First Western Financial (MYFW) 10-Q 8 Aug 19 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Aug. 06, 2019
Document And Entity Information Abstract
Entity Registrant Name	First Western Financial Inc
Entity Central Index Key	0001327607
Document Type	10-Q
Document Period End Date	Jun. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		7,983,866
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Cash and cash equivalents:
Cash and due from banks	$ 1,974	$ 1,574
Interest-bearing deposits in other financial institutions	90,795	71,783
Total cash and cash equivalents	92,769	73,357
Available-for-sale securities	51,698	43,695
Correspondent bank stock, at cost	1,649	2,488
Mortgage loans held for sale	36,269	14,832
Loans, net of allowance of $7,575 and $7,451	931,820	886,515
Premises and equipment, net	5,683	6,100
Accrued interest receivable	3,184	2,844
Accounts receivable	4,718	4,492
Other receivables	872	1,391
Other real estate owned, net	658	658
Goodwill	23,239	24,811
Other intangible assets, net	88	402
Deferred tax assets, net	4,607	4,306
Company-owned life insurance	14,898	14,709
Other assets	18,313	3,724
Total assets	1,190,465	1,084,324
Deposits:
Noninterest-bearing	229,266	202,856
Interest-bearing	775,911	734,902
Total deposits	1,005,177	937,758
Borrowings:
Federal Home Loan Bank Topeka borrowings	36,060	15,000
Subordinated Notes	6,560	6,560
Accrued interest payable	274	231
Other liabilities	20,237	7,900
Total liabilities	1,068,308	967,449
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preferred stock - no par value; 1,000,000 shares authorized; 0 issued and outstanding
Convertible preferred stock - no par value; 150,000 shares authorized; 0 shares issued and outstanding
Common stock - no par value; 10,000,000 shares authorized; 7,983,866 and 7,968,420 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively
Additional paid-in capital	142,095	141,359
Accumulated deficit	(19,933)	(23,199)
Accumulated other comprehensive loss	(5)	(1,285)
Total shareholders’ equity	122,157	116,875
Total liabilities and shareholders’ equity	$ 1,190,465	$ 1,084,324

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Allowance for loans	$ 7,575	$ 7,451
Preferred Stock, par value (in dollars per share)	$ 0	$ 0
Preferred Stock, shares authorized	1,000,000	1,000,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0
Common Stock, par value (in dollars per share)	$ 0	$ 0
Common Stock, shares authorized	10,000,000	10,000,000
Common Stock, shares issued	7,983,866	7,968,420
Common Stock, shares outstanding	7,983,866	7,968,420
Series D
Preferred Stock, par value (in dollars per share)	$ 0	$ 0
Preferred Stock, shares authorized	150,000	150,000
Preferred Stock, shares issued	0	0
Preferred Stock, shares outstanding	0	0

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Interest and dividend income:
Loans, including fees	$ 10,600	$ 9,074	$ 20,818	$ 17,676
Investment securities	331	281	641	558
Federal funds sold and other	243	150	765	277
Total interest and dividend income	11,174	9,505	22,224	18,511
Interest expense:
Deposits	2,995	1,411	5,904	2,571
Other borrowed funds	219	517	389	1,003
Total interest expense	3,214	1,928	6,293	3,574
Net interest income	7,960	7,577	15,931	14,937
Less: (recovery of) provision for credit losses	(78)		116	(187)
Net interest income, after (recovery of) provision for credit losses	8,038	7,577	15,815	15,124
Non-interest income:
Trust and investment management fees	4,693	4,689	9,363	9,643
Net gain on mortgage loans sold	3,262	1,359	4,718	2,610
Bank fees	341	455	630	1,065
Risk management and insurance fees	194	284	662	667
Income on company-owned life insurance	96	105	189	199
Total non-interest income	8,586	6,892	15,562	14,184
Total income before non-interest expense	16,624	14,469	31,377	29,308
Non-interest expense:
Salaries and employee benefits	7,699	7,660	15,317	15,840
Occupancy and equipment	1,398	1,527	2,805	3,012
Professional services	1,036	1,008	1,813	1,832
Technology and information systems	1,016	1,000	2,085	2,063
Data processing	742	687	1,429	1,327
Marketing	441	316	719	601
Amortization of other intangible assets	142	230	315	460
Goodwill impairment	1,572		1,572
Other	613	656	1,206	1,235
Total non-interest expense	14,659	13,084	27,261	26,370
Income before income taxes	1,965	1,385	4,116	2,938
Income tax expense	561	337	1,085	704
Net income	1,404	1,048	3,031	2,234
Preferred stock dividends		(562)		(1,123)
Net income available to common shareholders	$ 1,404	$ 486	$ 3,031	$ 1,111
Earnings per common share:
Basic	$ 0.18	$ 0.08	$ 0.39	$ 0.19
Diluted	$ 0.18	$ 0.08	$ 0.39	$ 0.19

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 1,404	$ 1,048	$ 3,031	$ 2,234
Other comprehensive income (loss) items:
Net change in unrealized gains (losses) on available-for-sale securities	981	(140)	2,043	(846)
Income tax effects	(253)	192	(528)	173
Total other comprehensive income (loss)	728	52	1,515	(673)
Comprehensive income	$ 2,132	$ 1,100	$ 4,546	$ 1,561

CONSOLIDATED STATEMENTS OF SHAR

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands	Preferred Stock	Convertible Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (loss)	Total
Balance at Beginning at Dec. 31, 2017				$ 130,070	$ (27,296)	$ (928)	$ 101,846
Balance at Beginning (in shares) at Dec. 31, 2017	20,868	41,000	5,833,456
Increase (Decrease) in Stockholders' Equity
Net income					2,234		2,234
Issuance of common stock, net of issuance costs				1,909			1,909
Issuance of common stock (in shares)			67,242
Reclassification of unrealized loss on equity securities					(41)	41
Other comprehensive loss, net of tax						(714)	(714)
Settlement of share awards				(181)			(181)
Settlement of share awards (in shares)			16,969
Stock-based compensation				987			987
Preferred stock dividends					(1,123)		(1,123)
Balance at Ending at Jun. 30, 2018				132,785	(26,226)	(1,601)	104,958
Balance at Ending (in shares) at Jun. 30, 2018	20,868	41,000	5,917,667
Balance at Beginning at Mar. 31, 2018				132,520	(26,712)	(1,653)	104,155
Balance at Beginning (in shares) at Mar. 31, 2018	20,868	41,000	5,900,698
Increase (Decrease) in Stockholders' Equity
Net income					1,048		1,048
Issuance of common stock, net of issuance costs				(181)			(181)
Issuance of common stock (in shares)			16,969
Other comprehensive loss, net of tax						52	52
Stock-based compensation				446			446
Preferred stock dividends					(562)		(562)
Balance at Ending at Jun. 30, 2018				132,785	(26,226)	(1,601)	104,958
Balance at Ending (in shares) at Jun. 30, 2018	20,868	41,000	5,917,667
Balance at Beginning at Dec. 31, 2018				141,359	(23,199)	(1,285)	116,875
Balance at Beginning (in shares) at Dec. 31, 2018			7,968,420
Increase (Decrease) in Stockholders' Equity
Net income					3,031		3,031
Adoption of ASU 2018-02 - Reclassification of stranded tax effect					235	(235)	235
Other comprehensive loss, net of tax						1,515	1,515
Settlement of share awards				(110)			(110)
Settlement of share awards (in shares)			15,446
Stock-based compensation				846			846
Balance at Ending at Jun. 30, 2019				142,095	(19,933)	(5)	122,157
Balance at Ending (in shares) at Jun. 30, 2019			7,983,866
Balance at Beginning at Mar. 31, 2019				141,738	(21,337)	(733)	119,668
Balance at Beginning (in shares) at Mar. 31, 2019			7,968,420
Increase (Decrease) in Stockholders' Equity
Net income					1,404		1,404
Other comprehensive loss, net of tax						728	728
Settlement of share awards				(110)			(110)
Settlement of share awards (in shares)			15,446
Stock-based compensation				467			467
Balance at Ending at Jun. 30, 2019				$ 142,095	$ (19,933)	$ (5)	$ 122,157
Balance at Ending (in shares) at Jun. 30, 2019			7,983,866

CONSOLIDATED STATEMENTS OF SH_2

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Parenthetical) $ in Thousands	6 Months Ended
	Jun. 30, 2018USD ($)
Consolidated Statements of Shareholders’ Equity
Common stock issuance costs	$ 7

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Cash flows from operating activities
Net income	$ 3,031	$ 2,234
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	1,011	1,150
Deferred income tax expense	288	1,016
Stock-based compensation	846	987
Provision for (recovery of) credit losses	116	(187)
Net amortization of investment securities	71	107
Stock dividends received on correspondent bank stock	(19)	(76)
Increase in cash surrender value of company-owned life insurance	(189)	(199)
Net gain on mortgage loans sold	(4,718)	(2,610)
Origination of mortgage loans held for sale	(175,236)	(244,645)
Proceeds from mortgage loans sold	158,479	235,061
Loss on impairment of goodwill	1,572
Net changes in operating assets and liabilities:
Accounts receivable	(226)	88
Accrued interest receivable and other assets	(2,584)	(729)
Accrued interest payable and other liabilities	(35)	(858)
Net cash used in operating activities	(17,593)	(8,661)
Activity in available-for-sale securities:
Maturities, prepayments, and calls	3,831	9,556
Purchases	(10,390)
Purchases of correspondent bank stock	(1,237)	(3,646)
Redemption of correspondent bank stock	2,095	1,800
Purchases of premises and equipment	(280)	(168)
Payments received on promissory notes from related parties		3,701
Loan and note receivable originations and principal collections, net	(45,383)	(28,885)
Net cash used in investing activities	(51,364)	(17,642)
Cash flows from financing activities
Net change in deposits	67,419	27,625
Proceeds from issuance of common stock, net		1,909
Settlement of restricted stock	(110)	(181)
Dividends paid on preferred stock		(1,123)
Payments to Federal Home Loan Bank Topeka borrowings	(46,286)	(126,200)
Proceeds from Federal Home Loan Bank Topeka borrowings	67,346	173,235
Net cash provided by financing activities	88,369	75,265
Net change in cash and cash equivalents	19,412	48,962
Cash and cash equivalents, beginning of year	73,357	9,502
Cash and cash equivalents, end of period	92,769	58,464
Supplemental cash flow information:
Interest paid on deposits and borrowed funds	6,250	3,540
Income tax payment, net of refunds received	630	517
Cash paid for amounts included in the measurement of lease liabilities	2,738
Supplemental noncash disclosures:
Available-for-sale-reclass of equity securities		703
Adoption of ASU 2018-02 - Reclassification of stranded tax effects	235
Reclass of unrealized loss on equity securities		$ 52
Lease right-of-use-asset obtained in exchange for lease liabilities	$ 16,580

ORGANIZATION AND SUMMARY OF SIG

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2019
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business and Basis of Presentation : The condensed consolidated financial statements include the accounts of First Western Financial, Inc. (“FWFI”), incorporated in Colorado on July 18, 2002, and its direct and indirect wholly‑owned subsidiaries listed below (collectively referred to as the “Company”). FWFI is a bank holding company with financial holding company status registered with the Board of Governors of the Federal Reserve System. FWFI wholly owns the following subsidiaries: First Western Trust Bank (the “Bank”), First Western Capital Management Company (“FWCM”), and Ryder, Stilwell Inc. (“RSI”). The Bank wholly owns the following subsidiaries, which are therefore indirectly wholly‑owned by FWFI: First Western Merger Corporation (“Merger Corp.”), and RRI, LLC (“RRI”). RSI and RRI are not active operating entities. The Company provides a fully‑integrated suite of wealth management services including, private banking, personal trust, investment management, mortgage loans, and institutional asset management services to individual and corporate customers principally in Colorado (metro Denver, Aspen, Boulder, Fort Collins and Vail Valley), Arizona (Phoenix and Scottsdale), California (Century City, Los Angeles) and Wyoming (Jackson Hole and Laramie). The Company’s revenues are generated from its full range of product offerings as noted above, but principally from net interest income (the interest income earned on the Bank’s assets net of funding costs), fee‑based wealth advisory, investment management, asset management and personal trust services, and net gains earned on selling mortgage loans. The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The December 31, 2018 condensed consolidated balance sheet has been derived from the audited financial statements for the year ended December 31, 2018. In the opinion of management, all adjustments that were recurring in nature and considered necessary have been included for fair presentation of the Company’s financial position and results of operations. Operating results for the three and six months ended June 30, 2019 are not necessarily indicative of results that may be expected for the full year ending December 31, 2019. In preparing the condensed consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could be significantly different from those estimates. The condensed consolidated financial statements and notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the SEC. Consolidation : The Company’s policy is to consolidate all majority‑owned subsidiaries in which it has a controlling financial interest and variable‑interest entities where the Company is deemed to be the primary beneficiary. All material intercompany accounts and transactions have been eliminated in consolidation. Concentration of Credit Risk : Most of the Company’s lending activity is to customers located in and around Denver, Colorado; Phoenix and Scottsdale, Arizona; and Jackson Hole, Wyoming. The Company does not believe it has significant concentrations in any one industry or customer. At June 30, 2019 and December 31, 2018, 72.0% and 73.6%, respectively, of the Company’s loan portfolio was secured by real estate collateral. Declines in real estate values in the primary markets the Company operates in could negatively impact the Company. Revenue Recognition : In accordance with the Financial Accounting Standards Board (“FASB”), Revenue Contracts with Customers (“Topic 606”), trust and investment management fees are earned by providing trust and investment services to customers. The Company’s performance obligation under these contracts is satisfied over time as the services are provided. Fees are recognized monthly based on the average monthly value of the assets under management and the corresponding fee rate based on the terms of the contract. Performance based incentive fees are earned with respect to investment management contracts for the three and six month periods ended June 30, 2019 and the year ended December 31, 2018 were immaterial. Receivables are recorded on the condensed consolidated balance sheet in the accounts receivable line item. Income related to trust and investment management fees, bank fees, and risk management and insurance fees on the condensed consolidated statement of operations for the three and six months ended June 30, 2019 are considered in scope of Topic 606. Reclassifications : Certain items in prior year financial statements were reclassified to conform to the current presentation. Such reclassifications had no impact on net income or total shareholders’ equity. Adoption of new accounting standards : The following reflect recent accounting pronouncements that have been adopted by the Company since the end of the Company’s fiscal year ended December 31, 2018. In February 2016, the FASB issued ASU 2016-02, Lease Accounting (Topic 842) (“ASU 2016-02”). Under ASU 2016-02, a lessee is required to recognize assets and liabilities for leases with lease terms of more than twelve months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires only capital leases to be recognized on the balance sheet, ASU 2016-02 requires both types of leases to be recognized on the balance sheet. The ASU also requires disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements. Upon adoption of ASU 2016-02 with its March 31, 2019 Quarterly Report on Form 10-Q for the three months ended March 31, 2019, the Company recorded a right-of-use asset and related lease liability. We elected the modified retrospective transition approach. We also elected and applied the package of practical expedients whereby we will not reassess prior to the effective date (i) whether any expired contracts contain leases, (ii) the lease classification for any existing or expired lease, and (iii) initial direct costs of any existing leases. See Note 5 – Leases, for further information. In March 2017, the FASB issued ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) (“ASU 2017-08”). ASU 2017-08 amends the amortization period for certain purchased callable debt securities held at a premium. Prior to the issuance of this guidance, premiums were amortized as an adjustment of yield over the contractual life of the instrument. ASU 2017-08 requires premiums on purchased callable debt securities that have explicit, non-contingent call features that are callable at fixed prices to be amortized to the earliest call date. There are no accounting changes for securities held at a discount. ASU 2017-08 became effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12”), which provided guidance to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. ASU 2017-12 was effective for the Company on January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220) (“ASU 2018-02”). ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income into retained earnings. ASU 2018-02 was effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures. Recently issued accounting pronouncements, not yet adopted : The following reflects a pending pronouncement with an update to the expected impact since the end of the Company’s fiscal year ended December 31, 2018. In February 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) (“ASU 2016-13”). ASU 2016-13 replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on the financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. For all other assets within the scope of CECL, a cumulative-effect adjustment will be recognized in retained earnings and the allowance for loan losses as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 will be effective for most public companies on January 1, 2020. On July 17, 2019, the FASB voted to delay CECL implementation for certain companies including smaller reporting companies as defined by the SEC. The Company is designated as a smaller reporting company with the SEC. The proposed delay by FASB is subject to a 30-day comment period so the Company will determine if CECL is delayed during the third quarter of 2019. During the second quarter of 2019, the CECL committee of the Company continued to work through its implementation plan. The Company has integrated historical and current loan level data as required by CECL and is working with its third-party vendor solution on beginning to evaluate the methodologies available under the CECL model on its loan portfolios. The Company also continues to evaluate documentation requirements, internal control structure, relevant data sources, and system configurations. Currently, we are unable to estimate the impact the adoption of this update will have on the consolidated financial statements and disclosures. However, the Company expects the impact of the adoption will be significantly influenced by the composition and characteristics of its loan portfolios along with economic conditions prevalent as of the date of adoption.

INVESTMENT SECURITIES

INVESTMENT SECURITIES	6 Months Ended
	Jun. 30, 2019
INVESTMENT SECURITIES
INVESTMENT SECURITIES	NOTE 2 - INVESTMENT SECURITIES The following presents the amortized cost and fair value of securities available‑for‑sale, with gross unrealized gains and losses recognized in accumulated other comprehensive income as of June 30, 2019 and December 31, 2018 (in thousands): Gross Gross Amortized Unrealized Unrealized Fair June 30, 2019 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ 5 $ — $ 255 Government National Mortgage Association mortgage-backed securities—residential (“GNMA”) 38,529 273 (265) 38,537 Federal National Mortgage Association mortgage-backed securities—residential (“FNMA”) 3,546 8 (61) 3,493 Securities issued by U.S. government sponsored entities and agencies 4,300 1 (8) 4,293 Corporate collateralized mortgage obligations (“CMO”) and mortgage-backed securities (“MBS”) 5,058 74 (12) 5,120 Total securities available-for-sale $ 51,683 $ 361 $ (346) $ 51,698 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ — $ 250 GNMA 35,591 8 (1,597) 34,002 FNMA 4,076 2 (208) 3,870 Securities issued by U.S. government sponsored entities and agencies 4,525 — (223) 4,302 Corporate CMO and MBS 1,281 1 (11) 1,271 Total securities available-for-sale $ 45,723 $ 11 $ (2,039) $ 43,695 At June 30, 2019, the amortized cost and estimated fair value of available‑for‑sale securities have contractual maturity dates shown in the table below (in thousands). 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. Securities not due at a single maturity date are shown separately. Amortized Fair June 30, 2019 Cost Value Due within one year through five years $ 555 $ 560 Securities (agency and CMO) 51,128 51,138 Total $ 51,683 $ 51,698 At June 30, 2019 and December 31, 2018, securities with carrying values totaling $5.1 million and $5.4 million, respectively, were pledged to secure various public deposits and credit facilities of the Company. At June 30, 2019 and December 31, 2018, there were no holdings of securities of any one issuer, other than the U.S. Government sponsored entities and agencies, in an amount greater than 10% of shareholders’ equity. At June 30, 2019 and December 31, 2018, twelve securities and thirty-three securities, respectively were in an unrealized loss position, with unrealized losses totaling $0.3 million and $2.0 million, respectively. Twelve of the securities in an unrealized loss position at June 30, 2019 have been in a continuous unrealized loss position for more than twelve months, and the remaining securities in a loss position have been in a continuous unrealized loss position for less than twelve months. The unrealized loss positions were caused primarily by interest rate changes and market assumptions about prepayments of principal and interest on the underlying mortgages. Because the decline in market value is attributable to market conditions, not credit quality, and because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be near or at maturity, the Company does not consider these investments to be other‑than‑temporarily impaired at June 30, 2019. The following table summarizes securities with unrealized losses at June 30, 2019 and December 31, 2018, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands, before tax): Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2019 Value Losses Value Losses Value Losses U.S. Treasury debt $ — $ — $ — $ — $ — $ — GNMA — — 16,139 (265) 16,139 (265) FNMA — — 2,918 (61) 2,918 (61) Securities issued by U.S. government sponsored entities and agencies — — 3,988 (8) 3,988 (8) Corporate CMO and MBS 1,179 (12) 60 — 1,239 (12) Total $ 1,179 $ (12) $ 23,105 $ (334) $ 24,284 $ (346) Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2018 Value Losses Value Losses Value Losses U.S. Treasury debt $ — $ — $ — $ — $ — $ — GNMA 201 — 32,696 (1,597) 32,897 (1,597) FNMA 436 (3) 3,215 (205) 3,651 (208) Securities issued by U.S. government sponsored entities and agencies — — 4,302 (223) 4,302 (223) Corporate CMO and MBS 1,145 (9) 63 (2) 1,208 (11) Total $ 1,782 $ (12) $ 40,276 $ (2,027) $ 42,058 $ (2,039) The Company did not sell any securities during the three and six months ended June 30, 2019.

LOANS AND THE ALLOWANCE FOR LOA

LOANS AND THE ALLOWANCE FOR LOAN LOSSES	6 Months Ended
	Jun. 30, 2019
LOANS AND THE ALLOWANCE FOR LOAN LOSSES
LOANS AND THE ALLOWANCE FOR LOAN LOSSES	NOTE 3 - LOANS AND THE ALLOWANCE FOR LOAN LOSSES The following presents a summary of the Company’s loans as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities and Other $ 149,503 $ 114,165 Construction and Development 40,826 31,897 1-4 Family Residential 373,836 350,852 Non-Owner Occupied CRE 152,664 173,741 Owner Occupied CRE 112,660 108,480 Commercial and Industrial 108,516 113,660 Total loans 938,005 892,795 Deferred costs, net 1,390 1,171 Allowance for loan losses (7,575) (7,451) Loans, net $ 931,820 $ 886,515 The following presents, by class, an aging analysis of the recorded investments (excluding accrued interest receivable, deferred loan fees and deferred costs which are not material) in loans past due as of June 30, 2019 and December 31, 2018 (in thousands): 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded June 30, 2019 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ — $ — $ — $ — $ 149,503 $ 149,503 Construction and Development — — — — 40,826 40,826 1-4 Family Residential — 497 1,213 1,710 372,126 373,836 Non-Owner Occupied CRE — 460 — 460 152,204 152,664 Owner Occupied CRE — — — — 112,660 112,660 Commercial and Industrial — 2,300 — 2,300 106,216 108,516 Total $ — $ 3,257 $ 1,213 $ 4,470 $ 933,535 $ 938,005 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded December 31, 2018 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 331 $ — $ 11,252 $ 11,583 $ 102,582 $ 114,165 Construction and Development — — — — 31,897 31,897 1-4 Family Residential — — 1,217 1,217 349,635 350,852 Non-Owner Occupied CRE 567 — — 567 173,174 173,741 Owner Occupied CRE — — — — 108,480 108,480 Commercial and Industrial — — 1,735 1,735 111,925 113,660 Total $ 898 $ — $ 14,204 $ 15,102 $ 877,693 $ 892,795 At June 30, 2019 and December 31, 2018, the Company had a 1‑4 Family Residential loan totaling $1.2 million, which was more then 90 days delinquent and accruing interest. Non‑Accrual Loans and Troubled Debt Restructurings (“TDR”) The following presents the recorded investment in non‑accrual loans by class as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities and Other $ 5,107 $ 11,252 Construction and Development — — 1-4 Family Residential — — Non-Owner Occupied CRE — — Owner Occupied CRE — — Commercial and Industrial 1,035 1,735 Total $ 6,142 $ 12,987 At June 30, 2019 and December 31, 2018, the non‑accrual loans listed above were classified as TDR with a recorded investment totaling $6.1 million and $13.0 million, respectively. Non‑accrual loans include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. The following presents a summary of the unpaid principal balance of loans classified as TDRs as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities, and Other $ 5,107 $ 11,252 Commercial and Industrial 6,483 6,583 Total $ 11,590 $ 17,835 Allowance for loan associated with TDR (940) (940) Net recorded investment $ 10,650 $ 16,895 At June 30, 2019, the Company extended an additional $0.4 million to a Commercial and Industrial borrower with a loan classified as a TDR for operational needs. The majority owner for this borrower provided $1.5 million of pledged cash as collateral in exchange for this additional funding. At December 31, 2018, the Company had not committed any additional funds to a borrower with a loan classified as a TDR. The Company did not modify any loans into a TDR for the three and six months ended June 30, 2019 and June 30, 2018. The Company modified two loans into a TDR for the year ended December 31, 2018. For the six months ended June 30, 2019, a $5.1 million Cash, Securities and Other loan, which was classified as a TDR and not accruing interest, was making payments in accordance with its modified terms including additional paydowns. For the year ended December 31, 2018, this loan was not making payments in accordance with the original contract terms. The loan was placed on non-accrual status and classified as a TDR during the year ended December 31, 2018. The loan was making payments as agreed for the three and six months ended June 30, 2018. One loan classified as Commercial and Industrial of $5.4 million, which was accruing interest and classified as a TDR at June 30, 2019 and December 31, 2018, was making payments in accordance with its modified terms for the three and six months ended June 30, 2019 and the year ended December 31, 2018. The loan was also making payments as agreed for the three and six months ended June 30, 2018. The other Commercial and Industrial loan of $1.0 million that was classified as a TDR and not accruing interest at June 30, 2019 and December 31, 2018 was making payments in accordance with its modified terms for the three and six months ended June 30, 2019 and the year ended December 31, 2018. For the three and six months ended June 30, 2018, this loan was classified as a TDR and was not making payments in accordance with the modified terms. TDRs are reviewed individually for impairment and are included in the Company’s specific reserves in the allowance for loan losses. If charged off, the amount of the charge-off is included in the Company’s charge-off factors, which impact the Company’s reserves on non‑impaired loans. The following table presents impaired loans by portfolio and related valuation allowance as of the periods presented (in thousands): June 30, 2019 December 31, 2018 Unpaid Allowance Unpaid Allowance Total Contractual for Total Contractual for Recorded Principal Loan Recorded Principal Loan Investment Balance Losses Investment Balance Losses Impaired loans with a valuation allowance: Commercial and Industrial $ 1,035 $ 1,035 $ 940 $ 1,735 $ 1,735 $ 940 Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,448 $ 5,448 $ — $ 4,848 $ 4,848 $ — Cash, Securities, and Other 5,107 5,107 — 11,252 11,252 — 1-4 Family Residential 1,213 1,213 — — — — Total $ 11,768 $ 11,768 $ — $ 16,100 $ 16,100 $ — Total impaired loans: Commercial and Industrial $ 6,483 $ 6,483 $ 940 $ 6,583 $ 6,583 $ 940 Cash, Securities, and Other 5,107 5,107 — 11,252 11,252 — 1-4 Family Residential 1,213 1,213 — — — — Total $ 12,803 $ 12,803 $ 940 $ 17,835 $ 17,835 $ 940 The recorded investment in loans in the previous tables excludes accrued interest and deferred loan fees and costs which are not material. Interest income, if any, was recognized on the cash basis on non-accrual loans. The average balance of impaired loans and interest income recognized on impaired loans during the three months ended June 30, 2019 and 2018 are included in the table below (in thousands): Three Months Ended June 30, 2019 2018 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Commercial and Industrial $ 1,235 $ — $ 1,835 $ — Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,268 $ 68 $ — $ — Cash, Securities, and Other 8,042 — — — 1-4 Family Residential 412 26 — — Total $ 13,722 $ 94 $ — $ — Total impaired loans: Commercial and Industrial $ 6,503 $ 68 $ 1,835 $ — Cash, Securities, and Other 8,042 — — — 1-4 Family Residential 412 26 — — Total $ 14,957 $ 94 $ 1,835 $ — The average balance of impaired loans and interest income recognized on impaired loans during the six months ended June 30, 2019 and 2018 are included in the table below (in thousands): Six Months Ended June 30, 2019 2018 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Commercial and Industrial $ 1,398 $ — $ 1,835 $ — Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,131 $ 188 $ — $ — Cash, Securities, and Other 9,072 — — — 1-4 Family Residential 412 51 — — Total $ 14,615 $ 239 $ — $ — Total impaired loans: Commercial and Industrial $ 6,529 $ 188 $ 1,835 $ — Cash, Securities, and Other 9,072 — — — 1-4 Family Residential 412 51 — — Total $ 16,013 $ 239 $ 1,835 $ — Allowance for Loan Losses Allocation of a portion of the allowance for loan losses to one category of loans does not preclude its availability to absorb losses in other categories. The following presents the activity in the Company’s allowance for loan losses by portfolio class for the periods presented (in thousands): Cash, Construction 1-4 Non-Owner Owner Commercial Securities and Family Occupied Occupied and and Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2019 Beginning balance $ 877 $ 266 $ 2,588 $ 1,235 $ 780 $ 1,899 $ 7,645 Provision for (recovery of) credit losses 164 24 62 (149) 20 (199) (78) Charge-offs — — — — — — — Recoveries 8 — — — — — 8 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Changes in allowance for loan losses for the six months ended June 30, 2019 Beginning balance $ 764 $ 232 $ 2,552 $ 1,264 $ 789 $ 1,850 $ 7,451 Provision for (recovery of) credit losses 277 58 98 (178) 11 (150) 116 Charge-offs — — — — — — — Recoveries 8 — — — — — 8 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Allowance for loan losses at June 30, 2019 allocated to loans evaluated for impairment: Individually $ — $ — $ — $ — $ — $ 940 $ 940 Collectively 1,049 290 2,650 1,086 800 760 6,635 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Loans at June 30, 2019, evaluated for impairment: Individually $ 5,107 $ — $ 1,213 $ — $ — $ 6,483 $ 12,803 Collectively 144,396 40,826 372,623 152,664 112,660 102,033 925,202 Ending balance $ 149,503 $ 40,826 $ 373,836 $ 152,664 $ 112,660 $ 108,516 $ 938,005 Cash, Construction 1-4 Non-Owner Owner Commercial Securities and Family Occupied Occupied and and Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2018 Beginning balance $ 969 $ 228 $ 2,334 $ 1,313 $ 724 $ 1,532 $ 7,100 Provision for (recovery of) credit losses (35) (1) (377) (114) (98) 625 — Charge-offs — — — — — — — Recoveries — — — — — — — Ending balance $ 934 $ 227 $ 1,957 $ 1,199 $ 626 $ 2,157 $ 7,100 Changes in allowance for loan losses for the six months ended June 30, 2018 Beginning balance $ 1,066 $ 202 $ 2,283 $ 1,433 $ 751 $ 1,552 $ 7,287 Provision for (recovery of) credit losses (132) 25 (326) (234) (125) 605 (187) Charge-offs — — — — — — — Recoveries — — — — — — — Ending balance $ 934 $ 227 $ 1,957 $ 1,199 $ 626 $ 2,157 $ 7,100 Allowance for loan losses at December 31, 2018 allocated to loans evaluated for impairment: Individually $ — $ — $ — $ — $ — $ 940 $ 940 Collectively 764 232 2,552 1,264 789 910 6,511 Ending balance $ 764 $ 232 $ 2,552 $ 1,264 $ 789 $ 1,850 $ 7,451 Loans at December 31, 2018, evaluated for impairment: Individually $ 11,252 $ — $ — $ — $ — $ 6,583 $ 17,835 Collectively 102,913 31,897 350,852 173,741 108,480 107,077 874,960 Ending balance $ 114,165 $ 31,897 $ 350,852 $ 173,741 $ 108,480 $ 113,660 $ 892,795 The Company categorizes loans into risk categories based on relevant information about the ability of the 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 as to credit risk on a quarterly basis. The Company uses the following definitions for risk ratings: Special Mention—Loans classified as special mention have a potential weakness or borrowing relationships that require more than the usual amount of management attention. Adverse industry conditions, deteriorating financial conditions, declining trends, management problems, documentation deficiencies or other similar weaknesses may be evident. Ability to meet current payment schedules may be questionable, even though interest and principal are still being paid as agreed. The asset has potential weaknesses that may result in deteriorating repayment prospects if left uncorrected. Loans in this risk grade are not considered adversely classified. Substandard—Substandard loans are considered “classified” and are inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. Loans so classified have a well‑defined weakness or weaknesses that jeopardizes the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected. Loans in this category may be placed on non‑accrual status and may individually be evaluated for impairment if indicators of impairment exist. Doubtful—Loans graded doubtful are considered “classified” and have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions and values, highly questionable and improbable. However, the amount of certainty of eventual loss is not known because of specific pending factors. Loans not meeting any of the three criteria above are considered to be pass‑rated loans. The following presents, by class and by credit quality indicator, the recorded investment in the Company’s loans as of June 30, 2019 and December 31, 2018 (in thousands): Special June 30, 2019 Pass Mention Substandard Total Cash, Securities and Other $ 144,396 $ — $ 5,107 $ 149,503 Construction and Development 40,826 — — 40,826 1-4 Family Residential 366,577 6,046 1,213 373,836 Non-Owner Occupied CRE 151,020 1,184 460 152,664 Owner Occupied CRE 112,660 — — 112,660 Commercial and Industrial 96,114 — 12,402 108,516 Total $ 911,593 $ 7,230 $ 19,182 $ 938,005 Special December 31, 2018 Pass Mention Substandard Total Cash, Securities and Other $ 102,913 $ — $ 11,252 $ 114,165 Construction and Development 31,897 — — 31,897 1-4 Family Residential 349,635 — 1,217 350,852 Non-Owner Occupied CRE 165,164 8,117 460 173,741 Owner Occupied CRE 108,480 — — 108,480 Commercial and Industrial 100,929 — 12,731 113,660 Total $ 859,018 $ 8,117 $ 25,660 $ 892,795 The Company had no loans graded doubtful as of June 30, 2019 and December 31, 2018.

GOODWILL

GOODWILL	6 Months Ended
	Jun. 30, 2019
Goodwill.
Goodwill	NOTE 4 – GOODWILL Changes in the carrying amount of goodwill were as follows: Wealth Capital Management Management Consolidated Balance at December 31, 2018 $ 15,994 $ 8,817 $ 24,811 Impairment - (1,572) (1,572) Balance at June 30, 2019 $ 15,994 $ 7,245 $ 23,239 Goodwill is tested annually for impairment on October 31 or earlier upon the occurrence of certain events. During the second quarter of 2019, the Company received an unsolicited offer to purchase its Los Angeles-based fixed income team, a portion of the Capital Management reporting unit. The Company determined the sale of a portion of this reporting unit would benefit the Company by optimizing the cost structure and freeing up capital and resources to strengthen the Wealth Management and Mortgage reporting units. At June 30, 2019, the Company determined that it was more likely than not that it would sign this agreement to dispose of a portion of this reporting unit. Although the agreement to sell a portion of the Capital Management reporting unit did not meet the held for sale criteria at June 30, 2019, it did represent an event affecting a specific reporting unit and the Company proceeded to perform an interim impairment test for Capital Management reporting unit. As part of the qualitative assessment, it did indicate that it was more likely than not that the carrying value of the Capital Management reporting unit exceeded its fair value. Therefore, the Company proceeded to Step 1 of the interim goodwill impairment test. Step 1 of the goodwill impairment analysis includes the determination of the carrying value of the reporting unit, including the existing goodwill, and estimating the fair value of the reporting unit. If the carrying amount of a reporting unit exceeds its fair value, we are required to perform Step 2 of the impairment test. As such, the Company elected to perform a valuation of the Capital Management reporting unit at June 30, 2019. To estimate the fair value of our reporting units, an independent valuation specialist assisted us and we used an income approach, specifically a discounted cash flow methodology, and a market approach. The discounted cash flow methodology includes assumptions for forecasted revenues, growth rates, discount rates, and market multiples, which all require significant judgment and estimates by management and are inherently uncertain. The fair value did not exceed the carrying value of the Capital Management reporting unit as of June 30, 2019. During the first half of 2019, the growth in revenue has not been realized at previously forecasted levels for the Capital Management reporting unit. The Company has focused on revenue growth in the more core areas in Wealth Management and Mortgage. Our outlook for the Capital Management reporting unit has declined driven by the lower market penetration and slower growth in assets under management which has negatively impacted our near-term earnings outlook for this reporting unit. The sale would put the team into a group with distribution capabilities and a structure to support them. As such, this has caused a downward revision for our forecast on current and projected cash flows for the Capital Management reporting unit which resulted in a lower fair value for the six months ended June 30, 2019. Therefore, we conducted Step 2 of the goodwill impairment test for the Capital Management reporting unit. Step 2 requires that we allocate the fair value of the reporting unit to identifiable assets and liabilities of the reporting unit. Any residual fair value after this allocation is compared to the goodwill balance and any excess goodwill is charged to expense. As a result of our two step evaluation, we recorded a goodwill impairment loss of $1.6 million for the three months ended June 30, 2019 in the Capital Management reporting unit. After the impairment charge, there was $7.2 million of goodwill remaining in the Capital Management reporting unit.

LEASES

LEASES	6 Months Ended
	Jun. 30, 2019
LEASES
LEASES	NOTE 5 – LEASES A lease is defined as a contract that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. The Company adopted ASC 842 on January 1, 2019 and recorded an initial right-of-use asset and related lease liability of $12.9 million and $16.6 million, respectively. There was no cumulative effect upon adoption. Leases in which the Company is determined to be the lessee are primarily operating leases comprised of real estate property and office space for our corporate headquarters and profit centers with terms that extend to 2025. Certain properties contain portions that are subleased with terms that extend through 2020. In accordance with ASC 842, operating leases are required to be recognized as a right-of-use asset with a corresponding lease liability. The following table presents the classification of the right-of-use asset and corresponding liability within the condensed consolidated balance sheet. The Company elected to not include short-term leases with initial terms of twelve months or less, on the condensed consolidated balance sheet. June 30, 2019 Lease Right-of-Use Assets Classification Operating lease right-of-use assets Other assets $ 11,591 Lease Liabilities Classification Operating lease liabilities Other liabilities $ 15,063 The Company’s operating lease agreements typically include an option to renew the lease at the Company’s discretion. To the extent the Company is reasonably certain it will exercise the renewal option at the inception of the lease, the Company will include the extended term in the calculation of the right-of-use asset and lease liability. ASC 842 requires the use of the rate implicit in the lease when it is readily determinable. As this rate is typically not readily determinable, at the inception of the lease, the Company uses its collateralized incremental borrowing rate over a similar term. The amount of the right-of-use asset and lease liability are impacted by the discount rate used to calculate the present value of the minimum lease payments over the term of the lease. June 30, 2019 Weighted-Average Remaining Lease Term Operating leases years Weighted-Average Discount Rate Operating leases % The Company’s operating leases contain fixed and variable lease components and it has elected to account for all classes of underlying assets as a single lease component. Variable lease costs primarily represent common area maintenance and parking. The following table represents the Company’s net lease costs. Three Months Ended Six Months Ended June 30, 2019 June 30, 2019 Lease Costs Operating lease cost $ 789 $ 1,572 Variable lease cost 385 773 Sublease income (100) (199) Lease costs, net $ 1,074 $ 2,146 The following table presents a maturity analysis of the Company’s operating lease liabilities on an annual basis for each of the first five years and total amounts thereafter as of June 30, 2019 . Operating Leases Twelve Months Ended June 30, 2020 $ 3,707 June 30, 2021 3,061 June 30, 2022 2,709 June 30, 2023 2,567 June 30, 2024 2,248 Thereafter 2,319 Total Future Minimum Lease Payments $ 16,611 Less: Imputed interest (1,548) Present Value of Net Future Minimum Lease Payments $ 15,063 The following presents minimum lease payments due pursuant to the leases as of December 31, 2018 for the years indicated. Year Operating Leases 2019 $ 3,570 2020 3,374 2021 2,815 2022 2,675 2023 2,358 Thereafter 3,446 $ 18,238

DEPOSITS

DEPOSITS	6 Months Ended
	Jun. 30, 2019
DEPOSITS
DEPOSITS	NOTE 6 - DEPOSITS The following presents the Company’s interest-bearing deposits at the dates noted (in thousands): June 30, December 31, 2019 2018 Money market deposit accounts $ 508,263 $ 489,506 Time deposits 176,128 178,743 Negotiable order of withdrawal accounts 88,687 64,853 Savings accounts 2,833 1,800 Total interest bearing deposits $ 775,911 $ 734,902 Aggregate time deposits of $250,000 or greater $ 74,084 $ 83,550 Overdraft balances classified as loans totaled $0.1 million and $0.3 million at June 30, 2019 and December 31, 2018, respectively.

BORROWINGS

BORROWINGS	6 Months Ended
	Jun. 30, 2019
BORROWINGS
BORROWINGS	NOTE 7 - BORROWINGS FHLB Topeka Borrowings The Bank has executed a blanket pledge and security agreement with the Federal Home Loan Bank (“FHLB”) Topeka that requires certain loans and securities be pledged as collateral for any outstanding borrowings under the agreement. The collateral pledged as of June 30, 2019 and December 31, 2018 amounted to $532.8 million and $475.4 million, respectively. Based on this collateral and the Company’s holdings of FHLB Topeka stock, the Company was eligible to borrow an additional $332.7 million at June 30, 2019. Each advance is payable at its maturity date. The Company had the following borrowings from FHLB Topeka at the dates noted (in thousands): June 30, December 31, Maturity Date Rate % 2019 2018 August 2, 2019 2.55 $ 26,060 $ 5,000 August 26, 2020 1.94 10,000 10,000 Total $ 36,060 $ 15,000 The Bank has borrowing capacity associated with three unsecured federal funds lines of credit up to $10.0 million, $13.0 million, and $25.0 million. As of June 30, 2019 and December 31, 2018, there were no amounts outstanding on any of the federal funds lines. The Company’s borrowing facilities include various financial and other covenants, including, but not limited to, a requirement that the Bank maintains regulatory capital that is deemed “well capitalized” by federal banking agencies (see Note 15 – Regulatory Capital Matters). As of June 30, 2019 and December 31, 2018, the Company was in compliance with the covenant requirements.

COMMITMENTS AND COMMITMENTS AND

COMMITMENTS AND COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2019
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	NOTE 8 – COMMITMENTS AND CONTINGENCIES The Bank is party to credit‑related financial instruments with off‑balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the condensed consolidated balance sheets. Commitments may expire without being utilized. The Bank’s exposure to credit loss is represented by the contractual amount of these commitments, although material losses are not anticipated. The Bank follows the same credit policies in making commitments as it does for on‑balance sheet instruments. The following presents the Company’s financial instruments whose contract amounts represent credit risk, as of the dates noted (in thousands): June 30, 2019 December 31, 2018 Fixed Rate Variable Rate Fixed Rate Variable Rate Unused lines of credit $ 21,424 $ 252,755 $ 33,571 $ 271,580 Standby letters of credit 25 23,833 40 23,508 Commitments to make loans to sell 83,309 — 17,207 — Commitments to make loans 16,154 46,306 2,750 19,762 Unused lines of credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Several of the commitments may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Bank, is based on management’s credit evaluation of the customer. Unused lines of credit under commercial lines of credit, revolving credit lines and overdraft protection agreements are commitments for possible future extensions of credit to existing customers. These lines of credit are uncollateralized and usually do not contain a specified maturity date and may not be drawn upon to the total extent to which the Bank is committed. Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Substantially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank holds collateral supporting those commitments if deemed necessary. Commitments to make loans to sell are agreements to sell a loan to an investor in the secondary market for which the interest rate has been locked with the customer, provided there is no violation of any condition within the contract with either party. Commitments to make loans to sell have fixed interest rates. Since commitments may expire without being extended, total commitment amounts may not necessarily represent cash requirements. Commitments to make loans are agreements to lend to a customer, provided there is no violation of any condition within the contract. Commitments to make loans generally have fixed expiration dates or other termination clauses. Since commitments may expire without being extended, total commitment amounts may not necessarily represent cash requirements. Litigation, Claims and Settlements The Company, from time to time, is involved in various legal actions arising in the normal course of business. While the ultimate outcome of any such proceedings cannot be predicted with certainty, it is the opinion of management, based on advice from legal counsel, that no proceedings exist, either individually or in the aggregate, which, if determined adversely to the Company, would have a material effect on the Company’s condensed consolidated financial statements.

SHAREHOLDERS EQUITY

SHAREHOLDERS EQUITY	6 Months Ended
	Jun. 30, 2019
SHAREHOLDERS EQUITY
SHAREHOLDERS EQUITY	NOTE 9 – SHAREHOLDERS’ EQUITY Common Stock The Company’s common stock has no par value and each holder of common stock is entitled to one vote for each share (though certain voting restrictions may exist on non‑vested restricted stock) held. On June 14, 2019, the Company announced that its Board of Directors had authorized a share repurchase program under which the Company may repurchase up to 300,000 shares of its common stock and that the Board of Governors of the Federal Reserve System advised the Company that it had no objection to the Company’s stock repurchase program. The repurchase program authorizes the Company to purchase its common stock from time to time in privately negotiated transactions, in the open market, including pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 plan promulgated by the Securities and Exchange Commissions, or otherwise in a manner that complies with applicable federal securities laws. The program will be in effect for a one-year period, with the timing of purchases and the number of shares repurchased under the program dependent upon a variety of factors including price, trading volume, corporate and regulatory requirements and market conditions. The repurchase program may be suspended or discontinued at any time without notice. We have not repurchased any stock as of June 30, 2019. During the six months ended June 30, 2019 the Company sold no shares of common stock. During the three months ended June 30, 2018, the Company sold 67,242 shares of its common stock through a Private Placement Memorandum resulting in proceeds to the Company of $1.9 million (net of issuance costs of $0.1 million). During the three and six months ended June 30, 2018, the Company issued 16,969 shares of common stock upon the settlement of Time Vesting Units. Restricted Stock Awards As of June 30, 2019, the Restricted Stock Awards have a weighted-average grant date fair value of $28.50 per share. During the three months ended June 30, 2019 and 2018, the Company has recognized compensation expense of $0.1 million for the Restricted Stock Awards, respectively. During the six months ended June 30, 2019 and 2018, the Company has recognized compensation expense of $0.2 million for the Restricted Stock Awards, respectively. As of June 30, 2019 , the Company has $2.5 million of unrecognized stock-based compensation expense related to the shares issued. As of June 30, 2019, the unrecognized stock-based compensation expense is expected to be recognized over a weighted average period of 3.25 years. No Restricted Stock Awards vested during the three and six months ended June 30, 2019. Stock‑Based Compensation Plans As of June 30, 2019, there were a total of 626,907 shares available for issuance under the First Western Financial, Inc. 2016 Omnibus Inventive Plan (“the 2016 Plan”). If the Awards outstanding under the First Western 2008 Stock Incentive Plan (“the 2008 Plan”) or the 2016 Plan are forfeited, cancelled or terminated with no consideration paid to the Company, those amounts will increase the number of shares eligible to be granted under the 2016 Plan. Stock Options The Company did not grant any stock options during the six months ended June 30, 2019 and 2018. During the three months ended June 30, 2019 and 2018, the Company recognized stock based compensation expense of $0.1 million and $0.1 million, respectively, associated with stock options. During the six months ended June 30, 2019 and 2018, the Company recognized stock based compensation expense of $0.2 million and $0.3 million, respectively, associated with stock options. As of June 30, 2019, the Company has $0.4 million of unrecognized stock‑based compensation expense related to stock options which are unvested. As of June 30, 2019, the unrecognized cost is expected to be recognized over a weighted‑average period of approximately one year. The following summarizes activity for nonqualified stock options for the six months ended June 30, 2019: Weighted Weighted Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value Outstanding at beginning of year 465,947 $ 28.84 Granted — — Exercised — — Forfeited or expired (23,850) 26.25 Outstanding at end of period 442,097 $ 28.98 4.0 (a) Options fully vested / exercisable at June 30, 2019 388,216 $ 29.59 3.7 (a) (a) Nonqualified stock options outstanding at the end of the period and those fully vested / exercisable had immaterial aggregate intrinsic values. As of June 30, 2019 and December 31, 2018, there were 388,216 and 402,872 options, respectively, that were exercisable. Exercise prices are between $20.00 and $40.00 per share, and the options are exercisable for a period of ten‑years from the original grant date and expire on various dates between 2022 and 2026. Restricted Stock Units Pursuant to the 2016 Plan, the Company can grant associates and non‑associate directors long‑term cash and stock‑based compensation. During the six months ended June 30, 2019, the Company granted certain associates restricted stock units which are earned over time or based on various performance measures and convert to common stock upon vesting, which are summarized here and expanded further below. The following summarizes the activity for the Time Vesting Units, the Financial Performance Units and the Market Performance Units for the six months ended June 30, 2019: Time Financial Market Vesting Performance Performance Units Units Units Outstanding at beginning of year 184,369 15,932 17,258 Granted 71,127 59,536 - Vested (23,281) - - Forfeited (16,318) (4,603) (1,512) Outstanding at end of period During the three and six month period ended June 30, 2019, the Company issued 15,446 shares of common stock upon the settlement of Time Vesting Units. The remaining 7,835 shares were surrendered with a combined market value at the dates of settlement of $0.1 million to cover employee withholding taxes. During the three and six month period ended June 30, 2018, the Company issued 16,969 shares of common stock upon the settlement of Time Vesting Units. The remaining 6,313 shares were surrendered with a combined market value at the dates of settlement of $0.2 million to cover employee withholding taxes. Time Vesting Units Time Vesting Units are granted to full‑time associates and board members at the date approved by the Company’s board of directors. The Company granted 3,779 Time Vesting Units with a five‑year service period in the six months ended June 30, 2019 that vest in equal installments of 50% on the third and fifth anniversaries of the grant date, assuming continuous employment through the scheduled vesting dates. The Company granted 67,348 Time Vesting Units with a five year service period in the six months ended June 30, 2019 that vest in equal installments of 20% on the anniversary of the grant date, assuming continuous employment through the scheduled vesting dates. Time Vesting Units granted in 2019 have a weighted‑average grant‑date fair value of $13.80 per unit. During the three months ended June 30, 2019 and 2018, the Company recognized compensation expense of $0.2 million and $0.2 million, respectively, for Time Vesting Units. As During the six months ended June 30, 2019 and 2018, the Company recognized compensation expense of $0.4 million and $0.5 million, respectively, for Time Vesting Units. As of June 30, 2019, there was $4.1 million of unrecognized compensation expense related to Time Vesting Units. As of June 30, 2019, the unrecognized stock-based compensation expense is expected to be recognized over a weighted‑average period of approximately 2.4 years. Financial Performance Units Granted Prior to 2019 Financial Performance Units were granted to certain key associates and are earned based on the Company achieving various financial performance metrics beginning on the grant date and ending on December 31, 2019. If the Company achieves the financial metrics, which include various thresholds from 0% up to 150%, then the Financial Performance Units will have a subsequent two‑year service period vesting requirement ending on December 31, 2021. As of June 30, 2019, the Company is accruing at the maximum threshold for 50% of the awards and at 50% for the remainder. The maximum shares that can be issued at 150% as of June 30, 2019 was approximately 22,000 shares. During the three and six months ended June 30, 2019 and 2018, the Company recognized an immaterial amount of compensation expense for the Financial Performance Units. As of June 30, 2019, there was $0.2 million of unrecognized compensation expense related to the Financial Performance Units. As of June 30, 2019, the unrecognized stock-based compensation expense is expected to be recognized over a weighted‑average period of 2.5 years. Financial Performance Units Granted in 2019 On May 1, 2019, the Company granted an additional 59,536 Financial Performance Units to officers and other key employees. All Financial Performance Units granted on May 1, 2019, have a ten-year term and are earned based on the Company achieving various financial metrics beginning on the grant date and ending on December 31, 2021, which include various thresholds from 0% to 150%, then the Financial Performance Units will have a subsequent two-year service period vesting requirement ending on December 31, 2023. As of June 30, 2019, the Company is accruing at the maximum threshold for 50% of the awards and at 50% for the remainder. The maximum shares that can be issued at 150% as of June 30, 2019 was approximately 84,300 shares. During the three months ended June 30, 2019, the Company recognized an immaterial amount of compensation expense for the Financial Performance Units. As of June 30, 2019, there was $0.7 million of unrecognized compensation expense related to the Financial Performance Units . As of June 30, 2019, the unrecognized stock-based compensation expense is expected to be recognized over a weighted‑average period of 4.5 years. Market Performance Units Market Performance Units were granted to certain key associates and are earned based on growth in the value of the Company’s common stock and were dependent on the Company completing an initial public offering of stock during a defined period of time. If the Company’s common stock is trading at or above certain prices, over a performance period ending on June 30, 2020, the Market Performance Units will be determined to be earned and vest following the completion of a subsequent service period ending on June 30, 2022. On July 23, 2018, the Company completed its initial public offering and the Market Performance Units performance condition was met. Subsequent to the performance condition there is also a market condition as a vesting requirement for the Market Performance Units which affects the determination of the grant date fair value. The Company estimated the grant date fair value using various valuation assumptions. During the three and six months ended June 30, 2019, the Company recognized an immaterial amount of compensation expense for the Market Performance Units. As of June 30, 2019, there was $0.4 million of unrecognized compensation expense related to the Market Performance Units which is expected to be recognized over a weighted‑average period of 3.0 years.

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHARE	6 Months Ended
	Jun. 30, 2019
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE	NOTE 10 - EARNINGS PER COMMON SHARE The table below presents the calculation of basic and diluted earnings per common share for the periods indicated (amounts in thousands, except share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Earnings per common share - Basic Numerator: Net income $ 1,404 $ 1,048 $ 3,031 $ 2,234 Dividends on preferred stock — (562) — (1,123) Net income available for common shareholders $ 1,404 $ 486 $ 3,031 $ 1,111 Denominator: Basic weighted average shares 7,881,999 5,911,886 7,877,864 5,891,463 Earnings per common share - basic $ 0.18 $ 0.08 $ 0.39 $ 0.19 Earnings per common share - Diluted Numerator: Net income $ 1,404 $ 1,048 $ 3,031 $ 2,234 Dividends on preferred stock — (562) — (1,123) Net income available for common shareholders $ 1,404 $ 486 $ 3,031 $ 1,111 Denominator: Basic weighted average shares 7,881,999 5,911,886 7,877,864 5,891,463 Diluted effect of common stock equivalents: Stock options — 32,643 — 31,291 Time Vesting Units 2,044 13,958 2,062 22,261 Financial Performance Units — 16,355 — 9,758 Market Performance Units 13,049 — 13,448 — Restricted Stock Awards — 6,579 — 5,264 Total diluted effect of common stock equivalents 15,093 69,535 15,510 68,574 Diluted weighted average shares 7,897,092 5,981,421 7,893,374 5,960,037 Earnings per common share - diluted $ 0.18 $ 0.08 $ 0.39 $ 0.19 Diluted earnings per share was computed without consideration to potentially dilutive instruments as their inclusion would have been anti‑dilutive. As of June 30, 2019 and 2018, potentially dilutive securities excluded from the diluted earnings per share calculation are as follows: Three Months Ended Six Months Ended 2019 2018 2019 2018 Stock options 442,097 207,700 445,947 211,450 Convertible Preferred D shares — 151,700 — 151,700 Time Vesting Units 198,611 — 179,301 — Financial Performance Units 70,865 — 42,998 — Market Performance Units — — — — Restricted Stock Awards 94,736 — 94,736 — Total potentially dilutive securities 806,309 359,400 762,982 363,150

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jun. 30, 2019
INCOME TAXES
INCOME TAXES	NOTE 11 - INCOME TAXES During the three and six months ended June 30, 2019, the Company recorded an income tax provision of $0.5 million and $1.1 million, respectively, reflecting an effective tax rate of 28.5% and 26.4%, respectively. The increase is primarily related to the vesting of Restricted Stock Units during the three months ended June 30, 2019. During the three and six months ended June 30, 2018, the Company recorded an income tax provision of $0.3 million and $0.7 million, respectively, reflecting an effective tax rate of 24.3% and 24.0%, respectively.

RELATED-PARTY TRANSACTIONS

RELATED-PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2019
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS	NOTE 12 – RELATED‑PARTY TRANSACTIONS The Bank granted loans to principal officers and directors and their affiliates, all of whom are deemed related parties. At June 30, 2019 and December 31, 2018, there were no delinquent or non‑performing loans to any officer or director of the Company. The following presents a summary of related‑party loan activity as of the dates noted (in thousands): June 30, 2019 December 31, 2018 Balance, beginning of year $ 2,659 $ 14,077 Funded loans 5,623 1,466 Payments collected (2,588) (9,386) Changes in related parties — (3,498) Balance, end of year $ 5,694 $ 2,659 Deposits from related parties held by the Bank at June 30, 2019 and December 31, 2018 totaled $47.7 million and $36.7 million, respectively. The Company leases office space from an entity controlled by one of the Company’s board members. During the six months ended June 30, 2019 and 2018, the Company incurred an immaterial amount of expense related to this lease.

FAIR VALUE

FAIR VALUE	6 Months Ended
	Jun. 30, 2019
FAIR VALUE
FAIR VALUE	NOTE 13 - FAIR VALUE Fair value is the exchange price that would be received for an asset or paid to transfer a liability (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. There are three levels of inputs that may be used to measure fair values: Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. Level 2: Significant other 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. Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. There were no transfers between levels during the six months ended June 30, 2019 and 2018. The Company used the following methods and significant assumptions to estimate fair value: Investment Securities : The fair values for investment securities are determined by quoted market prices, if available (Level 1). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Interest Rate Locks and Forward Delivery Commitments : Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the commitment related to the loan is locked. The fair value estimate is based on valuation models using market data from secondary market loan sales and direct contacts with third party investors as of the measurement date (Level 2). Derivative instruments are carried at fair value in the Company’s financial statements. The accounting for changes in the fair value of a derivative instrument are accounted for within the condensed consolidated statements of income. The following presents assets measured on a recurring basis at June 30, 2019 and December 31, 2018 (in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2019 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 255 $ — $ — $ 255 GNMA — 38,537 — 38,537 FNMA — 3,493 — 3,493 Securities issued by US. Government sponsored entities and agencies — 4,293 — 4,293 Corporate CMO and MBS — 5,120 — 5,120 Total securities available-for-sale $ 255 $ 51,443 $ — $ 51,698 Equity securities $ 712 $ — $ — $ 712 Interest rate lock and forward delivery commitments $ — $ 739 $ — $ 739 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2018 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ — $ 250 GNMA — 34,002 — 34,002 FNMA — 3,870 — 3,870 Securities issued by US. Government sponsored entities and agencies — 4,302 4,302 Corporate CMO and MBS — 1,271 — 1,271 Total securities available-for-sale $ 250 $ 43,445 $ — $ 43,695 Equity securities $ 693 $ — $ — $ 693 Interest rate lock and forward delivery commitments $ — $ 890 $ — $ 890 Equity securities and U.S. Treasury debt are reported at fair value utilizing Level 1 inputs. The remaining portfolio of securities are reported at fair value with Level 2 inputs provided by a pricing service. As of June 30, 2019 and December 31, 2018, the majority of the securities have credit support provided by the Federal Home Loan Mortgage Corporation, GNMA, and FNMA. Factors used to value the securities by the pricing service include: benchmark yields, reported trades, interest spreads, prepayments, and other market research. In addition, ratings and collateral quality are considered. As of June 30, 2019, equity securities have been recorded at fair value within the other assets line item in the condensed consolidated balance sheet with changes recorded in the other line item in the condensed consolidated statement of income. Other Real Estate Owned : Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. They are subsequently accounted for at lower of cost or fair value less estimated costs to sell. Fair value is commonly based on recent real estate appraisals which are updated no less frequently than on an annual basis. Appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between comparable sales and income data available. Such adjustments can be significant and typically result in Level 3 classifications of the inputs for determining fair value. Other real estate owned is evaluated monthly for additional impairment and adjusted accordingly. Impaired Loans : The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments can be significant and typically result in Level 3 classifications of the inputs for determining fair value. Impaired loans are evaluated quarterly for additional impairment and adjusted accordingly. Appraisals for both collateral‑dependent impaired loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, the Company reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry‑wide statistics. The following presents assets measured on a nonrecurring basis as of June 30, 2019 and December 31, 2018 (in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2019 (Level 1) (Level 2) (Level 3) Balance Other real estate owned: Commercial properties $ — $ — $ 658 $ 658 Total impaired loans: Commercial and industrial $ — $ — $ 95 $ 95 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2018 (Level 1) (Level 2) (Level 3) Balance Other real estate owned: Commercial properties $ — $ — $ 658 $ 658 Total impaired loans: Commercial and industrial $ — $ — $ 795 $ 795 The sales comparison approach was utilized for estimating the fair value of non‑recurring assets. At June 30, 2019, other real estate owned remained unchanged from December 31, 2018 and had a carrying amount of $0.7 million, which is the cost basis of $2.4 million net of a valuation allowance of $1.7 million. At June 30, 2019, total impaired loans measured for impairment using the fair value of the collateral for collateral dependent loans had carrying values of $1.0 million with valuation allowances of $0.9 million and were classified as Level 3. As of December 31, 2018, impaired loans measured for impairment using the fair value of the collateral for collateral dependent loans had carrying values of $1.7 million with valuation allowances of $0.9 million and were classified as Level 3. Impaired loans valued using a discounted cash flow analyses were not deemed to be at fair value at June 30, 2019 and December 31, 2018. Impaired loans accounted for provisions for loan losses of $0 for each of the three and six months ended June 30, 2019. The following presents carrying amounts and estimated fair values for financial instruments as of June 30, 2019 and December 31, 2018 (in thousands): Carrying Fair Value Measurements Using: June 30, 2019 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 92,769 $ 92,769 $ — $ — Securities available-for-sale 51,698 255 51,443 — Loans, net 931,820 — — 912,965 Mortgage loans held for sale 36,269 — 36,269 — Accrued interest receivable 3,184 — 3,184 — Other assets 712 712 — — Liabilities: Deposits $ 1,005,177 $ — $ 1,008,032 $ — Borrowings: FHLB Topeka Borrowings – fixed rate 36,060 — 36,022 — 2016 Subordinated notes – fixed-to-floating rate 6,560 — — 6,217 Accrued interest payable 274 — 274 — Carrying Fair Value Measurements Using: December 31, 2018 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 73,357 $ 73,357 $ — $ — Securities available-for-sale 43,695 250 43,445 — Loans, net 886,515 — — 868,828 Mortgage loans held for sale 14,832 — 14,832 — Accrued interest receivable 2,844 — 2,844 — Other assets 693 693 — — Liabilities: Deposits $ 937,758 $ — $ 940,039 $ — Borrowings: FHLB Topeka Borrowings – fixed rate 15,000 — 14,833 — 2016 Subordinated notes – fixed-to-floating rate 6,560 — — 6,434 Accrued interest payable 231 — 231 — The fair value estimates presented and discussed above are based on pertinent information available to management as of the dates specified. The estimated fair value amounts are based on the exit price notion set forth by ASU 2016‑01 effective January 1, 2018 on a prospective basis.

SEGMENT REPORTING

SEGMENT REPORTING	6 Months Ended
	Jun. 30, 2019
SEGMENT REPORTING
SEGMENT REPORTING	NOTE 14 - SEGMENT REPORTING The Company’s reportable segments consist of Wealth Management, Capital Management, and Mortgage. The chief operating decision maker (“CODM”) is the Chief Executive Officer. The measure of profit or loss used by the CODM to identify and measure the Company’s reportable segments is income before income tax. The Wealth Management segment consists of operations relative to the Company’s fully integrated wealth management products and services. Services provided include deposit, loan, insurance, and trust and investment management advisory products and services. The Capital Management segment consists of operations relative to the Company’s institutional investment management services over proprietary fixed income, high yield, and equity strategies, including the advisor of three listed mutual funds. Capital Management products and services are financial in nature for which revenues are based on a percentage of assets under management or paid premiums. The Mortgage segment consists of operations relative to the Company’s residential mortgage service offerings. Mortgage products and services are financial in nature for which premiums are recognized net of expenses, upon the sale of mortgage loans to third parties. The tables below present the financial information for each segment that is specifically identifiable or based on allocations using internal methods for the three and six months ended June 30, 2019 and 2018 (in thousands): Three Months Ended June 30, 2019 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 11,174 $ — $ — $ 11,174 Total interest expense 3,214 — — 3,214 Provision for loan losses (78) — — (78) Net interest income 8,038 — — 8,038 Non-interest income 4,512 798 3,276 8,586 Total income 12,550 798 3,276 16,624 Depreciation and amortization expense 301 95 73 469 All other non-interest expense 10,432 2,313 (1) 1,445 14,190 Income (loss) before income tax $ 1,817 $ (1,610) $ 1,758 $ 1,965 Goodwill $ 15,994 $ 7,245 $ — $ 23,239 Total assets $ 1,145,910 $ 9,025 $ 35,530 $ 1,190,465 ______________________________________________ (1) Includes goodwill impairment charge of $1.6 million. Three Months Ended June 30, 2018 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 9,505 $ — $ — $ 9,505 Total interest expense 1,928 — — 1,928 Provision for loan losses - — — - Net interest income 7,577 — — 7,577 Non-interest income 4,680 845 1,367 6,892 Total income 12,257 845 1,367 14,469 Depreciation and amortization expense 321 132 124 577 All other non-interest expense 10,025 1,080 1,402 12,507 Income (loss) before income tax $ 1,911 $ (367) $ (159) $ 1,385 Goodwill $ 15,994 $ 8,817 $ — $ 24,811 Total assets $ 1,001,191 $ 10,318 $ 35,064 $ 1,046,573 Six Months Ended June 30, 2019 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 22,224 $ - $ - $ 22,224 Total interest expense 6,293 - - 6,293 Provision for loan losses 116 - - 116 Net-interest income 15,815 - - 15,815 Non-interest income 9,244 1,563 4,755 15,562 Total income 25,059 1,563 4,755 31,377 Depreciation and amortization expense 632 226 138 996 All other non-interest expense 20,499 3,008 (1) 2,758 26,265 Income before income tax $ 3,928 $ (1,671) $ 1,859 $ 4,116 Goodwill $ 15,994 $ 7,245 $ — $ 23,239 Total assets $ 1,145,910 $ 9,025 $ 35,530 $ 1,190,465 _______________________________________________ (1) Includes goodwill impairment charge of $1.6 million. Six Months Ended June 30, 2018 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 18,511 $ — $ — $ 18,511 Total interest expense 3,574 — — 3,574 Provision for loan losses (187) — — (187) Net-interest income 15,124 — — 15,124 Non-interest income 9,844 1,706 2,634 14,184 Total income 24,968 1,706 2,634 29,308 Depreciation and amortization expense 641 262 247 1,150 All other non-interest expense 20,165 2,276 2,779 25,220 Income before income tax $ 4,162 $ (832) $ (392) $ 2,938 Goodwill $ 15,994 $ 8,817 $ — $ 24,811 Total assets $ 1,001,191 $ 10,318 $ 35,064 $ 1,046,573

REGULATORY CAPITAL MATTERS

REGULATORY CAPITAL MATTERS	6 Months Ended
	Jun. 30, 2019
REGULATORY CAPITAL MATTERS
REGULATORY CAPITAL MATTERS	NOTE 15 - REGULATORY CAPITAL MATTERS The Bank is subject to various regulatory capital adequacy 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 Company’s consolidated financial statements. Under capital adequacy guidelines and, additionally for banks, the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities, and certain off‑balance sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and classification is also subject to qualitative judgments by the regulators regarding components, risk weightings and other factors. The final rules implementing Basel Committee on Banking Supervision’s capital guidelines for U.S. banks (“Basel III rules”) became effective for the Company on January 1, 2015 with full compliance with all of the requirements being phased in over a multi‑year schedule, and fully phased in by January 1, 2019. The net unrealized gain or loss on available‑for‑sale securities is not included in computing regulatory capital. Management believes as of June 30, 2019, the Bank meets all capital adequacy requirements to which it is subject to. Prompt corrective action regulations for the Bank provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. The standard ratios established by the Bank’s primary regulators to measure capital require the Bank to maintain minimum amounts and ratios. These ratios are common equity Tier 1 capital (“CET 1”), Tier 1 capital and total capital (as defined in the regulations) to risk‑weighted assets (as defined), and Tier 1 capital (as defined) to average assets (as defined). Actual capital ratios of the Bank, along with the applicable regulatory capital requirements as of June 30, 2019, which were calculated in accordance with the requirements of Basel III, became effective January 1, 2015. The final rules of Basel III also established a “capital conservation buffer” of 2.5% above new regulatory minimum capital ratios, that are fully effective in 2019, and resulted in the following minimum ratios: (i) a CET 1 ratio of 7.0%; (ii) a Tier 1 capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%. The new capital conservation buffer requirement began phasing in, in January 2016 at 0.625% of risk‑weighted assets and increased each year until fully implemented in January 2019. An institution is subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses if its capital level falls below the buffer amount. These limitations will establish a maximum percentage of eligible retained income that can be utilized for such activities. At June 30, 2019, required ratios including the capital conservation buffer were (i) CET 1 of 7.0%; (ii) a Tier 1 capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%. As of June 30, 2019 and December 31, 2018, the most recent filings with the Federal Deposit Insurance Corporation (“FDIC”) categorized the Bank as well capitalized under the regulatory guidelines. To be categorized as well capitalized, an institution must maintain minimum CET 1 risk‑based, Tier 1 risk‑based, total risk‑based, and Tier 1 leverage ratios as set forth in the following table. There are no conditions or events since June 30, 2019, that the Company believes have changed the categorization of the Bank as well capitalized. Management believes the Bank met all capital adequacy requirements to which it was subject to as of June 30, 2019 and December 31, 2018. The following presents the actual and required capital amounts and ratios as of June 30, 2019 and December 31, 2018 (in thousands): To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes Regulations June 30, 2019 Amount Ratio Amount Ratio Amount Ratio Common Equity Tier 1(CET1) to risk-weighted assets Bank $ 92,973 10.65 % $ 39,293 4.5 % $ 56,756 6.5 % Consolidated 100,024 11.41 N/A N/A N/A N/A Tier 1 capital to risk-weighted assets Bank 92,973 10.65 52,391 6.0 69,854 8.0 Consolidated 100,024 11.41 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 100,697 11.53 69,854 8.0 87,318 10.0 Consolidated 114,309 13.04 N/A N/A N/A N/A Tier 1 capital to average assets Bank 92,973 8.42 44,186 4.0 55,232 5.0 Consolidated 100,024 9.01 N/A N/A N/A N/A To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes Regulations December 31, 2018 Amount Ratio Amount Ratio Amount Ratio Common Equity Tier 1(CET1) to risk-weighted assets Bank $ 87,291 10.55 % $ 37,240 4.5 % $ 53,791 6.5 % Consolidated 94,335 11.35 N/A N/A N/A N/A Tier 1 capital to risk-weighted assets Bank 87,291 10.55 49,653 6.0 66,204 8.0 Consolidated 94,335 11.35 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 94,906 11.47 66,204 8.0 82,755 10.0 Consolidated 108,510 13.06 N/A N/A N/A N/A Tier 1 capital to average assets Bank 87,291 8.63 40,459 4.0 50,574 5.0 Consolidated 94,335 9.28 N/A N/A N/A N/A

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2019
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 16 – SUBSEQUENT EVENTS On July 19, 2019, the Company entered into an agreement to sell the Company’s Los Angeles-based fixed income portfolio management team, a portion of the Capital Management reporting unit, to Lido Advisors, LLC and Oakhurst Advisors, LLC in exchange for cash consideration of $0.5 million and contingent consideration. The contingent consideration is based on certain percentages of asset-based revenues generated over three to five years subsequent to the closing date, subject to quarterly minimum and maximum amounts. The Company expects the sale to benefit the Company by optimizing the cost structure and freeing up capital and resources to strengthen the Wealth Management and Mortgage reporting units. The transaction is expected to close in the third quarter of 2019.

ORGANIZATION AND SUMMARY OF S_2

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2019
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business and Basis of Presentation	Business and Basis of Presentation : The condensed consolidated financial statements include the accounts of First Western Financial, Inc. (“FWFI”), incorporated in Colorado on July 18, 2002, and its direct and indirect wholly‑owned subsidiaries listed below (collectively referred to as the “Company”). FWFI is a bank holding company with financial holding company status registered with the Board of Governors of the Federal Reserve System. FWFI wholly owns the following subsidiaries: First Western Trust Bank (the “Bank”), First Western Capital Management Company (“FWCM”), and Ryder, Stilwell Inc. (“RSI”). The Bank wholly owns the following subsidiaries, which are therefore indirectly wholly‑owned by FWFI: First Western Merger Corporation (“Merger Corp.”), and RRI, LLC (“RRI”). RSI and RRI are not active operating entities. The Company provides a fully‑integrated suite of wealth management services including, private banking, personal trust, investment management, mortgage loans, and institutional asset management services to individual and corporate customers principally in Colorado (metro Denver, Aspen, Boulder, Fort Collins and Vail Valley), Arizona (Phoenix and Scottsdale), California (Century City, Los Angeles) and Wyoming (Jackson Hole and Laramie). The Company’s revenues are generated from its full range of product offerings as noted above, but principally from net interest income (the interest income earned on the Bank’s assets net of funding costs), fee‑based wealth advisory, investment management, asset management and personal trust services, and net gains earned on selling mortgage loans. The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The December 31, 2018 condensed consolidated balance sheet has been derived from the audited financial statements for the year ended December 31, 2018. In the opinion of management, all adjustments that were recurring in nature and considered necessary have been included for fair presentation of the Company’s financial position and results of operations. Operating results for the three and six months ended June 30, 2019 are not necessarily indicative of results that may be expected for the full year ending December 31, 2019. In preparing the condensed consolidated financial statements, the Company is required to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could be significantly different from those estimates. The condensed consolidated financial statements and notes should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the SEC.
Consolidation	Consolidation : The Company’s policy is to consolidate all majority‑owned subsidiaries in which it has a controlling financial interest and variable‑interest entities where the Company is deemed to be the primary beneficiary. All material intercompany accounts and transactions have been eliminated in consolidation.
Concentration of Credit Risk	Concentration of Credit Risk : Most of the Company’s lending activity is to customers located in and around Denver, Colorado; Phoenix and Scottsdale, Arizona; and Jackson Hole, Wyoming. The Company does not believe it has significant concentrations in any one industry or customer. At June 30, 2019 and December 31, 2018, 72.0% and 73.6%, respectively, of the Company’s loan portfolio was secured by real estate collateral. Declines in real estate values in the primary markets the Company operates in could negatively impact the Company. Revenue Recognition : In accordance with the Financial Accounting Standards Board (“FASB”), Revenue Contracts with Customers (“Topic 606”), trust and investment management fees are earned by providing trust and investment services to customers. The Company’s performance obligation under these contracts is satisfied over time as the services are provided. Fees are recognized monthly based on the average monthly value of the assets under management and the corresponding fee rate based on the terms of the contract. Performance based incentive fees are earned with respect to investment management contracts for the three and six month periods ended June 30, 2019 and the year ended December 31, 2018 were immaterial. Receivables are recorded on the condensed consolidated balance sheet in the accounts receivable line item. Income related to trust and investment management fees, bank fees, and risk management and insurance fees on the condensed consolidated statement of operations for the three and six months ended June 30, 2019 are considered in scope of Topic 606. Reclassifications : Certain items in prior year financial statements were reclassified to conform to the current presentation. Such reclassifications had no impact on net income or total shareholders’ equity. Adoption of new accounting standards : The following reflect recent accounting pronouncements that have been adopted by the Company since the end of the Company’s fiscal year ended December 31, 2018. In February 2016, the FASB issued ASU 2016-02, Lease Accounting (Topic 842) (“ASU 2016-02”). Under ASU 2016-02, a lessee is required to recognize assets and liabilities for leases with lease terms of more than twelve months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires only capital leases to be recognized on the balance sheet, ASU 2016-02 requires both types of leases to be recognized on the balance sheet. The ASU also requires disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements. Upon adoption of ASU 2016-02 with its March 31, 2019 Quarterly Report on Form 10-Q for the three months ended March 31, 2019, the Company recorded a right-of-use asset and related lease liability. We elected the modified retrospective transition approach. We also elected and applied the package of practical expedients whereby we will not reassess prior to the effective date (i) whether any expired contracts contain leases, (ii) the lease classification for any existing or expired lease, and (iii) initial direct costs of any existing leases. See Note 5 – Leases, for further information. In March 2017, the FASB issued ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) (“ASU 2017-08”). ASU 2017-08 amends the amortization period for certain purchased callable debt securities held at a premium. Prior to the issuance of this guidance, premiums were amortized as an adjustment of yield over the contractual life of the instrument. ASU 2017-08 requires premiums on purchased callable debt securities that have explicit, non-contingent call features that are callable at fixed prices to be amortized to the earliest call date. There are no accounting changes for securities held at a discount. ASU 2017-08 became effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12”), which provided guidance to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. ASU 2017-12 was effective for the Company on January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220) (“ASU 2018-02”). ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income into retained earnings. ASU 2018-02 was effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures.
Revenue Recognition	Revenue Recognition : In accordance with the Financial Accounting Standards Board (“FASB”), Revenue Contracts with Customers (“Topic 606”), trust and investment management fees are earned by providing trust and investment services to customers. The Company’s performance obligation under these contracts is satisfied over time as the services are provided. Fees are recognized monthly based on the average monthly value of the assets under management and the corresponding fee rate based on the terms of the contract. Performance based incentive fees are earned with respect to investment management contracts for the three and six month periods ended June 30, 2019 and the year ended December 31, 2018 were immaterial. Receivables are recorded on the condensed consolidated balance sheet in the accounts receivable line item. Income related to trust and investment management fees, bank fees, and risk management and insurance fees on the condensed consolidated statement of operations for the three and six months ended June 30, 2019 are considered in scope of Topic 606.
Reclassifications	Reclassifications : Certain items in prior year financial statements were reclassified to conform to the current presentation. Such reclassifications had no impact on net income or total shareholders’ equity.
Adoption of new accounting standards and Recently issued accounting pronouncements, not yet adopted	Adoption of new accounting standards : The following reflect recent accounting pronouncements that have been adopted by the Company since the end of the Company’s fiscal year ended December 31, 2018. In February 2016, the FASB issued ASU 2016-02, Lease Accounting (Topic 842) (“ASU 2016-02”). Under ASU 2016-02, a lessee is required to recognize assets and liabilities for leases with lease terms of more than twelve months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires only capital leases to be recognized on the balance sheet, ASU 2016-02 requires both types of leases to be recognized on the balance sheet. The ASU also requires disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements. Upon adoption of ASU 2016-02 with its March 31, 2019 Quarterly Report on Form 10-Q for the three months ended March 31, 2019, the Company recorded a right-of-use asset and related lease liability. We elected the modified retrospective transition approach. We also elected and applied the package of practical expedients whereby we will not reassess prior to the effective date (i) whether any expired contracts contain leases, (ii) the lease classification for any existing or expired lease, and (iii) initial direct costs of any existing leases. See Note 5 – Leases, for further information. In March 2017, the FASB issued ASU 2017-08, Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20) (“ASU 2017-08”). ASU 2017-08 amends the amortization period for certain purchased callable debt securities held at a premium. Prior to the issuance of this guidance, premiums were amortized as an adjustment of yield over the contractual life of the instrument. ASU 2017-08 requires premiums on purchased callable debt securities that have explicit, non-contingent call features that are callable at fixed prices to be amortized to the earliest call date. There are no accounting changes for securities held at a discount. ASU 2017-08 became effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12”), which provided guidance to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. ASU 2017-12 was effective for the Company on January 1, 2019 and did not have a significant impact on the financial statements and disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220) (“ASU 2018-02”). ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Cuts and Jobs Act of 2017 from accumulated other comprehensive income into retained earnings. ASU 2018-02 was effective for the Company beginning January 1, 2019 and did not have a significant impact on the financial statements and disclosures. Recently issued accounting pronouncements, not yet adopted : The following reflects a pending pronouncement with an update to the expected impact since the end of the Company’s fiscal year ended December 31, 2018. In February 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) (“ASU 2016-13”). ASU 2016-13 replaces the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on the financial assets measured at amortized cost, including loan receivables, held-to-maturity debt securities, and reinsurance receivables. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in leases recognized by a lessor. For all other assets within the scope of CECL, a cumulative-effect adjustment will be recognized in retained earnings and the allowance for loan losses as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 will be effective for most public companies on January 1, 2020. On July 17, 2019, the FASB voted to delay CECL implementation for certain companies including smaller reporting companies as defined by the SEC. The Company is designated as a smaller reporting company with the SEC. The proposed delay by FASB is subject to a 30-day comment period so the Company will determine if CECL is delayed during the third quarter of 2019. During the second quarter of 2019, the CECL committee of the Company continued to work through its implementation plan. The Company has integrated historical and current loan level data as required by CECL and is working with its third-party vendor solution on beginning to evaluate the methodologies available under the CECL model on its loan portfolios. The Company also continues to evaluate documentation requirements, internal control structure, relevant data sources, and system configurations. Currently, we are unable to estimate the impact the adoption of this update will have on the consolidated financial statements and disclosures. However, the Company expects the impact of the adoption will be significantly influenced by the composition and characteristics of its loan portfolios along with economic conditions prevalent as of the date of adoption.

INVESTMENT SECURITIES (Tables)

INVESTMENT SECURITIES (Tables)	6 Months Ended
	Jun. 30, 2019
INVESTMENT SECURITIES
Schedule of the amortized cost and fair value of securities available for sale, with gross unrealized gains and losses recognized	The following presents the amortized cost and fair value of securities available‑for‑sale, with gross unrealized gains and losses recognized in accumulated other comprehensive income as of June 30, 2019 and December 31, 2018 (in thousands): Gross Gross Amortized Unrealized Unrealized Fair June 30, 2019 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ 5 $ — $ 255 Government National Mortgage Association mortgage-backed securities—residential (“GNMA”) 38,529 273 (265) 38,537 Federal National Mortgage Association mortgage-backed securities—residential (“FNMA”) 3,546 8 (61) 3,493 Securities issued by U.S. government sponsored entities and agencies 4,300 1 (8) 4,293 Corporate collateralized mortgage obligations (“CMO”) and mortgage-backed securities (“MBS”) 5,058 74 (12) 5,120 Total securities available-for-sale $ 51,683 $ 361 $ (346) $ 51,698 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018 Cost Gains Losses Value Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ — $ 250 GNMA 35,591 8 (1,597) 34,002 FNMA 4,076 2 (208) 3,870 Securities issued by U.S. government sponsored entities and agencies 4,525 — (223) 4,302 Corporate CMO and MBS 1,281 1 (11) 1,271 Total securities available-for-sale $ 45,723 $ 11 $ (2,039) $ 43,695
Summary of the amortized cost and estimated fair value of available for sale securities, excluding SBIC with contractual maturity dates	Amortized Fair June 30, 2019 Cost Value Due within one year through five years $ 555 $ 560 Securities (agency and CMO) 51,128 51,138 Total $ 51,683 $ 51,698
Summary of securities with unrealized losses aggregated by major security type and length of time in a continuous unrealized loss position	The following table summarizes securities with unrealized losses at June 30, 2019 and December 31, 2018, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands, before tax): Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized June 30, 2019 Value Losses Value Losses Value Losses U.S. Treasury debt $ — $ — $ — $ — $ — $ — GNMA — — 16,139 (265) 16,139 (265) FNMA — — 2,918 (61) 2,918 (61) Securities issued by U.S. government sponsored entities and agencies — — 3,988 (8) 3,988 (8) Corporate CMO and MBS 1,179 (12) 60 — 1,239 (12) Total $ 1,179 $ (12) $ 23,105 $ (334) $ 24,284 $ (346) Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized December 31, 2018 Value Losses Value Losses Value Losses U.S. Treasury debt $ — $ — $ — $ — $ — $ — GNMA 201 — 32,696 (1,597) 32,897 (1,597) FNMA 436 (3) 3,215 (205) 3,651 (208) Securities issued by U.S. government sponsored entities and agencies — — 4,302 (223) 4,302 (223) Corporate CMO and MBS 1,145 (9) 63 (2) 1,208 (11) Total $ 1,782 $ (12) $ 40,276 $ (2,027) $ 42,058 $ (2,039)

LOANS AND THE ALLOWANCE FOR L_2

LOANS AND THE ALLOWANCE FOR LOAN LOSSES (Tables)	6 Months Ended
	Jun. 30, 2019
LOANS AND THE ALLOWANCE FOR LOAN LOSSES
Summary of the Company’s loans	The following presents a summary of the Company’s loans as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities and Other $ 149,503 $ 114,165 Construction and Development 40,826 31,897 1-4 Family Residential 373,836 350,852 Non-Owner Occupied CRE 152,664 173,741 Owner Occupied CRE 112,660 108,480 Commercial and Industrial 108,516 113,660 Total loans 938,005 892,795 Deferred costs, net 1,390 1,171 Allowance for loan losses (7,575) (7,451) Loans, net $ 931,820 $ 886,515
Summary of aging analysis of the recorded investments in loans past due	The following presents, by class, an aging analysis of the recorded investments (excluding accrued interest receivable, deferred loan fees and deferred costs which are not material) in loans past due as of June 30, 2019 and December 31, 2018 (in thousands): 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded June 30, 2019 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ — $ — $ — $ — $ 149,503 $ 149,503 Construction and Development — — — — 40,826 40,826 1-4 Family Residential — 497 1,213 1,710 372,126 373,836 Non-Owner Occupied CRE — 460 — 460 152,204 152,664 Owner Occupied CRE — — — — 112,660 112,660 Commercial and Industrial — 2,300 — 2,300 106,216 108,516 Total $ — $ 3,257 $ 1,213 $ 4,470 $ 933,535 $ 938,005 30-59 60-89 90 or Total Total Days Days More Days Loans Recorded December 31, 2018 Past Due Past Due Past Due Past Due Current Investment Cash, Securities and Other $ 331 $ — $ 11,252 $ 11,583 $ 102,582 $ 114,165 Construction and Development — — — — 31,897 31,897 1-4 Family Residential — — 1,217 1,217 349,635 350,852 Non-Owner Occupied CRE 567 — — 567 173,174 173,741 Owner Occupied CRE — — — — 108,480 108,480 Commercial and Industrial — — 1,735 1,735 111,925 113,660 Total $ 898 $ — $ 14,204 $ 15,102 $ 877,693 $ 892,795
Schedule of recorded investment in non accrual loans by class	The following presents the recorded investment in non‑accrual loans by class as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities and Other $ 5,107 $ 11,252 Construction and Development — — 1-4 Family Residential — — Non-Owner Occupied CRE — — Owner Occupied CRE — — Commercial and Industrial 1,035 1,735 Total $ 6,142 $ 12,987
Summary of the unpaid principal balance of loans classified as TDRs	The following presents a summary of the unpaid principal balance of loans classified as TDRs as of the dates noted (in thousands): June 30, December 31, 2019 2018 Cash, Securities, and Other $ 5,107 $ 11,252 Commercial and Industrial 6,483 6,583 Total $ 11,590 $ 17,835 Allowance for loan associated with TDR (940) (940) Net recorded investment $ 10,650 $ 16,895
Summary of recorded investment in impaired loans	The following table presents impaired loans by portfolio and related valuation allowance as of the periods presented (in thousands): June 30, 2019 December 31, 2018 Unpaid Allowance Unpaid Allowance Total Contractual for Total Contractual for Recorded Principal Loan Recorded Principal Loan Investment Balance Losses Investment Balance Losses Impaired loans with a valuation allowance: Commercial and Industrial $ 1,035 $ 1,035 $ 940 $ 1,735 $ 1,735 $ 940 Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,448 $ 5,448 $ — $ 4,848 $ 4,848 $ — Cash, Securities, and Other 5,107 5,107 — 11,252 11,252 — 1-4 Family Residential 1,213 1,213 — — — — Total $ 11,768 $ 11,768 $ — $ 16,100 $ 16,100 $ — Total impaired loans: Commercial and Industrial $ 6,483 $ 6,483 $ 940 $ 6,583 $ 6,583 $ 940 Cash, Securities, and Other 5,107 5,107 — 11,252 11,252 — 1-4 Family Residential 1,213 1,213 — — — — Total $ 12,803 $ 12,803 $ 940 $ 17,835 $ 17,835 $ 940 The recorded investment in loans in the previous tables excludes accrued interest and deferred loan fees and costs which are not material. Interest income, if any, was recognized on the cash basis on non-accrual loans. The average balance of impaired loans and interest income recognized on impaired loans during the three months ended June 30, 2019 and 2018 are included in the table below (in thousands): Three Months Ended June 30, 2019 2018 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Commercial and Industrial $ 1,235 $ — $ 1,835 $ — Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,268 $ 68 $ — $ — Cash, Securities, and Other 8,042 — — — 1-4 Family Residential 412 26 — — Total $ 13,722 $ 94 $ — $ — Total impaired loans: Commercial and Industrial $ 6,503 $ 68 $ 1,835 $ — Cash, Securities, and Other 8,042 — — — 1-4 Family Residential 412 26 — — Total $ 14,957 $ 94 $ 1,835 $ — The average balance of impaired loans and interest income recognized on impaired loans during the six months ended June 30, 2019 and 2018 are included in the table below (in thousands): Six Months Ended June 30, 2019 2018 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized Impaired loans with a valuation allowance: Commercial and Industrial $ 1,398 $ — $ 1,835 $ — Impaired loans with no related valuation allowance: Commercial and Industrial $ 5,131 $ 188 $ — $ — Cash, Securities, and Other 9,072 — — — 1-4 Family Residential 412 51 — — Total $ 14,615 $ 239 $ — $ — Total impaired loans: Commercial and Industrial $ 6,529 $ 188 $ 1,835 $ — Cash, Securities, and Other 9,072 — — — 1-4 Family Residential 412 51 — — Total $ 16,013 $ 239 $ 1,835 $ —
Schedule of activity in the Company’s allowance for loan losses by portfolio class	Allocation of a portion of the allowance for loan losses to one category of loans does not preclude its availability to absorb losses in other categories. The following presents the activity in the Company’s allowance for loan losses by portfolio class for the periods presented (in thousands): Cash, Construction 1-4 Non-Owner Owner Commercial Securities and Family Occupied Occupied and and Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2019 Beginning balance $ 877 $ 266 $ 2,588 $ 1,235 $ 780 $ 1,899 $ 7,645 Provision for (recovery of) credit losses 164 24 62 (149) 20 (199) (78) Charge-offs — — — — — — — Recoveries 8 — — — — — 8 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Changes in allowance for loan losses for the six months ended June 30, 2019 Beginning balance $ 764 $ 232 $ 2,552 $ 1,264 $ 789 $ 1,850 $ 7,451 Provision for (recovery of) credit losses 277 58 98 (178) 11 (150) 116 Charge-offs — — — — — — — Recoveries 8 — — — — — 8 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Allowance for loan losses at June 30, 2019 allocated to loans evaluated for impairment: Individually $ — $ — $ — $ — $ — $ 940 $ 940 Collectively 1,049 290 2,650 1,086 800 760 6,635 Ending balance $ 1,049 $ 290 $ 2,650 $ 1,086 $ 800 $ 1,700 $ 7,575 Loans at June 30, 2019, evaluated for impairment: Individually $ 5,107 $ — $ 1,213 $ — $ — $ 6,483 $ 12,803 Collectively 144,396 40,826 372,623 152,664 112,660 102,033 925,202 Ending balance $ 149,503 $ 40,826 $ 373,836 $ 152,664 $ 112,660 $ 108,516 $ 938,005 Cash, Construction 1-4 Non-Owner Owner Commercial Securities and Family Occupied Occupied and and Other Development Residential CRE CRE Industrial Total Changes in allowance for loan losses for the three months ended June 30, 2018 Beginning balance $ 969 $ 228 $ 2,334 $ 1,313 $ 724 $ 1,532 $ 7,100 Provision for (recovery of) credit losses (35) (1) (377) (114) (98) 625 — Charge-offs — — — — — — — Recoveries — — — — — — — Ending balance $ 934 $ 227 $ 1,957 $ 1,199 $ 626 $ 2,157 $ 7,100 Changes in allowance for loan losses for the six months ended June 30, 2018 Beginning balance $ 1,066 $ 202 $ 2,283 $ 1,433 $ 751 $ 1,552 $ 7,287 Provision for (recovery of) credit losses (132) 25 (326) (234) (125) 605 (187) Charge-offs — — — — — — — Recoveries — — — — — — — Ending balance $ 934 $ 227 $ 1,957 $ 1,199 $ 626 $ 2,157 $ 7,100 Allowance for loan losses at December 31, 2018 allocated to loans evaluated for impairment: Individually $ — $ — $ — $ — $ — $ 940 $ 940 Collectively 764 232 2,552 1,264 789 910 6,511 Ending balance $ 764 $ 232 $ 2,552 $ 1,264 $ 789 $ 1,850 $ 7,451 Loans at December 31, 2018, evaluated for impairment: Individually $ 11,252 $ — $ — $ — $ — $ 6,583 $ 17,835 Collectively 102,913 31,897 350,852 173,741 108,480 107,077 874,960 Ending balance $ 114,165 $ 31,897 $ 350,852 $ 173,741 $ 108,480 $ 113,660 $ 892,795
Summary of recorded investment in the Company’s loans by class and by credit quality indicator	Special June 30, 2019 Pass Mention Substandard Total Cash, Securities and Other $ 144,396 $ — $ 5,107 $ 149,503 Construction and Development 40,826 — — 40,826 1-4 Family Residential 366,577 6,046 1,213 373,836 Non-Owner Occupied CRE 151,020 1,184 460 152,664 Owner Occupied CRE 112,660 — — 112,660 Commercial and Industrial 96,114 — 12,402 108,516 Total $ 911,593 $ 7,230 $ 19,182 $ 938,005 Special December 31, 2018 Pass Mention Substandard Total Cash, Securities and Other $ 102,913 $ — $ 11,252 $ 114,165 Construction and Development 31,897 — — 31,897 1-4 Family Residential 349,635 — 1,217 350,852 Non-Owner Occupied CRE 165,164 8,117 460 173,741 Owner Occupied CRE 108,480 — — 108,480 Commercial and Industrial 100,929 — 12,731 113,660 Total $ 859,018 $ 8,117 $ 25,660 $ 892,795

GOODWILL (Tables)

GOODWILL (Tables)	6 Months Ended
	Jun. 30, 2019
Goodwill.
Schedule of changes in carrying amount of goodwill	Wealth Capital Management Management Consolidated Balance at December 31, 2018 $ 15,994 $ 8,817 $ 24,811 Impairment - (1,572) (1,572) Balance at June 30, 2019 $ 15,994 $ 7,245 $ 23,239

LEASES (Tables)

LEASES (Tables)	6 Months Ended
	Jun. 30, 2019
LEASES
Lease Balance Sheet Location	The following table presents the classification of the right-of-use asset and corresponding liability within the condensed consolidated balance sheet. The Company elected to not include short-term leases with initial terms of twelve months or less, on the condensed consolidated balance sheet. June 30, 2019 Lease Right-of-Use Assets Classification Operating lease right-of-use assets Other assets $ 11,591 Lease Liabilities Classification Operating lease liabilities Other liabilities $ 15,063 The Company’s operating lease agreements typically include an option to renew the lease at the Company’s discretion. To the extent the Company is reasonably certain it will exercise the renewal option at the inception of the lease, the Company will include the extended term in the calculation of the right-of-use asset and lease liability. ASC 842 requires the use of the rate implicit in the lease when it is readily determinable. As this rate is typically not readily determinable, at the inception of the lease, the Company uses its collateralized incremental borrowing rate over a similar term. The amount of the right-of-use asset and lease liability are impacted by the discount rate used to calculate the present value of the minimum lease payments over the term of the lease. June 30, 2019 Weighted-Average Remaining Lease Term Operating leases years Weighted-Average Discount Rate Operating leases %
Lease Costs	The following table represents the Company’s net lease costs. Three Months Ended Six Months Ended June 30, 2019 June 30, 2019 Lease Costs Operating lease cost $ 789 $ 1,572 Variable lease cost 385 773 Sublease income (100) (199) Lease costs, net $ 1,074 $ 2,146
Summary of Minimum Lease Payments	The following table presents a maturity analysis of the Company’s operating lease liabilities on an annual basis for each of the first five years and total amounts thereafter as of June 30, 2019 . Operating Leases Twelve Months Ended June 30, 2020 $ 3,707 June 30, 2021 3,061 June 30, 2022 2,709 June 30, 2023 2,567 June 30, 2024 2,248 Thereafter 2,319 Total Future Minimum Lease Payments $ 16,611 Less: Imputed interest (1,548) Present Value of Net Future Minimum Lease Payments $ 15,063
Schedule of Minimum Lease Payments Due	The following presents minimum lease payments due pursuant to the leases as of December 31, 2018 for the years indicated. Year Operating Leases 2019 $ 3,570 2020 3,374 2021 2,815 2022 2,675 2023 2,358 Thereafter 3,446 $ 18,238

DEPOSITS (Tables)

DEPOSITS (Tables)	6 Months Ended
	Jun. 30, 2019
DEPOSITS
Schedule of interest bearing deposits	The following presents the Company’s interest-bearing deposits at the dates noted (in thousands): June 30, December 31, 2019 2018 Money market deposit accounts $ 508,263 $ 489,506 Time deposits 176,128 178,743 Negotiable order of withdrawal accounts 88,687 64,853 Savings accounts 2,833 1,800 Total interest bearing deposits $ 775,911 $ 734,902 Aggregate time deposits of $250,000 or greater $ 74,084 $ 83,550

BORROWINGS (Tables)

BORROWINGS (Tables)	6 Months Ended
	Jun. 30, 2019
BORROWINGS
Schedule of borrowings from FHLB Topeka	The Company had the following borrowings from FHLB Topeka at the dates noted (in thousands): June 30, December 31, Maturity Date Rate % 2019 2018 August 2, 2019 2.55 $ 26,060 $ 5,000 August 26, 2020 1.94 10,000 10,000 Total $ 36,060 $ 15,000

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2019
COMMITMENTS AND CONTINGENCIES
Schedule of contract amounts represent credit risk	The following presents the Company’s financial instruments whose contract amounts represent credit risk, as of the dates noted (in thousands): June 30, 2019 December 31, 2018 Fixed Rate Variable Rate Fixed Rate Variable Rate Unused lines of credit $ 21,424 $ 252,755 $ 33,571 $ 271,580 Standby letters of credit 25 23,833 40 23,508 Commitments to make loans to sell 83,309 — 17,207 — Commitments to make loans 16,154 46,306 2,750 19,762

SHAREHOLDERS EQUITY (Tables)

SHAREHOLDERS EQUITY (Tables)	6 Months Ended
	Jun. 30, 2019
SHAREHOLDERS EQUITY
Schedule of summarizes activity for nonqualified stock options	Weighted Weighted Average Number Average Remaining Aggregate of Exercise Contractual Intrinsic Options Price Term Value Outstanding at beginning of year 465,947 $ 28.84 Granted — — Exercised — — Forfeited or expired (23,850) 26.25 Outstanding at end of period 442,097 $ 28.98 4.0 (a) Options fully vested / exercisable at June 30, 2019 388,216 $ 29.59 3.7 (a) (a) Nonqualified stock options outstanding at the end of the period and those fully vested / exercisable had immaterial aggregate intrinsic values.
Schedule of summarizes the activity for the Time Vesting Units, the Financial Performance Units and the Market Performance Units	Time Financial Market Vesting Performance Performance Units Units Units Outstanding at beginning of year 184,369 15,932 17,258 Granted 71,127 59,536 - Vested (23,281) - - Forfeited (16,318) (4,603) (1,512) Outstanding at end of period

EARNINGS PER COMMON SHARE (Tabl

EARNINGS PER COMMON SHARE (Tables)	6 Months Ended
	Jun. 30, 2019
EARNINGS PER COMMON SHARE
Schedule of basic and diluted earning (loss) per share	The table below presents the calculation of basic and diluted earnings per common share for the periods indicated (amounts in thousands, except share and per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Earnings per common share - Basic Numerator: Net income $ 1,404 $ 1,048 $ 3,031 $ 2,234 Dividends on preferred stock — (562) — (1,123) Net income available for common shareholders $ 1,404 $ 486 $ 3,031 $ 1,111 Denominator: Basic weighted average shares 7,881,999 5,911,886 7,877,864 5,891,463 Earnings per common share - basic $ 0.18 $ 0.08 $ 0.39 $ 0.19 Earnings per common share - Diluted Numerator: Net income $ 1,404 $ 1,048 $ 3,031 $ 2,234 Dividends on preferred stock — (562) — (1,123) Net income available for common shareholders $ 1,404 $ 486 $ 3,031 $ 1,111 Denominator: Basic weighted average shares 7,881,999 5,911,886 7,877,864 5,891,463 Diluted effect of common stock equivalents: Stock options — 32,643 — 31,291 Time Vesting Units 2,044 13,958 2,062 22,261 Financial Performance Units — 16,355 — 9,758 Market Performance Units 13,049 — 13,448 — Restricted Stock Awards — 6,579 — 5,264 Total diluted effect of common stock equivalents 15,093 69,535 15,510 68,574 Diluted weighted average shares 7,897,092 5,981,421 7,893,374 5,960,037 Earnings per common share - diluted $ 0.18 $ 0.08 $ 0.39 $ 0.19
Schedule of Antidilutive securities	Three Months Ended Six Months Ended 2019 2018 2019 2018 Stock options 442,097 207,700 445,947 211,450 Convertible Preferred D shares — 151,700 — 151,700 Time Vesting Units 198,611 — 179,301 — Financial Performance Units 70,865 — 42,998 — Market Performance Units — — — — Restricted Stock Awards 94,736 — 94,736 — Total potentially dilutive securities 806,309 359,400 762,982 363,150

RELATED-PARTY TRANSACTIONS (Tab

RELATED-PARTY TRANSACTIONS (Tables)	6 Months Ended
	Jun. 30, 2019
RELATED-PARTY TRANSACTIONS
Summary of related-party loan activity	The following presents a summary of related‑party loan activity as of the dates noted (in thousands): June 30, 2019 December 31, 2018 Balance, beginning of year $ 2,659 $ 14,077 Funded loans 5,623 1,466 Payments collected (2,588) (9,386) Changes in related parties — (3,498) Balance, end of year $ 5,694 $ 2,659

FAIR VALUE (Tables)

FAIR VALUE (Tables)	6 Months Ended
	Jun. 30, 2019
FAIR VALUE
Summary of assets measured at fair value on recurring basis	The following presents assets measured on a recurring basis at June 30, 2019 and December 31, 2018 (in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2019 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 255 $ — $ — $ 255 GNMA — 38,537 — 38,537 FNMA — 3,493 — 3,493 Securities issued by US. Government sponsored entities and agencies — 4,293 — 4,293 Corporate CMO and MBS — 5,120 — 5,120 Total securities available-for-sale $ 255 $ 51,443 $ — $ 51,698 Equity securities $ 712 $ — $ — $ 712 Interest rate lock and forward delivery commitments $ — $ 739 $ — $ 739 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2018 (Level 1) (Level 2) (Level 3) Balance Investment securities available-for-sale: U.S. Treasury debt $ 250 $ — $ — $ 250 GNMA — 34,002 — 34,002 FNMA — 3,870 — 3,870 Securities issued by US. Government sponsored entities and agencies — 4,302 4,302 Corporate CMO and MBS — 1,271 — 1,271 Total securities available-for-sale $ 250 $ 43,445 $ — $ 43,695 Equity securities $ 693 $ — $ — $ 693 Interest rate lock and forward delivery commitments $ — $ 890 $ — $ 890
Summary of assets measured at fair value on nonrecurring basis	The following presents assets measured on a nonrecurring basis as of June 30, 2019 and December 31, 2018 (in thousands): Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported June 30, 2019 (Level 1) (Level 2) (Level 3) Balance Other real estate owned: Commercial properties $ — $ — $ 658 $ 658 Total impaired loans: Commercial and industrial $ — $ — $ 95 $ 95 Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Assets Inputs Inputs Reported December 31, 2018 (Level 1) (Level 2) (Level 3) Balance Other real estate owned: Commercial properties $ — $ — $ 658 $ 658 Total impaired loans: Commercial and industrial $ — $ — $ 795 $ 795
Summary of carrying amounts and estimated fair values of financial instruments	The following presents carrying amounts and estimated fair values for financial instruments as of June 30, 2019 and December 31, 2018 (in thousands): Carrying Fair Value Measurements Using: June 30, 2019 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 92,769 $ 92,769 $ — $ — Securities available-for-sale 51,698 255 51,443 — Loans, net 931,820 — — 912,965 Mortgage loans held for sale 36,269 — 36,269 — Accrued interest receivable 3,184 — 3,184 — Other assets 712 712 — — Liabilities: Deposits $ 1,005,177 $ — $ 1,008,032 $ — Borrowings: FHLB Topeka Borrowings – fixed rate 36,060 — 36,022 — 2016 Subordinated notes – fixed-to-floating rate 6,560 — — 6,217 Accrued interest payable 274 — 274 — Carrying Fair Value Measurements Using: December 31, 2018 Amount Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 73,357 $ 73,357 $ — $ — Securities available-for-sale 43,695 250 43,445 — Loans, net 886,515 — — 868,828 Mortgage loans held for sale 14,832 — 14,832 — Accrued interest receivable 2,844 — 2,844 — Other assets 693 693 — — Liabilities: Deposits $ 937,758 $ — $ 940,039 $ — Borrowings: FHLB Topeka Borrowings – fixed rate 15,000 — 14,833 — 2016 Subordinated notes – fixed-to-floating rate 6,560 — — 6,434 Accrued interest payable 231 — 231 —

SEGMENT REPORTING (Tables)

SEGMENT REPORTING (Tables)	6 Months Ended
	Jun. 30, 2019
SEGMENT REPORTING
Schedule of segment data	Three Months Ended June 30, 2019 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 11,174 $ — $ — $ 11,174 Total interest expense 3,214 — — 3,214 Provision for loan losses (78) — — (78) Net interest income 8,038 — — 8,038 Non-interest income 4,512 798 3,276 8,586 Total income 12,550 798 3,276 16,624 Depreciation and amortization expense 301 95 73 469 All other non-interest expense 10,432 2,313 (1) 1,445 14,190 Income (loss) before income tax $ 1,817 $ (1,610) $ 1,758 $ 1,965 Goodwill $ 15,994 $ 7,245 $ — $ 23,239 Total assets $ 1,145,910 $ 9,025 $ 35,530 $ 1,190,465 ______________________________________________ (1) Includes goodwill impairment charge of $1.6 million. Three Months Ended June 30, 2018 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 9,505 $ — $ — $ 9,505 Total interest expense 1,928 — — 1,928 Provision for loan losses - — — - Net interest income 7,577 — — 7,577 Non-interest income 4,680 845 1,367 6,892 Total income 12,257 845 1,367 14,469 Depreciation and amortization expense 321 132 124 577 All other non-interest expense 10,025 1,080 1,402 12,507 Income (loss) before income tax $ 1,911 $ (367) $ (159) $ 1,385 Goodwill $ 15,994 $ 8,817 $ — $ 24,811 Total assets $ 1,001,191 $ 10,318 $ 35,064 $ 1,046,573 Six Months Ended June 30, 2019 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 22,224 $ - $ - $ 22,224 Total interest expense 6,293 - - 6,293 Provision for loan losses 116 - - 116 Net-interest income 15,815 - - 15,815 Non-interest income 9,244 1,563 4,755 15,562 Total income 25,059 1,563 4,755 31,377 Depreciation and amortization expense 632 226 138 996 All other non-interest expense 20,499 3,008 (1) 2,758 26,265 Income before income tax $ 3,928 $ (1,671) $ 1,859 $ 4,116 Goodwill $ 15,994 $ 7,245 $ — $ 23,239 Total assets $ 1,145,910 $ 9,025 $ 35,530 $ 1,190,465 _______________________________________________ (1) Includes goodwill impairment charge of $1.6 million. Six Months Ended June 30, 2018 Wealth Capital Mortgage Consolidated Income Statement Total interest income $ 18,511 $ — $ — $ 18,511 Total interest expense 3,574 — — 3,574 Provision for loan losses (187) — — (187) Net-interest income 15,124 — — 15,124 Non-interest income 9,844 1,706 2,634 14,184 Total income 24,968 1,706 2,634 29,308 Depreciation and amortization expense 641 262 247 1,150 All other non-interest expense 20,165 2,276 2,779 25,220 Income before income tax $ 4,162 $ (832) $ (392) $ 2,938 Goodwill $ 15,994 $ 8,817 $ — $ 24,811 Total assets $ 1,001,191 $ 10,318 $ 35,064 $ 1,046,573

REGULATORY CAPITAL MATTERS (Tab

REGULATORY CAPITAL MATTERS (Tables)	6 Months Ended
	Jun. 30, 2019
REGULATORY CAPITAL MATTERS
Schedule of actual and required capital ratios	The following presents the actual and required capital amounts and ratios as of June 30, 2019 and December 31, 2018 (in thousands): To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes Regulations June 30, 2019 Amount Ratio Amount Ratio Amount Ratio Common Equity Tier 1(CET1) to risk-weighted assets Bank $ 92,973 10.65 % $ 39,293 4.5 % $ 56,756 6.5 % Consolidated 100,024 11.41 N/A N/A N/A N/A Tier 1 capital to risk-weighted assets Bank 92,973 10.65 52,391 6.0 69,854 8.0 Consolidated 100,024 11.41 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 100,697 11.53 69,854 8.0 87,318 10.0 Consolidated 114,309 13.04 N/A N/A N/A N/A Tier 1 capital to average assets Bank 92,973 8.42 44,186 4.0 55,232 5.0 Consolidated 100,024 9.01 N/A N/A N/A N/A To be Well Capitalized Under Prompt Required for Capital Corrective Action Actual Adequacy Purposes Regulations December 31, 2018 Amount Ratio Amount Ratio Amount Ratio Common Equity Tier 1(CET1) to risk-weighted assets Bank $ 87,291 10.55 % $ 37,240 4.5 % $ 53,791 6.5 % Consolidated 94,335 11.35 N/A N/A N/A N/A Tier 1 capital to risk-weighted assets Bank 87,291 10.55 49,653 6.0 66,204 8.0 Consolidated 94,335 11.35 N/A N/A N/A N/A Total capital to risk-weighted assets Bank 94,906 11.47 66,204 8.0 82,755 10.0 Consolidated 108,510 13.06 N/A N/A N/A N/A Tier 1 capital to average assets Bank 87,291 8.63 40,459 4.0 50,574 5.0 Consolidated 94,335 9.28 N/A N/A N/A N/A

ORGANIZATION AND SUMMARY OF S_3

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentration of Credit Risk (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Customer concentration | Loan portfolio
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Concentration risk (as a percent)	72.00%	73.60%

INVESTMENT SECURITIES - Amortiz

INVESTMENT SECURITIES - Amortized cost and fair value of securities available-for-sale (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 51,683	$ 45,723
Gross Unrealized Gains	361	11
Gross Unrealized Losses	(346)	(2,039)
Fair Value	51,698	43,695
U.S. treasury and federal agency
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	250	250
Gross Unrealized Gains	5
Fair Value	255	250
Association (“GNMA”) mortgage-backed securities – residential
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	38,529	35,591
Gross Unrealized Gains	273	8
Gross Unrealized Losses	(265)	(1,597)
Fair Value	38,537	34,002
Federal National Mortgage Association (“FNMA”) mortgage-backed securities – residential
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	3,546	4,076
Gross Unrealized Gains	8	2
Gross Unrealized Losses	(61)	(208)
Fair Value	3,493	3,870
Securities issued by U.S. government sponsored entities and agencies
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	4,300	4,525
Gross Unrealized Gains	1
Gross Unrealized Losses	(8)	(223)
Fair Value	4,293	4,302
Corporate collateralized mortgage obligations and mortgage-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	5,058	1,281
Gross Unrealized Gains	74	1
Gross Unrealized Losses	(12)	(11)
Fair Value	$ 5,120	$ 1,271

INVESTMENT SECURITIES - Amort_2

INVESTMENT SECURITIES - Amortized cost and estimated fair value of available-for-sale securities excluding SBIC (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019USD ($)security	Dec. 31, 2018USD ($)security
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 51,683	$ 45,723
Fair Value	51,698	43,695
Debt available for sale securities pledged as collateral	$ 5,100	$ 5,400
Threshold Percentage Of Shareholders Equity Amount Held As Securities By One Issuer	10.00%	10.00%
Unrealized loss	$ 346	$ 2,039
Number of securities in continuous unrealized loss position for more than twelve months | security	12
Available for sale securities, excluding SBIC
Debt Securities, Available-for-sale [Line Items]
Due within one year through five years amortized cost	$ 555
Due within one year through five years fair value	560
Mortgage-related securities, amortized cost	51,128
Mortgage-related securities, fair value	51,138
Amortized Cost	51,683
Fair Value	$ 51,698
Number of securities in unrealized loss position | security	12	33

INVESTMENT SECURITIES - Securit

INVESTMENT SECURITIES - Securities with unrealized losses (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Dec. 31, 2018
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value	$ 1,179	$ 1,179	$ 1,782
Less than 12 months, Unrealized Losses	(12)	(12)	(12)
More than 12 months, Fair Value	23,105	23,105	40,276
More than 12 months, Unrealized Losses	(334)	(334)	(2,027)
Total Fair Value	24,284	24,284	42,058
Total Unrealized Losses	(346)	(346)	(2,039)
Sales	0	0
Association (“GNMA”) mortgage-backed securities – residential
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value			201
More than 12 months, Fair Value	16,139	16,139	32,696
More than 12 months, Unrealized Losses	(265)	(265)	(1,597)
Total Fair Value	16,139	16,139	32,897
Total Unrealized Losses	(265)	(265)	(1,597)
Federal National Mortgage Association (“FNMA”) mortgage-backed securities – residential
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value			436
Less than 12 months, Unrealized Losses			(3)
More than 12 months, Fair Value	2,918	2,918	3,215
More than 12 months, Unrealized Losses	(61)	(61)	(205)
Total Fair Value	2,918	2,918	3,651
Total Unrealized Losses	(61)	(61)	(208)
Securities issued by U.S. government sponsored entities and agencies
Debt Securities, Available-for-sale [Line Items]
More than 12 months, Fair Value	3,988	3,988	4,302
More than 12 months, Unrealized Losses	(8)	(8)	(223)
Total Fair Value	3,988	3,988	4,302
Total Unrealized Losses	(8)	(8)	(223)
Corporate collateralized mortgage obligations and mortgage-backed securities
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value	1,179	1,179	1,145
Less than 12 months, Unrealized Losses	(12)	(12)	(9)
More than 12 months, Fair Value	60	60	63
More than 12 months, Unrealized Losses			(2)
Total Fair Value	1,239	1,239	1,208
Total Unrealized Losses	$ (12)	$ (12)	$ (11)

LOANS AND THE ALLOWANCE FOR L_3

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Summary of loans (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 938,005	$ 892,795
Deferred costs, net	1,390	1,171
Allowance for loan losses	(7,575)	(7,451)
Net loans	931,820	886,515
Cash, Securities and Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	149,503	114,165
Construction and Development
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	40,826	31,897
1-4 Family Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	373,836	350,852
Non-Owner Occupied CRE
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	152,664	173,741
Owner Occupied CRE
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	112,660	108,480
Commercial and Industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 108,516	$ 113,660

LOANS AND THE ALLOWANCE FOR L_4

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Aging analysis of recorded investments by class (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	$ 4,470	$ 15,102
Total current	933,535	877,693
Total Recorded Investment	938,005	892,795
30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		898
60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	3,257
90 or More Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	1,213	14,204
Cash, Securities and Other
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		11,583
Total current	149,503	102,582
Total Recorded Investment	149,503	114,165
Cash, Securities and Other | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		331
Cash, Securities and Other | 90 or More Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		11,252
Construction and Development
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total current	40,826	31,897
Total Recorded Investment	40,826	31,897
1-4 Family Residential, Non-Owner Occupied CRE and Owner Occupied CRE
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	1,200	1,200
1-4 Family Residential
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	1,710	1,217
Total current	372,126	349,635
Total Recorded Investment	373,836	350,852
1-4 Family Residential | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	497
1-4 Family Residential | 90 or More Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	1,213	1,217
Non-Owner Occupied CRE
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	460	567
Total current	152,204	173,174
Total Recorded Investment	152,664	173,741
Non-Owner Occupied CRE | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		567
Non-Owner Occupied CRE | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	460
Owner Occupied CRE
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total current	112,660	108,480
Total Recorded Investment	112,660	108,480
Commercial and Industrial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	2,300	1,735
Total current	106,216	111,925
Total Recorded Investment	108,516	113,660
Commercial and Industrial | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due	$ 2,300
Commercial and Industrial | 90 or More Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total past due		$ 1,735

LOANS AND THE ALLOWANCE FOR L_5

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in non-accrual loans by class (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-accrual loans	$ 6,142	$ 12,987
Recorded investments	6,100	13,000
Cash, Securities and Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-accrual loans	5,107	11,252
Commercial and Industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Non-accrual loans	$ 1,035	$ 1,735

LOANS AND THE ALLOWANCE FOR L_6

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Summary of unpaid principal balance of loans classified as TDRs (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)loan	Jun. 30, 2019USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans classified as TDRs		$ 11,590
Total Recorded Investment	$ 17,835	12,803
Allowance for loan associated with TDR	(940)	(940)
Net recorded investment	$ 16,895	10,650
Additional funds to loans classified as TDRs		400
Cash collateral received		1,500
Number of contracts modified | loan	2
Cash, Securities and Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans classified as TDRs		5,107
Total Recorded Investment	$ 11,252	5,107
1-4 Family Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total Recorded Investment		1,213
Commercial and Industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans classified as TDRs		6,483
Total Recorded Investment	6,583	6,483
Allowance for loan associated with TDR	(940)	(940)
Investment accruing interest	5,400	5,400
Investment non-accruing interest	$ 1,000	$ 1,000

LOANS AND THE ALLOWANCE FOR L_7

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in impaired loans (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recorded Investment With No Allowance	$ 11,768		$ 11,768		$ 16,100
Impaired Financing Receivable, Recorded Investment, Total	12,803		12,803		17,835
Unpaid Contractual Principal Balance with No Allowance	11,768		11,768		16,100
Impaired Financing Receivable, Unpaid Principal Balance, Total	12,803		12,803		17,835
Allowance for Loan Losses	940		940		940
Average Recorded Investment with No Allowance	13,722		14,615
Average Recorded Investment	14,957	$ 1,835	16,013	$ 1,835
Interest Income Recognized with No Allowance	94		239
Interest Income Recognized	94		239
Commercial and Industrial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recorded Investment With Allowance	1,035		1,035		1,735
Recorded Investment With No Allowance	5,448		5,448		4,848
Impaired Financing Receivable, Recorded Investment, Total	6,483		6,483		6,583
Unpaid Contractual Principal Balance with Allowance	1,035		1,035		1,735
Unpaid Contractual Principal Balance with No Allowance	5,448		5,448		4,848
Impaired Financing Receivable, Unpaid Principal Balance, Total	6,483		6,483		6,583
Allowance for Loan Losses	940		940		940
Average Recorded Investment with Allowance	1,235	1,835	1,398	1,835
Average Recorded Investment with No Allowance	5,268		5,131
Average Recorded Investment	6,503	$ 1,835	6,529	$ 1,835
Interest Income Recognized with No Allowance	68		188
Interest Income Recognized	68		188
Cash, Securities and Other
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recorded Investment With No Allowance	5,107		5,107		11,252
Impaired Financing Receivable, Recorded Investment, Total	5,107		5,107		11,252
Unpaid Contractual Principal Balance with No Allowance	5,107		5,107		11,252
Impaired Financing Receivable, Unpaid Principal Balance, Total	5,107		5,107		$ 11,252
Average Recorded Investment with No Allowance	8,042		9,072
Average Recorded Investment	8,042		9,072
1-4 Family Residential
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recorded Investment With No Allowance	1,213		1,213
Impaired Financing Receivable, Recorded Investment, Total	1,213		1,213
Unpaid Contractual Principal Balance with No Allowance	1,213		1,213
Impaired Financing Receivable, Unpaid Principal Balance, Total	1,213		1,213
Average Recorded Investment with No Allowance	412		412
Average Recorded Investment	412		412
Interest Income Recognized with No Allowance	26		51
Interest Income Recognized	$ 26		$ 51

LOANS AND THE ALLOWANCE FOR L_8

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Allowance for loan losses by portfolio (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	$ 7,645	$ 7,100	$ 7,451	$ 7,287
Provision for (recovery of) credit losses	(78)		116	(187)
Recoveries			8
Ending balance	7,575	7,100	7,575	7,100
Individually evaluated	940		940		$ 6,511
Collectively evaluated	6,635		6,635		940
Loans individually evaluated	12,803		12,803		17,835
Loans collectively evaluated	925,202		925,202		874,960
Total Recorded Investment	938,005		938,005		892,795
Cash, Securities and Other
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	877	969	764	1,066
Provision for (recovery of) credit losses	164	(35)	277	(132)
Recoveries			8
Ending balance	1,049	934	1,049	934
Individually evaluated					764
Collectively evaluated	1,049		1,049
Loans individually evaluated	5,107		5,107		11,252
Loans collectively evaluated	144,396		144,396		102,913
Total Recorded Investment	149,503		149,503		114,165
Construction and Development
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	266	228	232	202
Provision for (recovery of) credit losses	24	(1)	58	25
Ending balance	290	227	290	227
Individually evaluated					232
Collectively evaluated	290		290
Loans collectively evaluated	40,826		40,826		31,897
Total Recorded Investment	40,826		40,826		31,897
1-4 Family Residential
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	2,588	2,334	2,552	2,283
Provision for (recovery of) credit losses	62	(377)	98	(326)
Ending balance	2,650	1,957	2,650	1,957
Individually evaluated					2,552
Collectively evaluated	2,650		2,650
Loans individually evaluated	1,213		1,213
Loans collectively evaluated	372,623		372,623		350,852
Total Recorded Investment	373,836		373,836		350,852
Non-Owner Occupied CRE
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	1,235	1,313	1,264	1,433
Provision for (recovery of) credit losses	(149)	(114)	(178)	(234)
Ending balance	1,086	1,199	1,086	1,199
Individually evaluated					1,264
Collectively evaluated	1,086		1,086
Loans collectively evaluated	152,664		152,664		173,741
Total Recorded Investment	152,664		152,664		173,741
Owner Occupied CRE
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	780	724	789	751
Provision for (recovery of) credit losses	20	(98)	11	(125)
Ending balance	800	626	800	626
Individually evaluated					789
Collectively evaluated	800		800
Loans collectively evaluated	112,660		112,660		108,480
Total Recorded Investment	112,660		112,660		108,480
Commercial and Industrial
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Beginning balance	1,899	1,532	1,850	1,552
Provision for (recovery of) credit losses	(199)	625	(150)	605
Ending balance	1,700	$ 2,157	1,700	$ 2,157
Individually evaluated	940		940		910
Collectively evaluated	760		760		940
Loans individually evaluated	6,483		6,483		6,583
Loans collectively evaluated	102,033		102,033		107,077
Total Recorded Investment	$ 108,516		$ 108,516		$ 113,660

LOANS AND THE ALLOWANCE FOR L_9

LOANS AND THE ALLOWANCE FOR LOAN LOSSES - Recorded investment in company's loans (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Financing Receivable, Recorded Investment [Line Items]
Total loans	$ 938,005	$ 892,795
Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	911,593	859,018
Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total loans	7,230	8,117
Substandard
Financing Receivable, Recorded Investment [Line Items]
Total loans	19,182	25,660
Cash, Securities and Other
Financing Receivable, Recorded Investment [Line Items]
Total loans	149,503	114,165
Cash, Securities and Other | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	144,396	102,913
Cash, Securities and Other | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total loans	5,107	11,252
Construction and Development
Financing Receivable, Recorded Investment [Line Items]
Total loans	40,826	31,897
Construction and Development | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	40,826	31,897
1-4 Family Residential
Financing Receivable, Recorded Investment [Line Items]
Total loans	373,836	350,852
1-4 Family Residential | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	366,577	349,635
1-4 Family Residential | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total loans	6,046
1-4 Family Residential | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total loans	1,213	1,217
Non-Owner Occupied CRE
Financing Receivable, Recorded Investment [Line Items]
Total loans	152,664	173,741
Non-Owner Occupied CRE | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	151,020	165,164
Non-Owner Occupied CRE | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total loans	1,184	8,117
Non-Owner Occupied CRE | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total loans	460	460
Owner Occupied CRE
Financing Receivable, Recorded Investment [Line Items]
Total loans	112,660	108,480
Owner Occupied CRE | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	112,660	108,480
Commercial and Industrial
Financing Receivable, Recorded Investment [Line Items]
Total loans	108,516	113,660
Commercial and Industrial | Pass
Financing Receivable, Recorded Investment [Line Items]
Total loans	96,114	100,929
Commercial and Industrial | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total loans	$ 12,402	$ 12,731

GOODWILL - Changes in the carry

GOODWILL - Changes in the carrying amount of goodwill (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
Goodwill [Roll Forward]
Balance at beginning of period		$ 24,811
Impairment	$ (1,572)	(1,572)
Balance at end of period	23,239	23,239
Wealth Management
Goodwill [Roll Forward]
Balance at beginning of period		15,994
Balance at end of period	15,994	15,994
Capital Management
Goodwill [Roll Forward]
Balance at beginning of period		8,817
Impairment		(1,572)
Balance at end of period	$ 7,245	$ 7,245

LEASES - Leases Balance Sheets

LEASES - Leases Balance Sheets Location (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Jan. 01, 2019
LEASES
Operating lease right-of-use asset	$ 11,591	$ 12,900
Financial position	us-gaap:OtherAssets
Operating lease liability	$ 15,063	$ 16,600
Financial position	us-gaap:OtherLiabilities
Weighted-average remaining lease terms - Operating leases	5 years 3 months 4 days
Weighted-average discount rate - Operating leases	3.70%

LEASES - Leases Costs (Details)

LEASES - Leases Costs (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019
LEASES
Operating lease cost	$ 789	$ 1,572
Variable lease cost	385	773
Sublease income	(100)	(199)
Lease costs, net	$ 1,074	$ 2,146

LEASES - Lease Maturity (Detail

LEASES - Lease Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Jan. 01, 2019
LEASES
June 30, 2020	$ 3,707
June 30, 2021	3,061
June 30, 2022	2,709
June 30, 2023	2,567
June 30, 2024	2,248
Thereafter	2,319
Total Future Minimum Lease Payments	16,611
Less: Imputed interest	(1,548)
Present Value of Net Future Minimum Lease Payments	$ 15,063	$ 16,600

LEASES - Payments Due Maturitie

LEASES - Payments Due Maturities (Details) $ in Thousands	Dec. 31, 2018USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2019	$ 3,570
2020	3,374
2021	2,815
2022	2,675
2023	2,358
Thereafter	3,446
Operating Leases, Future Minimum Payments Due, Total	$ 18,238

DEPOSITS (Details)

DEPOSITS (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
DEPOSITS
Money market deposit accounts	$ 508,263	$ 489,506
Time deposits	176,128	178,743
Negotiable order of withdrawal accounts	88,687	64,853
Savings accounts	2,833	1,800
Total interest bearing deposits	775,911	734,902
Aggregate time deposits of $250,000 or greater	74,084	83,550
Overdrafts balances classified As loans	$ 100	$ 300

BORROWINGS (Details)

BORROWINGS (Details)	6 Months Ended
	Jun. 30, 2019USD ($)	Dec. 31, 2018USD ($)
BORROWINGS
Number of unsecured federal funds lines of credit	3
Federal Funds Lines of Credit One
BORROWINGS
Maximum borrowing capacity	$ 10,000,000
Amount outstanding	0	$ 0
Federal Funds Lines of Credit Two
BORROWINGS
Maximum borrowing capacity	13,000,000
Amount outstanding	0	0
Federal Funds Line of Credit Three
BORROWINGS
Maximum borrowing capacity	25,000,000
Amount outstanding	0	0
FHLB Topeka
BORROWINGS
Amount of collateral pledged	532,800,000	475,400,000
Available balance	332,700,000
Borrowings from FHLB	$ 36,060,000	15,000,000
August 2, 2019
BORROWINGS
Interest rate	2.55%
Borrowings from FHLB	$ 26,060,000	5,000,000
August 26, 2020
BORROWINGS
Interest rate	1.94%
Borrowings from FHLB	$ 10,000,000	$ 10,000,000

COMMITMENTS AND CONTINGENCIES_2

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Unused lines of credit-Fixed
COMMITMENTS AND CONTINGENCIES
Other commitment	$ 21,424	$ 33,571
Standby letters of credit-Fixed
COMMITMENTS AND CONTINGENCIES
Other commitment	25	40
Commitments to make loans to sell-Fixed
COMMITMENTS AND CONTINGENCIES
Other commitment	83,309	17,207
Commitments to make loans-Fixed
COMMITMENTS AND CONTINGENCIES
Other commitment	16,154	2,750
Unused lines of credit-Variable
COMMITMENTS AND CONTINGENCIES
Other commitment	252,755	271,580
Standby letters of credit-Variable
COMMITMENTS AND CONTINGENCIES
Other commitment	23,833	23,508
Commitments to make loans-Variable
COMMITMENTS AND CONTINGENCIES
Other commitment	$ 46,306	$ 19,762

SHAREHOLDERS EQUITY - Common St

SHAREHOLDERS EQUITY - Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Jun. 14, 2019	Dec. 31, 2018
Class of Stock [Line Items]
Common stock par value		$ 0			$ 0
Issuance of common stock, net of issuance costs	$ (181)		$ 1,909
Common stock issuance costs			$ 7
Preferred Stock, shares outstanding		0			0
Series D
Class of Stock [Line Items]
Preferred Stock, shares outstanding		0			0
Common Stock
Class of Stock [Line Items]
Common stock par value		$ 0
Number of votes per each share		one
Issuance of common stock (in shares)		0
Authorized share repurchase				300,000
Common Stock | Time Vesting Units
Class of Stock [Line Items]
Issuance of common stock (in shares)	16,969		16,969
Common Stock | Private Placement
Class of Stock [Line Items]
Issuance of common stock (in shares)	67,242
Issuance of common stock, net of issuance costs	$ 1,900
Common stock issuance costs	$ 100		$ 100

SHAREHOLDERS EQUITY - Stock bas

SHAREHOLDERS EQUITY - Stock based compensation - Restricted Stock Awards (Details) - Restricted Stock Awards - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average grant date fair value (in dollars per share)	$ 28.50		$ 28.50
Recognized compensation expense	$ 0.1	$ 0.2	$ 0.1	$ 0.2
Unrecognized compensation expense	$ 2.5		$ 2.5
Unrecognized compensation expense recognition period (in years)			3 years 3 months
Number of shares vested	0		0

SHAREHOLDERS EQUITY - Stock b_2

SHAREHOLDERS EQUITY - Stock based compensation - Stock Options (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options forfeited, cancelled or terminated			23,850
Stock-based compensation expense	$ 0.1	$ 0.1	$ 0.2	$ 0.3
Unrecognized stock-based compensation expense	$ 0.4		$ 0.4
Cost is expected to be recognized over a weighted-average period			1 year
Plan 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for issuance	626,907		626,907
2008 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amount of consideration paid to the company upon plan modification			$ 0

SHAREHOLDERS EQUITY - Stock b_3

SHAREHOLDERS EQUITY - Stock based compensation - Stock Options Activity (Details) - Stock Options - $ / shares	6 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding at beginning of year (in shares)	465,947
Forfeited or expired (in shares)	(23,850)
Outstanding at end of period (in shares)	442,097
Options fully vested / exercisable at end of period (in shares)	388,216	402,872
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance	$ 28.84
Forfeited or expired (in dollars per share)	26.25
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance	28.98
Options fully vested / exercisable at June 30, 2018	$ 29.59
Weighted Average Remaining Contractual Term
Outstanding at end of year	4 years
Options fully vested / exercisable at June 30, 2018	3 years 8 months 12 days
Aggregate Intrinsic Value
Exercise price low range	$ 20
Exercise price high range	$ 40
Expiry period	10 years

SHAREHOLDERS EQUITY - Stock b_4

SHAREHOLDERS EQUITY - Stock based compensation - Share Awards (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Stock surrendered (in shares)	7,835	6,313	7,835	6,313
Stock surrendered to cover employee withholding taxes	$ 0.1	$ 0.2	$ 0.1	$ 0.2
Time Vesting Units
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Outstanding at beginning of year			184,369
Granted (in shares)			71,127
Vested (in shares)			(23,281)
Forfeited (in shares)			(16,318)
Outstanding at end of year	215,897		215,897
Stock issued (in shares)	15,446	16,969	15,446	16,969
Financial Performance Units
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Outstanding at beginning of year			15,932
Granted (in shares)			59,536
Forfeited (in shares)			(4,603)
Outstanding at end of year	70,865		70,865
Market Performance Units
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Outstanding at beginning of year			17,258
Forfeited (in shares)			(1,512)
Outstanding at end of year	15,746		15,746

SHAREHOLDERS EQUITY - Stock b_5

SHAREHOLDERS EQUITY - Stock based compensation - Time Vesting Units (Details) - Time Vesting Units - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant date fair value			$ 13.80
Granted (in shares)			71,127
Stock-based compensation expense	$ 0.2	$ 0.2	$ 0.4	$ 0.5
Unrecognized compensation expense	$ 4.1		$ 4.1
Unrecognized compensation expense recognition period (in years)			2 years 4 months 24 days
Third and fifth anniversaries
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)			5 years
Vesting Percentage			50.00%
Granted (in shares)			3,779
Anniversary of grant date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting Percentage			20.00%
Granted (in shares)			67,348

SHAREHOLDERS EQUITY - Stock b_6

SHAREHOLDERS EQUITY - Stock based compensation - Financial Performance Units (Details) - USD ($) $ in Millions	May 01, 2019	Jun. 30, 2019
Financial Performance Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		59,536
Financial Performance Units Granted Prior to 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)		2 years
Maximum accruing threshold awards		50.00%
Remainder threshold awards		50.00%
Maximum percentage of shares can be issued		150.00%
Maximum number of shares can be issued		22,000
Unrecognized compensation expense		$ 0.2
Unrecognized compensation expense recognition period (in years)		3 years 9 months
Financial Performance Units Granted Prior to 2019 | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Financial performance threshold percentage		150.00%
Financial Performance Units Granted Prior to 2019 | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Financial performance threshold percentage		0.00%
Financial Performance Units Granted in 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)	2 years
Granted (in shares)	59,536
Maximum accruing threshold awards		50.00%
Remainder threshold awards		50.00%
Maximum percentage of shares can be issued		150.00%
Maximum number of shares can be issued		84,300
Unrecognized compensation expense		$ 0.7
Unrecognized compensation expense recognition period (in years)		4 years 6 months
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Financial Performance Units Granted in 2019 | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Financial performance threshold percentage	150.00%
Financial Performance Units Granted in 2019 | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Financial performance threshold percentage	0.00%

SHAREHOLDERS EQUITY - Stock b_7

SHAREHOLDERS EQUITY - Stock based compensation - Market Performance Units (Details) - Market Performance Units $ in Millions	6 Months Ended
	Jun. 30, 2019USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense	$ 0.4
Unrecognized compensation expense recognition period (in years)	3 years 6 months

EARNINGS PER COMMON SHARE (Deta

EARNINGS PER COMMON SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Numerator:
Net income	$ 1,404	$ 1,048	$ 3,031	$ 2,234
Dividends on preferred stock		(562)		(1,123)
Net income available for common shareholders	$ 1,404	$ 486	$ 3,031	$ 1,111
Denominator:
Basic weighted average shares	7,881,999	5,911,886	7,877,864	5,891,463
Earnings per common share - basic	$ 0.18	$ 0.08	$ 0.39	$ 0.19
Numerator:
Net income	$ 1,404	$ 1,048	$ 3,031	$ 2,234
Dividends on preferred stock		(562)		(1,123)
Net income available for common shareholders	$ 1,404	$ 486	$ 3,031	$ 1,111
Denominator:
Basic weighted average shares	7,881,999	5,911,886	7,877,864	5,891,463
Diluted effect of common stock equivalents:
Total diluted effect of common stock equivalents	15,093	69,535	15,510	68,574
Diluted weighted average shares	7,897,092	5,981,421	7,893,374	5,960,037
Earnings per common share - diluted	$ 0.18	$ 0.08	$ 0.39	$ 0.19
Stock Options
Diluted effect of common stock equivalents:
Diluted effect of common stock equivalents		32,643		31,291
Time Vesting Units
Diluted effect of common stock equivalents:
Diluted effect of common stock equivalents	2,044	13,958	2,062	22,261
Financial Performance Units
Diluted effect of common stock equivalents:
Diluted effect of common stock equivalents		16,355		9,758
Market Performance Units
Diluted effect of common stock equivalents:
Diluted effect of common stock equivalents	13,049		13,448
Restricted Stock Awards
Diluted effect of common stock equivalents:
Diluted effect of common stock equivalents		6,579		5,264

EARNINGS PER COMMON SHARE - Ant

EARNINGS PER COMMON SHARE - Anti-dilutive Securities (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities	806,309	359,400	762,982	363,150
Stock Options
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities	442,097	207,700	445,947	211,450
Convertible Preferred D Shares
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities		151,700		151,700
Time Vesting Units
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities	198,611		179,301
Financial Performance Units
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities	70,865		42,998
Restricted Stock Awards
EARNINGS (LOSS) PER COMMON SHARE
Total potentially dilutive securities	94,736		94,736

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
INCOME TAXES
Income tax provision	$ 561	$ 337	$ 1,085	$ 704
Effective income tax rate	28.50%	24.30%	26.40%	24.00%

RELATED-PARTY TRANSACTIONS (Det

RELATED-PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
Summary of related party loan activity
Balance, beginning of year	$ 2,659	$ 14,077
Funded loans	5,623	1,466
Payments collected	(2,588)	(9,386)
Changes in related parties		(3,498)
Balance, end of year	5,694	2,659
Deposits from related parties	$ 47,700	$ 36,700

FAIR VALUE - General (Details)

FAIR VALUE - General (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019	Dec. 31, 2018
FAIR VALUE
Fair value, assets, level 1 to level 2 transfers, amount	$ 0	$ 0
Fair value, assets, level 2 to level 1 transfers, amount	0	0
Fair value, liabilities, level 1 to level 2 transfers, amount	0	0
Fair value, liabilities, level 2 to level 1 transfers, amount	0	0
Transfer to level 3, assets, amount	0	0
Transfer from level 3, assets, amount	0	0
Transfer to level 3, liabilities, amount		0
Transfer from level 3, liabilities, amount	0	0
Fair value, equity, level 1 to level 2 transfers, amount	0	0
Fair value, equity, level 2 to level 1 transfers, amount	$ 0	$ 0

FAIR VALUE - Summary of assets

FAIR VALUE - Summary of assets measured at fair value on recurring basis (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	$ 51,698	$ 43,695
U.S. treasury and federal agency
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	255	250
Securities issued by U.S. government sponsored entities and agencies
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	4,293	4,302
Recurring
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	51,698	43,695
Equity securities not available-for-sale	712	693
Recurring | U.S. treasury and federal agency
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	255	250
Recurring | Securities issued by U.S. government sponsored entities and agencies
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	4,293	4,302
Recurring | Corporate collateralized mortgage obligations and mortgage-backed securities
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	5,120	1,271
Recurring | Interest rate lock and forward delivery commitments
Summary of assets measured on a recurring and nonrecurring basis
Derivative asset, Fair value	739	890
Recurring | GNMA
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	38,537	34,002
Recurring | FNMA
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	3,493	3,870
Level 1 | Recurring
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	255	250
Equity securities not available-for-sale	712	693
Level 1 | Recurring | U.S. treasury and federal agency
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	255	250
Level 2 | Recurring
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	51,443	43,445
Level 2 | Recurring | Securities issued by U.S. government sponsored entities and agencies
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	4,293	4,302
Level 2 | Recurring | Corporate collateralized mortgage obligations and mortgage-backed securities
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	5,120	1,271
Level 2 | Recurring | Interest rate lock and forward delivery commitments
Summary of assets measured on a recurring and nonrecurring basis
Derivative asset, Fair value	739	890
Level 2 | Recurring | GNMA
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	38,537	34,002
Level 2 | Recurring | FNMA
Summary of assets measured on a recurring and nonrecurring basis
Total securities available-for-sale	$ 3,493	$ 3,870

FAIR VALUE - Summary of asset_2

FAIR VALUE - Summary of assets measured at fair value on Non recurring basis (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2019	Dec. 31, 2018
Summary of assets measured on a recurring and nonrecurring basis
Other real estate owned	$ 658	$ 658	$ 658
Impaired loans	10,650	10,650	16,895
Other real estate owned, gross			2,400
Other real estate owned valuation allowance			1,700
Allowance for loans	7,575	7,575	7,451
Level 3
Summary of assets measured on a recurring and nonrecurring basis
Impaired loans carrying value	1,000	1,000	1,700
Allowance for loans	900	900	900
Provision for loan losses	0	0
Commercial properties | Nonrecurring
Summary of assets measured on a recurring and nonrecurring basis
Other real estate owned	658	658	658
Commercial properties | Level 3 | Nonrecurring
Summary of assets measured on a recurring and nonrecurring basis
Other real estate owned	658	658	658
Commercial and Industrial | Nonrecurring
Summary of assets measured on a recurring and nonrecurring basis
Impaired loans	95	95	795
Commercial and Industrial | Level 3 | Nonrecurring
Summary of assets measured on a recurring and nonrecurring basis
Impaired loans	$ 95	$ 95	$ 795

FAIR VALUE - Summary of carryin

FAIR VALUE - Summary of carrying amounts and estimated fair values for financial instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017
Summary of carrying amounts and estimated fair values for financial instruments
Cash and cash equivalents	$ 92,769	$ 73,357	$ 58,464	$ 9,502
Securities available-for-sale	51,698	43,695
Loans, net	931,820	886,515
Mortgage loans held for sale	36,269	14,832
Accrued interest receivable	3,184	2,844
Other assets	18,313	3,724
Deposits	1,005,177	937,758
FHLB Topeka Borrowings – fixed rate	36,060	15,000
Subordinated Notes	6,560	6,560
Accrued interest payable	274	231
Carrying Amount
Summary of carrying amounts and estimated fair values for financial instruments
Cash and cash equivalents	92,769	73,357
Securities available-for-sale	51,698	43,695
Loans, net	931,820	886,515
Mortgage loans held for sale	36,269	14,832
Accrued interest receivable	3,184	2,844
Other assets	712	693
Deposits	1,005,177	937,758
FHLB Topeka Borrowings – fixed rate	36,060	15,000
Accrued interest payable	274	231
2016 Subordinated notes – fixed-to-floating rate | Carrying Amount
Summary of carrying amounts and estimated fair values for financial instruments
Subordinated Notes	6,560	6,560
Level 1 | Estimated Fair Value
Summary of carrying amounts and estimated fair values for financial instruments
Cash and cash equivalents	92,769	73,357
Securities available-for-sale	255	250
Other assets	712	693
Level 2 | Estimated Fair Value
Summary of carrying amounts and estimated fair values for financial instruments
Securities available-for-sale	51,443	43,445
Mortgage loans held for sale	36,269	14,832
Accrued interest receivable	3,184	2,844
Deposits	1,008,032	940,039
FHLB Topeka Borrowings – fixed rate	36,022	14,833
Accrued interest payable	274	231
Level 3 | Estimated Fair Value
Summary of carrying amounts and estimated fair values for financial instruments
Loans, net	912,965	868,828
Level 3 | 2016 Subordinated notes – fixed-to-floating rate | Estimated Fair Value
Summary of carrying amounts and estimated fair values for financial instruments
Subordinated Notes	$ 6,217	$ 6,434

SEGMENT REPORTING (Details)

SEGMENT REPORTING (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018
Income Statement
Total interest income	$ 11,174	$ 9,505	$ 22,224	$ 18,511
Total interest expense	3,214	1,928	6,293	3,574
Provision for (recovery of) credit losses	(78)		116	(187)
Net-interest income	8,038	7,577	15,815	15,124
Non-interest income	8,586	6,892	15,562	14,184
Total income	16,624	14,469	31,377	29,308
Depreciation and amortization expense	469	577	996	1,150
All other non-interest expense	14,190	12,507	26,265	25,220
Income before income taxes	1,965	1,385	4,116	2,938
Segment reporting
Goodwill	23,239	24,811	23,239	24,811	$ 24,811
Total assets	1,190,465	1,046,573	1,190,465	1,046,573	1,084,324
Goodwill impairment	1,572		1,572
Wealth Management
Income Statement
Total interest income	11,174	9,505	22,224	18,511
Total interest expense	3,214	1,928	6,293	3,574
Provision for (recovery of) credit losses	(78)		116	(187)
Net-interest income	8,038	7,577	15,815	15,124
Non-interest income	4,512	4,680	9,244	9,844
Total income	12,550	12,257	25,059	24,968
Depreciation and amortization expense	301	321	632	641
All other non-interest expense	10,432	10,025	20,499	20,165
Income before income taxes	1,817	1,911	3,928	4,162
Segment reporting
Goodwill	15,994	15,994	15,994	15,994	15,994
Total assets	1,145,910	1,001,191	1,145,910	1,001,191
Capital Management
Income Statement
Non-interest income	798	845	1,563	1,706
Total income	798	845	1,563	1,706
Depreciation and amortization expense	95	132	226	262
All other non-interest expense	2,313	1,080	3,008	2,276
Income before income taxes	(1,610)	(367)	(1,671)	(832)
Segment reporting
Goodwill	7,245	8,817	7,245	8,817	$ 8,817
Total assets	9,025	10,318	9,025	10,318
Goodwill impairment			1,572
Mortgage
Income Statement
Non-interest income	3,276	1,367	4,755	2,634
Total income	3,276	1,367	4,755	2,634
Depreciation and amortization expense	73	124	138	247
All other non-interest expense	1,445	1,402	2,758	2,779
Income before income taxes	1,758	(159)	1,859	(392)
Segment reporting
Total assets	$ 35,530	$ 35,064	$ 35,530	$ 35,064

REGULATORY CAPITAL MATTERS (Det

REGULATORY CAPITAL MATTERS (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2019USD ($)item	Dec. 31, 2019	Dec. 31, 2018USD ($)
REGULATORY CAPITAL MATTERS
Capital conservation buffer	0.625%
Common Equity Tier 1 capital ratio including capital conservation buffer (as a percent)	7.00%
Tier 1 capital ratio including capital conservation buffer (as a percent)	8.50%
Total capital ratio including capital conservation buffer (as a percent0	10.50%
Number of conditions or events to be performed | item	0
Common Equity Tier 1 (CET 1) to risk-weighted assets
Actual Amount	$ 100,024		$ 94,335
Actual Ratio (as a percent)	11.41%		11.35%
Tier 1 capital to risk-weighted assets
Actual Amount	$ 100,024		$ 94,335
Actual Ratio (as a percent)	11.41%		11.35%
Total capital to risk-weighted assets
Actual Amount	$ 114,309		$ 108,510
Actual Ratio (as a percent)	13.04%		13.06%
Tier 1 capital to average assets
Actual Amount	$ 100,024		$ 94,335
Actual Ratio (as a percent)	9.01%		9.28%
Bank
Common Equity Tier 1 (CET 1) to risk-weighted assets
Actual Amount	$ 92,973		$ 87,291
Actual Ratio (as a percent)	10.65%		10.55%
Required for Capital Adequacy Purposes Amount	$ 39,293		$ 37,240
Required for Capital Adequacy Purposes Ratio (as a percent)	4.50%		4.50%
To be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 56,756		$ 53,791
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent)	6.50%		6.50%
Tier 1 capital to risk-weighted assets
Actual Amount	$ 92,973		$ 87,291
Actual Ratio (as a percent)	10.65%		10.55%
Required for Capital Adequacy Purposes Amount	$ 52,391		$ 49,653
Required for Capital Adequacy Purposes Amount (as a percent)	6.00%		6.00%
To be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 69,854		$ 66,204
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent)	8.00%		8.00%
Total capital to risk-weighted assets
Actual Amount	$ 100,697		$ 94,906
Actual Ratio (as a percent)	11.53%		11.47%
Required for Capital Adequacy Purposes Amount	$ 69,854		$ 66,204
Required for Capital Adequacy Purposes Ratio (as a percent)	8.00%		8.00%
To be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 87,318		$ 82,755
To be Well Capitalized Under Prompt Corrective Action Regulations Ratio (as a percent)	10.00%		10.00%
Tier 1 capital to average assets
Actual Amount	$ 92,973		$ 87,291
Actual Ratio (as a percent)	8.42%		8.63%
Required for Capital Adequacy Purposes Amount	$ 44,186		$ 40,459
Required for Capital Adequacy Purposes Ratio (as a percent)	4.00%		4.00%
To be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 55,232		$ 50,574
Tier One Leverage Capital Required to be Well Capitalized to Average Assets	5.00%		5.00%
Forecast
REGULATORY CAPITAL MATTERS
Capital conservation buffer		2.50%
Common Equity Tier 1 (CET 1) to risk-weighted assets
Required for Capital Adequacy Purposes Ratio (as a percent)		7.00%
Tier 1 capital to risk-weighted assets
Required for Capital Adequacy Purposes Amount (as a percent)		8.50%
Total capital to risk-weighted assets
Required for Capital Adequacy Purposes Ratio (as a percent)		10.50%

SUBSEQUENT EVENTS (Details)

SUBSEQUENT EVENTS (Details) - Subsequent events - Capital Management - Fixed Income Portfolio Management Team $ in Millions	Jul. 19, 2019USD ($)
Subsequent Event [Line Items]
Cash Consideration	$ 0.5
Minimum
Subsequent Event [Line Items]
Asset-based revenues period for contingent consideration	3 years
Maximum
Subsequent Event [Line Items]
Asset-based revenues period for contingent consideration	5 years