Home Loan Bank advances 17,000 17,000 — 17,000 — Note payable 4,950 4,950 — 4,950 — Accrued interest payable 236 236 236 — — Off-balance-sheet liabilities: Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit — 1,673 — — 1,673

B. STOCK OPTION PLANS (Detail N

B. STOCK OPTION PLANS (Detail Narratives) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Share-based Compensation [Abstract]
Compensation expense for options	$ 70	$ 61	$ 227	$ 183
Income tax benefit	0	0	0	154
Intrinsic Value Options Exercised			1,151	671
Intrinsic Value Options Exercisable	3,994	$ 3,042	3,994	$ 3,042
Unrecognized Compensation Expense Nonvested Options	$ 817		$ 817
Non-vested options weighted average period			3 years 4 months 8 days

C. EARNINGS PER SHARE CALCULA20

C. EARNINGS PER SHARE CALCULATION (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Earnings per share data:
Net earnings	$ 2,444	$ 2,239	$ 7,459	$ 6,109
Average number of shares outstanding	4,612	4,524	4,582	4,508
Effect of dilutive options	$ 105	$ 119	$ 118	$ 127
Average number of shares outstanding used to calculate diluted earnings per share	4,717	4,643	4,700	4,635
Anti-dilutive options not included	68	103	70	104

D. SECURITIES AVAILABLE FOR S21

D. SECURITIES AVAILABLE FOR SALE, Amortized cost and fair values (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Available for sale securities, Amortized Cost	$ 351,155	$ 326,595
Available for sale securities, Unrealized Gains	7,977	4,021
Available for sale securities, Unrealized Losses	(255)	(1,409)
Available for sale securities, Estimated Fair Value	358,877	329,207
U.S. Treasury securities
Available for sale securities, Amortized Cost	975	7,004
Available for sale securities, Unrealized Gains	28	14
Available for sale securities, Unrealized Losses	0	(18)
Available for sale securities, Estimated Fair Value	1,003	7,000
Obligations of U.S. government agencies
Available for sale securities, Amortized Cost	60,724	84,842
Available for sale securities, Unrealized Gains	974	168
Available for sale securities, Unrealized Losses	(1)	(401)
Available for sale securities, Estimated Fair Value	61,697	84,609
Mortgage-backed securities
Available for sale securities, Amortized Cost	98,933	61,579
Available for sale securities, Unrealized Gains	2,219	641
Available for sale securities, Unrealized Losses	(118)	(557)
Available for sale securities, Estimated Fair Value	101,034	61,663
Obligations of states and political subdivisions
Available for sale securities, Amortized Cost	154,304	132,125
Available for sale securities, Unrealized Gains	4,344	3,148
Available for sale securities, Unrealized Losses	(131)	(83)
Available for sale securities, Estimated Fair Value	158,517	135,190
Corporate debt
Available for sale securities, Amortized Cost	36,219	41,045
Available for sale securities, Unrealized Gains	412	50
Available for sale securities, Unrealized Losses	(5)	(350)
Available for sale securities, Estimated Fair Value	$ 36,626	$ 40,745

D. SECURITIES AVAILABLE FOR S22

D. SECURITIES AVAILABLE FOR SALE, Analysis of gross unrealized losses (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Less than 12 months, Total Fair Value	$ 34,558	$ 122,000
Less than 12 months, Unrealized Loss	(243)	(923)
12 months or more, Total Fair Value	6,445	27,995
12 months or more, Unrealized Loss	(12)	(487)
Total Fair Value	41,003	149,995
Total Unrealized Loss	(255)	(1,409)
Obligations of U.S. government agencies
Less than 12 months, Total Fair Value	0	55,382
Less than 12 months, Unrealized Loss	0	(338)
12 months or more, Total Fair Value	1,008	4,976
12 months or more, Unrealized Loss	(1)	(62)
Total Fair Value	1,008	60,358
Total Unrealized Loss	(1)	(401)
Mortgage-backed securities
Less than 12 months, Total Fair Value	18,864	19,458
Less than 12 months, Unrealized Loss	(114)	(193)
12 months or more, Total Fair Value	2,627	16,714
12 months or more, Unrealized Loss	(4)	(365)
Total Fair Value	21,491	36,172
Total Unrealized Loss	(118)	(557)
Obligations of states and political subdivisions
Less than 12 months, Total Fair Value	13,679	14,988
Less than 12 months, Unrealized Loss	(126)	(74)
12 months or more, Total Fair Value	1,810	1,856
12 months or more, Unrealized Loss	(5)	(10)
Total Fair Value	15,489	16,844
Total Unrealized Loss	(131)	(83)
Corporate debt
Less than 12 months, Total Fair Value	2,015	27,130
Less than 12 months, Unrealized Loss	(3)	(300)
12 months or more, Total Fair Value	1,000	4,449
12 months or more, Unrealized Loss	(2)	(50)
Total Fair Value	3,015	31,579
Total Unrealized Loss	$ (5)	(350)
U.S. Treasury securities
Less than 12 months, Total Fair Value		5,042
Less than 12 months, Unrealized Loss		(18)
12 months or more, Total Fair Value		0
12 months or more, Unrealized Loss		0
Total Fair Value		5,042
Total Unrealized Loss		$ (18)

D. SECURITIES AVAILABLE FOR S23

D. SECURITIES AVAILABLE FOR SALE, Amortized Cost and Carrying Value (Details) $ in Thousands	Sep. 30, 2016USD ($)
SECURITIES AVAILABLE FOR SALE - Summary of Investments Amortized Cost and Carrying Value
Due in one year or less, Amortized Cost	$ 12,725
Due after one through five years, Amortized Cost	146,953
Due after five through ten years, Amortized Cost	138,771
Due after ten years, Amortized Cost	52,706
Equity securities, Amortized Cost	351,155
Due in one year or less, Fair Value	12,755
Due after one through five years, Fair Value	150,017
Due after five through ten years, Fair Value	142,744
Due after ten years, Fair Value	53,361
Equity securities, Fair Value	$ 358,877

D. SECURITIES AVAILABLE FOR S24

D. SECURITIES AVAILABLE FOR SALE (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
D. Securities Available For Sale Details Narrative
Gross realized gains	$ 140	$ 29	$ 381	$ 250
Sell of securities	14,178	3,187	35,400	11,463
Gross realized losses	0	$ 0	0	$ 0
Amortized cost	102,449		102,449
Fair value of pledged as collateral for public deposits	$ 104,857		$ 104,857

E. LOANS, Summary of Loan as fo

E. LOANS, Summary of Loan as follows (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Gross loans	$ 753,012	$ 733,977
Net deferred loan fees	(1,513)	(1,260)
Allowance for loan losses	(10,092)	(9,970)
Net loans	741,407	722,747
Commercial real estate
Gross loans	404,964	399,993
Real estate construction
Gross loans	38,163	44,816
Real Estate Multi family
Gross loans	83,944	63,597
Real Estate 1 to 4 family
Gross loans	173,441	171,964
Commercial and industrial
Gross loans	50,870	52,033
Consumer
Gross loans	1,630	1,574
FNB Bancorp Originated
Gross loans	636,220	595,997
Net deferred loan fees	(1,513)	(1,260)
Allowance for loan losses	(10,092)	(9,970)
Net loans	624,615	584,767
FNB Bancorp Originated | Commercial real estate
Gross loans	331,392	314,141
FNB Bancorp Originated | Real estate construction
Gross loans	36,654	38,909
FNB Bancorp Originated | Real Estate Multi family
Gross loans	74,712	47,607
FNB Bancorp Originated | Real Estate 1 to 4 family
Gross loans	148,993	153,872
FNB Bancorp Originated | Commercial and industrial
Gross loans	42,839	39,894
FNB Bancorp Originated | Consumer
Gross loans	1,630	1,574
PNCI
Gross loans	115,559	136,676
Net deferred loan fees	0	0
Allowance for loan losses	0	0
Net loans	115,559	136,676
PNCI | Commercial real estate
Gross loans	72,339	84,548
PNCI | Real estate construction
Gross loans	1,509	5,907
PNCI | Real Estate Multi family
Gross loans	9,232	15,990
PNCI | Real Estate 1 to 4 family
Gross loans	24,448	18,092
PNCI | Commercial and industrial
Gross loans	8,031	12,139
PNCI | Consumer
Gross loans	0	0
PCI
Gross loans	1,233	1,304
Net deferred loan fees	0	0
Allowance for loan losses	0	0
Net loans	1,233	1,304
PCI | Commercial real estate
Gross loans	1,233	1,304
PCI | Real estate construction
Gross loans	0	0
PCI | Real Estate Multi family
Gross loans	0	0
PCI | Real Estate 1 to 4 family
Gross loans	0	0
PCI | Commercial and industrial
Gross loans	0	0
PCI | Consumer
Gross loans	$ 0	$ 0

E. LOANS, Recorded Investment i

E. LOANS, Recorded Investment in Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015
Commercial Real estate
Ending balance	$ 404,964	$ 399,993	$ 394,090
Ending balance: individually evaluated for impairment	10,214	11,292	9,501
Ending balance: collectively evaluated for impairment	394,750	388,701	384,589
Real Estate Construction
Ending balance	38,163	44,816	35,868
Ending balance: individually evaluated for impairment	2,072	2,154	2,162
Ending balance: collectively evaluated for impairment	36,091	42,662	33,706
Real Estate Multi family
Ending balance	83,944	63,597	63,928
Ending balance: individually evaluated for impairment	0	0	0
Ending balance: collectively evaluated for impairment	83,944	63,597	63,928
Real Estate 1 to 4 family
Ending balance	173,441	171,964	172,280
Ending balance: individually evaluated for impairment	3,620	4,218	4,857
Ending balance: collectively evaluated for impairment	169,821	167,746	167,423
Commercial and industrial
Ending balance	50,871	52,033	39,843
Ending balance: individually evaluated for impairment	1,236	1,782	1,813
Ending balance: collectively evaluated for impairment	49,635	50,251	38,030
Consumer
Ending balance	1,630	1,574	1,497
Ending balance: individually evaluated for impairment	0	0	0
Ending balance: collectively evaluated for impairment	1,630	1,574	1,497
Total
Ending balance	753,013	733,977	707,506
Ending balance: individually evaluated for impairment	17,142	19,446	18,333
Ending balance: collectively evaluated for impairment	$ 735,871	$ 714,531	$ 689,173

E. LOANS, Impaired Loans Allowa

E. LOANS, Impaired Loans Allowance (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
With no related allowance, Recorded Investment	$ 11,347	$ 8,557	$ 11,347	$ 8,557	$ 11,304
With no related allowance, Unpaid Principal Balance	12,656	9,874	12,656	9,874	12,589
With no related allowance recorded, Related Allowance	0	0	0	0	0
With no related allowance, Average Recorded Investment	11,689	8,758	11,378	13,118	11,834
With no related allowance, Income Recognized	101	151	665	393	475
With an allowance recorded, Recorded Investment	5,795	9,776	5,795	9,776	7,653
With an allowance recorded, Unpaid Principal Balance	5,604	9,624	5,604	9,624	7,917
With an allowance recorded, Related Allowance	626	872	626	872	757
With an allowance recorded, Average Impaired Balance	5,770	9,834	5,814	9,853	7,934
With an allowance recorded, Income Recognized	30	93	152	297	316
Recorded Investment	17,142	18,333	17,142	18,333	18,957
Unpaid Principal Balance	18,260	19,498	18,260	19,498	20,506
Related Allowance	626	872	626	872	757
Average Recorded Investment	17,459	18,593	17,192	22,971	19,768
Income Recognized	131	244	817	690	791
Commercial real estate
With no related allowance, Recorded Investment	8,554	4,392	8,554	4,392	8,169
With no related allowance, Unpaid Principal Balance	9,676	5,271	9,676	5,271	9,271
With no related allowance recorded, Related Allowance	0	0	0	0	0
With no related allowance, Average Recorded Investment	8,449	4,402	8,637	4,867	8,379
With no related allowance, Income Recognized	95	92	520	217	282
With an allowance recorded, Recorded Investment	1,660	5,109	1,660	5,109	2,634
With an allowance recorded, Unpaid Principal Balance	1,660	5,113	1,660	5,113	2,638
With an allowance recorded, Related Allowance	72	126	72	126	96
With an allowance recorded, Average Impaired Balance	1,664	5,121	1,675	5,162	2,664
With an allowance recorded, Income Recognized	17	66	68	196	160
Recorded Investment	10,214	9,501	10,214	9,501	10,803
Unpaid Principal Balance	11,336	10,384	11,336	10,384	11,909
Related Allowance	72	126	72	126	96
Average Recorded Investment	10,113	9,523	10,312	10,029	11,043
Income Recognized	112	158	588	413	442
Commercial real estate construction
With no related allowance, Recorded Investment	2,072	2,162	2,072	2,162	2,154
With no related allowance, Unpaid Principal Balance	2,259	2,345	2,259	2,345	2,337
With no related allowance recorded, Related Allowance	0	0	0	0	0
With no related allowance, Average Recorded Investment	2,090	2,341	2,118	2,359	2,264
With no related allowance, Income Recognized	0	32	104	100	130
Recorded Investment	2,072	2,162	2,072	2,162	2,154
Unpaid Principal Balance	2,259	2,345	2,259	2,345	2,337
Related Allowance	0	0	0	0	0
Average Recorded Investment	2,090	2,341	2,118	2,359	2,264
Income Recognized	0	32	104	100	130
Real Estate 1 to 4 family
With no related allowance, Recorded Investment	605	1,475	605	1,475	457
With no related allowance, Unpaid Principal Balance	605	1,476	605	1,476	457
With no related allowance recorded, Related Allowance	0	0	0	0	0
With no related allowance, Average Recorded Investment	834	1,479	303	1,482	460
With no related allowance, Income Recognized	0	18	21	49	36
With an allowance recorded, Recorded Investment	3,015	3,382	3,015	3,382	3,761
With an allowance recorded, Unpaid Principal Balance	2,618	2,972	2,618	2,972	3,782
With an allowance recorded, Related Allowance	453	522	453	522	479
With an allowance recorded, Average Impaired Balance	3,019	3,374	3,032	3,202	3,786
With an allowance recorded, Income Recognized	13	27	80	96	149
Recorded Investment	3,620	4,857	3,620	4,857	4,218
Unpaid Principal Balance	3,223	4,448	3,223	4,448	4,239
Related Allowance	453	522	453	522	479
Average Recorded Investment	3,853	4,853	3,335	4,684	4,246
Income Recognized	13	45	101	145	185
Commercial and industrial
With no related allowance, Recorded Investment	116	528	116	528	524
With no related allowance, Unpaid Principal Balance	116	782	116	782	524
With no related allowance recorded, Related Allowance	0	0	0	0	0
With no related allowance, Average Recorded Investment	316	537	320	4,410	731
With no related allowance, Income Recognized	6	9	20	27	27
With an allowance recorded, Recorded Investment	1,120	1,285	1,120	1,285	1,258
With an allowance recorded, Unpaid Principal Balance	1,326	1,539	1,326	1,539	1,497
With an allowance recorded, Related Allowance	101	224	101	224	182
With an allowance recorded, Average Impaired Balance	1,087	1,339	1,107	1,489	1,484
With an allowance recorded, Income Recognized	0	0	4	5	7
Recorded Investment	1,236	1,813	1,236	1,813	1,782
Unpaid Principal Balance	1,442	2,321	1,442	2,321	2,021
Related Allowance	101	224	101	224	182
Average Recorded Investment	1,403	1,876	1,427	5,899	2,215
Income Recognized	$ 6	$ 9	$ 24	$ 32	$ 34

E. LOANS, Nonaccrual (Details)

E. LOANS, Nonaccrual (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Loans, Nonaccrual Status	$ 6,903	$ 7,915
Commercial real estate
Loans, Nonaccrual Status	5,707	6,021
Real Estate Construction
Loans, Nonaccrual Status		0
Real Estate 1 to 4 family
Loans, Nonaccrual Status	76	636
Commercial and industrial
Loans, Nonaccrual Status	$ 1,120	1,258
Consumer
Loans, Nonaccrual Status		$ 0

E. LOANS, Troubled Debt Restruc

E. LOANS, Troubled Debt Restructurings (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Troubled debt restructured loans outstanding, accrual status	$ 9,380	$ 10,165
Troubled debt restructured loans outstanding, nonaccrual status	2,162	3,103
Total modifications	11,542	13,268
Commercial real estate
Troubled debt restructured loans outstanding, accrual status	4,625	4,775
Troubled debt restructured loans outstanding, nonaccrual status	1,233	0
Total modifications	5,858	4,775
Real Estate Construction
Troubled debt restructured loans outstanding, accrual status	1,212	1,283
Troubled debt restructured loans outstanding, nonaccrual status	0	0
Total modifications	1,212	1,283
Real Estate 1 to 4 family
Troubled debt restructured loans outstanding, accrual status	3,543	3,583
Troubled debt restructured loans outstanding, nonaccrual status	0	2,060
Total modifications	3,543	5,643
Commercial and industrial
Troubled debt restructured loans outstanding, accrual status	0	524
Troubled debt restructured loans outstanding, nonaccrual status	929	1,043
Total modifications	$ 929	$ 1,567

E. LOANS, Payment Modification

E. LOANS, Payment Modification (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2015USD ($)Contract
Number of Contracts | Contract	1
Pre-modification Recorded Investment	$ 474
Post-modification Recorded Investment	$ 474
Real Estate 1 to 4 family
Number of Contracts | Contract	1
Pre-modification Recorded Investment	$ 474
Post-modification Recorded Investment	$ 474

E. LOANS, Allowance for Credit

E. LOANS, Allowance for Credit Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Commercial Real estate
Allowance for credit losses
Beginning balance	$ 6,206	$ 6,027	$ 6,059	$ 5,549	$ 5,549
Charge-offs	0	0	0	0	0
Recoveries	2	15	6	37	576
Provision for (recovery of) loan losses	(63)	(67)	80	389	(66)
Ending balance	6,145	5,975	6,145	5,975	6,059
Ending balance: individually evaluated for impairment	72	126	72	126	96
Ending balance: collectively evaluated for impairment	6,073	5,849	6,073	5,849	5,963
Real Estate Construction
Allowance for credit losses
Beginning balance	404	697	589	849	849
Charge-offs	0	0	0	0	0
Recoveries	0	0	0	0	0
Provision for (recovery of) loan losses	138	(49)	(46)	(201)	(260)
Ending balance	542	648	543	648	589
Ending balance: individually evaluated for impairment	0	0	0	0	0
Ending balance: collectively evaluated for impairment	542	648	542	648	589
Real Estate Multi family
Allowance for credit losses
Beginning balance	335	198	243	206	206
Charge-offs	0	0	0	0	0
Recoveries	0	0	0	0	0
Provision for (recovery of) loan losses	(3)	(10)	89	(18)	37
Ending balance	332	188	332	188	243
Ending balance: individually evaluated for impairment	0	0	0	0	0
Ending balance: collectively evaluated for impairment	332	188	332	188	243
Real Estate 1 to 4 family
Allowance for credit losses
Beginning balance	2,261	2,014	2,176	1,965	1,965
Charge-offs	0	0	(12)	(45)	(45)
Recoveries	23	7	42	8	15
Provision for (recovery of) loan losses	(77)	289	1	382	241
Ending balance	2,207	2,310	2,207	2,310	2,176
Ending balance: individually evaluated for impairment	453	522	453	522	479
Ending balance: collectively evaluated for impairment	1,754	1,788	1,754	1,788	1,697
Commercial and industrial
Allowance for credit losses
Beginning balance	799	848	853	1,073	1,073
Charge-offs	0	(23)	(165)	(23)	0
Recoveries	37	26	119	45	60
Provision for (recovery of) loan losses	(47)	(73)	(19)	(317)	(280)
Ending balance	789	778	788	778	853
Ending balance: individually evaluated for impairment	101	224	101	224	182
Ending balance: collectively evaluated for impairment	688	554	688	554	671
Consumer
Allowance for credit losses
Beginning balance	33	52	50	58	58
Charge-offs	(8)	0	(18)	(11)	(36)
Recoveries	0	4	0	4	5
Provision for (recovery of) loan losses	52	(15)	45	(10)	23
Ending balance	77	41	77	41	50
Ending balance: individually evaluated for impairment	0	0	0	0	0
Ending balance: collectively evaluated for impairment	77	41	77	41	50
Total
Allowance for credit losses
Beginning balance	10,038	9,836	9,970	9,700	9,700
Charge-offs	(8)	(23)	(195)	(79)	(81)
Recoveries	62	52	167	94	656
Provision for (recovery of) loan losses	0	75	150	225	(305)
Ending balance	10,092	9,940	10,092	9,940	9,970
Ending balance: individually evaluated for impairment	626	872	626	872	757
Ending balance: collectively evaluated for impairment	$ 9,466	$ 9,068	$ 9,466	$ 9,068	$ 9,213

E. LOANS, Past due loans (Detai

E. LOANS, Past due loans (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Originated
Past Due, Total	$ 2,204	$ 6,401
Current	634,017	589,596
Total Loans	636,221	595,997
Originated | Commercial real estate
Past Due, Total	0	1,541
Current	331,392	312,600
Total Loans	331,392	314,141
Originated | Commercial real estate | Past Due, 30 - 59 days
Past Due, Total	0	1,541
Originated | Commercial real estate | Past Due, 60 - 89 days
Past Due, Total	0	0
Originated | Commercial real estate | Past Due, More than 90 days
Past Due, Total	0	0
Originated | Real Estate Construction
Past Due, Total	140	1,431
Current	36,514	37,478
Total Loans	36,654	38,909
Originated | Real Estate Construction | Past Due, 30 - 59 days
Past Due, Total	0	706
Originated | Real Estate Construction | Past Due, 60 - 89 days
Past Due, Total	0	725
Originated | Real Estate Construction | Past Due, More than 90 days
Past Due, Total	140	0
Originated | Real Estate Multi family
Past Due, Total	0	0
Current	74,712	47,607
Total Loans	74,712	47,607
Originated | Real Estate Multi family | Past Due, 30 - 59 days
Past Due, Total	0	0
Originated | Real Estate Multi family | Past Due, 60 - 89 days
Past Due, Total	0	0
Originated | Real Estate Multi family | Past Due, More than 90 days
Past Due, Total	0	0
Originated | Real Estate 1 to 4 family
Past Due, Total	76	2,171
Current	148,917	151,701
Total Loans	148,993	153,872
Originated | Real Estate 1 to 4 family | Past Due, 30 - 59 days
Past Due, Total	0	1,363
Originated | Real Estate 1 to 4 family | Past Due, 60 - 89 days
Past Due, Total	0	737
Originated | Real Estate 1 to 4 family | Past Due, More than 90 days
Past Due, Total	76	71
Originated | Commercial and industrial
Past Due, Total	1,988	1,258
Current	40,852	38,636
Total Loans	42,840	39,894
Originated | Commercial and industrial | Past Due, 30 - 59 days
Past Due, Total	845	0
Originated | Commercial and industrial | Past Due, 60 - 89 days
Past Due, Total	23	0
Originated | Commercial and industrial | Past Due, More than 90 days
Past Due, Total	1,120	1,258
Originated | Consumer
Past Due, Total	0	0
Current	1,630	1,574
Total Loans	1,630	1,574
Originated | Consumer | Past Due, 30 - 59 days
Past Due, Total	0	0
Originated | Consumer | Past Due, 60 - 89 days
Past Due, Total	0	0
Originated | Consumer | Past Due, More than 90 days
Past Due, Total	0	0
Purchased Not credit impaired
Past Due, Total	2,700	245
Current	112,859	136,431
Total Loans	115,559	136,676
Purchased Not credit impaired | Past Due, 30 - 59 days
Past Due, Total		245
Purchased Not credit impaired | Past Due, 60 - 89 days
Past Due, Total		0
Purchased Not credit impaired | Past Due, More than 90 days
Past Due, Total		0
Purchased Not credit impaired | Commercial real estate
Past Due, Total	550	0
Current	71,789	84,548
Total Loans	72,339	84,548
Purchased Not credit impaired | Commercial real estate | Past Due, 30 - 59 days
Past Due, Total	0	0
Purchased Not credit impaired | Commercial real estate | Past Due, 60 - 89 days
Past Due, Total	0	0
Purchased Not credit impaired | Commercial real estate | Past Due, More than 90 days
Past Due, Total	550	0
Purchased Not credit impaired | Real Estate Construction
Past Due, Total	0	0
Current	1,509	5,907
Total Loans	1,509	5,907
Purchased Not credit impaired | Real Estate Construction | Past Due, 30 - 59 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate Construction | Past Due, 60 - 89 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate Construction | Past Due, More than 90 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate Multi family
Past Due, Total	0	0
Current	9,232	15,990
Total Loans	9,232	15,990
Purchased Not credit impaired | Real Estate Multi family | Past Due, 30 - 59 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate Multi family | Past Due, 60 - 89 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate Multi family | Past Due, More than 90 days
Past Due, Total	0	0
Purchased Not credit impaired | Real Estate 1 to 4 family
Past Due, Total	2,150	175
Current	22,298	17,917
Total Loans	24,448	18,092
Purchased Not credit impaired | Real Estate 1 to 4 family | Past Due, 30 - 59 days
Past Due, Total	0	175
Purchased Not credit impaired | Real Estate 1 to 4 family | Past Due, 60 - 89 days
Past Due, Total	2,150	0
Purchased Not credit impaired | Real Estate 1 to 4 family | Past Due, More than 90 days
Past Due, Total	0	0
Purchased Not credit impaired | Commercial and industrial
Past Due, Total	0	70
Current	8,031	12,069
Total Loans	8,031	12,139
Purchased Not credit impaired | Commercial and industrial | Past Due, 30 - 59 days
Past Due, Total	0	70
Purchased Not credit impaired | Commercial and industrial | Past Due, 60 - 89 days
Past Due, Total	0	0
Purchased Not credit impaired | Commercial and industrial | Past Due, More than 90 days
Past Due, Total	0	0
Purchased Credit impaired
Past Due, Total	0	1,304
Current	1,233
Total Loans	1,233	1,304
Purchased Credit impaired | Commercial real estate
Past Due, Total	0	1,304
Current	1,233
Total Loans	$ 1,233	$ 1,304

E. LOANS, Credit Quality Indica

E. LOANS, Credit Quality Indicators Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Pass
Commercial real estate	$ 328,230	$ 308,164
Real estate construction	35,654	37,850
Real estate multi-family	74,712	47,607
Real estate 1 to 4 family	148,917	153,285
Commercial and industrial	42,447	39,287
Consumer loans	1,630	1,574
Totals	631,590	587,767
Commercial real estate	62,236	68,936
Real estate construction	1,509	5,907
Real estate multi-family	9,232	15,990
Real estate 1 to 4 family	24,448	18,092
Commercial and industrial	7,939	12,044
Total	105,364	120,969
Special mention
Commercial real estate	0	1,857
Real estate construction	0	0
Real estate multi-family	0	0
Real estate 1 to 4 family	0	0
Commercial and industrial	0	0
Consumer loans	0	0
Totals	0	1,857
Commercial real estate	895	3,455
Real estate construction	0	0
Real estate multi-family	0	0
Real estate 1 to 4 family	0	0
Commercial and industrial	0	0
Total	895	3,455
Sub Standard
Commercial real estate	3,162	4,120
Real estate construction	1,000	1,059
Real estate multi-family	0	0
Real estate 1 to 4 family	76	587
Commercial and industrial	387	451
Consumer loans	0	0
Totals	4,625	6,217
Commercial real estate	9,208	12,145
Real estate construction	0	0
Real estate multi-family	0	0
Real estate 1 to 4 family	0	0
Commercial and industrial	92	95
Total	9,300	12,240
Doubtful
Commercial real estate	0	0
Real estate construction	0	0
Real estate multi-family	0	0
Real estate 1 to 4 family	0	0
Commercial and industrial	6	156
Consumer loans	0	0
Totals	6	156
Commercial real estate	0	12
Real estate construction	0	0
Real estate multi-family	0	0
Real estate 1 to 4 family	0	0
Commercial and industrial	0	0
Total	0	12
Total loans
Commercial real estate	331,392	314,141
Real estate construction	36,654	38,909
Real estate multi-family	74,712	47,607
Real estate 1 to 4 family	148,993	153,872
Commercial and industrial	42,840	39,894
Consumer loans	1,630	1,574
Totals	636,221	595,997
Commercial real estate	72,339	84,548
Real estate construction	1,509	5,907
Real estate multi-family	9,232	15,990
Real estate 1 to 4 family	24,448	18,092
Commercial and industrial	8,031	12,139
Total	115,559	136,676
Commercial real estate	1,233	1,304
Total	$ 1,233	$ 1,304

E. LOANS, (Details Narrative)

E. LOANS, (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
E. Loans Details Narrative
Interest income on impaired loans recognized	$ 131,000	$ 244,000	$ 817,000	$ 690,000	$ 791,000
Interest on impaired loans not collected	164,313,000	$ 86,430,000	439,579,000	$ 284,198,000	460,390,000
Cumulative amount of unpaid interest on impaired loans			3,844,000		3,405,000
Nonaccrual loans	$ 6,903,000		$ 6,903,000		$ 7,915,000

G. FAIR VALUE MEASUREMENT, Asse

G. FAIR VALUE MEASUREMENT, Assets (Details) $ in Thousands	Dec. 31, 2015USD ($)
U. S. Treasury securities	$ 7,000
Obligations of U.S. Government agencies	84,609
Mortgage-backed securities	61,663
Obligations of states and political subdivisions	135,190
Corporate debt	40,745
Total assets measured at fair value	329,207
Quoted Prices in Active Markets for Identical Assets (Level 1)
U. S. Treasury securities	7,000
Obligations of U.S. Government agencies	0
Mortgage-backed securities	0
Obligations of states and political subdivisions	0
Corporate debt	0
Total assets measured at fair value	7,000
Other Observable Inputs (Level 2)
U. S. Treasury securities	0
Obligations of U.S. Government agencies	84,609
Mortgage-backed securities	61,663
Obligations of states and political subdivisions	135,190
Corporate debt	40,745
Total assets measured at fair value	322,207
Significant Unobservable Inputs(Level 3)
U. S. Treasury securities	0
Obligations of U.S. Government agencies	0
Mortgage-backed securities	0
Obligations of states and political subdivisions	0
Corporate debt	0
Total assets measured at fair value	$ 0

G. FAIR VALUE MEASUREMENT, Nonr

G. FAIR VALUE MEASUREMENT, Nonrecurring basis (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Fair Value
Commercial real estate		$ 136
Residential- 1 to 4 family		301
Commercial and Industrial	$ 984	1,065
Total impaired assets measured at fair value	984	1,502
Quoted Prices in Active Markets for Identical Assets (Level 1)
Commercial real estate		0
Residential- 1 to 4 family		0
Commercial and Industrial	0	0
Total impaired assets measured at fair value	0	0
Other Observable Inputs (Level 2)
Commercial real estate		0
Residential- 1 to 4 family		0
Commercial and Industrial	0	0
Total impaired assets measured at fair value	0	0
Significant Unobservable Inputs(Level 3)
Commercial real estate		136
Residential- 1 to 4 family		301
Commercial and Industrial	984	1,065
Total impaired assets measured at fair value	$ 984	$ 1,502

G. FAIR VALUE MEASUREMENT, Fina

G. FAIR VALUE MEASUREMENT, Financial instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015	Dec. 31, 2014
Financial assets:
Cash and cash equivalents	$ 17,342	$ 12,314	$ 40,282	$ 14,978
Interest-bearing time deposits with financial Institutions	204	205
Other equity securities	358,877
Accrued interest receivable	4,544	4,511
Financial liabilities:
Deposits	1,003,457	983,189
Notes payable	4,500	4,950
Carrying Amount
Financial assets:
Cash and cash equivalents	17,342	12,314
Interest-bearing time deposits with financial Institutions	204	205
Securities available for sale	358,877	329,207
Loans	753,013	733,977
Other equity securities	7,206	6,748
Accrued interest receivable	4,544	4,511
Financial liabilities:
Deposits	1,003,457	983,189
Federal Home Loan Bank advances	37,000	17,000
Notes payable	4,500	4,950
Accrued interest payable	287	236
Off-balance-sheet liabilities:
Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit		0
Fair Value
Financial assets:
Cash and cash equivalents	17,342	12,314
Interest-bearing time deposits with financial Institutions	204	205
Securities available for sale	358,877	329,207
Loans	748,688	725,196
Other equity securities	7,206	6,748
Accrued interest receivable	4,544	4,511
Financial liabilities:
Deposits	1,002,771	983,771
Federal Home Loan Bank advances	37,000	17,000
Notes payable	4,500	4,950
Accrued interest payable	287	236
Off-balance-sheet liabilities:
Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit	1,702	1,673
Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets:
Cash and cash equivalents	17,342	12,314
Securities available for sale	1,003	7,000
Accrued interest receivable	4,544	4,511
Financial liabilities:
Deposits	885,864	857,759
Accrued interest payable	287	236
Other Observable Inputs (Level 2)
Financial assets:
Interest-bearing time deposits with financial Institutions	204	205
Securities available for sale	357,874	322,207
Financial liabilities:
Deposits	116,907	126,012
Federal Home Loan Bank advances	37,000	17,000
Notes payable	4,500	4,950
Significant Unobservable Inputs(Level 3)
Financial assets:
Loans	748,688	725,196
Other equity securities	7,206	6,748
Off-balance-sheet liabilities:
Undisbursed loan commitments, lines of credit, standby letters of credit and Mastercard lines of credit	$ 1,702	$ 1,673

G. FAIR VALUE MEASUREMENT (Deta

G. FAIR VALUE MEASUREMENT (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
FAIR VALUE MEASUREMENT TABLES
Nonaccrual loans	$ 6,903	$ 7,915