New Peoples Bankshares (NWPP) 10-Q 14 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 11, 2018
Document And Entity Information
Entity Registrant Name	NEW PEOPLES BANKSHARES INC
Entity Central Index Key	1,163,389
Document Type	10-Q
Trading Symbol	NWPP
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		23,922,086
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,018

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
INTEREST AND DIVIDEND INCOME
Loans including fees	$ 6,462	$ 6,115	$ 12,920	$ 11,779
Interest-earning deposits with banks	96	49	161	92
Investments	397	381	805	731
Dividends on equity securities (restricted)	38	34	73	66
Total Interest and Dividend Income	6,993	6,579	13,959	12,668
INTEREST EXPENSE
Deposits	769	607	1,465	1,145
Borrowed funds	245	181	437	367
Total Interest Expense	1,014	788	1,902	1,512
NET INTEREST INCOME	5,979	5,791	12,057	11,156
PROVISION FOR LOAN LOSSES	63		126
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	5,916	5,791	11,931	11,156
NONINTEREST INCOME
Service charges and fees	1,653	1,602	3,175	3,098
Gain on sale and leaseback transactions		2,619		2,619
Insurance and investment fees	179	54	253	106
Other noninterest income	39	134	193	300
Total Noninterest Income	1,871	4,409	3,621	6,123
NONINTEREST EXPENSES
Salaries and employee benefits	3,670	3,341	7,314	6,722
Occupancy and equipment expense	1,299	1,172	2,591	2,299
Data processing and telecommunications	736	670	1,340	1,223
Other operating expenses	2,190	2,440	4,289	4,357
Total Noninterest Expenses	7,895	7,623	15,534	14,601
INCOME (LOSS) BEFORE INCOME TAXES	(108)	2,577	18	2,678
INCOME TAX BENEFIT	(59)		(13)	(14)
NET INCOME (LOSS)	$ (49)	$ 2,577	$ 31	$ 2,692
Income (Loss) Per Share
Basic	$ 0	$ 0.11	$ 0	$ 0.12
Fully Diluted	$ 0	$ 0.11	$ 0	$ 0.12
Weighted Average Shares of Common Stock
Basic	23,922,086	23,355,503	23,922,086	23,355,198
Fully Diluted	23,922,086	23,355,503	23,922,086	23,355,198

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Consolidated Statements Of Comprehensive Income Loss
NET INCOME (LOSS)	$ (49)	$ 2,577	$ 31	$ 2,692
Investment Securities Activity
Unrealized gains (losses) arising during the period	(207)	518	(1,248)	607
Tax related to unrealized gains (losses)	43	(176)	263	(206)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)	(164)	342	(985)	401
TOTAL COMPREHENSIVE INCOME (LOSS)	$ (213)	$ 2,919	$ (954)	$ 3,093

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
ASSETS
Cash and due from banks	$ 15,817	$ 18,249
Interest-bearing deposits with banks	27,476	14,452
Federal funds sold	180	4
Total Cash and Cash Equivalents	43,473	32,705
Investment securities available-for-sale	63,995	71,088
Loans receivable	527,379	513,008
Allowance for loan losses	(5,288)	(6,196)
Net Loans	522,091	506,812
Bank premises and equipment, net	25,432	26,115
Other real estate owned	6,574	6,859
Accrued interest receivable	1,901	2,036
Deferred taxes, net	5,774	5,499
Right-of-use assets - operating leases	5,099	5,253
Other assets	10,784	10,333
Total Assets	685,123	666,700
Deposits:
Noninterest bearing	167,540	154,631
Interest-bearing	424,011	427,913
Total Deposits	591,551	582,544
Borrowed funds	35,496	24,054
Lease liabilities - operating leases	5,099	5,253
Accrued interest payable	511	426
Accrued expenses and other liabilities	2,447	3,450
Total Liabilities	635,104	615,727
Commitments and contingencies
STOCKHOLDERS' EQUITY
Common stock - $2.00 par value; 50,000,000 shares authorized; 23,922,086 shares issued and outstanding at June 30, 2018 and December 31, 2017	47,844	47,844
Additional paid-in-capital	14,570	14,570
Retained deficit	(10,816)	(10,847)
Accumulated other comprehensive loss	(1,579)	(594)
Total Stockholders' Equity	50,019	50,973
Total Liabilities and Stockholders' Equity	$ 685,123	$ 666,700

CONSOLIDATED BALANCE SHEETS (U5

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 2	$ 2
Common stock, authorized	50,000,000	50,000,000
Common stock, issued	23,922,086	23,922,086
Common stock, outstanding	23,922,086	23,922,086

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands	Common Stock [Member]	Common Stock Warrants [Member]	Additional Paid-in Capital [Member]	Retained Deficit [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total
Balance at beginning at Dec. 31, 2016	$ 46,709	$ 764	$ 13,965	$ (14,065)	$ (456)	$ 46,917
Balance at beginning (in shares) at Dec. 31, 2016	23,354
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income				2,692		2,692
Exercise of common stock warrants	$ 4	(2)	1			3
Exercise of common stock warrants (in shares)	2
Other comprehensive income (loss), net of tax					401	401
Balance at end at Jun. 30, 2017	$ 46,713	762	13,966	(11,373)	(55)	50,013
Balance at end (in shares) at Jun. 30, 2017	23,356
Balance at beginning at Dec. 31, 2017	$ 47,844		14,570	(10,847)	(594)	$ 50,973
Balance at beginning (in shares) at Dec. 31, 2017	23,922					23,922,086
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income				31		$ 31
Other comprehensive income (loss), net of tax					(985)	(985)
Balance at end at Jun. 30, 2018	$ 47,844		$ 14,570	$ (10,816)	$ (1,579)	$ 50,019
Balance at end (in shares) at Jun. 30, 2018	23,922					23,922,086

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 31	$ 2,692
Adjustments to reconcile net income to net cash provided by operating activities:
Accretion of bond premiums/discounts	330	398
Provision for loan losses	126
Depreciation	1,295	1,279
Income on life insurance	(28)	(55)
Gain on sale and leaseback transactions		(2,619)
(Gain) loss on sale of premises and equipment	82	(2)
Loss on sale of foreclosed assets	111	4
Adjustment of carrying value of foreclosed real estate	198	590
Deferred tax benefit	(12)
Net change in:
Interest receivable	135	68
Other assets	66	(66)
Accrued interest payable	85	28
Accrued expenses and other liabilities	(1,003)	629
Net Cash Provided by Operating Activities	1,416	2,946
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans	(16,694)	(15,944)
Purchase of securities available-for-sale		(13,032)
Proceeds from sales, maturities, and principal paydowns of securities available-for-sale	5,515	7,457
Net sale (purchase) of equity securities (restricted)	(489)	232
Proceeds from sale of premises and equipment	777	5
Payments for the purchase of premises and equipment	(1,471)	(1,446)
Proceeds from sales and leaseback transactions		1,042
Proceeds from sales of other real estate owned	1,265	3,961
Net Cash Used In Investing Activities	(11,097)	(17,725)
CASH FLOWS FROM FINANCING ACTIVITIES
Exercise of common stock warrants		3
Net increase (decrease) in Federal Home Loan Bank advances	11,442	(5,600)
Increase in deposits	9,007	21,908
Net Cash Provided by Financing Activities	20,449	16,311
Net increase in cash and cash equivalents	10,768	1,532
Cash and Cash Equivalents, Beginning of Period	32,705	35,448
Cash and Cash Equivalents, End of Period	43,473	36,980
Supplemental Disclosure of Cash Paid During the Period for:
Interest	1,817	1,484
Taxes	320
Supplemental Disclosure of Non Cash Transactions:
Right-of-use assets obtained in exchange for new operating lease liabilities		5,321
Loan made to finance sale of premises and equipment		4,935
Other real estate acquired in settlement of foreclosed loans	1,289	2,071
Loans made to finance sale of foreclosed real estate	467	1,092
Transfer of premises and equipment to other real estate		125
Change in unrealized gains (losses) on securities available-for-sale	$ (1,248)	$ 607

NATURE OF OPERATIONS

NATURE OF OPERATIONS	6 Months Ended
	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF OPERATIONS	NOTE 1 NATURE OF OPERATIONS: New Peoples Bankshares, Inc. (the “Company”) is a financial holding company whose principal activity is the ownership and management of a community bank, New Peoples Bank, Inc. (the “Bank”). The Bank was organized and incorporated under the laws of the Commonwealth of Virginia. As a state-chartered member bank, the Bank is subject to regulation by the Virginia Bureau of Financial Institutions, the Federal Deposit Insurance Corporation and the Federal Reserve Bank. The Bank provides general banking services to individuals, small and medium size businesses and the professional community of southwestern Virginia, southern West Virginia, and eastern Tennessee. Services include commercial and consumer loans along with traditional deposit products such as checking and savings accounts.

ACCOUNTING PRINCIPLES

ACCOUNTING PRINCIPLES	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
ACCOUNTING PRINCIPLES	NOTE 2 ACCOUNTING PRINCIPLES: These consolidated financial statements conform to U. S. generally accepted accounting principles and to general industry practices. In the opinion of management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the Company’s financial position at June 30, 2018 and December 31, 2017, and the results of operations for the three and six-month periods ended June 30, 2018 and 2017. The notes included herein should be read in conjunction with the notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The results of operations for interim periods are not necessarily indicative of the results of operations that may be expected for a full year or any future period. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The determination of the adequacy of the allowance for loan losses and the determination of the deferred tax asset and related valuation allowance are based on estimates that are particularly susceptible to significant changes in the economic environment and market conditions.

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jun. 30, 2018
Income (Loss) Per Share
EARNINGS PER SHARE	NOTE 3 EARNINGS PER SHARE: Basic earnings per share computations are based on the weighted average number of shares outstanding during each period. Dilutive earnings per share reflect the additional common shares that would have been outstanding if dilutive potential common shares had been issued. Potential common shares that may be issued related to outstanding common stock warrants are determined by the Treasury method. For the three and six months ended June 30, 2017, potential common shares of 880,136 were anti-dilutive and were not included in the calculation. There were no anti-dilutive potential common shares at June 30, 2018. Basic and diluted net income per common share calculations follow: (Amounts in Thousands, Except For the three months For the six months 2018 2017 2018 2017 Net income (loss) $ (49 ) $ 2,577 $ 31 $ 2,692 Weighted average shares outstanding 23,922,086 23,355,503 23,922,086 23,355,198 Dilutive shares for warrants — — — — Weighted average dilutive shares outstanding 23,922,086 23,355,503 23,922,086 23,355,198 Basic income (loss) per share $ (0.00 ) $ 0.11 $ 0.00 $ 0.12 Diluted income (loss) per share $ (0.00 ) $ 0.11 $ 0.00 $ 0.12

CAPITAL

CAPITAL	6 Months Ended
	Jun. 30, 2018
Capital [Abstract]
CAPITAL	NOTE 4 CAPITAL: Capital Requirements and Ratios The Bank is subject to various capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and, possibly, additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum ratios of Tier 1 and total capital as a percentage of assets and off-balance sheet exposures, adjusted for risk weights ranging from 0% to 1250%. Tier 1 capital consists of common stockholders’ equity, excluding the unrealized gain or loss on securities available-for-sale, minus certain intangible assets. Tier 2 capital consists of the allowance for loan losses subject to certain limitations. Total capital for purposes of computing the capital ratios consists of the sum of Tier 1 and Tier 2 capital. The Bank is also required to maintain capital at a minimum level based on quarterly average assets, which is known as the leverage ratio. The Company meets eligibility criteria of a small bank holding company in accordance with the Federal Reserve Board’s Small Bank Holding Company Policy Statement issued in February 2015, and is no longer obligated to report consolidated regulatory capital. The Bank’s actual capital amounts and ratios are presented in the following table as of June 30, 2018 and December 31, 2017, respectively. These ratios comply with Federal Reserve rules to align with the Basel III Capital requirements effective January 1, 2015. Actual Minimum Capital Requirement Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions (Dollars are in thousands) Amount Ratio Amount Ratio Amount Ratio June 30, 2018: Total Capital to Risk Weighted Assets: New Peoples Bank, Inc. 69,208 14.69 % $ 37,699 8.0 % $ 47,124 10.0 % Tier 1 Capital to Risk Weighted Assets: New Peoples Bank, Inc. 63,920 13.56 % 28,274 6.0 % 37,699 8.0 % Tier 1 Capital to Average Assets: New Peoples Bank, Inc. 63,920 9.51 % 26,895 4.0 % 33,619 5.0 % Common Equity Tier 1 Capital New Peoples Bank, Inc. 63,920 13.56 % 21,206 4.5 % 30,631 6.5 % December 31, 2017: Total Capital to Risk Weighted Assets: New Peoples Bank, Inc. 68,787 15.30 % $ 35,970 8.0 % $ 44,962 10.0 % Tier 1 Capital to Risk Weighted Assets: New Peoples Bank, Inc. 63,160 14.05 % 26,977 6.0 % 35,970 8.0 % Tier 1 Capital to Average Assets: New Peoples Bank, Inc. 63,160 9.56 % 26,422 4.0 % 33,028 5.0 % Common Equity Tier 1 Capital New Peoples Bank, Inc. 63,160 14.05 % 20,233 4.5 % 29,225 6.5 % As of June 30, 2018, the Bank was well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based, Tier 1 leverage, and Common Equity Tier 1 ratios as set forth in the above tables. There were no subsequent conditions or events that management believes have changed the Bank’s category. Under Basel III Capital requirements, a capital conservation buffer of 0.625% became effective beginning on January 1, 2016. The capital conservation buffer will be gradually increased through January 1, 2019 to 2.50%. Banks will be required to maintain levels that meet the required minimum plus the capital conservation buffer in order to make distributions, such as dividends, or discretionary bonus payments.

INVESTMENT SECURITIES

INVESTMENT SECURITIES	6 Months Ended
	Jun. 30, 2018
Investment Securities Activity
INVESTMENT SECURITIES	NOTE 5 INVESTMENT SECURITIES: The amortized cost and estimated fair value of securities (all available-for-sale (“AFS”)) are as follows: Gross Gross Approximate Amortized Unrealized Unrealized Fair (Dollars are in thousands) Cost Gains Losses Value June 30, 2018 U.S. Government Agencies $ 22,022 $ 8 $ (444) $ 21,586 Taxable municipals 4,447 - (170) 4,277 Corporate bonds 5,430 86 (138) 5,378 Mortgage backed securities 34,095 1 (1,342) 32,754 Total Securities AFS $ 65,994 $ 95 $ (2,094) $ 63,995 December 31, 2017 U.S. Government Agencies $ 23,986 $ 79 $ (221) $ 23,844 Taxable municipals 4,466 9 (78) 4,397 Corporate bonds 5,437 168 (26) 5,579 Mortgage backed securities 37,950 3 (685) 37,268 Total Securities AFS $ 71,839 $ 259 $ (1,010) $ 71,088 The following table details unrealized losses and related fair values in the available-for-sale portfolio. This information is aggregated by the length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2018 and December 31, 2017. Less than 12 Months 12 Months or More Total (Dollars are in thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses June 30, 2018 U.S. Government Agencies $ 9,751 $ (132) $ 9,433 $ (312) $ 19,184 $ (444) Taxable municipals 3,527 (120) 750 (50) 4,277 (170) Corporate bonds 2,393 (138) - - 2,393 (138) Mtg. backed securities 11,066 (359) 21,631 (983) 32,697 (1,342) Total Securities AFS $ 26,737 $ (749) $ 31,814 $ (1,345) $ 58,551 $ (2,094) December 31, 2017 U.S. Government Agencies $ 7,840 $ (69) $ 7,189 $ (152) $ 15,029 $ (221) Taxable municipals 2,403 (44) 767 (34) 3,170 (78) Corporate bonds 1,507 (26) - - 1,507 (26) Mtg. backed securities 14,720 (145) 21,500 (540) 36,220 (685) Total Securities AFS $ 26,470 $ (284) $ 29,456 $ (726) $ 55,926 $ (1,010) At June 30, 2018, there were nineteen U.S. Government Agency securities, two taxable municipal securities, and sixty-five mortgage backed securities that had been in a loss position for greater than twelve months. Management believes that all unrealized losses have resulted from temporary changes in the interest rates and current market conditions and not as a result of credit deterioration. Management does not intend to sell, and it is not likely that the Bank will be required to sell any of the securities referenced in the table above before recovery of their amortized cost. Investment securities with a carrying value of $10.0 million and $11.0 million at June 30, 2018 and December 31, 2017, respectively, were pledged as collateral to secure public deposits and for other purposes required by law. There were no sales of investment securities during the six months ended June 30, 2018 or June 30, 2017. The amortized cost and fair value of investment securities at June 30, 2018, by contractual maturity, are shown in the following schedule. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Weighted (Dollars are in thousands) Amortized Fair Average Securities Available-for-Sale Cost Value Yield Due in one year or less $ 1 $ 1 -% Due after one year through five years 3,932 3,816 1.93% Due after five years through ten years 15,524 15,206 3.26% Due after ten years 46,537 44,972 2.38% Total $ 65,994 $ 63,995 2.56% The Bank, as a member of the Federal Reserve Bank and the Federal Home Loan Bank, is required to hold stock in each. The Bank also owns stock in CBB Financial Corp., which is a correspondent of the Bank. These equity securities are restricted from trading and are recorded at a cost of $3.1 million and $2.6 million as of June 30, 2018 and December 31, 2017, respectively.

LOANS

LOANS	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
LOANS	NOTE 6 LOANS: Loans receivable outstanding are summarized as follows: (Dollars are in thousands) June 30, 2018 December 31, 2017 Real estate secured: Commercial $ 138,849 $ 127,688 Construction and land development 27,611 29,763 Residential 1-4 family 250,329 249,159 Multifamily 13,757 15,481 Farmland 22,203 22,998 Total real estate loans 452,749 445,089 Commercial 48,034 41,345 Agriculture 4,487 3,494 Consumer installment loans 21,475 22,411 All other loans 634 669 Total loans $ 527,379 $ 513,008 Loans receivable on nonaccrual status are summarized as follows: (Dollars are in thousands) June 30, 2018 December 31, 2017 Real estate secured: Commercial $ 1,832 $ 2,035 Construction and land development 196 470 Residential 1-4 family 3,265 2,991 Multifamily 81 152 Farmland 1,052 800 Total real estate loans 6,426 6,448 Commercial — 1,065 Agriculture — 3 Consumer installment loans 16 48 Total loans receivable on nonaccrual status $ 6,442 $ 7,564 Total interest income not recognized on nonaccrual loans for the six months ended June 30, 2018 and 2017 was $390 thousand and $280 thousand, respectively. The following table presents information concerning the Company’s investment in loans considered impaired as of June 30, 2018 and December 31, 2017: As of June 30, 2018 Recorded Unpaid Principal Balance Related With no related allowance recorded: Real estate secured: Commercial $ 2,764 $ 2,817 $ — Construction and land development 150 348 — Residential 1-4 family 3,144 3,206 — Multifamily 81 122 — Farmland 1,861 1,887 — Commercial 7 7 — Agriculture 1 1 — Consumer installment loans — — — All other loans — — — With an allowance recorded: Real estate secured: Commercial 545 545 43 Construction and land development — — — Residential 1-4 family 355 355 86 Multifamily — — — Farmland 368 368 154 Commercial 111 111 12 Agriculture — — — Consumer installment loans 7 7 1 All other loans — — — Total $ 9,394 $ 9,774 $ 296 As of December 31, 2017 Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Real estate secured: Commercial $ 2,646 $ 2,719 $ — Construction and land development 424 680 — Residential 1-4 family 3,586 3,885 — Multifamily 281 321 — Farmland 1,264 1,664 — Commercial 628 628 — Agriculture 12 12 — Consumer installment loans 8 8 — All other loans — — — With an allowance recorded: Real estate secured: Commercial 2,503 2,622 499 Construction and land development — — — Residential 1-4 family 421 437 91 Multifamily — — — Farmland 378 378 243 Commercial 489 572 413 Agriculture — — — Consumer installment loans — — — All other loans — — — Total $ 12,640 $ 13,926 $ 1,246 The following table presents information concerning the Company’s average impaired loans and interest recognized on those impaired loans, for the periods indicated: Six Months Ended June 30, 2018 June 30, 2017 (Dollars are in thousands) Average Interest Average Interest With no related allowance recorded: Real estate secured: Commercial $ 2,746 $ 54 $ 3,136 $ 64 Construction and land development 246 — 3 — Residential 1-4 family 3,291 87 3,831 102 Multifamily 191 4 440 11 Farmland 1,430 42 2,884 26 Commercial 216 — — — Agriculture 5 — 19 1 Consumer installment loans 3 — 15 — All other loans — — — — With an allowance recorded: Real estate secured: Commercial 1,698 16 837 6 Construction and land development — — 228 — Residential 1-4 family 378 7 657 9 Multifamily — — 444 32 Farmland 371 — 694 16 Commercial 354 2 210 16 Agriculture — — 2 — Consumer installment loans 5 1 3 — All other loans — — — — Total $ 10,934 $ 213 $ 13,403 $ 283 Three Months Ended June 30, 2018 June 30, 2017 (Dollars are in thousands) Average Interest Average Interest With no related allowance recorded: Real estate secured: Commercial $ 2,796 $ 26 $ 2,886 $ 39 Construction and land development 158 — 2 — Residential 1-4 family 3,144 45 3,817 53 Multifamily 147 — 510 (1 ) Farmland 1,514 30 2,378 141 Commercial 10 — — — Agriculture 2 — 19 1 Consumer installment loans — — 9 — All other loans — — — — With an allowance recorded: Real estate secured: Commercial 1,296 — 660 4 Construction and land development — — 222 — Residential 1-4 family 357 3 708 — Multifamily — — 666 32 Farmland 368 — 746 11 Commercial 286 2 282 16 Agriculture — — 1 — Consumer installment loans 8 1 — — All other loans — — — — Total $ 10,086 $ 107 $ 12,906 $ 296 An age analysis of past due loans receivable is below. At June 30, 2018 and December 31, 2017, there were no loans over 90 days past due that were accruing. As of June 30, 2018 Loans Loans Loans Total Current Total Real estate secured: Commercial $ 542 $ — $ 317 $ 859 $ 137,990 $ 138,849 Construction and land 32 18 42 92 27,519 27,611 Residential 1-4 family 2,251 514 618 3,383 246,946 250,329 Multifamily 276 — — 276 13,481 13,757 Farmland 527 — 245 772 21,431 22,203 Total real estate loans 3,628 532 1,222 5,382 447,367 452,749 Commercial — 110 — 110 47,924 48,034 Agriculture — — — — 4,487 4,487 Consumer installment 43 13 4 60 21,415 21,475 All other loans — — — — 634 634 Total loans $ 3,671 $ 655 $ 1,226 $ 5,552 $ 521,827 $ 527,379 As of December 31, 2017 Loans Loans Loans Total Current Total Real estate secured: Commercial $ 190 $ 2,396 $ 453 $ 3,039 $ 124,649 $ 127,688 Construction and land 69 246 42 357 29,406 29,763 Residential 1-4 family 3,789 378 969 5,136 244,023 249,159 Multifamily 125 89 — 214 15,267 15,481 Farmland 309 — — 309 22,689 22,998 Total real estate loans 4,482 3,109 1,464 9,055 436,034 445,089 Commercial 103 25 603 731 40,614 41,345 Agriculture 38 — — 38 3,456 3,494 Consumer installment 102 15 28 145 22,266 22,411 All other loans — — — — 669 669 Total loans $ 4,725 $ 3,149 $ 2,095 $ 9,969 $ 503,039 $ 513,008 The Company categorizes loans receivable into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans receivable as to credit risk. The Company uses the following definitions for risk ratings: Pass Special Mention Substandard A substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful Loans classified doubtful have all the weaknesses inherent in loans classified as substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. Based on the most recent analysis performed, the risk category of loans receivable was as follows: As of June 30, 2018 Pass Special Substandard Total Real estate secured: Commercial $ 134,536 $ 2,023 $ 2,290 $ 138,849 Construction and land development 26,629 773 209 27,611 Residential 1-4 family 242,862 2,638 4,829 250,329 Multifamily 13,544 75 138 13,757 Farmland 18,709 1,632 1,862 22,203 Total real estate loans 436,280 7,141 9,328 452,749 Commercial 45,586 2,387 61 48,034 Agriculture 4,465 14 8 4,487 Consumer installment loans 21,440 — 35 21,475 All other loans 634 — — 634 Total $ 508,405 $ 9,542 $ 9,432 $ 527,379 As of December 31, 2017 Pass Special Substandard Total Real estate secured: Commercial $ 120,104 $ 3,228 $ 4,356 $ 127,688 Construction and land development 28,462 816 485 29,763 Residential 1-4 family 243,048 1,810 4,301 249,159 Multifamily 13,695 1,445 341 15,481 Farmland 19,273 2,445 1,280 22,998 Total real estate loans 424,582 9,744 10,763 445,089 Commercial 37,973 2,307 1,065 41,345 Agriculture 3,468 23 3 3,494 Consumer installment loans 22,357 2 52 22,411 All other loans 669 — — 669 Total $ 489,049 $ 12,076 11,883 $ 513,008

ALLOWANCE FOR LOAN LOSSES

ALLOWANCE FOR LOAN LOSSES	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
ALLOWANCE FOR LOAN LOSSES	NOTE 7 ALLOWANCE FOR LOAN LOSSES: The following table details activity in the allowance for loan losses by portfolio segment for the period ended June 30, 2018. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. As of June 30, 2018 Beginning Charge Recoveries Provisions Ending Balance Real estate secured: Commercial $ 1,989 $ (334 ) $ 68 $ (218 ) $ 1,505 Construction and land development 191 (96 ) — 151 246 Residential 1-4 family 2,400 (167 ) 38 18 2,289 Multifamily 106 — — (7 ) 99 Farmland 415 (18 ) 60 (143 ) 314 Total real estate loans 5,101 (615 ) 166 (199 ) 4,453 Commercial 660 (597 ) 24 310 397 Agriculture 20 — 1 12 33 Consumer installment loans 156 (37 ) 24 (5 ) 138 All other loans 3 — — — 3 Unallocated 256 — — 8 264 Total $ 6,196 $ (1,249 ) $ 215 $ 126 $ 5,288 Allowance for Loan Losses Recorded Investment in Loans As of June 30, 2018 (Dollars are in thousands) Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Real estate secured: Commercial $ 43 $ 1,462 $ 1,505 $ 3,309 $ 135,540 $ 138,849 Construction and land development - 246 246 150 27,461 27,611 Residential 1-4 family 86 2,203 2,289 3,499 246,830 250,329 Multifamily - 99 99 81 13,676 13,757 Farmland 154 160 314 2,229 19,974 22,203 Total real estate loans 283 4,170 4,453 9,268 443,481 452,749 Commercial 12 385 397 118 47,916 48,034 Agriculture - 33 33 1 4,486 4,487 Consumer installment loans 1 137 138 7 21,468 21,475 All other loans - 3 3 - 634 634 Unallocated - 264 264 - - - Total $ 296 $ 4,992 $ 5,288 $ 9,394 $ 517,985 $ 527,379 The following table details activity in the allowance for loan losses by portfolio segment for the period ended December 31, 2017. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. As of December 31, 2017 Beginning Charge Recoveries Provisions Ending Balance Real estate secured: Commercial $ 1,625 $ (179 ) $ 193 $ 350 $ 1,989 Construction and land development 346 (1 ) — (154 ) 191 Residential 1-4 family 2,376 (714 ) 48 690 2,400 Multifamily 241 — — (135 ) 106 Farmland 428 (49 ) 361 (325 ) 415 Total real estate loans 5,016 (943 ) 602 426 5,101 Commercial 163 (11 ) 153 355 660 Agriculture 31 (4 ) 5 (12 ) 20 Consumer installment loans 123 (147 ) 19 161 156 All other loans — — — 3 3 Unallocated 739 — — (483 ) 256 Total $ 6,072 $ (1,105 ) $ 779 $ 450 $ 6,196 Allowance for Loan Losses Recorded Investment in Loans As of December 31, 2017 (Dollars are in thousands) Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Real estate secured: Commercial $ 499 $ 1,490 $ 1,989 $ 5,149 $ 122,539 $ 127,688 Construction and land development - 191 191 424 29,339 29,763 Residential 1-4 family 91 2,309 2,400 4,007 245,152 249,159 Multifamily - 106 106 281 15,200 15,481 Farmland 243 172 415 1,642 21,356 22,998 Total real estate loans 833 4,268 5,101 11,503 433,586 445,089 Commercial 413 247 660 1,117 40,228 41,345 Agriculture - 20 20 12 3,482 3,494 Consumer installment loans - 156 156 8 22,403 22,411 All other loans - 3 3 - 669 669 Unallocated - 256 256 - - - Total $ 1,246 $ 4,950 6,196 $ 12,640 $ 500,368 $ 513,008 In determining the amount of our allowance, we rely on an analysis of our loan portfolio, our experience and our evaluation of general economic conditions, as well as any regulatory input. If our assumptions prove to be incorrect, our current allowance may not be sufficient to cover future loan losses and we may experience significant increases to our provision.

TROUBLED DEBT RESTRUCTURINGS

TROUBLED DEBT RESTRUCTURINGS	6 Months Ended
	Jun. 30, 2018
Troubled Debt Restructurings
TROUBLED DEBT RESTRUCTURINGS	NOTE 8 TROUBLED DEBT RESTRUCTURINGS: At June 30, 2018 there were 5.8 million in loans that are classified as troubled debt restructurings compared to $6.9 million at December 31, 2017. The following table presents information related to loans modified as troubled debt restructurings during the six and three months ended June 30, 2018 and 2017. For the six months ended June 30, 2018 For the six months ended June 30, 2017 Troubled Debt Restructurings (Dollars are in thousands) # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment Real estate secured: Commercial - $ - $ - - $ - $ - Construction and land Development - - - - - - Residential 1-4 family - - - - - - Multifamily - - - - - - Farmland - - - - - - Total real estate loans - - - - - - Commercial 1 443 443 Agriculture - - - - - - Consumer installment loans - - - - - - All other loans - - - - - - Total $ $ 1 $ 443 $ 443 For the three months ended June 30, 2018 For the three months ended June 30, 2017 Troubled Debt Restructurings (Dollars are in thousands) # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment Real estate secured: Commercial - $ - $ - - $ - $ - Construction and land Development - - - - - - Residential 1-4 family - - - - - - Multifamily - - - - - - Farmland - - - - - - Total real estate loans - - - - - - Commercial 1 443 443 Agriculture - - - - - - Consumer installment loans - - - - - - All other loans - - - - - - Total $ $ 1 $ 443 $ 443 During the six and three months ended June 30, 2018, the Company modified no loans for for which the modification was considered to be a troubled debt restructuring. During the six and three months ended June 30, 2017, the Company modified the terms of one loan for which the modification was considered to be a troubled debt restructuring. The interest rate was not modified on this loan; however, the payment terms and maturity date were changed. No loans modified as troubled debt restructurings defaulted during the three or six months ended June 30, 2018 or 2017. Generally, a troubled debt restructuring is considered to be in default once it becomes 90 days or more past due following a modification. In determination of the allowance for loan losses, management considers troubled debt restructurings and subsequent defaults in these restructurings in its estimate. The Company evaluates all troubled debt restructurings for possible further impairment. As a result, the allowance may be increased, adjustments may be made in the allocation of the allowance, or charge-offs may be taken to further writedown the carrying value of the loan.

OTHER REAL ESTATE OWNED

OTHER REAL ESTATE OWNED	6 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
OTHER REAL ESTATE OWNED	NOTE 9 OTHER REAL ESTATE OWNED: The following table summarizes the activity in other real estate owned for the six months ended June 30, 2018 and the year ended December 31, 2017: (Dollars are in thousands) June 30, December 31, 2017 Balance, beginning of period $ 6,859 $ 10,655 Additions 1,289 3,087 Transfers from premises and equipment — 125 Proceeds from sales (1,265 ) (4,742 ) Proceeds from insurance claims — (12 ) Loans made to finance sales — (1,477 ) Adjustment of carrying value (198 ) (758 ) Deferred gain from sales — 45 Losses from sales (111 ) (64 ) Balance, end of period $ 6,574 $ 6,859

FAIR VALUES

FAIR VALUES	6 Months Ended
	Jun. 30, 2018
Fair Value Disclosures [Abstract]
FAIR VALUES	NOTE 10 FAIR VALUES: The financial reporting standard, “Fair Value Measurements and Disclosures” provides a framework for measuring fair value under generally accepted accounting principles and requires disclosures about the fair value of assets and liabilities recognized in the balance sheet in periods subsequent to initial recognition, whether the measurements are made on a recurring basis (for example, available-for-sale investment securities) or on a nonrecurring basis (for example, impaired loans and other real estate acquired through foreclosure). Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair Value Measurements and Disclosures also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an exchange market, as well as U. S. Treasury, other U. S. Government and agency mortgage-backed debt securities that are highly liquid and are actively traded in over-the-counter markets. Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes certain derivative contracts and impaired loans. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. For example, this category generally includes certain private equity investments, retained residual interests in securitizations, residential mortgage servicing rights, and highly structured or long-term derivative contracts. Investment Securities Available-for-Sale Assets measured at fair value on a recurring basis are as follows. There were no liabilities measured at fair value on a recurring basis. (Dollars are in thousands) Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 U.S. Government Agencies $ — $ 21,586 $ — Taxable municipals — 4,277 — Corporate bonds — 5,378 — Mortgage backed securities — 32,754 — Total $ — $ 63,995 $ — December 31, 2017 U.S. Government Agencies $ — $ 23,844 $ — Taxable municipals — 4,397 — Corporate bonds — 5,579 — Mortgage backed securities — 37,268 — Total $ — $ 71,088 $ — Loans - Other Real Estate Owned – Assets measured at fair value on a non-recurring basis are as follows (for purpose of this table the impaired loans are shown net of the related allowance). There were no liabilities measured at fair value on a non-recurring basis. (Dollars are in thousands) Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 Other real estate owned — — $ 6,574 Impaired loans — — 9,098 Total — — $ 15,672 December 31, 2017 Other real estate owned — — $ 6,859 Impaired loans — — 11,394 Total — — $ 18,253 For Level 3 assets measured at fair value on a recurring or non-recurring basis as of June 30, 2018 and December 31, 2017, the significant unobservable inputs used in the fair value measurements were as follows: (Dollars in thousands) Fair Value at June 30, 2018 Valuation Technique Significant Unobservable Inputs General Range of Significant Unobservable Input Values Impaired Loans $ 9,098 $ Appraised Value/Discounted Cash Flows/Market Value of Note Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell 0 – 18% Other Real Estate Owned $ 6,574 $ Appraised Value/Comparable Sales/Other Estimates from Independent Sources Discounts to reflect current market conditions and estimated costs to sell 0 – 18% Fair Value of Financial Instruments Fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practical to estimate the value is based upon the characteristics of the instruments and relevant market information. Financial instruments include cash, evidence of ownership in an entity, or contracts that convey or impose on an entity that contractual right or obligation to either receive or deliver cash for another financial instrument. The information used to determine fair value is highly subjective and judgmental in nature and, therefore, the results may not be precise. Subjective factors include, among other things, estimates of cash flows, risk characteristics, credit quality, and interest rates, all of which are subject to change. Since the fair value is estimated as of the balance sheet date, the amounts that will actually be realized or paid upon settlement or maturity on these various instruments could be significantly different. The tables below present the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments. This table excludes financial instruments for which the carrying amount approximates fair value. The carrying value of cash and due from banks, federal funds sold, interest-bearing deposits with banks, deposits with no stated maturities, and accrued interest approximates fair value. During the first quarter of 2018, the Company adopted Accounting Standard Update (“ASU”) 2016-01, “Recognition and Measurement of Financial Assets and Liabilities.” The amendments included within this standard, which are applied prospectively, require the Company to use an exit price notion to estimate fair value of financial instruments measured at amortized cost on the balance sheet. Prior to adopting the amendments included in the standard, the Company was allowed to measure fair value under an entry price notion. The entry price notion previously applied by the Company used a discounted cash flows technique to calculate the present value of expected future cash flows for a financial instrument. The exit price notion uses the same approach, but also incorporates other factors, such as enhanced credit risk, illiquidity risk and market factors that sometimes exist in exit prices in dislocated markets. As of December 31, 2017, the fair value of the Company’s loan portfolio includes a credit risk assumption in the determination of the fair value of its loans. This credit risk assumption is intended to approximate the fair value that a market participant would realize in a hypothetical orderly transaction. The Company’s loan portfolio is initially fair valued using a segmented approach. The Company divides its loan portfolio into the following categories: variable rate loans, impaired loans and all other loans. The results are then adjusted to account for credit risk as described above. For variable-rate loans that reprice frequently and have no significant change in credit risk, fair values approximate carrying values. Fair values for impaired loans are estimated using discounted cash flow models or based on the fair value of the underlying collateral. For other loans, fair values are estimated using discounted cash flow models, using current market interest rates offered for loans with similar terms to borrowers of similar credit quality. The values derived from the discounted cash flow approach for each of the above portfolios are then further discounted to incorporate credit risk. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price as of December 31, 2017. As of June 30, 2018, the technique used by the Company to estimate the exit price of the loan portfolio consists of similar procedures to those used as of December 31, 2017, but with added emphasis on both illiquidity risk and credit risk not captured by the previously applied entry price notion. The fair value of the Company’s loan portfolio has always included a credit risk assumption in the determination of the fair value of its loans. This credit risk assumption is intended to approximate the fair value that a market participant would realize in a hypothetical orderly transaction. After adjusting the segmented portfolio, under the new guidance, a further credit risk discount must be applied through the use of a discounted cash flow model to compensate for illiquidity risk, based on certain assumptions included within the discounted cash flow model, primarily the use of discount rates that better capture inherent credit risk over the lifetime of a loan. This consideration of enhanced credit risk provides an estimated exit price for the Company’s loan portfolio. For variable-rate loans that reprice frequently and have no significant change in credit risk, fair values approximate carrying values. Fair values for impaired loans are estimated using discounted cash flow models or based on the fair value of the underlying collateral. The remaining financial instruments were valued based on the present value of estimated future cash flows, discounted at various rates in effect for similar instruments. Fair Value Measurements (Dollars are in thousands) Carrying Fair Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 Financial Instruments – Assets Net Loans $ 522,091 $ 510,879 $ — $ 501,781 $ 9,098 Financial Instruments – Liabilities Time Deposits 257,585 257,482 — 257,482 — FHLB Advances 19,000 19,301 — 19,301 — Trust Preferred Securities 16,496 13,903 — 13,903 — December 31, 2017 Financial Instruments – Assets Net Loans $ 506,812 $ 506,608 $ — $ 495,214 $ 11,394 Financial Instruments– Liabilities Time Deposits 272,330 272,352 — 272,352 — FHLB Advances 7,558 7,794 — 7,794 — Trust Preferred Securities 16,496 16,496 — 16,496 —

SALE AND LEASEBACK TRANSACTIONS

SALE AND LEASEBACK TRANSACTIONS	6 Months Ended
	Jun. 30, 2018
Leases [Abstract]
SALE AND LEASEBACK TRANSACTIONS	NOTE 11 SALE AND LEASEBACK TRANSACTIONS: On May 31, 2017, the Bank sold four of its properties, one each located in Abingdon, Bristol, Gate City and Castlewood, Virginia to a nonaffiliated third party for a total purchase price of $6.2 million. After selling expenses of $192 thousand, the net proceeds on the transactions were $6.0 million. The sales prices for the properties were based on outside appraisals obtained by the Bank. The Bank provided $4.9 million of financing to the purchaser for a term of 10 years for this transaction. In connection with the sale of the four properties, on May 31, 2017, the Bank entered into commercial lease agreements with the purchaser for the properties (the “Leases”), which will allow the Bank to continue to service customers from these locations. The Leases, which commenced on June 1, 2017, provide the Bank with use of the properties for an initial term of fifteen years. Base rent payments for years one through five of the Leases are approximately $417 thousand a year. The base rent payments will increase by 8% for years 6 through 10 of the Leases and then by another 8% for years eleven through fifteen of the Leases. The Bank has the option to renew the Leases five times and each renewal would be for a term of five years. The base rent for the renewals would be negotiated at the time the renewal option is exercised by the Bank. While the cash lease payments are currently $417 thousand a year, the Company is required to straight-line the expense over the initial term of fifteen years. As a result, the annual lease expense will be approximately $451 thousand. The weighted average remaining life of the leases is 13.92 years. In anticipation of this transaction the Company adopted ASU No. 2016-02 Leases (Topic 842) early. This ASU revised certain aspects of recognition, measurement, presentation, and disclosure of leasing transactions. As a result of this transaction the Company recognized initial right-to-use assets – operating leases of approximately $5.3 million, along with corresponding lease liabilities of approximately $5.3 million. The $5.3 million was determined by calculating the present value of the annual cash lease payments using a discount rate of 3.25%. The 3.25% discount rate was determined to be our fifteen year incremental borrowing rate as of May 31, 2017. As a result of the sale and the determination that the corresponding leases were operating leases, the Company also recognized a gain in 2017 of $2.6 million on the sale and leaseback transactions.

NONINTEREST EXPENSES

NONINTEREST EXPENSES	6 Months Ended
	Jun. 30, 2018
Noninterest Expenses
NONINTEREST EXPENSES	NOTE 12 NONINTEREST EXPENSES: Other operating expenses, included as part of noninterest expenses, consisted of the following for the periods presented: For the three months ended June 30, For the six months ended June 30, (Dollars are in thousands) 2018 2017 2018 2017 Advertising $ 114 $ 97 $ 261 $ 206 ATM network expense 450 428 842 831 Legal and professional fees 406 327 773 625 Loan related expenses 130 149 330 333 Printing and supplies 66 30 202 54 FDIC insurance premiums 84 110 181 212 Other real estate owned, net 113 753 360 1,053 Other 827 546 1,340 1,043 Total other operating expenses $ 2,190 $ 2,440 $ 4,289 $ 4,357

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 13 SUBSEQUENT EVENTS: Subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued. Recognized subsequent events are events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Non-recognized subsequent events are events that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. Management has reviewed events occurring through the date the financial statements were available to be issued and no subsequent events occurred requiring accrual or disclosure.

RECENT ACCOUNTING DEVELOPMENTS

RECENT ACCOUNTING DEVELOPMENTS	6 Months Ended
	Jun. 30, 2018
Accounting Changes and Error Corrections [Abstract]
RECENT ACCOUNTING DEVELOPMENTS	NOTE 14 RECENT ACCOUNTING DEVELOPMENTS: The following is a summary of recent authoritative announcements: In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance to change the recognition of revenue from contracts with customers. The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration the entity receives or expects to receive. The guidance became effective January 1, 2018. The amendment does not apply to revenue associated with financial instruments, such as loans and investment securities available for sale, and therefore had no material effect on our consolidated financial statements. In January 2016, the FASB amended the Financial Instruments topic of the Accounting Standards Codification (“ASC”), to address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The amendments became effective on January 1, 2018 and did not have a material effect on the financial statements. As discussed in Note 10, the Company measured the fair value of its loan portfolio using an exit price notion as of June 30, 2018. In February 2016, the FASB amended the Leases topic of the ASC to revise certain aspects of recognition, measurement, presentation, and disclosure of leasing transactions. The amendments will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. As discussed in Note 11, the Company early adopted ASU No. 2016-02 Leases (Topic 842). In March 2016, the FASB amended the Revenue from Contracts with Customers topic of the ASC to clarify the implementation guidance on principal versus agent considerations and address how an entity should assess whether it is the principal or the agent in contracts that include three or more parties. The guidance became effective January 1, 2018. The Company completed an assessment of revenue streams and a review of related contracts potentially affected by the ASU and, based on this assessment, the Company concluded that the ASU did not materially change the method in which the Company currently recognizes revenue for these revenue streams. As such, a cumulative effect adjustment to opening retained earnings was not deemed necessary. In June 2016, the FASB issued guidance to change the accounting for credit losses and modify the impairment model for certain debt securities. The amendments will be effective for the Company for reporting periods beginning after December 15, 2019. Early adoption is permitted for all organizations for periods beginning after December 15, 2018. The Company is currently evaluating the effect that implementation of the new standard will have on its financial position, results of operations, and cash flows. In December 2016, the FASB issued technical corrections and improvements to the Revenue from Contracts with Customers Topic. These corrections make a limited number of revisions to several pieces of the revenue recognition standard issued in 2014. The amendment became effective on January 1, 2018 and did not have a material effect on the financial statements. In January 2017, the FASB updated the Accounting Changes and Error Corrections and the Investments—Equity Method and Joint Ventures Topics of the ASC. The ASU incorporates into the ASC recent SEC guidance about disclosing, under SEC SAB Topic 11.M, the effect on financial statements of adopting the revenue, leases, and credit losses standards. The ASU was effective upon issuance. The Company is currently evaluating the impact on additional disclosure requirements as each of the standards is adopted, however it does not expect these amendments to have a material effect on its financial position, results of operations or cash flows. In February 2017, the FASB amended the Other Income Topic of the ASC to clarify the scope of the guidance on nonfinancial asset derecognition as well as the accounting for partial sales of nonfinancial assets. The amendments conform the derecognition guidance on nonfinancial assets with the model for transactions in the new revenue standard. The amendment became effective on January 1, 2018 and did not have a material effect on the financial statements. In September 2017, the FASB updated the Revenue from Contracts with Customers and the Leases Topics of the ASC. The amendments incorporate into the ASC recent SEC guidance about certain public business entities (PBEs) electing to use the non-PBE effective dates solely to adopt the FASB’s new standards on revenue and leases. The amendments were effective upon issuance. The Company is currently in the process of evaluating the impact of adoption of this guidance, however it does not expect these amendments to have a material effect on its financial statements. In November 2017, the FASB updated the Income Statement and Revenue from Contracts with Customers Topics of the ASC. The amendments incorporate into the ASC recent SEC guidance related to revenue recognition. The amendments were effective upon issuance and did not have a material effect on the financial statements. In February 2018, the FASB Issued (ASU 2018-02), Income Statement (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which requires Companies to reclassify the stranded effects in other comprehensive income to retained earnings as a result of the change in the tax rates under the Tax Cuts and Jobs Act. The Company has opted to early adopt this pronouncement by retrospective application to each period (or periods) in which the effect of the change in the tax rate under the Tax Cuts and Jobs Act is recognized. The impact of the reclassification from other comprehensive income to retained earnings was $98 thousand as of December 31, 2017. In February 2018, the FASB amended the Financial Instruments Topic of the ASC. The amendments clarify certain aspects of the guidance issued in ASU 2016-01. The amendments will be effective for the third quarter of 2018 subsequent to adopting the amendments in ASU 2016-01. All entities may early adopt these amendments for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, as long as they have adopted ASU 2016-01. The Company does not expect these amendments to have a material effect on its financial statements. In March 2018, the FASB updated the Debt Securities and the Regulated Operations Topics of the ASC. The amendments incorporate into the ASC recent SEC guidance which was issued in order to make the relevant interpretive guidance consistent with current authoritative accounting and auditing guidance and SEC rules and regulations. The amendments were effective upon issuance. The Company does not expect these amendments to have a material effect on its financial statements. In March 2018, the FASB updated the Income Taxes Topic of the ASC. The amendments incorporate into the ASC recent SEC guidance related to the income tax accounting implications of the Tax Cuts and Jobs Act. The amendments were effective upon issuance. The Company does not expect these amendments to have a material effect on its financial statements. In May 2018, the FASB amended the Financial Services—Depository and Lending Topic of the ASC to remove outdated guidance related to Circular 202. The amendments were effective upon issuance and did not have a material effect on the financial statements. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

ACCOUNTING POLICIES (Policies)

ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation	These consolidated financial statements conform to U. S. generally accepted accounting principles and to general industry practices. In the opinion of management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the Company’s financial position at June 30, 2018 and December 31, 2017, and the results of operations for the three and six-month periods ended June 30, 2018 and 2017. The notes included herein should be read in conjunction with the notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The results of operations for interim periods are not necessarily indicative of the results of operations that may be expected for a full year or any future period. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The determination of the adequacy of the allowance for loan losses and the determination of the deferred tax asset and related valuation allowance are based on estimates that are particularly susceptible to significant changes in the economic environment and market conditions.

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2018
Income (Loss) Per Share
Schedule of anti-dilutive income per common share	Basic and diluted net income per common share calculations follow: (Amounts in Thousands, Except For the three months For the six months 2018 2017 2018 2017 Net income (loss) $ (49 ) $ 2,577 $ 31 $ 2,692 Weighted average shares outstanding 23,922,086 23,355,503 23,922,086 23,355,198 Dilutive shares for warrants — — — — Weighted average dilutive shares outstanding 23,922,086 23,355,503 23,922,086 23,355,198 Basic income (loss) per share $ (0.00 ) $ 0.11 $ 0.00 $ 0.12 Diluted income (loss) per share $ (0.00 ) $ 0.11 $ 0.00 $ 0.12

CAPITAL (Tables)

CAPITAL (Tables)	6 Months Ended
	Jun. 30, 2018
Capital [Abstract]
Schedule of capital requirements	These ratios comply with Federal Reserve rules to align with the Basel III Capital requirements effective January 1, 2015. Actual Minimum Capital Requirement Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions (Dollars are in thousands) Amount Ratio Amount Ratio Amount Ratio June 30, 2018: Total Capital to Risk Weighted Assets: New Peoples Bank, Inc. 69,208 14.69 % $ 37,699 8.0 % $ 47,124 10.0 % Tier 1 Capital to Risk Weighted Assets: New Peoples Bank, Inc. 63,920 13.56 % 28,274 6.0 % 37,699 8.0 % Tier 1 Capital to Average Assets: New Peoples Bank, Inc. 63,920 9.51 % 26,895 4.0 % 33,619 5.0 % Common Equity Tier 1 Capital New Peoples Bank, Inc. 63,920 13.56 % 21,206 4.5 % 30,631 6.5 % December 31, 2017: Total Capital to Risk Weighted Assets: New Peoples Bank, Inc. 68,787 15.30 % $ 35,970 8.0 % $ 44,962 10.0 % Tier 1 Capital to Risk Weighted Assets: New Peoples Bank, Inc. 63,160 14.05 % 26,977 6.0 % 35,970 8.0 % Tier 1 Capital to Average Assets: New Peoples Bank, Inc. 63,160 9.56 % 26,422 4.0 % 33,028 5.0 % Common Equity Tier 1 Capital New Peoples Bank, Inc. 63,160 14.05 % 20,233 4.5 % 29,225 6.5 %

INVESTMENT SECURITIES (Tables)

INVESTMENT SECURITIES (Tables)	6 Months Ended
	Jun. 30, 2018
Investment Securities Activity
Schedule of securities' amortized cost and estimated fair value	The amortized cost and estimated fair value of securities (all available-for-sale (“AFS”)) are as follows: Gross Gross Approximate Amortized Unrealized Unrealized Fair (Dollars are in thousands) Cost Gains Losses Value June 30, 2018 U.S. Government Agencies $ 22,022 $ 8 $ (444) $ 21,586 Taxable municipals 4,447 - (170) 4,277 Corporate bonds 5,430 86 (138) 5,378 Mortgage backed securities 34,095 1 (1,342) 32,754 Total Securities AFS $ 65,994 $ 95 $ (2,094) $ 63,995 December 31, 2017 U.S. Government Agencies $ 23,986 $ 79 $ (221) $ 23,844 Taxable municipals 4,466 9 (78) 4,397 Corporate bonds 5,437 168 (26) 5,579 Mortgage backed securities 37,950 3 (685) 37,268 Total Securities AFS $ 71,839 $ 259 $ (1,010) $ 71,088
Schedule of fair value and gross unrealized losses on investment securities in a continuous unrealized loss position	The following table details unrealized losses and related fair values in the available-for-sale portfolio. This information is aggregated by the length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2018 and December 31, 2017. Less than 12 Months 12 Months or More Total (Dollars are in thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses June 30, 2018 U.S. Government Agencies $ 9,751 $ (132) $ 9,433 $ (312) $ 19,184 $ (444) Taxable municipals 3,527 (120) 750 (50) 4,277 (170) Corporate bonds 2,393 (138) - - 2,393 (138) Mtg. backed securities 11,066 (359) 21,631 (983) 32,697 (1,342) Total Securities AFS $ 26,737 $ (749) $ 31,814 $ (1,345) $ 58,551 $ (2,094) December 31, 2017 U.S. Government Agencies $ 7,840 $ (69) $ 7,189 $ (152) $ 15,029 $ (221) Taxable municipals 2,403 (44) 767 (34) 3,170 (78) Corporate bonds 1,507 (26) - - 1,507 (26) Mtg. backed securities 14,720 (145) 21,500 (540) 36,220 (685) Total Securities AFS $ 26,470 $ (284) $ 29,456 $ (726) $ 55,926 $ (1,010)
Schedule of amortized cost and fair value of investment securities' contractual maturity	The amortized cost and fair value of investment securities at June 30, 2018, by contractual maturity, are shown in the following schedule. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Weighted (Dollars are in thousands) Amortized Fair Average Securities Available-for-Sale Cost Value Yield Due in one year or less $ 1 $ 1 -% Due after one year through five years 3,932 3,816 1.93% Due after five years through ten years 15,524 15,206 3.26% Due after ten years 46,537 44,972 2.38% Total $ 65,994 $ 63,995 2.56%

LOANS (Tables)

LOANS (Tables)	6 Months Ended
	Jun. 30, 2018
Loans and Leases Receivable Disclosure [Abstract]
Summary of loans receivable outstanding	Loans receivable outstanding are summarized as follows: (Dollars are in thousands) June 30, 2018 December 31, 2017 Real estate secured: Commercial $ 138,849 $ 127,688 Construction and land development 27,611 29,763 Residential 1-4 family 250,329 249,159 Multifamily 13,757 15,481 Farmland 22,203 22,998 Total real estate loans 452,749 445,089 Commercial 48,034 41,345 Agriculture 4,487 3,494 Consumer installment loans 21,475 22,411 All other loans 634 669 Total loans $ 527,379 $ 513,008
Summary of loans receivable on nonaccrual status	Loans receivable on nonaccrual status are summarized as follows: (Dollars are in thousands) June 30, 2018 December 31, 2017 Real estate secured: Commercial $ 1,832 $ 2,035 Construction and land development 196 470 Residential 1-4 family 3,265 2,991 Multifamily 81 152 Farmland 1,052 800 Total real estate loans 6,426 6,448 Commercial — 1,065 Agriculture — 3 Consumer installment loans 16 48 Total loans receivable on nonaccrual status $ 6,442 $ 7,564
Summary of impaired loans	The following table presents information concerning the Company’s investment in loans considered impaired as of June 30, 2018 and December 31, 2017: As of June 30, 2018 Recorded Unpaid Principal Balance Related With no related allowance recorded: Real estate secured: Commercial $ 2,764 $ 2,817 $ — Construction and land development 150 348 — Residential 1-4 family 3,144 3,206 — Multifamily 81 122 — Farmland 1,861 1,887 — Commercial 7 7 — Agriculture 1 1 — Consumer installment loans — — — All other loans — — — With an allowance recorded: Real estate secured: Commercial 545 545 43 Construction and land development — — — Residential 1-4 family 355 355 86 Multifamily — — — Farmland 368 368 154 Commercial 111 111 12 Agriculture — — — Consumer installment loans 7 7 1 All other loans — — — Total $ 9,394 $ 9,774 $ 296 As of December 31, 2017 Recorded Investment Unpaid Principal Balance Related Allowance With no related allowance recorded: Real estate secured: Commercial $ 2,646 $ 2,719 $ — Construction and land development 424 680 — Residential 1-4 family 3,586 3,885 — Multifamily 281 321 — Farmland 1,264 1,664 — Commercial 628 628 — Agriculture 12 12 — Consumer installment loans 8 8 — All other loans — — — With an allowance recorded: Real estate secured: Commercial 2,503 2,622 499 Construction and land development — — — Residential 1-4 family 421 437 91 Multifamily — — — Farmland 378 378 243 Commercial 489 572 413 Agriculture — — — Consumer installment loans — — — All other loans — — — Total $ 12,640 $ 13,926 $ 1,246
Summary of average impaired loans	The following table presents information concerning the Company’s average impaired loans and interest recognized on those impaired loans, for the periods indicated: Six Months Ended June 30, 2018 June 30, 2017 (Dollars are in thousands) Average Interest Average Interest With no related allowance recorded: Real estate secured: Commercial $ 2,746 $ 54 $ 3,136 $ 64 Construction and land development 246 — 3 — Residential 1-4 family 3,291 87 3,831 102 Multifamily 191 4 440 11 Farmland 1,430 42 2,884 26 Commercial 216 — — — Agriculture 5 — 19 1 Consumer installment loans 3 — 15 — All other loans — — — — With an allowance recorded: Real estate secured: Commercial 1,698 16 837 6 Construction and land development — — 228 — Residential 1-4 family 378 7 657 9 Multifamily — — 444 32 Farmland 371 — 694 16 Commercial 354 2 210 16 Agriculture — — 2 — Consumer installment loans 5 1 3 — All other loans — — — — Total $ 10,934 $ 213 $ 13,403 $ 283 Three Months Ended June 30, 2018 June 30, 2017 (Dollars are in thousands) Average Interest Average Interest With no related allowance recorded: Real estate secured: Commercial $ 2,796 $ 26 $ 2,886 $ 39 Construction and land development 158 — 2 — Residential 1-4 family 3,144 45 3,817 53 Multifamily 147 — 510 (1 ) Farmland 1,514 30 2,378 141 Commercial 10 — — — Agriculture 2 — 19 1 Consumer installment loans — — 9 — All other loans — — — — With an allowance recorded: Real estate secured: Commercial 1,296 — 660 4 Construction and land development — — 222 — Residential 1-4 family 357 3 708 — Multifamily — — 666 32 Farmland 368 — 746 11 Commercial 286 2 282 16 Agriculture — — 1 — Consumer installment loans 8 1 — — All other loans — — — — Total $ 10,086 $ 107 $ 12,906 $ 296
Summary of age analysis of past due loans receivable	An age analysis of past due loans receivable is below. At June 30, 2018 and December 31, 2017, there were no loans over 90 days past due that were accruing. As of June 30, 2018 Loans Loans Loans Total Current Total Real estate secured: Commercial $ 542 $ — $ 317 $ 859 $ 137,990 $ 138,849 Construction and land 32 18 42 92 27,519 27,611 Residential 1-4 family 2,251 514 618 3,383 246,946 250,329 Multifamily 276 — — 276 13,481 13,757 Farmland 527 — 245 772 21,431 22,203 Total real estate loans 3,628 532 1,222 5,382 447,367 452,749 Commercial — 110 — 110 47,924 48,034 Agriculture — — — — 4,487 4,487 Consumer installment 43 13 4 60 21,415 21,475 All other loans — — — — 634 634 Total loans $ 3,671 $ 655 $ 1,226 $ 5,552 $ 521,827 $ 527,379 As of December 31, 2017 Loans Loans Loans Total Current Total Real estate secured: Commercial $ 190 $ 2,396 $ 453 $ 3,039 $ 124,649 $ 127,688 Construction and land 69 246 42 357 29,406 29,763 Residential 1-4 family 3,789 378 969 5,136 244,023 249,159 Multifamily 125 89 — 214 15,267 15,481 Farmland 309 — — 309 22,689 22,998 Total real estate loans 4,482 3,109 1,464 9,055 436,034 445,089 Commercial 103 25 603 731 40,614 41,345 Agriculture 38 — — 38 3,456 3,494 Consumer installment 102 15 28 145 22,266 22,411 All other loans — — — — 669 669 Total loans $ 4,725 $ 3,149 $ 2,095 $ 9,969 $ 503,039 $ 513,008
Summary of risk category of loans receivable	Based on the most recent analysis performed, the risk category of loans receivable was as follows: As of June 30, 2018 Pass Special Substandard Total Real estate secured: Commercial $ 134,536 $ 2,023 $ 2,290 $ 138,849 Construction and land development 26,629 773 209 27,611 Residential 1-4 family 242,862 2,638 4,829 250,329 Multifamily 13,544 75 138 13,757 Farmland 18,709 1,632 1,862 22,203 Total real estate loans 436,280 7,141 9,328 452,749 Commercial 45,586 2,387 61 48,034 Agriculture 4,465 14 8 4,487 Consumer installment loans 21,440 — 35 21,475 All other loans 634 — — 634 Total $ 508,405 $ 9,542 $ 9,432 $ 527,379 As of December 31, 2017 Pass Special Substandard Total Real estate secured: Commercial $ 120,104 $ 3,228 $ 4,356 $ 127,688 Construction and land development 28,462 816 485 29,763 Residential 1-4 family 243,048 1,810 4,301 249,159 Multifamily 13,695 1,445 341 15,481 Farmland 19,273 2,445 1,280 22,998 Total real estate loans 424,582 9,744 10,763 445,089 Commercial 37,973 2,307 1,065 41,345 Agriculture 3,468 23 3 3,494 Consumer installment loans 22,357 2 52 22,411 All other loans 669 — — 669 Total $ 489,049 $ 12,076 11,883 $ 513,008

ALLOWANCE FOR LOAN LOSSES (Tabl

ALLOWANCE FOR LOAN LOSSES (Tables)	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
Summary of activity in the allowance for loan losses by portfolio segment	The following table details activity in the allowance for loan losses by portfolio segment for the period ended June 30, 2018. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. As of June 30, 2018 Beginning Charge Recoveries Provisions Ending Balance Real estate secured: Commercial $ 1,989 $ (334 ) $ 68 $ (218 ) $ 1,505 Construction and land development 191 (96 ) — 151 246 Residential 1-4 family 2,400 (167 ) 38 18 2,289 Multifamily 106 — — (7 ) 99 Farmland 415 (18 ) 60 (143 ) 314 Total real estate loans 5,101 (615 ) 166 (199 ) 4,453 Commercial 660 (597 ) 24 310 397 Agriculture 20 — 1 12 33 Consumer installment loans 156 (37 ) 24 (5 ) 138 All other loans 3 — — — 3 Unallocated 256 — — 8 264 Total $ 6,196 $ (1,249 ) $ 215 $ 126 $ 5,288 Allowance for Loan Losses Recorded Investment in Loans As of June 30, 2018 (Dollars are in thousands) Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Real estate secured: Commercial $ 43 $ 1,462 $ 1,505 $ 3,309 $ 135,540 $ 138,849 Construction and land development - 246 246 150 27,461 27,611 Residential 1-4 family 86 2,203 2,289 3,499 246,830 250,329 Multifamily - 99 99 81 13,676 13,757 Farmland 154 160 314 2,229 19,974 22,203 Total real estate loans 283 4,170 4,453 9,268 443,481 452,749 Commercial 12 385 397 118 47,916 48,034 Agriculture - 33 33 1 4,486 4,487 Consumer installment loans 1 137 138 7 21,468 21,475 All other loans - 3 3 - 634 634 Unallocated - 264 264 - - - Total $ 296 $ 4,992 $ 5,288 $ 9,394 $ 517,985 $ 527,379
Schedule of allocation of portion of allowance	The following table details activity in the allowance for loan losses by portfolio segment for the period ended December 31, 2017. Allocation of a portion of the allowance to one category of loans does not preclude its availability to absorb losses in other categories. As of December 31, 2017 Beginning Charge Recoveries Provisions Ending Balance Real estate secured: Commercial $ 1,625 $ (179 ) $ 193 $ 350 $ 1,989 Construction and land development 346 (1 ) — (154 ) 191 Residential 1-4 family 2,376 (714 ) 48 690 2,400 Multifamily 241 — — (135 ) 106 Farmland 428 (49 ) 361 (325 ) 415 Total real estate loans 5,016 (943 ) 602 426 5,101 Commercial 163 (11 ) 153 355 660 Agriculture 31 (4 ) 5 (12 ) 20 Consumer installment loans 123 (147 ) 19 161 156 All other loans — — — 3 3 Unallocated 739 — — (483 ) 256 Total $ 6,072 $ (1,105 ) $ 779 $ 450 $ 6,196 Allowance for Loan Losses Recorded Investment in Loans As of December 31, 2017 (Dollars are in thousands) Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Individually Evaluated for Impairment Collectively Evaluated for Impairment Total Real estate secured: Commercial $ 499 $ 1,490 $ 1,989 $ 5,149 $ 122,539 $ 127,688 Construction and land development - 191 191 424 29,339 29,763 Residential 1-4 family 91 2,309 2,400 4,007 245,152 249,159 Multifamily - 106 106 281 15,200 15,481 Farmland 243 172 415 1,642 21,356 22,998 Total real estate loans 833 4,268 5,101 11,503 433,586 445,089 Commercial 413 247 660 1,117 40,228 41,345 Agriculture - 20 20 12 3,482 3,494 Consumer installment loans - 156 156 8 22,403 22,411 All other loans - 3 3 - 669 669 Unallocated - 256 256 - - - Total $ 1,246 $ 4,950 6,196 $ 12,640 $ 500,368 $ 513,008

TROUBLED DEBT RESTRUCTURING (Ta

TROUBLED DEBT RESTRUCTURING (Tables)	6 Months Ended
	Jun. 30, 2018
Troubled Debt Restructurings
Schedule of loans modified as troubled debt restructurings	At June 30, 2018 there were 5.8 million in loans that are classified as troubled debt restructurings compared to $6.9 million at December 31, 2017. The following table presents information related to loans modified as troubled debt restructurings during the six and three months ended June 30, 2018 and 2017. For the six months ended June 30, 2018 For the six months ended June 30, 2017 Troubled Debt Restructurings (Dollars are in thousands) # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment Real estate secured: Commercial - $ - $ - - $ - $ - Construction and land Development - - - - - - Residential 1-4 family - - - - - - Multifamily - - - - - - Farmland - - - - - - Total real estate loans - - - - - - Commercial 1 443 443 Agriculture - - - - - - Consumer installment loans - - - - - - All other loans - - - - - - Total $ $ 1 $ 443 $ 443 For the three months ended June 30, 2018 For the three months ended June 30, 2017 Troubled Debt Restructurings (Dollars are in thousands) # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment # of Loans Pre-Mod. Recorded Investment Post-Mod. Recorded Investment Real estate secured: Commercial - $ - $ - - $ - $ - Construction and land Development - - - - - - Residential 1-4 family - - - - - - Multifamily - - - - - - Farmland - - - - - - Total real estate loans - - - - - - Commercial 1 443 443 Agriculture - - - - - - Consumer installment loans - - - - - - All other loans - - - - - - Total $ $ 1 $ 443 $ 443

OTHER REAL ESTATE OWNED (Tables

OTHER REAL ESTATE OWNED (Tables)	6 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
Schedule of other real estate	The following table summarizes the activity in other real estate owned for the six months ended June 30, 2018 and the year ended December 31, 2017: (Dollars are in thousands) June 30, December 31, 2017 Balance, beginning of period $ 6,859 $ 10,655 Additions 1,289 3,087 Transfers from premises and equipment — 125 Proceeds from sales (1,265 ) (4,742 ) Proceeds from insurance claims — (12 ) Loans made to finance sales — (1,477 ) Adjustment of carrying value (198 ) (758 ) Deferred gain from sales — 45 Losses from sales (111 ) (64 ) Balance, end of period $ 6,574 $ 6,859

FAIR VALUES (Tables)

FAIR VALUES (Tables)	6 Months Ended
	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Summary of assets and liabilities measured at fair value	Assets measured at fair value on a recurring basis are as follows. There were no liabilities measured at fair value on a recurring basis. (Dollars are in thousands) Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 U.S. Government Agencies $ — $ 21,586 $ — Taxable municipals — 4,277 — Corporate bonds — 5,378 — Mortgage backed securities — 32,754 — Total $ — $ 63,995 $ — December 31, 2017 U.S. Government Agencies $ — $ 23,844 $ — Taxable municipals — 4,397 — Corporate bonds — 5,579 — Mortgage backed securities — 37,268 — Total $ — $ 71,088 $ — Assets measured at fair value on a non-recurring basis are as follows (for purpose of this table the impaired loans are shown net of the related allowance). There were no liabilities measured at fair value on a non-recurring basis. (Dollars are in thousands) Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 Other real estate owned — — $ 6,574 Impaired loans — — 9,098 Total — — $ 15,672 December 31, 2017 Other real estate owned — — $ 6,859 Impaired loans — — 11,394 Total — — $ 18,253
Schedule of significant unobservable inputs in level 3 assets	(Dollars in thousands) Fair Value at June 30, 2018 Valuation Technique Significant Unobservable Inputs General Range of Significant Unobservable Input Values Impaired Loans $ 9,098 $ Appraised Value/Discounted Cash Flows/Market Value of Note Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell 0 – 18% Other Real Estate Owned $ 6,574 $ Appraised Value/Comparable Sales/Other Estimates from Independent Sources Discounts to reflect current market conditions and estimated costs to sell 0 – 18%
Estimated fair value of financial instruments	The remaining financial instruments were valued based on the present value of estimated future cash flows, discounted at various rates in effect for similar instruments. Fair Value Measurements (Dollars are in thousands) Carrying Fair Quoted market price in active markets Significant other observable inputs Significant unobservable inputs June 30, 2018 Financial Instruments – Assets Net Loans $ 522,091 $ 510,879 $ — $ 501,781 $ 9,098 Financial Instruments – Liabilities Time Deposits 257,585 257,482 — 257,482 — FHLB Advances 19,000 19,301 — 19,301 — Trust Preferred Securities 16,496 13,903 — 13,903 — December 31, 2017 Financial Instruments – Assets Net Loans $ 506,812 $ 506,608 $ — $ 495,214 $ 11,394 Financial Instruments– Liabilities Time Deposits 272,330 272,352 — 272,352 — FHLB Advances 7,558 7,794 — 7,794 — Trust Preferred Securities 16,496 16,496 — 16,496 —

NONINTEREST EXPENSES (Tables)

NONINTEREST EXPENSES (Tables)	6 Months Ended
	Jun. 30, 2018
Noninterest Expenses
NONINTEREST EXPENSES	Other operating expenses, included as part of noninterest expenses, consisted of the following for the periods presented: For the three months ended June 30, For the six months ended June 30, (Dollars are in thousands) 2018 2017 2018 2017 Advertising $ 114 $ 97 $ 261 $ 206 ATM network expense 450 428 842 831 Legal and professional fees 406 327 773 625 Loan related expenses 130 149 330 333 Printing and supplies 66 30 202 54 FDIC insurance premiums 84 110 181 212 Other real estate owned, net 113 753 360 1,053 Other 827 546 1,340 1,043 Total other operating expenses $ 2,190 $ 2,440 $ 4,289 $ 4,357

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Accounting Policies [Abstract]
Net income	$ (49)	$ 2,577	$ 31	$ 2,692
Weighted average shares outstanding	23,922,086	23,355,503	23,922,086	23,355,198
Weighted average dilutive shares outstanding	23,922,086	23,355,503	23,922,086	23,355,198
Basic income (loss) per share	$ 0	$ 0.11	$ 0	$ 0.12
Diluted income (loss) per share	$ 0	$ 0.11	$ 0	$ 0.12

CAPITAL_ (Details)

CAPITAL: (Details) - Bank - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Total Capital to Risk Weighted Assets, Actual, Amount	$ 69,208	$ 68,787
Total Capital to Risk Weighted Assets, Actual, Ratio	14.69%	15.30%
Total Capital to Risk Weighted Assets, Minimum Capital Requirement, Amount	$ 37,699	$ 35,970
Total Capital to Risk Weighted Assets, Minimum Capital Requirement, Ratio	8.00%	8.00%
Total Capital to Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 47,124	$ 44,962
Total Capital to Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	10.00%	10.00%
Tier 1 Capital Risk Weighted Assets, Actual, Amount	$ 63,920	$ 63,160
Tier 1 Capital Risk Weighted Assets, Actual, Ratio	13.56%	14.05%
Tier 1 Capital Risk Weighted Assets, Minimum Capital Requirement, Amount	$ 28,274	$ 26,977
Tier 1 Capital Risk Weighted Assets, Minimum Capital Requirement, Ratio	6.00%	6.00%
Tier 1 Capital Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 37,699	$ 35,970
Tier 1 Capital Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	8.00%	8.00%
Tier 1 Capital to Average Assets, Actual, Amount	$ 63,920	$ 63,160
Tier 1 Capital to Average Assets, Actual, Ratio	9.51%	9.56%
Tier 1 Capital to Average Assets, Minimum Capital Requirement, Amount	$ 26,895	$ 26,422
Tier 1 Capital to Average Assets, Minimum Capital Requirement, Ratio	4.00%	4.00%
Tier 1 Capital to Average Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 33,619	$ 33,028
Tier 1 Capital to Average Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	5.00%	5.00%
Common Equity Tier 1 Capital to Risk Weighted Assets, Actual, Amount	$ 63,920	$ 63,160
Common Equity Tier 1 Capital to Risk Weighted Assets, Actual, Ratio	13.56%	14.05%
Common Equity Tier 1 Capital to Risk Weighted Assets, Minimum Capital Requirement, Amount	$ 21,206	$ 20,233
Common Equity Tier 1 Capital to Risk Weighted Assets, Minimum Capital Requirement, Ratio	4.50%	4.50%
Common Equity Tier 1 Capital to Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 30,631	$ 29,225
Common Equity Tier 1 Capital to Risk Weighted Assets, Minimum to Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	6.50%	6.50%

INVESTMENT SECURITIES (Details)

INVESTMENT SECURITIES (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Amortized Cost	$ 65,994	$ 71,839
Gross Unrealized Gains	95	259
Gross Unrealized Losses	(2,094)	(1,010)
Approximate Fair Value	63,995	71,088
US Government Agencies [Member]
Amortized Cost	22,022	23,986
Gross Unrealized Gains	8	79
Gross Unrealized Losses	(444)	(221)
Approximate Fair Value	21,586	23,844
Taxable Municipals
Amortized Cost	4,447	4,466
Gross Unrealized Gains		9
Gross Unrealized Losses	(170)	(78)
Approximate Fair Value	4,277	4,397
Corporate Bonds
Amortized Cost	5,430	5,437
Gross Unrealized Gains	86	168
Gross Unrealized Losses	(138)	(26)
Approximate Fair Value	5,378	5,579
Mortgage Backed Securities [Member]
Amortized Cost	34,095	37,950
Gross Unrealized Gains	1	3
Gross Unrealized Losses	(1,342)	(685)
Approximate Fair Value	$ 32,754	$ 37,268

INVESTMENT SECURITIES_ (Details

INVESTMENT SECURITIES: (Details 1) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Dec. 31, 2017	Jun. 30, 2018
Fair Value, Less than 12 Months	$ 26,470	$ 26,737
Unrealized Losses, Less than 12 Months	(284)	(749)
Fair Value, 12 Months or More	29,456	31,814
Unrealized Losses, 12 Months or More	(726)	(1,345)
Fair Value, Total	55,926	58,551
Unrealized Losses, Total	(1,010)	(2,094)
US Government Agencies [Member]
Fair Value, Less than 12 Months	7,840	9,751
Unrealized Losses, Less than 12 Months	(69)	(132)
Fair Value, 12 Months or More	7,189	9,433
Unrealized Losses, 12 Months or More	(152)	(312)
Fair Value, Total	15,029	19,184
Unrealized Losses, Total	(221)	(444)
Taxable Municipals
Fair Value, Less than 12 Months	2,403	3,527
Unrealized Losses, Less than 12 Months	(44)	(120)
Fair Value, 12 Months or More	767	750
Unrealized Losses, 12 Months or More	(34)	(50)
Fair Value, Total	3,170	4,277
Unrealized Losses, Total	(78)	(170)
Corporate Bonds
Fair Value, Less than 12 Months	1,507	2,393
Unrealized Losses, Less than 12 Months	(26)	(138)
Fair Value, 12 Months or More
Unrealized Losses, 12 Months or More
Fair Value, Total	1,507	2,393
Unrealized Losses, Total	(26)	(138)
Mortgage Backed Securities [Member]
Fair Value, Less than 12 Months	14,720	11,066
Unrealized Losses, Less than 12 Months	(145)	(359)
Fair Value, 12 Months or More	21,500	21,631
Unrealized Losses, 12 Months or More	(540)	(983)
Fair Value, Total	36,220	32,697
Unrealized Losses, Total	$ (685)	$ (1,342)

INVESTMENT SECURITIES_ (Detai36

INVESTMENT SECURITIES: (Details 2) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Investment Securities Activity
Due in one year or less, Amortized Cost	$ 1
Due after one year through five years, Amortized Cost	3,932
Due after five years through ten years, Amortized Cost	15,524
Due after ten years, Amortized Cost	46,537
Amortized Cost, Total	65,994	$ 71,839
Due in one year or less, Fair Value	1
Due after one year through five years, Fair Value	3,816
Due after five years through ten years, Fair Value	15,206
Due after ten years, Fair Value	44,972
Approximate Fair Value	$ 63,995	$ 71,088
Due in one year or less, Weighted Average Yield
Due after one year through five years, Weighted Average Yield	1.93%
Due after five years through ten years, Weighted Average Yield	3.26%
Due after ten years, Weighted Average Yield	2.38%
Weighted Average Yield, Total	2.56%

LOANS_ (Details)

LOANS: (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Total loans and leases	$ 527,379	$ 513,008
Real Estate [Member]
Total loans and leases	452,749	445,089
Commercial [Member]
Total loans and leases	48,034	41,345
Commercial [Member] | Real Estate [Member]
Total loans and leases	138,849	127,688
Construction and Land Development | Real Estate [Member]
Total loans and leases	27,611	29,763
Residential 1-4 Family | Real Estate [Member]
Total loans and leases	250,329	249,159
Multifamily | Real Estate [Member]
Total loans and leases	13,757	15,481
Farmland | Real Estate [Member]
Total loans and leases	22,203	22,998
Commercial Real Estate [Member]
Total loans and leases	48,034	41,345
Agriculture
Total loans and leases	4,487	3,494
Consumer Installment Loans
Total loans and leases	21,475	22,411
Other Loans
Total loans and leases	$ 634	$ 669

LOANS_ (Details 1)

LOANS: (Details 1) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Total loans receivable on nonaccrual status	$ 6,442	$ 7,564
Real Estate [Member]
Total loans receivable on nonaccrual status	6,426	6,448
Consumer Installment Loans
Total loans receivable on nonaccrual status	16	48
Commercial Real Estate [Member]
Total loans receivable on nonaccrual status		1,065
Commercial [Member] | Real Estate [Member]
Total loans receivable on nonaccrual status	1,832	2,035
Construction and Land Development | Real Estate [Member]
Total loans receivable on nonaccrual status	196	470
Residential 1-4 Family | Real Estate [Member]
Total loans receivable on nonaccrual status	3,265	2,991
Multifamily | Real Estate [Member]
Total loans receivable on nonaccrual status	81	152
Farmland | Real Estate [Member]
Total loans receivable on nonaccrual status	1,052	800
Agriculture
Total loans receivable on nonaccrual status		$ 3

LOANS_ (Details 2)

LOANS: (Details 2) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Recorded Investment	$ 9,394	$ 12,640
Unpaid Principal Balance	9,774	13,926
Related Allowance	296	1,246
Impaired Financing Receivables With Related Allowance [Member] | Commercial Real Estate [Member] | Real Estate [Member]
Recorded Investment	545	2,503
Unpaid Principal Balance	545	2,622
Related Allowance	43	499
Impaired Financing Receivables With Related Allowance [Member] | Residential 1-4 Family | Real Estate [Member]
Recorded Investment	355	421
Unpaid Principal Balance	355	437
Related Allowance	86	91
Impaired Financing Receivables With Related Allowance [Member] | Farmland | Real Estate [Member]
Recorded Investment	368	378
Unpaid Principal Balance	368	378
Related Allowance	154
Impaired Financing Receivables With Related Allowance [Member] | Other Loans
Related Allowance
Impaired Financing Receivables With Related Allowance [Member] | Consumer Installment Loans
Recorded Investment	7
Unpaid Principal Balance	7
Related Allowance	1
Impaired Financing Receivables With Related Allowance [Member] | Commercial Real Estate [Member]
Recorded Investment	111	489
Unpaid Principal Balance	111	572
Related Allowance	12	413
Impaired Financing Receivables With No Related Allowance [Member] | Commercial Real Estate [Member]
Recorded Investment	7	628
Unpaid Principal Balance	7	628
Impaired Financing Receivables With No Related Allowance [Member] | Commercial Real Estate [Member] | Real Estate [Member]
Recorded Investment	2,764	2,646
Unpaid Principal Balance	2,817	2,719
Impaired Financing Receivables With No Related Allowance [Member] | Construction and Land Development | Real Estate [Member]
Recorded Investment	150	424
Unpaid Principal Balance	348	680
Impaired Financing Receivables With No Related Allowance [Member] | Residential 1-4 Family | Real Estate [Member]
Recorded Investment	3,144	3,586
Unpaid Principal Balance	3,206	3,885
Impaired Financing Receivables With No Related Allowance [Member] | Multifamily | Real Estate [Member]
Recorded Investment	81	281
Unpaid Principal Balance	122	321
Impaired Financing Receivables With No Related Allowance [Member] | Farmland | Real Estate [Member]
Recorded Investment	1,861	1,264
Unpaid Principal Balance	1,887	1,664
Impaired Financing Receivables With No Related Allowance [Member] | Consumer Installment Loans
Recorded Investment		8
Unpaid Principal Balance		8
Impaired Financing Receivables With No Related Allowance [Member] | Agriculture
Recorded Investment	1	12
Unpaid Principal Balance	$ 1	$ 12

LOANS_ (Details 3)

LOANS: (Details 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Impaired loans without a valuation allowance:
Average Recorded Investment		$ 12,906	$ 10,934	$ 13,403
Interest Income Recognized		296	213	283
Consumer Installment Loans | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		9	3	15
Impaired loans with valuation allowance:
Average Recorded Investment			5
Consumer Installment Loans | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans with valuation allowance:
Average Recorded Investment	$ 8			3
Interest Income Recognized	1
Commercial Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	2,796		2,746
Interest Income Recognized	26		54
Impaired loans with valuation allowance:
Average Recorded Investment	1,296	282	1,698	694
Interest Income Recognized		16	16
Agriculture | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		19		19
Interest Income Recognized		1		1
Agriculture | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	2		5
Impaired loans with valuation allowance:
Average Recorded Investment		1		2
Commercial Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	10		216
Impaired loans with valuation allowance:
Average Recorded Investment	286		354
Interest Income Recognized	2
Commercial Real Estate [Member] | Real Estate [Member] | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		2,886		3,136
Interest Income Recognized		39		64
Commercial Real Estate [Member] | Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans with valuation allowance:
Average Recorded Investment		660		837
Interest Income Recognized		4		6
Construction and Land Development | Real Estate [Member] | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		2		3
Construction and Land Development | Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	158		246
Impaired loans with valuation allowance:
Average Recorded Investment		222		228
Residential 1-4 Family | Real Estate [Member] | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		3,817		3,831
Interest Income Recognized		53		102
Residential 1-4 Family | Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	3,144		3,291
Interest Income Recognized	45		87
Impaired loans with valuation allowance:
Average Recorded Investment	357	708	378	657
Interest Income Recognized	3		7
Multifamily | Real Estate [Member] | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		510		440
Interest Income Recognized		(1)		11
Impaired loans with valuation allowance:
Average Recorded Investment		666		444
Interest Income Recognized		32		32
Multifamily | Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	147		191
Interest Income Recognized			4
Impaired loans with valuation allowance:
Average Recorded Investment		666		9
Interest Income Recognized		32
Farmland | Real Estate [Member] | Impaired Financing Receivables With No Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment		2,378		2,884
Interest Income Recognized		141		26
Farmland | Real Estate [Member] | Impaired Financing Receivables With Related Allowance [Member]
Impaired loans without a valuation allowance:
Average Recorded Investment	1,514		1,430
Interest Income Recognized	$ 30		1,430
Impaired loans with valuation allowance:
Average Recorded Investment		746	$ 371	694
Interest Income Recognized		$ 11		$ 16

LOANS_ (Details 4)

LOANS: (Details 4) - USD ($) $ in Thousands	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017
Loans 30-59 Days Past Due	$ 3,671	$ 5,565	$ 4,725
Loans 60-89 Days Past Due	655	800	3,149
Loans 90 or More Days Past Due	1,226	1,175	2,095
Total Past Due Loans	5,552	7,540	9,969
Current Loans	521,827	$ 508,823	503,039
Total loans and leases	527,379		513,008
Real Estate [Member]
Loans 30-59 Days Past Due	3,628		4,482
Loans 60-89 Days Past Due	532		3,109
Loans 90 or More Days Past Due	1,222		1,464
Total Past Due Loans	5,382		9,055
Current Loans	447,367		436,034
Total loans and leases	452,749		445,089
Commercial [Member]
Total loans and leases	48,034		41,345
Commercial [Member] | Real Estate [Member]
Loans 30-59 Days Past Due	542		190
Loans 60-89 Days Past Due			2,396
Loans 90 or More Days Past Due	317		453
Total Past Due Loans	859		3,039
Current Loans	137,990		124,649
Total loans and leases	138,849		127,688
Construction and Land Development | Real Estate [Member]
Loans 30-59 Days Past Due	32		69
Loans 60-89 Days Past Due	18		246
Loans 90 or More Days Past Due	42		42
Total Past Due Loans	92		357
Current Loans	27,519		29,406
Total loans and leases	27,611		29,763
Residential 1-4 Family | Real Estate [Member]
Loans 30-59 Days Past Due	2,251		3,789
Loans 60-89 Days Past Due	514		378
Loans 90 or More Days Past Due	618		969
Total Past Due Loans	3,383		5,136
Current Loans	246,946		244,023
Total loans and leases	250,329		249,159
Multifamily | Real Estate [Member]
Loans 30-59 Days Past Due	276		125
Loans 60-89 Days Past Due			89
Total Past Due Loans	276		214
Current Loans	13,481		15,267
Total loans and leases	13,757		15,481
Farmland | Real Estate [Member]
Loans 30-59 Days Past Due	527		309
Loans 90 or More Days Past Due	245
Total Past Due Loans	772		309
Current Loans	21,431		22,689
Total loans and leases	22,203		22,998
Commercial Real Estate [Member]
Loans 30-59 Days Past Due			103
Loans 60-89 Days Past Due	110		25
Loans 90 or More Days Past Due			603
Total Past Due Loans	110		731
Current Loans	47,924		40,614
Total loans and leases	48,034		41,345
Consumer Installment Loans
Loans 30-59 Days Past Due	43		102
Loans 60-89 Days Past Due	13		15
Loans 90 or More Days Past Due	4		28
Total Past Due Loans	60		145
Current Loans	21,415		22,266
Total loans and leases	21,475		22,411
Agriculture
Loans 30-59 Days Past Due			38
Total Past Due Loans			38
Current Loans	4,487		3,456
Total loans and leases	4,487		3,494
Other Loans
Current Loans	634		669
Total loans and leases	$ 634		$ 669

LOANS (Details 5)

LOANS (Details 5) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Total	$ 527,379	$ 513,008
Substandard
Total	9,432	11,883
Special Mention
Total	9,542	12,076
Pass
Total	508,405	489,049
Real Estate [Member] | Substandard
Total	9,328	10,763
Real Estate [Member] | Special Mention
Total	7,141	9,744
Real Estate [Member] | Pass
Total	436,280	424,582
Real Estate [Member]
Total	452,749	445,089
Commercial [Member]
Total	48,034	41,345
Commercial [Member] | Real Estate [Member]
Total	138,849	127,688
Construction and Land Development | Real Estate [Member] | Substandard
Total	209	485
Construction and Land Development | Real Estate [Member] | Special Mention
Total	773	816
Construction and Land Development | Real Estate [Member] | Pass
Total	26,629	28,462
Construction and Land Development | Real Estate [Member]
Total	27,611	29,763
Residential 1-4 Family | Real Estate [Member] | Substandard
Total	4,829	4,301
Residential 1-4 Family | Real Estate [Member] | Special Mention
Total	2,638	1,810
Residential 1-4 Family | Real Estate [Member] | Pass
Total	242,862	243,048
Residential 1-4 Family | Real Estate [Member]
Total	250,329	249,159
Consumer Installment Loans
Total	21,475	22,411
Consumer Installment Loans | Substandard
Total	35	52
Consumer Installment Loans | Special Mention
Total		2
Consumer Installment Loans | Pass
Total	21,440	22,357
Commercial Portfolio Segment [Member] | Substandard
Total	61	1,065
Commercial Portfolio Segment [Member] | Special Mention
Total	2,387	2,307
Commercial Portfolio Segment [Member] | Pass
Total	134,536	37,973
Commercial Portfolio Segment [Member] | Real Estate [Member] | Substandard
Total	2,290	4,356
Commercial Portfolio Segment [Member] | Real Estate [Member] | Special Mention
Total	2,023	3,228
Commercial Portfolio Segment [Member] | Real Estate [Member] | Pass
Total	134,536	120,104
Multifamily | Real Estate [Member] | Substandard
Total	138	341
Multifamily | Real Estate [Member] | Special Mention
Total	75	1,445
Multifamily | Real Estate [Member] | Pass
Total	13,544	13,695
Multifamily | Real Estate [Member]
Total	13,757	15,481
Farmland | Real Estate [Member] | Substandard
Total	1,862	1,280
Farmland | Real Estate [Member] | Special Mention
Total	1,632	2,445
Farmland | Real Estate [Member] | Pass
Total	18,709	19,273
Farmland | Real Estate [Member]
Total	22,203	22,998
Agriculture
Total	4,487	3,494
Agriculture | Substandard
Total		3
Agriculture | Special Mention
Total	14	23
Agriculture | Pass
Total	4,465	3,468
Other Loans
Total	634	669
Other Loans | Pass
Total		669
Commercial Real Estate [Member]
Total	$ 48,034	$ 41,345

ALLOWANCE FOR LOAN LOSSES_ (Det

ALLOWANCE FOR LOAN LOSSES: (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Balance, beginning of year	$ 6,196	$ 6,072
Charge Offs	(1,249)	(1,105)
Recoveries	215	779
Provision for loan losses	126	450
Balance, End of period	5,288	6,196
Commercial Real Estate [Member]
Balance, beginning of year	660	163
Charge Offs	(597)	(11)
Recoveries	24	153
Provision for loan losses	310	355
Balance, End of period	397	660
Unallocated
Balance, beginning of year	256	739
Charge Offs
Provision for loan losses	8	(483)
Balance, End of period	264	256
Agriculture
Balance, beginning of year	20	31
Charge Offs		(4)
Recoveries	1	5
Provision for loan losses	12	(12)
Balance, End of period	33	20
Consumer Installment Loans
Balance, beginning of year	156	123
Charge Offs	(37)	(147)
Recoveries	24	19
Provision for loan losses	(5)	161
Balance, End of period	138	156
Other Loans
Balance, beginning of year	3
Charge Offs
Provision for loan losses		3
Balance, End of period	3	3
Real Estate [Member]
Balance, beginning of year	5,101
Charge Offs	(615)	(943)
Recoveries	166	602
Provision for loan losses	(199)	426
Balance, End of period		5,101
Real Estate [Member] | Commercial Real Estate [Member]
Balance, beginning of year	1,989	163
Charge Offs	(334)	(179)
Recoveries	68	193
Provision for loan losses	(218)	350
Balance, End of period	1,505	1,989
Real Estate [Member] | Construction and Land Development
Balance, beginning of year	191	5,016
Charge Offs	(96)	(1)
Provision for loan losses	151	(154)
Balance, End of period	246	191
Real Estate [Member] | Residential 1-4 Family
Balance, beginning of year	2,400	5,016
Charge Offs	(167)	(714)
Recoveries	38	48
Provision for loan losses	18	690
Balance, End of period	2,289	2,400
Real Estate [Member] | Multifamily
Balance, beginning of year	106	5,016
Charge Offs
Provision for loan losses	(7)	(135)
Balance, End of period	99	106
Real Estate [Member] | Farmland
Balance, beginning of year	415	5,016
Charge Offs	(18)	(49)
Recoveries	60	361
Provision for loan losses	(143)	(325)
Balance, End of period	$ 314	$ 415

ALLOWANCE FOR LOAN LOSSES (Deta

ALLOWANCE FOR LOAN LOSSES (Details 1) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017	Dec. 31, 2016
Allowance for Loan Losses, Individually Evaluated for Impairment	$ 296	$ 1,246
Allowance for Loan Losses, Collectively Evaluated for Impairment	4,992	4,950
Allowance for loan losses	5,288	6,196	$ 6,072
Recorded Investment in Loans, Individually Evaluated for Impairment	9,394	12,640
Recorded Investment in Loans, Collectively Evaluated for Impairment	517,985	500,368
Recorded Investment in Loans, Total	527,379	513,008
Real Estate [Member]
Allowance for Loan Losses, Individually Evaluated for Impairment	283	833
Allowance for Loan Losses, Collectively Evaluated for Impairment	4,170	4,268
Allowance for loan losses	4,453	5,101
Recorded Investment in Loans, Individually Evaluated for Impairment	9,268	11,503
Recorded Investment in Loans, Collectively Evaluated for Impairment	443,481	433,586
Recorded Investment in Loans, Total	452,749	445,089
Commercial [Member]
Recorded Investment in Loans, Total	48,034	41,345
Commercial [Member] | Real Estate [Member]
Allowance for Loan Losses, Individually Evaluated for Impairment	43	499
Allowance for Loan Losses, Collectively Evaluated for Impairment	1,462	1,490
Allowance for loan losses	1,505	1,989
Recorded Investment in Loans, Individually Evaluated for Impairment	3,309	5,149
Recorded Investment in Loans, Collectively Evaluated for Impairment	135,540	122,539
Recorded Investment in Loans, Total	138,849	127,688
Unallocated
Allowance for Loan Losses, Collectively Evaluated for Impairment	264	256
Allowance for loan losses	264	256	739
Construction and Land Development | Real Estate [Member]
Allowance for Loan Losses, Collectively Evaluated for Impairment	246	191
Allowance for loan losses	246	191
Recorded Investment in Loans, Individually Evaluated for Impairment	150	424
Recorded Investment in Loans, Collectively Evaluated for Impairment	27,461	29,339
Recorded Investment in Loans, Total	27,611	29,763
Residential 1-4 Family | Real Estate [Member]
Allowance for Loan Losses, Individually Evaluated for Impairment	86	91
Allowance for Loan Losses, Collectively Evaluated for Impairment	2,203	2,309
Allowance for loan losses	2,289	2,400
Recorded Investment in Loans, Individually Evaluated for Impairment	3,499	4,007
Recorded Investment in Loans, Collectively Evaluated for Impairment	246,830	245,152
Recorded Investment in Loans, Total	250,329	249,159
Multifamily | Real Estate [Member]
Allowance for Loan Losses, Collectively Evaluated for Impairment	99	106
Allowance for loan losses	99	106
Recorded Investment in Loans, Individually Evaluated for Impairment	81	281
Recorded Investment in Loans, Collectively Evaluated for Impairment	13,676	15,200
Recorded Investment in Loans, Total	13,757	15,481
Farmland | Real Estate [Member]
Allowance for Loan Losses, Individually Evaluated for Impairment	154	243
Allowance for Loan Losses, Collectively Evaluated for Impairment	160	172
Allowance for loan losses	314	415
Recorded Investment in Loans, Individually Evaluated for Impairment	2,229	1,642
Recorded Investment in Loans, Collectively Evaluated for Impairment	19,974	21,356
Recorded Investment in Loans, Total	22,203	22,998
Commercial Real Estate [Member]
Allowance for Loan Losses, Individually Evaluated for Impairment	12	413
Allowance for Loan Losses, Collectively Evaluated for Impairment	385	247
Allowance for loan losses	397	660	163
Recorded Investment in Loans, Individually Evaluated for Impairment	118	1,117
Recorded Investment in Loans, Collectively Evaluated for Impairment	47,916	40,228
Recorded Investment in Loans, Total	48,034	41,345
Agriculture
Allowance for Loan Losses, Collectively Evaluated for Impairment	33	20
Allowance for loan losses	33	20	31
Recorded Investment in Loans, Individually Evaluated for Impairment	1	12
Recorded Investment in Loans, Collectively Evaluated for Impairment	4,486	3,482
Recorded Investment in Loans, Total	4,487	3,494
Consumer Installment Loans
Allowance for Loan Losses, Individually Evaluated for Impairment	1
Allowance for Loan Losses, Collectively Evaluated for Impairment	137	156
Allowance for loan losses	138	156	$ 123
Recorded Investment in Loans, Individually Evaluated for Impairment	7	8
Recorded Investment in Loans, Collectively Evaluated for Impairment	21,468	22,403
Recorded Investment in Loans, Total	21,475	22,411
Other Loans
Allowance for Loan Losses, Collectively Evaluated for Impairment	3	3
Allowance for loan losses	3	3
Recorded Investment in Loans, Collectively Evaluated for Impairment	634	669
Recorded Investment in Loans, Total	$ 634	$ 669

TROUBLED DEBT RESTRUCTURINGS (D

TROUBLED DEBT RESTRUCTURINGS (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2017USD ($)loans	Jun. 30, 2017USD ($)loans
# of Loans | loans	1	1
Pre-Mod. Recorded Investment	$ 443	$ 443
Post-Mod. Recorded Investment	$ 443	$ 443
Commercial [Member]
# of Loans | loans	1	1
Pre-Mod. Recorded Investment	$ 443	$ 443
Post-Mod. Recorded Investment	$ 443	$ 443

TROUBLED DEBT RESTRUCTURINGS 46

TROUBLED DEBT RESTRUCTURINGS (Details Narrative)	6 Months Ended
	Jun. 30, 2018
Notes to Financial Statements
Period loan is considered to be in default, days	90 days

OTHER REAL ESTATE OWNED (Detail

OTHER REAL ESTATE OWNED (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Real Estate [Abstract]
Balance, beginning of year	$ 6,859	$ 10,655
Additions	1,289	3,087
Transfers from premises and equipment		125
Proceeds from sales	(1,265)	(4,742)
Proceeds from insurance claims		(12)
Loans made to finance sales		(1,477)
Adjustment of carrying value	(198)	(758)
Deferred gain from sales		45
Losses from sales	(111)	(64)
Balance, end of year	$ 6,574	$ 6,859

FAIR VALUES (Details)

FAIR VALUES (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Fair Value, Measurements, Recurring [Member]
Available for sale investments		$ 71,088
Nonrecurring Basis [Member]
Total	$ 15,672	18,253
Fair Value, Inputs, Level 2 [Member]
Available for sale investments	63,995
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | US Government Agencies [Member]
Available for sale investments	21,586	23,844
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Taxable Municipals [Default Label]
Available for sale investments	4,277	4,397
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Corporate Bond Securities [Member]
Available for sale investments	5,378	5,579
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Mortgage Backed Securities [Member]
Available for sale investments	32,754	37,268
Fair Value, Inputs, Level 3 [Member]
Other real estate owned	6,574	6,859
Impaired Loans	$ 9,098	$ 11,394

FAIR VALUES (Details 1)

FAIR VALUES (Details 1) $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)
Impaired Loans
Fair Value	$ 9,098
Valuation Technique	Appraised Value/Discounted Cash Flows/Market Value of Note
Significant Unobservable Inputs	Discounts to reflect current market conditions, ultimate collectability, and estimated costs to sell
Impaired Loans | Minimum [Member]
General Range of Significant Unobservable Input Values	0.00%
Impaired Loans | Maximum [Member]
General Range of Significant Unobservable Input Values	18.00%
Other Real Estate Owned
Fair Value	$ 6,574
Valuation Technique	Appraised Value/Comparable Sales/Other Estimates from Independent Sources
Significant Unobservable Inputs	Discounts to reflect current market conditions and estimated costs to sell
Other Real Estate Owned | Minimum [Member]
General Range of Significant Unobservable Input Values	0.00%
Other Real Estate Owned | Maximum [Member]
General Range of Significant Unobservable Input Values	0.18%

FAIR VALUES (Details 2)

FAIR VALUES (Details 2) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Net Loans	$ 522,091	$ 506,812
Fair Value, Estimate Not Practicable, Carrying (Reported) Amount [Member]
Net Loans	522,091	506,812
Time deposits	257,585	272,330
FHLB advances	19,000	7,558
Trust Preferred Securities	16,496	16,496
Fair Value, Measurements, Recurring [Member]
Net Loans	510,879	506,608
Time deposits	257,482	272,352
FHLB advances	19,301	7,794
Trust Preferred Securities	13,903	16,496
Fair Value, Inputs, Level 2 [Member]
Net Loans	501,781	495,214
Time deposits	257,482	272,352
FHLB advances	19,301	7,794
Trust Preferred Securities	13,903	16,496
Fair Value, Inputs, Level 3 [Member]
Net Loans	$ 9,098	$ 11,394

NONINTEREST EXPENSES (Details)

NONINTEREST EXPENSES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Noninterest Expenses Details
Advertising	$ 114	$ 97	$ 261	$ 206
ATM network expense	450	428	842	831
Legal and professional fees	406	327	773	625
Loan related expenses	130	149	330	333
Printing and supplies	66	30	202	54
FDIC insurance premiums	84	110	181	212
Other real estate owned, net	113	753	360	1,053
Other	827	546	1,340	1,043
Total other operating expenses	$ 2,190	$ 2,440	$ 4,289	$ 4,357