Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 10, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | FFBW, Inc. /MD/ | |
Entity Central Index Key | 0001787384 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Amendment Flag | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 7,197,902 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Cash and due from banks | $ 50,725 | $ 41,454 |
Fed funds sold | 8,400 | 25 |
Cash and cash equivalents | 59,125 | 41,479 |
Available for sale securities, stated at fair value | 56,463 | 64,243 |
Loans held for sale | 1,098 | 1,708 |
Loans, net of allowance for loan and lease losses of $2,813 and $2,811, respectively | 203,376 | 214,723 |
Premises and equipment, net | 5,551 | 5,594 |
Foreclosed assets | 125 | |
Other equity investments | 1,279 | 1,279 |
Accrued interest receivable | 912 | 995 |
Cash value of life insurance | 8,576 | 7,272 |
Other assets | 1,371 | 1,554 |
TOTAL ASSETS | 337,751 | 338,972 |
Liabilities and Equity | ||
Deposits | 229,577 | 226,498 |
Advance payments by borrowers for taxes and insurance | 391 | 127 |
FHLB advances | 7,500 | 7,500 |
Accrued interest payable | 117 | 17 |
Other liabilities | 1,091 | 1,565 |
Total liabilities | 238,676 | 235,707 |
Preferred stock ($0.01 par value, 50,000,000 authorized, no shares issued or outstanding as of March 31, 2021 and December 31, 2020, respectively) | ||
Common stock ($0.01 par value, 100,000,000 authorized, 7,286,461 and 7,695,214 issued and outstanding as of March 31, 2021 and December 31, 2020, respectively) | 73 | 77 |
Additional paid in capital | 64,563 | 69,090 |
Unallocated common stock of Employee Stock Ownership Plan ("ESOP") (573,446 and 581,093 shares at March 31, 2021 and December 31, 2020, respectively) | (5,735) | (5,811) |
Retained earnings | 39,052 | 38,382 |
Accumulated other comprehensive income (loss), net of income taxes | 1,122 | 1,527 |
Total equity | 99,075 | 103,265 |
TOTAL LIABILITIES AND EQUITY | $ 337,751 | $ 338,972 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Allowance for loan and lease losses | $ 2,813 | $ 2,811 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 7,286,461 | 7,695,214 |
Common stock, outstanding (in shares) | 7,286,461 | 7,695,214 |
Unallocated common stock of Employee Stock Ownership Plan, shares (in shares) | 573,446 | 581,093 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Interest and dividend income: | ||
Loans, including fees | $ 2,872 | $ 2,435 |
Securities | ||
Taxable | 239 | 284 |
Tax-exempt | 46 | 4 |
Other | 9 | 84 |
Total interest and dividend income | 3,166 | 2,807 |
Interest Expense: | ||
Interest-bearing deposits | 249 | 483 |
Borrowed funds | 17 | 61 |
Total interest expense | 266 | 544 |
Net interest income | 2,900 | 2,263 |
Provision for loan losses | 40 | |
Net interest income after provision for loan losses | 2,900 | 2,223 |
Noninterest income: | ||
Service charges and other fees | 116 | 55 |
Net gain on sale of loans | 161 | 35 |
Increase in cash surrender value of insurance | 53 | 49 |
Other noninterest income | 25 | 24 |
Total noninterest income | 355 | 163 |
Noninterest expense: | ||
Salaries and employee benefits | 1,362 | 1,132 |
Occupancy and equipment | 292 | 244 |
Data processing | 337 | 206 |
Technology | 56 | 60 |
Foreclosed assets | 1 | (16) |
Professional fees | 106 | 108 |
Other noninterest expense | 249 | 110 |
Total noninterest expense | 2,403 | 1,844 |
Income before income taxes | 852 | 542 |
Provision for income taxes | 182 | 135 |
Net income | $ 670 | $ 407 |
Earnings Per Share | ||
Basic (in dollars per share) | $ 0.10 | $ 0.06 |
Diluted (in dollars per share) | $ 0.10 | $ 0.06 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 670 | $ 407 |
Other comprehensive income (loss): | ||
Unrealized holding gains (losses) arising during the period | (573) | 997 |
Reclassification adjustment for (gains) losses realized in net income | ||
Other comprehensive income (loss) before tax effect | (573) | 997 |
Tax effect of other comprehensive income (loss) items | 168 | (270) |
Other comprehensive income (loss), net of tax | (405) | 727 |
Comprehensive income | $ 265 | $ 1,134 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Unallocated Common Stock of ESOP [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Total |
Balance at Dec. 31, 2019 | $ 67 | $ 28,672 | $ (2,303) | $ 36,551 | $ 344 | $ (1,461) | $ 61,870 |
Balance (in shares) at Dec. 31, 2019 | 7,702,478 | ||||||
Conversion of FFBW, Inc. (net of costs) | $ 10 | 41,561 | 41,571 | ||||
Conversion of FFBW, Inc. (net of costs) (in shares) | 2,397 | ||||||
Purchase of ESOP shares | (3,814) | (3,814) | |||||
Treasury stock retired | (1,461) | $ 1,461 | |||||
Contribution of FFBW, MHC | 99 | 99 | |||||
Net Income | 407 | 407 | |||||
ESOP shares committed to be released | (15) | 78 | 63 | ||||
Stock based compensation expense | 87 | 87 | |||||
Other comprehensive income (loss) | 727 | 727 | |||||
Balance at Mar. 31, 2020 | $ 77 | 68,943 | (6,039) | 36,958 | 1,071 | 101,010 | |
Balance (in shares) at Mar. 31, 2020 | 7,704,875 | ||||||
Balance at Dec. 31, 2020 | $ 77 | 69,090 | (5,811) | 38,382 | 1,527 | 103,265 | |
Balance (in shares) at Dec. 31, 2020 | 7,695,214 | ||||||
Net Income | 670 | 670 | |||||
ESOP shares committed to be released | 6 | 76 | 82 | ||||
Stock based compensation expense | 81 | 81 | |||||
Other comprehensive income (loss) | (405) | (405) | |||||
Repurchase of common stock | $ (4) | (4,614) | (4,618) | ||||
Repurchase of common stock (in shares) | (408,753) | ||||||
Balance at Mar. 31, 2021 | $ 73 | $ 64,563 | $ (5,735) | $ 39,052 | $ 1,122 | $ 99,075 | |
Balance (in shares) at Mar. 31, 2021 | 7,286,461 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($)shares | |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |
ESOP shares committed to be released (in shares) | 7,647 |
Conversion cost of FFBW, Inc | $ | $ 1.2 |
Purchase of ESOP shares (in shares) | 341,485 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 670 | $ 407 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan losses | 40 | |
Depreciation | 72 | 79 |
Net amortization of loan portfolio discount and deposit premium | 317 | |
Net amortization on securities available for sale | 145 | 81 |
(Gain) loss on sales and impairments of foreclosed assets | 2 | (11) |
Increase in cash surrender value of life insurance | (53) | (49) |
ESOP compensation | 82 | 61 |
Stock based compensation | 81 | 87 |
Changes in operating assets and liabilities: | ||
Accrued interest receivable | 82 | (91) |
Loans held for sale | 611 | (343) |
Other assets | 325 | 641 |
Accrued interest payable | 101 | 208 |
Other liabilities | (474) | (60) |
Net cash provided by operating activities | 1,961 | 1,050 |
Cash flows from investing activities: | ||
Maturities, calls, paydowns on available for sale securities | 7,062 | 2,655 |
Purchases of available for sale securities | (8,624) | |
Net (increase) decrease in loans | 11,056 | (4,012) |
Purchases of premises and equipment | (30) | (16) |
Purchase of life insurance | (1,250) | |
Proceeds from sale of foreclosed assets | 122 | 95 |
Cash received in MHC merger | 99 | |
Net cash provided by (used in) investing activities | 16,960 | (9,803) |
Cash flows from financing activities: | ||
Net (increase) decrease in deposits | 3,079 | (53,858) |
Net increase in advance payments by borrowers for taxes and insurance | 264 | 334 |
Repurchase of common stock | (4,618) | |
Purchase of shares of ESOP | (3,814) | |
Net proceeds from issuance of common stock | 41,571 | |
Net cash used in financing activities | (1,275) | (15,767) |
Net change in cash and cash equivalents | 17,646 | (24,520) |
Cash and cash equivalents at beginning | 41,479 | 39,377 |
Cash and cash equivalents at end | 59,125 | 14,857 |
Supplemental Cash Flow Disclosures: | ||
Cash paid for interest | 165 | 336 |
Cash paid for income taxes | $ 626 | |
Loans transferred to foreclosed assets | $ 347 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Notes to Financial Statements | |
Basis of Presentation | NOTE 1 – Basis of Presentation The accompanying unaudited consolidated financial statements of FFBW, Inc. and its wholly-owned subsidiary, First Federal Bank of Wisconsin, (collectively the “Company”) were prepared in accordance with instructions for Form 10‑Q and Regulation S-X and do not include information or footnotes necessary for a complete presentation of financial condition, results of operations, comprehensive income, changes in equity and cash flows in conformity with accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments necessary for a fair presentation of the financial statements have been included. The results of operations for the three month period ended March 31, 2021 are not necessarily indicative of the results which may be expected for the entire year. These statements should be read in conjunction with the Financial Statements and notes thereto for the year ended December 31, 2020 filed with the U.S. Securities and Exchange Commission (“SEC”) as part of FFBW, Inc.’s Annual Report on Form 10‑K for the year ended December 31, 2020. In preparing the financial statements, the Company is required to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the Company’s financial condition, results of operations, comprehensive income, changes in shareholders’ equity and cash flows for the interim periods presented. These adjustments are of a normal recurring nature and include appropriate estimated provisions. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | NOTE 2 - Summary of Significan Organization From October 2017 until January 2020, as discussed below, we operated in a two-tier mutual holding company structure. FFBW, Inc. (the “Company”) was a federal corporation that was the publicly traded stock holding company of First Federal Bank of Wisconsin (the “Bank”). At December 31, 2019, the Company had 7,702,478 shares of common stock outstanding, of which 3,436,424 shares, or 44.6%, were owned by the public, including 29,325 shares owned by FFBW Community Foundation, and the remaining 4,266,054 shares were held by FFBW, MHC (the “MHC”), a federally chartered mutual holding company and former parent company of the Company. At December 31, 2019, the significant assets of the Company consisted of the capital stock of the Bank. The liabilities of the Company were insignificant. The Company was subject to the financial reporting requirements of the Securities Exchange Act of 1934, as amended. The Company was subject to regulation and examination by the Board of Governors of the Federal Reserve System (“the Federal Reserve Board”). The Bank is a community bank headquartered in Waukesha, Wisconsin that provides financial services to individuals and businesses from our offices in Waukesha, Brookfield, and the South Side of Milwaukee. FFBW, Inc. (“New FFBW”), a Maryland corporation that was organized in September 2019, is a savings and loan holding company headquartered in Waukesha, Wisconsin. New FFBW was formed to be the successor to the Company upon completion of the second step mutual-to-stock conversion (the “Conversion”) of the MHC. Prior to completion of the Conversion, approximately 55.4% of the shares of common stock of the Company were owned by the MHC. In conjunction with the Conversion, the MHC and the Company merged into New FFBW. The Conversion was completed on January 16, 2020. In the Conversion, New FFBW sold 4,268,570 shares of common stock at $10.00 per share, for net proceeds of approximately $37.9 million (including purchase of 341,485 ESOP shares), and issued 3,436,430 shares of common stock in exchange for the shares of common stock of FFBW, Inc. a federal corporation, (“Old FFBW”) owned by stockholders of Old FFBW, other than FFBW, MHC, as of the effective date of the conversion. As a result of the conversion, FFBW, MHC and Old FFBW ceased to exist. The Conversion was conducted pursuant to the MHC’s Plan of Conversion. The Plan of Conversion provided for the establishment, upon the completion of the Conversion, of special “liquidation accounts” for the benefit of certain depositors of the Bank in an amount equal to the MHC’s ownership interest in the stockholders’ equity of the Company as of the date of the latest balance sheet contained in the prospectus plus the MHC’s net assets (excluding its ownership of the Company). Following the completion of the Conversion, the Company and the Bank are not permitted to pay dividends on their capital stock if the shareholders' equity of New FFBW, or the shareholder's equity of the Bank, would be reduced below the amount of the liquidation accounts. The liquidation accounts will be reduced annually to the extent that eligible account holders have reduced their qualifying deposits. Subsequent increases will not restore an eligible account holder's interest in the liquidation accounts. Direct costs of the conversion and public offering, totaling approximately $1.2 million, have been applied against the proceeds from the shares sold in the public offering. Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the fair values of securities, fair value of financial instruments, the valuation of other real estate owned and the valuation of deferred income tax assets. Revenue Recognition Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers ("ASC 606"), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity's contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. The majority of the Company's revenue-generating transactions are not subject to ASC 606, including revenue all interest and dividend income generated from financial instruments. Certain noninterest income items, including loan servicing income, gain on sales of loans, gain on sales of securities, and other noninterest income have been evaluated to not fall within the scope of ASC 606. Elements of noninterest income that are within the scope of ASC 606, are as follows: Service charges and other fees - The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements and determined that the agreements can be terminated at any time by either the Company or the account holder. Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied. The Company's monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month. The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges. It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards. Interchange fees - Customers use a Bank-issued debit card to purchase goods and services, and the Company earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction. The Company records the amount due when it receives the settlement from the payment network. Payments from the payment network are received and recorded into income on a daily basis. These fees are included in “service charges and other fees” on the Consolidated Statements of Operations. There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods. Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash and balances due from banks, non-maturity deposits in the Federal Home Loan Bank of Chicago (FHLB), and fed funds sold. The Company has not experienced any losses in such accounts. Available for Sale Securities Securities classified as available for sale are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity. Any decision to sell a security classified as available for sale would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital requirements, and other similar factors. Securities classified as available for sale are carried at fair value. Unrealized gains or losses are reported as increases or decreases in other comprehensive income, net of the related deferred tax effect. Realized gains or losses, determined on the basis of the cost of specific securities sold, are included in earnings. Gains and losses on the sale of securities are recorded on the trade date and determined using the specific-identification method. Declines in fair value of securities that are deemed to be other than temporary, if applicable, are reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers the length of time and the extent to which fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient enough to allow for any anticipated recovery in fair value. Loans Acquired in a Transfer The Company acquires loans (including debt securities) individually and in groups or portfolios. These loans are initially measured at fair value with no allowance for loan losses. The Company’s allowance for loan losses on all acquired loans reflect only those losses incurred subsequent to acquisition. Certain acquired loans may have experienced deterioration of credit quality between origination and the Company’s acquisition of the loans. At acquisition, the Company reviews each loan to determine whether there is evidence of deterioration of credit quality since origination and if it is probable that the Company will be unable to collect all amounts due according to the loan’s contractual terms. If both conditions exist, the Company determines whether each such loan is to be accounted for individually or whether such loans will be assembled into pools of loans based on common risk characteristics (for example, credit score, loan type, and date of origination). The Company considers expected prepayments and estimates the amount and timing of undiscounted principal, interest, and other cash flows expected at acquisition for each loan and aggregated pool of loans. The excess of the loan’s or pool’s scheduled contractual principal and interest payments over all cash flows expected at acquisition is calculated as the nonaccretable difference. The excess of cash flows expected to be collected over the fair value of each loan or pool (accretable yield) is accreted into interest income over the remaining life of the loan or pool. At each reporting date, the Company continues to estimate cash flows expected to be collected for each loan or pool. If expected cash flows have decreased from the acquisition date estimate, the Company recognizes an allowance for loan losses. If expected cash flows have increased from the acquisition date estimate, the Company increases the amount of accretable yield to be recognized as interest income over the remaining life of the loan or pool. Loans Held for Sale Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. Mortgage loans held for sale are sold with the mortgage servicing rights released by the Company. Gains or losses on sales of mortgage loans are recognized based on the difference between the selling price and the carrying value of the related mortgage loan sold. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff generally are reported at their outstanding unpaid principal balances adjusted for deferred loan fees and costs, charge-offs, and an allowance for loan losses. Interest on loans is accrued and credited to income based on the unpaid principal balance. Loan-origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method. The accrual of interest on loans is discontinued when, in the opinion of management, there is an indication that the borrower may be unable to make payments as they become due. When loans are placed on nonaccrual status or charged off, all unpaid accrued interest is reversed against interest income. The interest on these loans is subsequently accounted for on the cash-basis or cost-recovery method until qualifying for return to accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Allowance for Loan Losses The allowance for loan losses is maintained at the level considered adequate by management to provide for losses that are probable as of the balance sheet date. The allowance for loan losses is established through a provision for loan losses charged to expense as losses are estimated to have occurred. Loan losses are charged against the allowance when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. In determining the adequacy of the allowance balance, the Company makes evaluations of the loan portfolio and related off-balance sheet commitments, considers current economic conditions and historical loss experience, and reviews specific problem loans and other factors. When establishing the allowance for loan losses, management categorizes loans into risk categories generally based on the nature of the collateral and the basis of repayment. These risk categories and their relevant risk characteristics are as follows: Commercial development: These loans are secured by vacant land and/or property that are in the process of improvement. Repayment of these loans can be dependent on the sale of the property to third parties or the successful completion of the improvements by the builder for the end user. Construction loans include not only construction of new structures, but loans originated to finance additions to or alterations of existing structures. Until a permanent loan originates, or payoff occurs, all commercial construction loans secured by real estate are reported in this loan pool. Development loans also have the risk that improvements will not be completed on time, or in accordance with specifications and projected costs. Commercial real estate: These loans are primarily secured by office and industrial buildings, warehouses, small retail shopping facilities, and various special purpose properties, including restaurants. These loans are subject to underwriting standards and processes similar to commercial and industrial loans. Loans to closely held businesses are generally guaranteed in full by the owners of the business. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property. The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to the general economic factors or conditions specific to the real estate market, such as geographic location and/or purpose type. Commercial and industrial: Commercial and industrial loans are extended primarily to small and middle market customers. Such credits typically comprise working capital loans, asset acquisition loans, and loans for other business purposes. Loans to closely held businesses are generally guaranteed in full by the owners of the business. Commercial and industrial loans are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Minimum standards and underwriting guidelines have been established for commercial and industrial loans. One-to-four family owner-occupied: These loans are generally to individuals and are underwritten by evaluating the credit history of the borrower, the ability of the borrower to meet the debt service requirements of the loan and total debt obligations, the underlying collateral, and the loan to collateral value. Also included in this category are junior liens on one-to-four family residential properties. Underwriting standards for one-to-four family owner-occupied loans are heavily influenced by statutory requirements, which include, but are not limited to, loan-to-value and affordability ratios, risk-based pricing strategies, and documentation requirements. One-to-four family investor-owned: These loans may be to individuals or businesses and are subject to underwriting standards and processes similar to commercial and industrial loans. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property(ies). The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to the general economic factors or conditions specific to the real estate market, such as geographic location and/or purpose type. Multifamily real estate: These loans include loans to finance non-farm properties with five or more units in structures primarily to accommodate households. Such credits are typically originated to finance the acquisition or refinancing of an apartment building. These loans are subject to underwriting standards and processes similar to commercial and industrial loans. Loans to closely held businesses are generally guaranteed in full by the owners of the business. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the subject multifamily property, with assumptions made for vacancy rates. Cash flows of the borrowers rely on the receipt of rental income from the tenants of the property who are themselves subject to fluctuations in national and local economic conditions and unemployment trends. Consumer: These loans may take the form of installment loans, demand loans, or single payment loans, and are extended to individuals for household, family, and other personal expenditures. These loans generally include direct consumer automobile loans and credit card loans. These loans are generally smaller in size and are underwritten by evaluating the credit history of the borrower, the ability of the borrower to meet the debt service requirements of the loan and total debt obligations. Management regularly evaluates the allowance for loan losses using the Company’s past loan loss experience, known and inherent risks in the loan portfolio, composition of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, current economic conditions, and other relevant factors. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. A loan is impaired when, based on current information, it is probable that the Company will not collect all amounts due in accordance with the contractual terms of the loan agreement. Management determines whether a loan is impaired on a case-by-case basis, taking into consideration the payment status, collateral value, length and reason of any payment delays, the borrower’s prior payment record, and any other relevant factors. Large groups of smaller-balance homogeneous loans, such as residential mortgage and consumer loans, are collectively evaluated in the allowance for loan losses analysis and are not subject to impairment analysis unless such loans have been subject to a restructuring agreement. Specific allowances for impaired loans are based on discounted cash flows of expected future payments using the loan’s initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. In addition, various regulatory agencies periodically review the allowance for loan losses. These agencies may require the Company to make additions to the allowance for loan losses based on their judgments of collectability based on information available to them at the time of their examination. Troubled Debt Restructurings Loans are accounted for as troubled debt restructurings when a borrower is experiencing financial difficulties that lead to a restructuring of the loan and the Company grants a “concession” to the borrower that they would not otherwise consider. These concessions include a modification of terms, such as a reduction of the stated interest rate or loan balance, a reduction of accrued interest, an extension of the maturity date at an interest rate lower than a current market rate for a new loan with similar risk, or some combination thereof to facilitate repayment. Troubled debt restructurings are considered impaired loans. Foreclosed Assets Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value, less costs to sell, at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less costs to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net expenses from foreclosed assets. Premises and Equipment Depreciable assets are stated at cost less accumulated depreciation. Provisions for depreciation are computed on straight-line and accelerated methods over the estimated useful lives of the assets. Other Equity Investments Other Equity Investments consist of Federal Home Loan Bank of Chicago (“FHLB”) stock and Bankers’ Bank stock. The Company's investment in the FHLB stock is carried at cost, which approximates fair value. The Company is required to hold the stock as a member of the FHLB and transfer of the stock is substantially restricted. The stock is evaluated for impairment on an annual basis. The Company is required to adjust its reported value of Bankers’ Bank stock, which is considered an equity security without a readily determinable market value, if a comparable transaction is observed. Income Taxes Amounts provided for income tax expense are based on income reported for financial statement purposes and do not necessarily represent amounts currently payable under tax laws. Deferred income tax assets and liabilities are computed annually for differences between the financial statement and income tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. As changes in tax laws or rates are enacted, deferred income tax assets and liabilities are adjusted through the provision for income taxes. The differences relate principally to the allowances for loan losses, deferred compensation, depreciation, FHLB stock dividends and non-accrual interest. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not to be sustained on audit, based on the technical merits of the position. The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. The Company’s policy is to recognize interest and penalties related to income tax issues as components of income tax expense. During the periods shown, the Company did not recognize any interest or penalties related to income tax expense in its statements of operations. Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Advertising Advertising costs are expensed as incurred. Other Comprehensive Income (Loss) Other comprehensive income (loss) is shown on the statements of comprehensive income. The Company’s accumulated other comprehensive income (loss) is composed of the unrealized gains (losses) on securities available for sale, net of tax and is shown on the statements of changes in equity. Reclassification adjustments out of other comprehensive income (loss) for losses realized on sales of securities available for sale comprise the entire balance of “net loss on sale of securities” on the statements of operations. Off-Balance Sheet Financial Instruments In the ordinary course of business, the Company has entered into off-balance-sheet financial instruments consisting of commitments to extend credit, unfunded commitments under lines of credit, and standby letters of credit. Such financial instruments are recorded in the financial statements when they become payable. Life Insurance The Company has purchased life insurance policies on certain key memebers of the management team. Life insurance is measured at the amount that could be realized under the insurance contract as of the balance sheet date, which is generally the cash surrender value of the policy. Subsequent Events Subsequent events have been evaluated through May 11, 2021, which is the date the financial statements are available to be issued. Recent Accounting Pronouncements The Company qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). For as long as the Company is an emerging growth company, it may choose to take advantage of exemptions from various reporting requirements applicable to other public companies. An emerging growth company may elect to use the extended transition period to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies, but must make such election when the Company is first required to file a registration statement. The Company has elected to use the extended transition period described above and intends to maintain its emerging growth company status as allowed under the JOBS Act. The Company recently adopted the following Accounting Standards Updates (ASU) issued by the Financial Accounting Standards Board (FASB). ASU No. 2019-12, “Simplifying the Accounting for Income Taxes” This standard is intended to simplify the accounting for income taxes and improve the consistent application of accounting guidance through the following changes: 1) removes certain exceptions for recognizing deferred tax liabilities, tax allocations, and the calculation methodology for an interim year-to-date loss that exceeds the anticipated loss for the year; 2) requires a franchise tax or similar tax based partially on income be recognized as an income-based tax and account for any incremental amount incurred as a non-income based tax; 3) requires an entity evaluate when a step up in the tax basis of goodwill should be considered part of a business combination in which goodwill was originally recognized and when it should be considered a separate transaction; 4) does not require the allocation of consolidated current and deferred tax expense to a member entity that is not subject to tax in separate financial statements, but may elect to do so for certain legal entities that are disregarded by the taxing authority; and 5) amends guidance on the handling of an enacted change in tax law or rates within interim tax periods. This new standard is effective for financial statements issued for interim and annual periods beginning after December 15, 2020. The Company does not believe this will have a significant impact on its financial statements. ASU No. 2020-04 “Facilitation of the Effects of Reference Rate Reform on Financial Reporting” This standard provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform if certain criteria are met. Effective March 12, 2020, the amendments in this ASU are elective and prospectively applied only to contracts modified on or before December 31, 2022, or hedging relationships entered into or evaluated through December 31, 2022. The adoption of this standard has not impacted the Company’s financial staetments and management does not believe it will have a significant impact moving forward. The following ASUs have been issued by the FASB and may impact the Company's financial statements in future reporting periods: ASU No. 2016-13, “Credit Losses (Topic 326).” ASU No. 2019-04, “Codification Improvements to Topic 326.” ASU No. 2019-05, “Financial Instruments-Credit Losses.” ASU 2016-13 requires organizations to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption will be permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently assessing the impact of adopting ASU 2016-13 on its financial statements. ASU No. 2016-02, “Leases (Topic 842): Amendments to the Leases Analysis.” ASU No. 2018-10, "Codification Improvements to Topic 842." ASU No. 2018-11, "Targeted Improvements" For lessees, Topic 842 requires leases to be recognized on the balance sheet, along with disclosure of key information about leasing arrangements. Topic 842 was subsequently amended by ASU 2018-01, 2018-10 and 2018-11. The new standard establishes a right-of-use (ROU) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification expense recognition in the income statement. For lessors, Topic 842 requires lessors to classify leases as sales-type, direct financing or operating leases. A lease is a sales-type lease if any one of five criteria are met, each of which indicate that the lease, in effect, transfers control of the underlying asset to the lessee. If none of those five criteria are met, but two additional criteria are both met, indicating the lessor has transferred substantially all the risks and benefits of the underlying asset to the lessee and a third party, the lease is a direct financing lease. All leases that are not sales-type or direct financing leases are operating leases. The new standard is effective for the Company on January 1, 2022, with early adoption permitted. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) the new standard's effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company expects to adopt the new standard on January 1, 2022 using the effective date as its date of initial application. The Company is evaluating what impact this standard will have on its consolidated financial statements. ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement” This ASU modifies the disclosure requirements on fair value measurements in Topic 820, including the removal, modification to, and addition of certain disclosure requirements. This ASU was adopted effective January 1, 2020. Given the nature of the Company’s fair value instruments, the i |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share | |
Earnings Per Share | NOTE 3 – Earnings Per Share Basic earnings per common share is computed by dividing net income by the weighted average number of common shares outstanding, adjusted for weighted average unallocated ESOP shares, during the applicable period, excluding outstanding participating securities. Participating securities include non-vested restricted stock awards and restricted stock units, though no actual shares of common stock related to restricted stock units are issued until the settlement of such units, to the extent holders of these securities receive non-forfeitable dividends or dividend equivalents at the same rate as holders of the Company’s common stock. Diluted earnings per share is computed using the weighted-average number of shares determined for the basic earnings per common share computation plus the dilutive effect of stock compensation using the treasury stock method. Antidilutive options are disregarded in earnings per share calculations. The following table presents the earnings per share calculations for the three months ended March 31: Three months ended March 31, 2021 2020 Net income $ 670 $ 407 Basic potential common shares Weighted average shares outstanding 7,224,401 7,704,875 Weighted average unallocated Employee Stock Ownership Plan Shares (576,061) (607,924) Basic weighted average shares outstanding 6,648,340 7,096,951 Dilutive potential common shares 13,770 — Dilutive weighted average shares outstanding 6,662,110 7,096,951 Basic earnings per share $ 0.10 $ 0.06 Diluted earnings per share $ 0.10 $ 0.06 |
Available for Sale Securities
Available for Sale Securities | 3 Months Ended |
Mar. 31, 2021 | |
Available for Sale Securities | |
Available for Sale Securities | NOTE 4 – Available for Sale Securities Amortized costs and fair values of available for sale securities are summarized as follows: Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value March 31, 2021 Obligations of the US government and US government sponsored agencies $ 655 $ $ 29 $ — $ 684 Obligations of states and political subdivisions 14,978 413 (99) 15,292 Mortgage-backed securities 32,968 1,083 (68) 33,983 Certificates of deposit 4,150 51 — 4,201 Corporate debt securities 2,177 126 — 2,303 Total available for sale securities $ 54,928 $ 1,702 $ (167) $ 56,463 December 31, 2020 Obligations of the US government and US government sponsored agencies $ 717 $ 37 $ — $ 754 Obligations of states and political subdivisions 15,012 612 (19) 15,605 Mortgage-backed securities 36,347 1,361 (28) 37,680 Certificates of deposit 7,880 57 — 7,937 Corporate debt securities 2,179 92 (4) 2,267 Total available for sale securities $ 62,135 $ 2,159 $ (51) $ 64,243 Fair values of securities are estimated based on financial models or prices paid for similar securities. It is possible interest rates could change considerably, resulting in a material change in estimated fair value. The following table presents the portion of the Company’s portfolio which has gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position: Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses March 31, 2021 Obligations of states and political subdivisions $ 4,475 $ (99) $ — $ — $ 4,475 $ (99) Mortgage-backed securities 5,545 (61) 1,132 (7) 6,677 (68) Total $ 10,020 $ (160) $ 1,132 $ (7) $ 11,152 $ (167) December 31, 2020 Obligations of states and political subdivisions $ 1,543 $ (19) $ — $ — $ 1,543 $ (19) Mortgage-backed securities 4,140 (21) 736 (7) 4,876 (28) Corporate debt securities 849 (4) — — 849 (4) Total $ 6,532 $ (44) $ 736 $ (7) $ 7,268 $ (51) At March 31, 2021, the investment portfolio included 4 securities available for sale, which had been in an unrealized loss position for greater than twelve months, and 18 securities available for sale, which had been in an unrealized loss position for less than twelve months. At December 31, 2020, the investment portfolio included 4 securities available for sale, which had been in an unrealized loss position for greater than twelve months, and 13 securities available for sale, which had been in an unrealized loss position for less than twelve months. Because these securities have a fixed interest rate, their fair value is sensitive to movements in market interest rates. These unrealized losses are considered temporary because the Company does not currently have the intent to sell the securities before recovery of the losses; therefore we expect to collect all contractually due amounts from these securities. Accordingly, these investments were reduced to their fair values through accumulated other comprehensive income, not through earnings. We regularly assess our securities portfolio for other than temporary impairment (“OTTI”). These assessments are based on the nature of the securities, the underlying collateral, the financial condition of the issuer, the extent and duration of the loss, our intent related to the individual securities, and the likelihood that we will have to sell securities prior to expected recovery. We did not have any impairment losses recognized in earnings for the three months ended March 31, 2021 or March 31, 2020. The amortized cost and fair value of available for sale securities by contractual maturity are shown below. Expected maturities will differ from contractual maturities in mortgage-backed securities since the anticipated maturities are not readily determinable. Therefore, these securities are not included in the maturity categories in the following maturity summary listed below: March 31, 2021 Amortized Cost Fair Value Due in one year or less $ 418 $ 425 Due after one year through 5 years 6,556 6,754 Due after 5 years through 10 years 7,758 8,061 Due after 10 years 7,228 7,240 Subtotal $ 21,960 $ 22,480 Mortgage-backed securities 32,968 33,983 Total $ 54,928 $ 56,463 No securities were sold during the three months ended March 31, 2021 or 2020. Available for sale securities with a carrying value of $1 ,019 and $ 1,036 were pledged at March 31, 2021 and December 31, 2020, respectively. |
Loans
Loans | 3 Months Ended |
Mar. 31, 2021 | |
Loans | |
Loans | NOTE 5 - Loans Major classifications of loans are as follows: March 31, December 31, 2021 2020 Commercial Development $ 14,565 $ 14,090 Real estate 80,224 87,605 Commercial and industrial 20,041 20,758 Residential real estate and consumer One-to-four family owner-occupied 28,356 30,548 One-to-four family investor-owned 27,968 32,638 Multifamily 30,432 29,303 Consumer 4,972 3,016 Subtotal $ 206,558 $ 217,958 Deferred loan fees (369) (424) Allowance for loan losses (2,813) (2,811) Net loans $ 203,376 $ 214,723 Deposit accounts in an overdraft position and reclassified as loans approximated $4 and $5 at March 31, 2021 and December 31, 2020, respectively. A summary of the activity in the allowance for loan losses by portfolio segment is as follows: Residential real estate Three Months Ended Commercial and consumer Total March 31, 2021 Balance at December 31, 2020 $ 1,834 $ 977 $ 2,811 Provision for loan losses 58 (58) — Loans charged off — — — Recoveries of loans previously charged off — 2 2 Total ending allowance balance $ 1,892 $ 921 $ 2,813 March 31, 2020 Balance at December 31, 2019 $ 1,251 $ 1,013 $ 2,264 Provision for loan losses 50 (10) 40 Loans charged off — — — Recoveries of loans previously charged off — 3 3 Total ending allowance balance $ 1,301 $ 1,006 $ 2,307 Information about how loans were evaluated for impairment and the related allowance for loan losses follows: Residential Real Estate and March 31, 2021 Commercial Consumer Total Loans: Individually evaluated for impairment $ 827 $ 1,245 $ 2,072 Collectively evaluated for impairment 114,003 90,483 204,486 Total loans $ 114,830 $ 91,728 $ 206,558 Allowance for loan losses: Individually evaluated for impairment $ 450 $ — $ 450 Collectively evaluated for impairment 1,442 921 2,363 Total allowance for loan losses $ 1,892 $ 921 $ 2,813 Residential Real Estate and December 31, 2020 Commercial Consumer Total Loans: Individually evaluated for impairment $ 792 $ 1,228 $ 2,020 Collectively evaluated for impairment 121,661 94,277 215,938 Total loans $ 122,453 $ 95,505 $ 217,958 Allowance for loan losses: Individually evaluated for impairment $ 450 $ — $ 450 Collectively evaluated for impairment 1,384 977 2,361 Total allowance for loan losses $ 1,834 $ 977 $ 2,811 Information regarding impaired loans follows: Principal Recorded Related Average Interest As of March 31, 2021 Balance Investment Allowance Investment Recognized Loans with related allowance for loan losses: Commercial Commercial and industrial $ 713 $ 704 $ 450 $ 708 $ — Total loans with related allowance for loan losses 713 704 450 708 — Loans with no related allowance for loan losses: Commercial Commercial and industrial 146 123 — 135 1 Residential real estate and consumer One-to-four family owner-occupied 1,039 992 — 1,016 9 One-to-four family investor-owned 242 203 — 222 — Consumer 50 50 — 50 — Total loans with no related allowance for loan losses 1,477 1,368 — 1,423 10 Total impaired loans $ 2,190 $ 2,072 $ 450 $ 2,131 $ 10 Principal Recorded Related Average Interest As of December 31, 2020 Balance Investment Allowance Investment Recognized Loans with related allowance for loan losses: Commercial Commercial and industrial $ 713 $ 704 $ 450 $ 713 $ 19 Residential real estate and consumer One-to-four family investor-owned — — — — — Total loans with related allowance for loan losses 713 704 450 713 19 Loans with no related allowance for loan losses: Commercial Commercial and industrial 108 88 — 109 5 Residential real estate and consumer One-to-four family owner-occupied 1,017 971 — 979 9 One-to-four family investor-owned 242 206 — 242 — Consumer 52 51 — 54 — Total loans with no related allowance for loan losses 1,419 1,316 — 1,384 14 Total impaired loans $ 2,132 $ 2,020 $ 450 $ 2,097 $ 33 Additional funds of $0 and $215 were committed to impaired loans as of March 31, 2021 and December 31, 2020, respectively. The Company regularly evaluates various attributes of loans to determine the appropriateness of the allowance for loan losses. The credit quality indicators monitored differ depending on the class of loan. Commercial loans and one-to-four family investor-owned and multifamily loans are generally evaluated using the following internally prepared ratings: “Pass” ratings are assigned to loans with adequate collateral and debt service ability such that collectability of the contractual loan payments is highly probable. “Special mention” ratings are assigned to loans where management has some concern that the collateral or debt service ability may not be adequate, though the collectability of the contractual loan payments is still probable. “Substandard” ratings are assigned to loans that do not have adequate collateral and/or debt service ability such that collectability of the contractual loan payments is no longer probable. “Doubtful” ratings are assigned to loans that do not have adequate collateral and/or debt service ability, and collectability of the contractual loan payments is unlikely. Information regarding the credit quality indicators most closely monitored for commercial loans by class follows: Special Pass Mention Substandard Doubtful Totals March 31, 2021 Development $ 14,565 $ — $ — $ — $ 14,565 Real estate 80,224 — — — 80,224 Commercial and industrial 19,252 — 85 704 20,041 One-to-four family investor-owned 27,968 — — — 27,968 Multifamily 30,432 — — — 30,432 Totals $ 172,441 $ — $ 85 $ 704 $ 173,230 December 31, 2020 Development $ 14,090 $ — $ — $ — $ 14,090 Real estate 87,605 — — — 87,605 Commercial and industrial 20,046 — 8 704 20,758 One-to-four family investor-owned 32,358 — 280 — 32,638 Multifamily 29,303 — — — 29,303 Totals $ 183,402 $ — $ 288 $ 704 $ 184,394 Residential real estate and consumer loans are generally evaluated based on whether or not the loan is performing according to the contractual terms of the loan. Information regarding the credit quality indicators most closely monitored for residential real estate and consumer loans by class follows: Performing Non-performing Totals March 31, 2021 One-to-four family owner-occupied $ 28,199 $ 157 $ 28,356 Consumer 4,972 — 4,972 $ 33,171 $ 157 $ 33,328 December 31, 2020 One-to-four family owner-occupied $ 30,548 $ — $ 30,548 Consumer 3,016 — 3,016 $ 33,564 $ — $ 33,564 Loan aging information follows: Loans Past Due Loans Past Due Nonaccrual Current Loans 30-89 Days 90+ Days Total Loans Loans March 31, 2021 Commercial Development $ 14,565 $ — $ — $ 14,565 $ — Real estate 80,224 — — 80,224 — Commercial and industrial 20,041 — — 20,041 789 Residential real estate and consumer One-to-four family owner-occupied 28,241 115 — 28,356 157 One-to-four family investor-owned 27,968 — — 27,968 203 Multifamily 30,432 — — 30,432 — Consumer 4,972 — — 4,972 — Total $ 206,443 $ 115 $ — $ 206,558 $ 1,149 Loans Past Due Loans Past Due Nonaccrual Current Loans 30-89 Days 90+ Days Total Loans Loans December 31, 2020 Commercial Development $ 14,090 $ — $ — $ 14,090 $ — Real estate 87,040 565 — 87,605 — Commercial and industrial 20,054 704 — 20,758 792 Residential real estate and consumer One-to-four family owner-occupied 30,347 201 — 30,548 69 One-to-four family investor-owned 32,638 — — 32,638 206 Multifamily 29,303 — — 29,303 — Consumer 3,016 — — 3,016 — Total $ 216,488 $ 1,470 $ — $ 217,958 $ 1,067 There are no loans 90 or more days past due and accruing interest as of March 31, 2021 or December 31, 2020. When, for economic or legal reasons related to the borrower’s financial difficulties, the Company grants a concession to the borrower that the Company would not otherwise consider, the modified loan is classified as a troubled debt restructuring. Loan modifications may consist of forgiveness of interest and/or principal, a reduction of the interest rate, allowing interest-only payments for a period of time, and/or extending amortization terms. During the three months ended and as of March 31, 2021, there were no new troubled debt restructurings. No troubled debt restructurings defaulted within 12 months of their modification date during the three months ended March 31, 2021. During the year ended and as of December 31, 2020, there were no new troubled debt restructurings. No troubled debt restructurings defaulted within 12 months of their modifications during the year ended December 31, 2020. During April 2020, the Coronavirus Aid, Relief and Economic Security Act was signed into law which provides optional, temporary relief from accounting for certain pandemic-related loan modifications as a TDR. During 2020, the Bank offered payment deferrals to loan customers that were excluded from TDR classification based on this Act. Loans totaling $4.5 million remain on a modified status as of March 31, 2021. Management regularly monitors impaired loan relationships. In the event facts and circumstances change, an additional provision for loan losses may be necessary. |
Deposits
Deposits | 3 Months Ended |
Mar. 31, 2021 | |
Deposits | |
Deposits | NOTE 6 - Deposits The composition of deposits are as follows: March 31, December 31, 2021 2020 Non interest-bearing checking $ 52,852 $ 51,802 Interest-bearing checking 10,523 10,899 Money market 69,119 70,455 Statement savings accounts 35,152 31,977 Health savings accounts 10,859 10,854 Certificates of deposit 51,072 50,511 Total $ 229,577 $ 226,498 Certificates of deposit that meet or exceed the FDIC insurance limit of $250 totaled $9,752 and $9,485 at March 31, 2021 and December 31, 2020, respectively. The scheduled maturities of certificates of deposit are as follows as of March 31, 2021: 2021 $ 28,530 2022 17,780 2023 2,999 2024 1,200 2025 460 2026 103 Total $ 51,072 |
FHLB Advances
FHLB Advances | 3 Months Ended |
Mar. 31, 2021 | |
FHLB Advances [Abstract] | |
FHLB Advances | NOTE 7– FHLB Advances FHLB advances consist of the following: March 31, 2021 December 31, 2020 Rates Amount Rates Amount Fixed rate, fixed term advances 0.0%-1.71% $ 5,500 0.0%-1.71% $ 5,500 Fixed term advances with floating spread 2.10% 2,000 2.10% 2,000 $ 7,500 $ 7,500 The following is a summary of scheduled maturities of fixed term FHLB advances as of March 31, 2021: Fixed Rate Advances Adjustable Rate Advances Weighted Weighted Total Average Rate Amount Average Rate Amount Amount 2021 % $ 4,000 2.10 % $ 2,000 $ 6,000 2022 1.71 % 1,500 — — 1,500 Total 0.47 % $ 5,500 2.10 % $ 2,000 $ 7,500 Actual maturities may differ from the scheduled principal maturities due to call options on the various advances. The Company has a master contract agreement with the FHLB that provides for a borrowing up to the lesser of a determined multiple of FHLB stock owned or a determined percentage of the book value of the Company’s qualifying one-to-four family, multifamily, commercial real estate and commercial business loans. The Company pledged approximately $172,647 and $149,304 of one-to-four family, multifamily, commercial real estate and commercial business loans to secure FHLB advances at March 31, 2021 and December 31, 2020, respectively. FHLB provides both fixed and floating rate advances. Floating rates are tied to short-term market rates of interest, such as Federal funds, FHLB discount note or prime rates. Fixed rate advances are priced in reference to market rates of interest at the time of the advance, namely the rates that FHLB pays to borrowers at various maturities. FHLB advances are subject to a prepayment penalty if they are repaid prior to maturity. FHLB advances are also secured by $851 of FHLB stock owned by the Company at both March 31, 2021 and December 31, 2020. At March 31, 2021, the Company’s available and unused portion of this borrowing agreement based on the amount of FHLB stock was $14,459. In addition, the Company has a $7,000 federal funds line of credit through Bankers’ Bank of Wisconsin, which was not drawn on as of March 31, 2021. The Company also has the authority to borrow through the Federal Reserve’s Discount Window . |
Employee Stock Ownership Plan
Employee Stock Ownership Plan | 3 Months Ended |
Mar. 31, 2021 | |
Employee Stock Ownership Plan | |
Employee Stock Ownership Plan | NOTE 8 – Employee Stock Ownership Plan The Company maintains a leveraged employee stock ownership plan (“ESOP”) that covers substantially all employees. The ESOP was established in conjunction with the Company’s initial stock offering completed in October 2017 and operates on a plan year ending December 31. The loan to fund the acquisition of stock by the ESOP was made by the Company. Additional shares were purchased by the ESOP in conjunction with the stock offering completed in January 2020, which was also financed by a loan from the Company. The Bank makes annual contributions to the ESOP equal to the ESOP’s debt service. The ESOP shares initially were pledged as collateral for this debt. As the debt is repaid, shares are released from collateral and allocated to active participants, based on the proportion of debt service paid in the year. Because the debt is intercompany, it is eliminated in consolidation for presentation in these financial statements. The shares pledged as collateral are reported as unearned ESOP shares in the balance sheet. As shares are committed to be released from collateral and allocated to active participants, the Company reports compensation expense equal to the current market price of the shares and the shares will become outstanding for earnings-per-shares (EPS) computations. During the quarters ended March 31, 2021 and 2020, 7,647 and 7,647 shares were committed to be released, respectively. During the three months ended March 31, 2021 the average fair value per share of stock was $10.77 resulting in total ESOP compensation expense of $82 for the three months ended March 31, 2021. During the three months ended March 31, 2020 the average fair value per share of stock was $10.15 resulting in total ESOP compensation expense of $63 for the three months ended March 31, 2020. The ESOP shares as of March 31, 2021 and December 31, 2020 were as follows: March 31, 2021 December 31, 2020 Shares allocated to active participants 62,305 33,861 Shares committed to be released and allocated to participants 7,647 30,584 Shares distributed — (2,140) Total unallocated shares 573,446 581,093 Total ESOP shares 643,398 643,398 Fair value of unallocated shares (based on $11.25 and $10.02 share price at March 31, 2021 and December 31, 2020, respectively) $ 6,451 $ 5,823 |
Share-based Compensation Plans
Share-based Compensation Plans | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Compensation Plans | |
Share-based Compensation Plans | NOTE 9 - Share-based Compensation Plans The Company adopted the FFBW, Inc. 2018 Equity Incentive Plan (the “2018 Equity Incentive Plan”) in 2018. ASC Topic 718 requires that the grant date fair value of equity awards to employees and directors be recognized as compensation expense over the period during which they are required to provide service in exchange for such awards. The following table summarizes the impact of the Company’s share-based payment plans in the financial statements for the period shown: Three Months Ended March 31, 2021 2020 Total cost of stock grant plan during the year $ 44 $ 50 Total cost of stock option plan during the year 37 37 Total cost of share-based payment plans during the year $ 81 $ 87 Amount of related income tax benefit recognized in income $ 19 $ 23 Options are granted with an exercise price equal to no less than the market price of the Company’s shares at the date of grant: those option awards generally vest pro-rata over five years of service and have 10‑year contractual terms. Restricted shares typically vest pro-rata over a five year period, 20% per year beginning one year from the issuance date. Share amounts related to periods prior to the date of the closing of the Offering on January 16, 2020 have been restated to give retroactive recognition to the 1.1730 exchange ratio applied in the offering. The following table summarizes stock options activity for the three months ended March 31, 2021: Outstanding Weighted Weighted Average Average Remaining Aggregate Stock Option Exercise Contractual Intrinsic Awards Price Term (years) Value Options outstanding as of December 31, 2020 269,220 $ 10.51 Granted — — Exercised — — Forfeited — — Options outstanding as of March 31, 2021 269,220 $ 10.51 8.26 $ 201,772 Options exercisable as of March 31, 2021 81,964 $ 10.81 7.98 $ 19,926 The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model based on certain assumptions. Since the Company does not have sufficient historical fair value estimates of its stock, the Company calculates expected volatility using the historical volatility of the Dow Jones U.S. Financial Services Index. The risk-free interest rate for periods within the contractual term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The expected life of options is estimated based on the assumption that options will be exercised evenly throughout their life after vesting and represents the period of time that options granted are expected to remain outstanding. There were no options granted during the three months ended March 31, 2021. The following is a summary of changes in restricted shares for the three months ended March 31, 2021: Weighted Average Number of Grant Date Fair Shares Value Nonvested stock awards as of December 31, 2020 62,060 $ 10.73 Granted — — Vested — — Forfeited — — Nonvested stock awards as of March 31, 2021 62,060 $ 10.73 As of March 31, 2021, there was $1.0 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements (including share option and non-vested share awards) granted under the 2018 Equity Incentive Plan. At March 31, 2021, the weighted-average period over which the unrecognized compensation expense is expected to be recognized was approximately 2. 9 years. |
Equity and Regulatory Matters
Equity and Regulatory Matters | 3 Months Ended |
Mar. 31, 2021 | |
Equity and Regulatory Matters | |
Equity and Regulatory Matters | NOTE 10 – Equity and Regulatory Matters The Bank is subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of Common Equity Tier 1, Tier 1, and Total capital to risk-weighted assets and of Tier 1 capital to average assets. It is management’s opinion, as of March 31, 2021, that the Bank meet all applicable capital adequacy requirements. As of March 31, 2021, the Bank is categorized as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum regulatory capital ratios as set forth in the table. There are no conditions or events since March 31, 2021 that management believes have changed the category. The Bank’s actual capital amounts and ratios are presented in the following tables: To Be Well Capitalized Under Prompt For Capital Adequacy Corrective Actual Purposes Action Provisions Amount Ratio Amount Ratio Amount Ratio March 31, 2021 Common Equity Tier 1 capital (to risk‑weighted assets) $ 74,087 33.9 % $ ≥ 9,832 ≥ 4.5 % $ ≥ 14,202 ≥ 6.5 % Tier 1 capital (to risk‑weighted assets) 74,087 33.3 ≥ 13,110 ≥ 6.0 ≥ 17,479 ≥ 8.0 Total capital (to risk‑weighted assets) 76,819 34.5 ≥ 17,479 ≥ 8.0 ≥ 21,849 ≥ 10.0 Tier 1 capital (to average assets) 74,087 22.3 ≥ 13,309 ≥ 4.0 ≥ 16,637 ≥ 5.0 December 31, 2020 Common Equity Tier 1 capital (to risk‑weighted assets) $ 73,665 33.1 % $ ≥ 10,018 ≥ 4.5 % $ ≥ 14,471 ≥ 6.5 % Tier 1 capital (to risk‑weighted assets) 73,665 33.1 ≥ 13,358 ≥ 6.0 ≥ 17,810 ≥ 8.0 Total capital (to risk‑weighted assets) 76,448 34.3 ≥ 17,810 ≥ 8.0 ≥ 22,263 ≥ 10.0 Tier 1 capital (to average assets) 73,665 25.2 ≥ 11,700 ≥ 4.0 ≥ 14,625 ≥ 5.0 |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value | |
Fair Value | NOTE 11 – Fair Value Accounting standards describe three levels of inputs that may be used to measure fair value (the fair value hierarchy). The level of an asset or liability within the fair value hierarchy is based on the lowest level of input significant to the fair value measurement of that asset or liability. Following is a brief description of each level of the fair value hierarchy: Level 1 - Fair value measurement is based on quoted prices for identical assets or liabilities in active markets. Level 2 - Fair value measurement is based on: (1) quoted prices for similar assets or liabilities in active markets; (2) quoted prices for identical or similar assets or liabilities in markets that are not active; or (3) valuation models and methodologies for which all significant assumptions are or can be corroborated by observable market data. Level 3 - Fair value measurement is based on valuation models and methodologies that incorporate at least one significant assumption that cannot be corroborated by observable market data. Level 3 measurements reflect the Company’s estimates about assumptions market participants would use in measuring fair value of the asset or liability. Some assets and liabilities, such as securities available for sale, are measured at fair value on a recurring basis under accounting principles generally accepted in the United States. Other assets and liabilities, such as impaired loans, may be measured at fair value on a nonrecurring basis. Following is a description of the Company’s valuation methodology and significant inputs used for each asset and liability measured at fair value on a recurring or nonrecurring basis, as well as the classification of the asset or liability within the fair value hierarchy. Available for sale securities - Available for sale securities may be classified as Level 1 or Level 2 measurements within the fair value hierarchy. Level 1 securities include equity securities traded on a national exchange. The fair value measurement of a Level 1 security is based on the quoted price of the security. Level 2 securities include U.S. government and agency securities, obligations of states and political subdivisions, corporate debt securities, and mortgage related securities. The fair value measurement of a Level 2 security is obtained from an independent pricing service and is based on recent sales of similar securities and other observable market data. Loans - Loans are not measured at fair value on a recurring basis. However, loans considered to be impaired may be measured at fair value on a nonrecurring basis. The fair value measurement of an impaired loan that is collateral dependent is based on the fair value of the underlying collateral. Independent appraisals are obtained that utilize one or more valuation methodologies - typically they will incorporate a comparable sales approach and an income approach. Management routinely evaluates the fair value measurements of independent appraisers and adjusts those valuations based on differences noted between actual selling prices of collateral and the most recent appraised value. Such adjustments are usually significant, which results in a Level 3 classification. All other impaired loan measurements are based on the present value of expected future cash flows discounted at the applicable effective interest rate and, thus, are not fair value measurements. Foreclosed assets - Real estate acquired through or in lieu of loan foreclosure are not measured at fair value on a recurring basis. However, foreclosed assets are initially measured at fair value (less estimated costs to sell) when they are acquired and may also be measured at fair value (less estimated costs to sell) if they become subsequently impaired. The fair value measurement for each asset may be obtained from an independent appraiser or prepared internally. Fair value measurements obtained from independent appraisers generally utilize a market approach based on sales of comparable assets and/or an income approach. Such measurements are usually considered Level 2 measurements. However, management routinely evaluates fair value measurements of independent appraisers by comparing actual selling prices to the most recent appraisals. If management determines significant adjustments should be made to the independent appraisals based on these evaluations, these measurements are considered Level 3 measurements. Fair value measurements prepared internally are based on management’s comparisons to sales of comparable assets, but include significant unobservable data and are therefore considered Level 3 measurements. Other equity investments - Certain equity investments are measured at fair value on a non-recurring basis using observable transactions and are classified as Level 2. Assets measured at fair value on a recurring basis are summarized below: Recurring Fair Value Measurements Using Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Instruments Inputs Inputs (Level 1) (Level 2) (Level 3) Total As of March 31, 2021 Assets: Available for sale securities: Obligations of the US government and US government sponsored agencies $ — $ 684 $ — $ 684 Obligations of states and political subdivisions — 15,292 — 15,292 Mortgage-backed securities — 33,983 — 33,983 Certificates of deposit — 4,201 — 4,201 Corporate debt securities — 2,303 — 2,303 Total available for sale securities $ — $ 56,463 $ — $ 56,463 As of December 31, 2020 Assets: Available for sale securities: Obligations of the US government and US government sponsored agencies $ — $ 754 $ — $ 754 Obligations of states and political subdivisions — 15,605 — 15,605 Mortgage-backed securities — 37,680 — 37,680 Certificates of deposit — 7,937 — 7,937 Corporate debt securities — 2,267 — 2,267 Total available for sale securities $ — $ 64,243 $ — $ 64,243 Information regarding the fair value of assets measured at fair value on a nonrecurring basis follows: Nonrecurring Fair Value Measurements Using Quoted Prices in Active Significant Markets for Other Significant Assets Identical Observable Unobservable Measured at Instruments Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) As of March 31, 2021 Assets: Loans $ 254 $ — $ — $ 254 Other equity investments 225 — 225 — As of December 31, 2020 Assets: Loans $ 254 $ — $ — $ 254 Foreclosed assets 125 — — 125 Other equity investments 225 — 225 — Loans with a carrying amount of $704 were considered impaired and were written down to their estimated fair value of $254 as of March 31, 2021. Loans with a carrying amount of $704 were considered impaired and were written down to their estimated fair value of $254 as of December 31, 2020. As a result, the Company recognized a specific valuation allowance against these impaired loans totaling $450 and $450 as of March 31, 2021 and December 31, 2020, respectively. Foreclosed assets with a carrying amount of $0 and $125 were determined to be at their fair value as of March 31, 2021 and December 31, 2020, respectively. The following presents quantitative information about nonrecurring Level 3 fair value measurements: Range/Weighted Fair Value Valuation Technique Unobservable Input(s) Average As of March 31, 2021 Loans $ Market and/or income approach Management discount on appraised values 10 % - 20 % Foreclosed assets $ Market and/or income approach Management discount on appraised values 10 % - 20 % As of December 31, 2020 Loans $ Market and/or income approach Management discount on appraised values 10 % - 20 % Foreclosed assets $ Market and/or income approach Management discount on appraised values 10 % - 20 % The carrying value and estimated fair value of financial instruments as of March 31, 2021 and December 31, 2020 follow: March 31, 2021 Carrying Fair Value Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 59,125 $ 59,125 $ — $ — Available for sale securities 56,463 — 56,463 — Loans held for sale 1,098 — 1,098 — Loans 203,376 — — 205,155 Accrued interest receivable 912 912 — — Cash value of life insurance 8,576 — — 8,576 Other equity investments 1,278 — 225 1,053 Financial liabilities: Deposits 229,577 175,987 — 51,164 Advance payments by borrowers for taxes and insurance 391 391 — — FHLB advances 7,500 — — 7,535 Accrued interest payable 117 117 — — December 31, 2020 Carrying Fair Value Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 41,479 $ 41,479 $ — $ — Available for sale securities 64,243 — 64,243 — Loans held for sale 1,708 — 1,708 — Loans 214,723 — — 217,893 Accrued interest receivable 995 995 — — Cash value of life insurance 7,272 — — 7,272 Other equity investments 1,279 — 225 1,054 Financial liabilities: Deposits 226,498 175,987 — 50,732 Advance payments by borrowers for taxes and insurance 127 127 — — FHLB advances 7,500 — — 7,544 Accrued interest payable 17 17 — — Limitations - The fair value of a financial instrument is the current amount that would be exchanged between market participants, other than in a forced liquidation. Fair value is best determined based on quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Consequently, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company. |
Business Combination
Business Combination | 3 Months Ended |
Mar. 31, 2021 | |
Business Combination [Abstract] | |
Business Combination | NOTE 12 – Business Combination On December 31, 2020, the Company acquired substantially all of the assets and assumed substantially all of the liabilities of Mitchell Bank pursuant to the Purchase and Acquisition Agreement dated July 24, 2020. The assets acquired and the liabilities assumed from Mitchell Bank were recorded at their fair value as of the closing date of the acquisition. Fair values are preliminary and subject to refinement for up to one year after the closing date of the acquisition as additional information regarding fair values becomes available. A bargain purchase gain of $7,000 was recorded at the time of the acquisition. As Recorded Fair Value and Other As Recorded by Mitchell Bank Merger Related Adjustments by the Company Consideration Paid Cash $ 4,978 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and due from banks $ 38,266 $ - $ 38,266 Securities 7,133 16 7,149 Other equity securities 51 177 228 Loans, net of allowance 14,512 (217) 14,295 Premises and equipment 529 499 1,028 Core deposit intangibles - 369 369 Accrued interest receivable 83 - 83 Foreclosed assets 185 (60) 125 Deferred tax asset 228 (228) - Other assets 209 (88) 121 Total assets acquired $ 61,196 $ 468 61,664 Deposits $ 56,641 $ - 56,641 Other liabilities 38 - 38 Total liabilities assumed $ 56,679 $ - 56,679 Total identifiable assets 4,517 468 4,985 Bargain purchase gain resulting from acquisition (7) |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Summary of Significant Accounting Policies | |
Organization | Organization From October 2017 until January 2020, as discussed below, we operated in a two-tier mutual holding company structure. FFBW, Inc. (the “Company”) was a federal corporation that was the publicly traded stock holding company of First Federal Bank of Wisconsin (the “Bank”). At December 31, 2019, the Company had 7,702,478 shares of common stock outstanding, of which 3,436,424 shares, or 44.6%, were owned by the public, including 29,325 shares owned by FFBW Community Foundation, and the remaining 4,266,054 shares were held by FFBW, MHC (the “MHC”), a federally chartered mutual holding company and former parent company of the Company. At December 31, 2019, the significant assets of the Company consisted of the capital stock of the Bank. The liabilities of the Company were insignificant. The Company was subject to the financial reporting requirements of the Securities Exchange Act of 1934, as amended. The Company was subject to regulation and examination by the Board of Governors of the Federal Reserve System (“the Federal Reserve Board”). The Bank is a community bank headquartered in Waukesha, Wisconsin that provides financial services to individuals and businesses from our offices in Waukesha, Brookfield, and the South Side of Milwaukee. FFBW, Inc. (“New FFBW”), a Maryland corporation that was organized in September 2019, is a savings and loan holding company headquartered in Waukesha, Wisconsin. New FFBW was formed to be the successor to the Company upon completion of the second step mutual-to-stock conversion (the “Conversion”) of the MHC. Prior to completion of the Conversion, approximately 55.4% of the shares of common stock of the Company were owned by the MHC. In conjunction with the Conversion, the MHC and the Company merged into New FFBW. The Conversion was completed on January 16, 2020. In the Conversion, New FFBW sold 4,268,570 shares of common stock at $10.00 per share, for net proceeds of approximately $37.9 million (including purchase of 341,485 ESOP shares), and issued 3,436,430 shares of common stock in exchange for the shares of common stock of FFBW, Inc. a federal corporation, (“Old FFBW”) owned by stockholders of Old FFBW, other than FFBW, MHC, as of the effective date of the conversion. As a result of the conversion, FFBW, MHC and Old FFBW ceased to exist. The Conversion was conducted pursuant to the MHC’s Plan of Conversion. The Plan of Conversion provided for the establishment, upon the completion of the Conversion, of special “liquidation accounts” for the benefit of certain depositors of the Bank in an amount equal to the MHC’s ownership interest in the stockholders’ equity of the Company as of the date of the latest balance sheet contained in the prospectus plus the MHC’s net assets (excluding its ownership of the Company). Following the completion of the Conversion, the Company and the Bank are not permitted to pay dividends on their capital stock if the shareholders' equity of New FFBW, or the shareholder's equity of the Bank, would be reduced below the amount of the liquidation accounts. The liquidation accounts will be reduced annually to the extent that eligible account holders have reduced their qualifying deposits. Subsequent increases will not restore an eligible account holder's interest in the liquidation accounts. Direct costs of the conversion and public offering, totaling approximately $1.2 million, have been applied against the proceeds from the shares sold in the public offering. |
Use of Estimates | Use of Estimates In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the fair values of securities, fair value of financial instruments, the valuation of other real estate owned and the valuation of deferred income tax assets. |
Revenue Recognition | Revenue Recognition Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers ("ASC 606"), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity's contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. The majority of the Company's revenue-generating transactions are not subject to ASC 606, including revenue all interest and dividend income generated from financial instruments. Certain noninterest income items, including loan servicing income, gain on sales of loans, gain on sales of securities, and other noninterest income have been evaluated to not fall within the scope of ASC 606. Elements of noninterest income that are within the scope of ASC 606, are as follows: Service charges and other fees - The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Management reviewed the deposit account agreements and determined that the agreements can be terminated at any time by either the Company or the account holder. Transaction fees, such as balance transfers, wires and overdraft charges are settled the day the performance obligation is satisfied. The Company's monthly service charges and maintenance fees are for services provided to the customer on a monthly basis and are considered a series of services that have the same pattern of transfer each month. The review of service charges assessed on deposit accounts included the amount of variable consideration that is a part of the monthly charges. It was found that the waiver of service charges due to insufficient funds and dormant account fees is immaterial and would not require a change in the accounting treatment for these fees under the new revenue standards. Interchange fees - Customers use a Bank-issued debit card to purchase goods and services, and the Company earns interchange fees on those transactions, typically a percentage of the sale amount of the transaction. The Company records the amount due when it receives the settlement from the payment network. Payments from the payment network are received and recorded into income on a daily basis. These fees are included in “service charges and other fees” on the Consolidated Statements of Operations. There are no contingent debit card interchange fees recorded by the Company that could be subject to a clawback in future periods. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash and balances due from banks, non-maturity deposits in the Federal Home Loan Bank of Chicago (FHLB), and fed funds sold. The Company has not experienced any losses in such accounts. |
Available for Sale Securities | Available for Sale Securities Securities classified as available for sale are those securities that the Company intends to hold for an indefinite period of time, but not necessarily to maturity. Any decision to sell a security classified as available for sale would be based on various factors, including significant movements in interest rates, changes in the maturity mix of the Company’s assets and liabilities, liquidity needs, regulatory capital requirements, and other similar factors. Securities classified as available for sale are carried at fair value. Unrealized gains or losses are reported as increases or decreases in other comprehensive income, net of the related deferred tax effect. Realized gains or losses, determined on the basis of the cost of specific securities sold, are included in earnings. Gains and losses on the sale of securities are recorded on the trade date and determined using the specific-identification method. Declines in fair value of securities that are deemed to be other than temporary, if applicable, are reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers the length of time and the extent to which fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient enough to allow for any anticipated recovery in fair value. |
Loans Acquired in a Transfer | Loans Acquired in a Transfer The Company acquires loans (including debt securities) individually and in groups or portfolios. These loans are initially measured at fair value with no allowance for loan losses. The Company’s allowance for loan losses on all acquired loans reflect only those losses incurred subsequent to acquisition. Certain acquired loans may have experienced deterioration of credit quality between origination and the Company’s acquisition of the loans. At acquisition, the Company reviews each loan to determine whether there is evidence of deterioration of credit quality since origination and if it is probable that the Company will be unable to collect all amounts due according to the loan’s contractual terms. If both conditions exist, the Company determines whether each such loan is to be accounted for individually or whether such loans will be assembled into pools of loans based on common risk characteristics (for example, credit score, loan type, and date of origination). The Company considers expected prepayments and estimates the amount and timing of undiscounted principal, interest, and other cash flows expected at acquisition for each loan and aggregated pool of loans. The excess of the loan’s or pool’s scheduled contractual principal and interest payments over all cash flows expected at acquisition is calculated as the nonaccretable difference. The excess of cash flows expected to be collected over the fair value of each loan or pool (accretable yield) is accreted into interest income over the remaining life of the loan or pool. At each reporting date, the Company continues to estimate cash flows expected to be collected for each loan or pool. If expected cash flows have decreased from the acquisition date estimate, the Company recognizes an allowance for loan losses. If expected cash flows have increased from the acquisition date estimate, the Company increases the amount of accretable yield to be recognized as interest income over the remaining life of the loan or pool. |
Loans Held for Sale | Loans Held for Sale Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. Mortgage loans held for sale are sold with the mortgage servicing rights released by the Company. Gains or losses on sales of mortgage loans are recognized based on the difference between the selling price and the carrying value of the related mortgage loan sold. |
Loans | Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff generally are reported at their outstanding unpaid principal balances adjusted for deferred loan fees and costs, charge-offs, and an allowance for loan losses. Interest on loans is accrued and credited to income based on the unpaid principal balance. Loan-origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method. The accrual of interest on loans is discontinued when, in the opinion of management, there is an indication that the borrower may be unable to make payments as they become due. When loans are placed on nonaccrual status or charged off, all unpaid accrued interest is reversed against interest income. The interest on these loans is subsequently accounted for on the cash-basis or cost-recovery method until qualifying for return to accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is maintained at the level considered adequate by management to provide for losses that are probable as of the balance sheet date. The allowance for loan losses is established through a provision for loan losses charged to expense as losses are estimated to have occurred. Loan losses are charged against the allowance when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. In determining the adequacy of the allowance balance, the Company makes evaluations of the loan portfolio and related off-balance sheet commitments, considers current economic conditions and historical loss experience, and reviews specific problem loans and other factors. When establishing the allowance for loan losses, management categorizes loans into risk categories generally based on the nature of the collateral and the basis of repayment. These risk categories and their relevant risk characteristics are as follows: Commercial development: These loans are secured by vacant land and/or property that are in the process of improvement. Repayment of these loans can be dependent on the sale of the property to third parties or the successful completion of the improvements by the builder for the end user. Construction loans include not only construction of new structures, but loans originated to finance additions to or alterations of existing structures. Until a permanent loan originates, or payoff occurs, all commercial construction loans secured by real estate are reported in this loan pool. Development loans also have the risk that improvements will not be completed on time, or in accordance with specifications and projected costs. Commercial real estate: These loans are primarily secured by office and industrial buildings, warehouses, small retail shopping facilities, and various special purpose properties, including restaurants. These loans are subject to underwriting standards and processes similar to commercial and industrial loans. Loans to closely held businesses are generally guaranteed in full by the owners of the business. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property. The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to the general economic factors or conditions specific to the real estate market, such as geographic location and/or purpose type. Commercial and industrial: Commercial and industrial loans are extended primarily to small and middle market customers. Such credits typically comprise working capital loans, asset acquisition loans, and loans for other business purposes. Loans to closely held businesses are generally guaranteed in full by the owners of the business. Commercial and industrial loans are made based primarily on the historical and projected cash flow of the borrower and secondarily on the underlying collateral provided by the borrower. The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to economic or individual performance factors. Minimum standards and underwriting guidelines have been established for commercial and industrial loans. One-to-four family owner-occupied: These loans are generally to individuals and are underwritten by evaluating the credit history of the borrower, the ability of the borrower to meet the debt service requirements of the loan and total debt obligations, the underlying collateral, and the loan to collateral value. Also included in this category are junior liens on one-to-four family residential properties. Underwriting standards for one-to-four family owner-occupied loans are heavily influenced by statutory requirements, which include, but are not limited to, loan-to-value and affordability ratios, risk-based pricing strategies, and documentation requirements. One-to-four family investor-owned: These loans may be to individuals or businesses and are subject to underwriting standards and processes similar to commercial and industrial loans. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the property(ies). The cash flows of the borrowers, however, may not behave as forecasted and collateral securing loans may fluctuate in value due to the general economic factors or conditions specific to the real estate market, such as geographic location and/or purpose type. Multifamily real estate: These loans include loans to finance non-farm properties with five or more units in structures primarily to accommodate households. Such credits are typically originated to finance the acquisition or refinancing of an apartment building. These loans are subject to underwriting standards and processes similar to commercial and industrial loans. Loans to closely held businesses are generally guaranteed in full by the owners of the business. These loans are viewed primarily as cash flow loans and the repayment of these loans is largely dependent on the successful operation of the subject multifamily property, with assumptions made for vacancy rates. Cash flows of the borrowers rely on the receipt of rental income from the tenants of the property who are themselves subject to fluctuations in national and local economic conditions and unemployment trends. Consumer: These loans may take the form of installment loans, demand loans, or single payment loans, and are extended to individuals for household, family, and other personal expenditures. These loans generally include direct consumer automobile loans and credit card loans. These loans are generally smaller in size and are underwritten by evaluating the credit history of the borrower, the ability of the borrower to meet the debt service requirements of the loan and total debt obligations. Management regularly evaluates the allowance for loan losses using the Company’s past loan loss experience, known and inherent risks in the loan portfolio, composition of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, current economic conditions, and other relevant factors. This evaluation is inherently subjective since it requires material estimates that may be susceptible to significant change. A loan is impaired when, based on current information, it is probable that the Company will not collect all amounts due in accordance with the contractual terms of the loan agreement. Management determines whether a loan is impaired on a case-by-case basis, taking into consideration the payment status, collateral value, length and reason of any payment delays, the borrower’s prior payment record, and any other relevant factors. Large groups of smaller-balance homogeneous loans, such as residential mortgage and consumer loans, are collectively evaluated in the allowance for loan losses analysis and are not subject to impairment analysis unless such loans have been subject to a restructuring agreement. Specific allowances for impaired loans are based on discounted cash flows of expected future payments using the loan’s initial effective interest rate or the fair value of the collateral if the loan is collateral dependent. In addition, various regulatory agencies periodically review the allowance for loan losses. These agencies may require the Company to make additions to the allowance for loan losses based on their judgments of collectability based on information available to them at the time of their examination. |
Troubled Debt Restructurings | Troubled Debt Restructurings Loans are accounted for as troubled debt restructurings when a borrower is experiencing financial difficulties that lead to a restructuring of the loan and the Company grants a “concession” to the borrower that they would not otherwise consider. These concessions include a modification of terms, such as a reduction of the stated interest rate or loan balance, a reduction of accrued interest, an extension of the maturity date at an interest rate lower than a current market rate for a new loan with similar risk, or some combination thereof to facilitate repayment. Troubled debt restructurings are considered impaired loans. |
Foreclosed Assets | Foreclosed Assets Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value, less costs to sell, at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less costs to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net expenses from foreclosed assets. |
Premises and Equipment | Premises and Equipment Depreciable assets are stated at cost less accumulated depreciation. Provisions for depreciation are computed on straight-line and accelerated methods over the estimated useful lives of the assets. |
Other Equity Investments | Other Equity Investments Other Equity Investments consist of Federal Home Loan Bank of Chicago (“FHLB”) stock and Bankers’ Bank stock. The Company's investment in the FHLB stock is carried at cost, which approximates fair value. The Company is required to hold the stock as a member of the FHLB and transfer of the stock is substantially restricted. The stock is evaluated for impairment on an annual basis. The Company is required to adjust its reported value of Bankers’ Bank stock, which is considered an equity security without a readily determinable market value, if a comparable transaction is observed. |
Income Taxes | Income Taxes Amounts provided for income tax expense are based on income reported for financial statement purposes and do not necessarily represent amounts currently payable under tax laws. Deferred income tax assets and liabilities are computed annually for differences between the financial statement and income tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. As changes in tax laws or rates are enacted, deferred income tax assets and liabilities are adjusted through the provision for income taxes. The differences relate principally to the allowances for loan losses, deferred compensation, depreciation, FHLB stock dividends and non-accrual interest. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not to be sustained on audit, based on the technical merits of the position. The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. Based on its evaluation, the Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. The Company’s policy is to recognize interest and penalties related to income tax issues as components of income tax expense. During the periods shown, the Company did not recognize any interest or penalties related to income tax expense in its statements of operations. |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Advertising | Advertising Advertising costs are expensed as incurred. |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) Other comprehensive income (loss) is shown on the statements of comprehensive income. The Company’s accumulated other comprehensive income (loss) is composed of the unrealized gains (losses) on securities available for sale, net of tax and is shown on the statements of changes in equity. Reclassification adjustments out of other comprehensive income (loss) for losses realized on sales of securities available for sale comprise the entire balance of “net loss on sale of securities” on the statements of operations. |
Off-Balance Sheet Financial Instruments | Off-Balance Sheet Financial Instruments In the ordinary course of business, the Company has entered into off-balance-sheet financial instruments consisting of commitments to extend credit, unfunded commitments under lines of credit, and standby letters of credit. Such financial instruments are recorded in the financial statements when they become payable. |
Life Insurance | Life Insurance The Company has purchased life insurance policies on certain key memebers of the management team. Life insurance is measured at the amount that could be realized under the insurance contract as of the balance sheet date, which is generally the cash surrender value of the policy. |
Subsequent Events | Subsequent Events Subsequent events have been evaluated through May 11, 2021, which is the date the financial statements are available to be issued. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). For as long as the Company is an emerging growth company, it may choose to take advantage of exemptions from various reporting requirements applicable to other public companies. An emerging growth company may elect to use the extended transition period to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies, but must make such election when the Company is first required to file a registration statement. The Company has elected to use the extended transition period described above and intends to maintain its emerging growth company status as allowed under the JOBS Act. The Company recently adopted the following Accounting Standards Updates (ASU) issued by the Financial Accounting Standards Board (FASB). ASU No. 2019-12, “Simplifying the Accounting for Income Taxes” This standard is intended to simplify the accounting for income taxes and improve the consistent application of accounting guidance through the following changes: 1) removes certain exceptions for recognizing deferred tax liabilities, tax allocations, and the calculation methodology for an interim year-to-date loss that exceeds the anticipated loss for the year; 2) requires a franchise tax or similar tax based partially on income be recognized as an income-based tax and account for any incremental amount incurred as a non-income based tax; 3) requires an entity evaluate when a step up in the tax basis of goodwill should be considered part of a business combination in which goodwill was originally recognized and when it should be considered a separate transaction; 4) does not require the allocation of consolidated current and deferred tax expense to a member entity that is not subject to tax in separate financial statements, but may elect to do so for certain legal entities that are disregarded by the taxing authority; and 5) amends guidance on the handling of an enacted change in tax law or rates within interim tax periods. This new standard is effective for financial statements issued for interim and annual periods beginning after December 15, 2020. The Company does not believe this will have a significant impact on its financial statements. ASU No. 2020-04 “Facilitation of the Effects of Reference Rate Reform on Financial Reporting” This standard provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform if certain criteria are met. Effective March 12, 2020, the amendments in this ASU are elective and prospectively applied only to contracts modified on or before December 31, 2022, or hedging relationships entered into or evaluated through December 31, 2022. The adoption of this standard has not impacted the Company’s financial staetments and management does not believe it will have a significant impact moving forward. The following ASUs have been issued by the FASB and may impact the Company's financial statements in future reporting periods: ASU No. 2016-13, “Credit Losses (Topic 326).” ASU No. 2019-04, “Codification Improvements to Topic 326.” ASU No. 2019-05, “Financial Instruments-Credit Losses.” ASU 2016-13 requires organizations to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. Early adoption will be permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently assessing the impact of adopting ASU 2016-13 on its financial statements. ASU No. 2016-02, “Leases (Topic 842): Amendments to the Leases Analysis.” ASU No. 2018-10, "Codification Improvements to Topic 842." ASU No. 2018-11, "Targeted Improvements" For lessees, Topic 842 requires leases to be recognized on the balance sheet, along with disclosure of key information about leasing arrangements. Topic 842 was subsequently amended by ASU 2018-01, 2018-10 and 2018-11. The new standard establishes a right-of-use (ROU) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification expense recognition in the income statement. For lessors, Topic 842 requires lessors to classify leases as sales-type, direct financing or operating leases. A lease is a sales-type lease if any one of five criteria are met, each of which indicate that the lease, in effect, transfers control of the underlying asset to the lessee. If none of those five criteria are met, but two additional criteria are both met, indicating the lessor has transferred substantially all the risks and benefits of the underlying asset to the lessee and a third party, the lease is a direct financing lease. All leases that are not sales-type or direct financing leases are operating leases. The new standard is effective for the Company on January 1, 2022, with early adoption permitted. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) the new standard's effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company expects to adopt the new standard on January 1, 2022 using the effective date as its date of initial application. The Company is evaluating what impact this standard will have on its consolidated financial statements. ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement” This ASU modifies the disclosure requirements on fair value measurements in Topic 820, including the removal, modification to, and addition of certain disclosure requirements. This ASU was adopted effective January 1, 2020. Given the nature of the Company’s fair value instruments, the impact of adoption did not significantly impact the fair value disclosures provided in Note 15. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the earnings per share calculations for the three months ended March 31: Three months ended March 31, 2021 2020 Net income $ 670 $ 407 Basic potential common shares Weighted average shares outstanding 7,224,401 7,704,875 Weighted average unallocated Employee Stock Ownership Plan Shares (576,061) (607,924) Basic weighted average shares outstanding 6,648,340 7,096,951 Dilutive potential common shares 13,770 — Dilutive weighted average shares outstanding 6,662,110 7,096,951 Basic earnings per share $ 0.10 $ 0.06 Diluted earnings per share $ 0.10 $ 0.06 |
Available for Sale Securities (
Available for Sale Securities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Available for Sale Securities | |
Schedule of Amortized Costs and Fair Values of Available for Sale Securities | Amortized costs and fair values of available for sale securities are summarized as follows: Gross Gross Estimated Amortized Unrealized Unrealized Fair Cost Gains Losses Value March 31, 2021 Obligations of the US government and US government sponsored agencies $ 655 $ $ 29 $ — $ 684 Obligations of states and political subdivisions 14,978 413 (99) 15,292 Mortgage-backed securities 32,968 1,083 (68) 33,983 Certificates of deposit 4,150 51 — 4,201 Corporate debt securities 2,177 126 — 2,303 Total available for sale securities $ 54,928 $ 1,702 $ (167) $ 56,463 December 31, 2020 Obligations of the US government and US government sponsored agencies $ 717 $ 37 $ — $ 754 Obligations of states and political subdivisions 15,012 612 (19) 15,605 Mortgage-backed securities 36,347 1,361 (28) 37,680 Certificates of deposit 7,880 57 — 7,937 Corporate debt securities 2,179 92 (4) 2,267 Total available for sale securities $ 62,135 $ 2,159 $ (51) $ 64,243 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | The following table presents the portion of the Company’s portfolio which has gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position: Less Than 12 Months 12 Months or More Total Unrealized Unrealized Unrealized Fair Value Losses Fair Value Losses Fair Value Losses March 31, 2021 Obligations of states and political subdivisions $ 4,475 $ (99) $ — $ — $ 4,475 $ (99) Mortgage-backed securities 5,545 (61) 1,132 (7) 6,677 (68) Total $ 10,020 $ (160) $ 1,132 $ (7) $ 11,152 $ (167) December 31, 2020 Obligations of states and political subdivisions $ 1,543 $ (19) $ — $ — $ 1,543 $ (19) Mortgage-backed securities 4,140 (21) 736 (7) 4,876 (28) Corporate debt securities 849 (4) — — 849 (4) Total $ 6,532 $ (44) $ 736 $ (7) $ 7,268 $ (51) |
Investments Classified by Contractual Maturity Date | The amortized cost and fair value of available for sale securities by contractual maturity are shown below. Expected maturities will differ from contractual maturities in mortgage-backed securities since the anticipated maturities are not readily determinable. Therefore, these securities are not included in the maturity categories in the following maturity summary listed below: March 31, 2021 Amortized Cost Fair Value Due in one year or less $ 418 $ 425 Due after one year through 5 years 6,556 6,754 Due after 5 years through 10 years 7,758 8,061 Due after 10 years 7,228 7,240 Subtotal $ 21,960 $ 22,480 Mortgage-backed securities 32,968 33,983 Total $ 54,928 $ 56,463 |
Loans (Tables)
Loans (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Loans | |
Major Classifications of Loans | Major classifications of loans are as follows: March 31, December 31, 2021 2020 Commercial Development $ 14,565 $ 14,090 Real estate 80,224 87,605 Commercial and industrial 20,041 20,758 Residential real estate and consumer One-to-four family owner-occupied 28,356 30,548 One-to-four family investor-owned 27,968 32,638 Multifamily 30,432 29,303 Consumer 4,972 3,016 Subtotal $ 206,558 $ 217,958 Deferred loan fees (369) (424) Allowance for loan losses (2,813) (2,811) Net loans $ 203,376 $ 214,723 |
Summary of the Activity in the Allowance for Loan Losses | A summary of the activity in the allowance for loan losses by portfolio segment is as follows: Residential real estate Three Months Ended Commercial and consumer Total March 31, 2021 Balance at December 31, 2020 $ 1,834 $ 977 $ 2,811 Provision for loan losses 58 (58) — Loans charged off — — — Recoveries of loans previously charged off — 2 2 Total ending allowance balance $ 1,892 $ 921 $ 2,813 March 31, 2020 Balance at December 31, 2019 $ 1,251 $ 1,013 $ 2,264 Provision for loan losses 50 (10) 40 Loans charged off — — — Recoveries of loans previously charged off — 3 3 Total ending allowance balance $ 1,301 $ 1,006 $ 2,307 Information about how loans were evaluated for impairment and the related allowance for loan losses follows: Residential Real Estate and March 31, 2021 Commercial Consumer Total Loans: Individually evaluated for impairment $ 827 $ 1,245 $ 2,072 Collectively evaluated for impairment 114,003 90,483 204,486 Total loans $ 114,830 $ 91,728 $ 206,558 Allowance for loan losses: Individually evaluated for impairment $ 450 $ — $ 450 Collectively evaluated for impairment 1,442 921 2,363 Total allowance for loan losses $ 1,892 $ 921 $ 2,813 Residential Real Estate and December 31, 2020 Commercial Consumer Total Loans: Individually evaluated for impairment $ 792 $ 1,228 $ 2,020 Collectively evaluated for impairment 121,661 94,277 215,938 Total loans $ 122,453 $ 95,505 $ 217,958 Allowance for loan losses: Individually evaluated for impairment $ 450 $ — $ 450 Collectively evaluated for impairment 1,384 977 2,361 Total allowance for loan losses $ 1,834 $ 977 $ 2,811 |
Impairment and the Related Allowance for Loan Losses | Information regarding impaired loans follows: Principal Recorded Related Average Interest As of March 31, 2021 Balance Investment Allowance Investment Recognized Loans with related allowance for loan losses: Commercial Commercial and industrial $ 713 $ 704 $ 450 $ 708 $ — Total loans with related allowance for loan losses 713 704 450 708 — Loans with no related allowance for loan losses: Commercial Commercial and industrial 146 123 — 135 1 Residential real estate and consumer One-to-four family owner-occupied 1,039 992 — 1,016 9 One-to-four family investor-owned 242 203 — 222 — Consumer 50 50 — 50 — Total loans with no related allowance for loan losses 1,477 1,368 — 1,423 10 Total impaired loans $ 2,190 $ 2,072 $ 450 $ 2,131 $ 10 Principal Recorded Related Average Interest As of December 31, 2020 Balance Investment Allowance Investment Recognized Loans with related allowance for loan losses: Commercial Commercial and industrial $ 713 $ 704 $ 450 $ 713 $ 19 Residential real estate and consumer One-to-four family investor-owned — — — — — Total loans with related allowance for loan losses 713 704 450 713 19 Loans with no related allowance for loan losses: Commercial Commercial and industrial 108 88 — 109 5 Residential real estate and consumer One-to-four family owner-occupied 1,017 971 — 979 9 One-to-four family investor-owned 242 206 — 242 — Consumer 52 51 — 54 — Total loans with no related allowance for loan losses 1,419 1,316 — 1,384 14 Total impaired loans $ 2,132 $ 2,020 $ 450 $ 2,097 $ 33 |
Information Regarding the Credit Quality Indicators | Information regarding the credit quality indicators most closely monitored for commercial loans by class follows: Special Pass Mention Substandard Doubtful Totals March 31, 2021 Development $ 14,565 $ — $ — $ — $ 14,565 Real estate 80,224 — — — 80,224 Commercial and industrial 19,252 — 85 704 20,041 One-to-four family investor-owned 27,968 — — — 27,968 Multifamily 30,432 — — — 30,432 Totals $ 172,441 $ — $ 85 $ 704 $ 173,230 December 31, 2020 Development $ 14,090 $ — $ — $ — $ 14,090 Real estate 87,605 — — — 87,605 Commercial and industrial 20,046 — 8 704 20,758 One-to-four family investor-owned 32,358 — 280 — 32,638 Multifamily 29,303 — — — 29,303 Totals $ 183,402 $ — $ 288 $ 704 $ 184,394 Information regarding the credit quality indicators most closely monitored for residential real estate and consumer loans by class follows: Performing Non-performing Totals March 31, 2021 One-to-four family owner-occupied $ 28,199 $ 157 $ 28,356 Consumer 4,972 — 4,972 $ 33,171 $ 157 $ 33,328 December 31, 2020 One-to-four family owner-occupied $ 30,548 $ — $ 30,548 Consumer 3,016 — 3,016 $ 33,564 $ — $ 33,564 |
Loan Aging Information | Loan aging information follows: Loans Past Due Loans Past Due Nonaccrual Current Loans 30-89 Days 90+ Days Total Loans Loans March 31, 2021 Commercial Development $ 14,565 $ — $ — $ 14,565 $ — Real estate 80,224 — — 80,224 — Commercial and industrial 20,041 — — 20,041 789 Residential real estate and consumer One-to-four family owner-occupied 28,241 115 — 28,356 157 One-to-four family investor-owned 27,968 — — 27,968 203 Multifamily 30,432 — — 30,432 — Consumer 4,972 — — 4,972 — Total $ 206,443 $ 115 $ — $ 206,558 $ 1,149 Loans Past Due Loans Past Due Nonaccrual Current Loans 30-89 Days 90+ Days Total Loans Loans December 31, 2020 Commercial Development $ 14,090 $ — $ — $ 14,090 $ — Real estate 87,040 565 — 87,605 — Commercial and industrial 20,054 704 — 20,758 792 Residential real estate and consumer One-to-four family owner-occupied 30,347 201 — 30,548 69 One-to-four family investor-owned 32,638 — — 32,638 206 Multifamily 29,303 — — 29,303 — Consumer 3,016 — — 3,016 — Total $ 216,488 $ 1,470 $ — $ 217,958 $ 1,067 |
Deposits (Tables)
Deposits (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Deposits | |
Composition of deposits | The composition of deposits are as follows: March 31, December 31, 2021 2020 Non interest-bearing checking $ 52,852 $ 51,802 Interest-bearing checking 10,523 10,899 Money market 69,119 70,455 Statement savings accounts 35,152 31,977 Health savings accounts 10,859 10,854 Certificates of deposit 51,072 50,511 Total $ 229,577 $ 226,498 |
Scheduled Maturities of Certificates of Deposit | The scheduled maturities of certificates of deposit are as follows as of March 31, 2021: 2021 $ 28,530 2022 17,780 2023 2,999 2024 1,200 2025 460 2026 103 Total $ 51,072 |
FHLB Advances (Tables)
FHLB Advances (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
FHLB Advances [Abstract] | |
Schedule of Federal Home Loan Bank, Advances | FHLB advances consist of the following: March 31, 2021 December 31, 2020 Rates Amount Rates Amount Fixed rate, fixed term advances 0.0%-1.71% $ 5,500 0.0%-1.71% $ 5,500 Fixed term advances with floating spread 2.10% 2,000 2.10% 2,000 $ 7,500 $ 7,500 |
Maturities of Federal Home Loan Bank Advances | The following is a summary of scheduled maturities of fixed term FHLB advances as of March 31, 2021: Fixed Rate Advances Adjustable Rate Advances Weighted Weighted Total Average Rate Amount Average Rate Amount Amount 2021 % $ 4,000 2.10 % $ 2,000 $ 6,000 2022 1.71 % 1,500 — — 1,500 Total 0.47 % $ 5,500 2.10 % $ 2,000 $ 7,500 |
Employee Stock Ownership Plan (
Employee Stock Ownership Plan (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Employee Stock Ownership Plan | |
Employee Stock Ownership Plan (ESOP) Disclosures | March 31, 2021 December 31, 2020 Shares allocated to active participants 62,305 33,861 Shares committed to be released and allocated to participants 7,647 30,584 Shares distributed — (2,140) Total unallocated shares 573,446 581,093 Total ESOP shares 643,398 643,398 Fair value of unallocated shares (based on $11.25 and $10.02 share price at March 31, 2021 and December 31, 2020, respectively) $ 6,451 $ 5,823 |
Share-based Compensation Plans
Share-based Compensation Plans (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Compensation Plans | |
Impact of the Company’s Share-Based Payment Plans in the Financial Statements | The following table summarizes the impact of the Company’s share-based payment plans in the financial statements for the period shown: Three Months Ended March 31, 2021 2020 Total cost of stock grant plan during the year $ 44 $ 50 Total cost of stock option plan during the year 37 37 Total cost of share-based payment plans during the year $ 81 $ 87 Amount of related income tax benefit recognized in income $ 19 $ 23 |
Summary of Stock Options Activity | The following table summarizes stock options activity for the three months ended March 31, 2021: Outstanding Weighted Weighted Average Average Remaining Aggregate Stock Option Exercise Contractual Intrinsic Awards Price Term (years) Value Options outstanding as of December 31, 2020 269,220 $ 10.51 Granted — — Exercised — — Forfeited — — Options outstanding as of March 31, 2021 269,220 $ 10.51 8.26 $ 201,772 Options exercisable as of March 31, 2021 81,964 $ 10.81 7.98 $ 19,926 |
Summary of Changes in Restricted Shares | The following is a summary of changes in restricted shares for the three months ended March 31, 2021: Weighted Average Number of Grant Date Fair Shares Value Nonvested stock awards as of December 31, 2020 62,060 $ 10.73 Granted — — Vested — — Forfeited — — Nonvested stock awards as of March 31, 2021 62,060 $ 10.73 |
Equity and Regulatory Matters (
Equity and Regulatory Matters (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity and Regulatory Matters | |
Bank’s Actual Capital Amounts and Ratios | The Bank’s actual capital amounts and ratios are presented in the following tables: To Be Well Capitalized Under Prompt For Capital Adequacy Corrective Actual Purposes Action Provisions Amount Ratio Amount Ratio Amount Ratio March 31, 2021 Common Equity Tier 1 capital (to risk‑weighted assets) $ 74,087 33.9 % $ ≥ 9,832 ≥ 4.5 % $ ≥ 14,202 ≥ 6.5 % Tier 1 capital (to risk‑weighted assets) 74,087 33.3 ≥ 13,110 ≥ 6.0 ≥ 17,479 ≥ 8.0 Total capital (to risk‑weighted assets) 76,819 34.5 ≥ 17,479 ≥ 8.0 ≥ 21,849 ≥ 10.0 Tier 1 capital (to average assets) 74,087 22.3 ≥ 13,309 ≥ 4.0 ≥ 16,637 ≥ 5.0 December 31, 2020 Common Equity Tier 1 capital (to risk‑weighted assets) $ 73,665 33.1 % $ ≥ 10,018 ≥ 4.5 % $ ≥ 14,471 ≥ 6.5 % Tier 1 capital (to risk‑weighted assets) 73,665 33.1 ≥ 13,358 ≥ 6.0 ≥ 17,810 ≥ 8.0 Total capital (to risk‑weighted assets) 76,448 34.3 ≥ 17,810 ≥ 8.0 ≥ 22,263 ≥ 10.0 Tier 1 capital (to average assets) 73,665 25.2 ≥ 11,700 ≥ 4.0 ≥ 14,625 ≥ 5.0 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value | |
Assets Measured at Fair Value on Recurring Basis | Assets measured at fair value on a recurring basis are summarized below: Recurring Fair Value Measurements Using Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable Instruments Inputs Inputs (Level 1) (Level 2) (Level 3) Total As of March 31, 2021 Assets: Available for sale securities: Obligations of the US government and US government sponsored agencies $ — $ 684 $ — $ 684 Obligations of states and political subdivisions — 15,292 — 15,292 Mortgage-backed securities — 33,983 — 33,983 Certificates of deposit — 4,201 — 4,201 Corporate debt securities — 2,303 — 2,303 Total available for sale securities $ — $ 56,463 $ — $ 56,463 As of December 31, 2020 Assets: Available for sale securities: Obligations of the US government and US government sponsored agencies $ — $ 754 $ — $ 754 Obligations of states and political subdivisions — 15,605 — 15,605 Mortgage-backed securities — 37,680 — 37,680 Certificates of deposit — 7,937 — 7,937 Corporate debt securities — 2,267 — 2,267 Total available for sale securities $ — $ 64,243 $ — $ 64,243 |
Assets Measured at Fair Value on Nonrecurring Basis | Information regarding the fair value of assets measured at fair value on a nonrecurring basis follows: Nonrecurring Fair Value Measurements Using Quoted Prices in Active Significant Markets for Other Significant Assets Identical Observable Unobservable Measured at Instruments Inputs Inputs Fair Value (Level 1) (Level 2) (Level 3) As of March 31, 2021 Assets: Loans $ 254 $ — $ — $ 254 Other equity investments 225 — 225 — As of December 31, 2020 Assets: Loans $ 254 $ — $ — $ 254 Foreclosed assets 125 — — 125 Other equity investments 225 — 225 — |
Fair Value Measurement Inputs and Valuation Techniques | The following presents quantitative information about nonrecurring Level 3 fair value measurements: Range/Weighted Fair Value Valuation Technique Unobservable Input(s) Average As of March 31, 2021 Loans $ Market and/or income approach Management discount on appraised values 10 % - 20 % Foreclosed assets $ Market and/or income approach Management discount on appraised values 10 % - 20 % As of December 31, 2020 Loans $ Market and/or income approach Management discount on appraised values 10 % - 20 % Foreclosed assets $ Market and/or income approach Management discount on appraised values 10 % - 20 % |
Carrying Value and Estimated Fair Value of Financial Instruments | The carrying value and estimated fair value of financial instruments as of March 31, 2021 and December 31, 2020 follow: March 31, 2021 Carrying Fair Value Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 59,125 $ 59,125 $ — $ — Available for sale securities 56,463 — 56,463 — Loans held for sale 1,098 — 1,098 — Loans 203,376 — — 205,155 Accrued interest receivable 912 912 — — Cash value of life insurance 8,576 — — 8,576 Other equity investments 1,278 — 225 1,053 Financial liabilities: Deposits 229,577 175,987 — 51,164 Advance payments by borrowers for taxes and insurance 391 391 — — FHLB advances 7,500 — — 7,535 Accrued interest payable 117 117 — — December 31, 2020 Carrying Fair Value Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 41,479 $ 41,479 $ — $ — Available for sale securities 64,243 — 64,243 — Loans held for sale 1,708 — 1,708 — Loans 214,723 — — 217,893 Accrued interest receivable 995 995 — — Cash value of life insurance 7,272 — — 7,272 Other equity investments 1,279 — 225 1,054 Financial liabilities: Deposits 226,498 175,987 — 50,732 Advance payments by borrowers for taxes and insurance 127 127 — — FHLB advances 7,500 — — 7,544 Accrued interest payable 17 17 — — |
Business Combination (Tables)
Business Combination (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Business Combination [Abstract] | |
Summary of Assets Acquired and Liabilities Assumed Recognized | As Recorded Fair Value and Other As Recorded by Mitchell Bank Merger Related Adjustments by the Company Consideration Paid Cash $ 4,978 Recognized amounts of identifiable assets acquired and liabilities assumed: Cash and due from banks $ 38,266 $ - $ 38,266 Securities 7,133 16 7,149 Other equity securities 51 177 228 Loans, net of allowance 14,512 (217) 14,295 Premises and equipment 529 499 1,028 Core deposit intangibles - 369 369 Accrued interest receivable 83 - 83 Foreclosed assets 185 (60) 125 Deferred tax asset 228 (228) - Other assets 209 (88) 121 Total assets acquired $ 61,196 $ 468 61,664 Deposits $ 56,641 $ - 56,641 Other liabilities 38 - 38 Total liabilities assumed $ 56,679 $ - 56,679 Total identifiable assets 4,517 468 4,985 Bargain purchase gain resulting from acquisition (7) |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 16, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Common stock, outstanding (in shares) | 7,286,461 | 7,695,214 | 7,702,478 | ||
Stock issued during period, shares | 4,268,570 | ||||
Issuance of common stock, net of issuance costs | $ 37,900 | ||||
Purchase of ESOP shares (in shares) | 341,485 | 7,647 | 341,485 | ||
Sale of stock, price per share | $ 10 | ||||
Provision for income taxes | $ 182 | $ 135 | |||
Direct costs of the conversion and public offering | 1,200 | ||||
Unrecognized tax benefits, income tax penalties and interest expense | 0 | ||||
Customer deposits | 229,577 | $ 226,498 | |||
Loans acquired | $ 203,376 | $ 214,723 | |||
Owned by Public [Member] | |||||
Common stock, outstanding (in shares) | 3,436,424 | ||||
Percentage of common stock outstanding to eligible Members | 44.60% | ||||
FFBW Community Foundation [Member] | |||||
Common stock, outstanding (in shares) | 29,325 | ||||
FFBW, MHC [Member] | |||||
Common stock, outstanding (in shares) | 4,266,054 | ||||
Stock issued during period, shares | 3,436,430 | ||||
Percentage of shares held by Mutual Holding Company | 55.40% |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Earnings Per Share, Basic and Diluted) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings Per Share | ||
Net income | $ 670 | $ 407 |
Weighted average shares outstanding (in shares) | 7,224,401 | 7,704,875 |
Weighted average unallocated Employee Stock Ownership Plan Shares (in shares) | (576,061) | (607,924) |
Basic weighted average shares outstanding (in shares) | 6,648,340 | 7,096,951 |
Dilutive potential common shares (in shares) | 13,770 | |
Diluted weighted average shares outstanding (in shares) | 6,662,110 | 7,096,951 |
Basic earnings per share (in dollars per share) | $ 0.10 | $ 0.06 |
Diluted earnings per share (in dollars per share) | $ 0.10 | $ 0.06 |
Available for Sale Securities_2
Available for Sale Securities (Narrative) (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021USD ($)security | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)security | |
Available for Sale Securities | |||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Greater than or Equal to One Year | security | 4 | 4 | |
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less than One Year | security | 18 | 13 | |
Other than Temporary Impairment Losses, Investments, Available-for-sale Securities, Total | $ 0 | $ 0 | |
Security Owned and Pledged as Collateral, Fair Value, Total | 1,019 | $ 1,036 | |
Securities sold | $ 0 | $ 0 |
Available for Sale Securities_3
Available for Sale Securities (Amortized Cost and Fair Value) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | $ 54,928 | $ 62,135 |
Gross unrealized gains | 1,702 | 2,159 |
Gross unrealized losses | (167) | (51) |
Estimated fair value | 56,463 | 64,243 |
Obligations of the US Government and US Government Sponsored Agencies [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 655 | 717 |
Gross unrealized gains | 29 | 37 |
Estimated fair value | 684 | 754 |
Obligations of States and Political Subdivisions [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 14,978 | 15,012 |
Gross unrealized gains | 413 | 612 |
Gross unrealized losses | (99) | (19) |
Estimated fair value | 15,292 | 15,605 |
Mortgage Backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 32,968 | 36,347 |
Gross unrealized gains | 1,083 | 1,361 |
Gross unrealized losses | (68) | (28) |
Estimated fair value | 33,983 | 37,680 |
Certificates of Deposit [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 4,150 | 7,880 |
Gross unrealized gains | 51 | 57 |
Estimated fair value | 4,201 | 7,937 |
Corporate Debt Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 2,177 | 2,179 |
Gross unrealized gains | 126 | 92 |
Gross unrealized losses | (4) | |
Estimated fair value | $ 2,303 | $ 2,267 |
Available for Sale Securities_4
Available for Sale Securities (Continuous Unrealized Loss Position) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Less Than 12 Months Fair Value | $ 10,020 | $ 6,532 |
Less Than 12 Months Unrealized Losses | (160) | (44) |
12 Months or More Fair Value | 1,132 | 736 |
12 Months or More Unrealized Losses | (7) | (7) |
Total Fair Value | 11,152 | 7,268 |
Total Unrealized Losses | (167) | (51) |
Obligations of States and Political Subdivisions [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less Than 12 Months Fair Value | 4,475 | 1,543 |
Less Than 12 Months Unrealized Losses | (99) | (19) |
Total Fair Value | 4,475 | 1,543 |
Total Unrealized Losses | (99) | (19) |
Mortgage Backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less Than 12 Months Fair Value | 5,545 | 4,140 |
Less Than 12 Months Unrealized Losses | (61) | (21) |
12 Months or More Fair Value | 1,132 | 736 |
12 Months or More Unrealized Losses | (7) | (7) |
Total Fair Value | 6,677 | 4,876 |
Total Unrealized Losses | $ (68) | (28) |
Corporate Debt Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less Than 12 Months Fair Value | 849 | |
Less Than 12 Months Unrealized Losses | (4) | |
Total Fair Value | 849 | |
Total Unrealized Losses | $ (4) |
Available for Sale Securities_5
Available for Sale Securities (Contractual Maturity) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Due in one year or less, amortized cost | $ 418 | |
Due in one year or less, fair value | 425 | |
Due after one year through 5 years, amortized cost | 6,556 | |
Due after one year through 5 years, fair value | 6,754 | |
Due after 5 years through 10 years, amortized cost | 7,758 | |
Due after 5 years through 10 years, fair value | 8,061 | |
Due after 10 years, amortized cost | 7,228 | |
Due after 10 years, fair value | 7,240 | |
Subtotal, amortized cost | 21,960 | |
Subtotal, fair value | 22,480 | |
Amortized cost | 54,928 | $ 62,135 |
Estimated fair value | 56,463 | 64,243 |
Mortgage Backed Securities [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized cost | 32,968 | 36,347 |
Estimated fair value | $ 33,983 | $ 37,680 |
Loans (Narrative) (Details)
Loans (Narrative) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021USD ($)item | Dec. 31, 2020USD ($) | Dec. 31, 2019item | |
Deposit Liabilities Reclassified as Loans Receivable | $ 4 | $ 5 | |
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing | $ 0 | $ 0 | |
Financing Receivable, Modifications, Subsequent Default, Number of Contracts | 0 | 0 | 0 |
Financing Receivable, Modifications, Subsequent Default, Recorded Investment | $ 0 | $ 0 | |
Loans granted | 206,558 | 217,958 | |
Funds committed to impaired loans | 0 | 215 | |
Loans on modified status | 4,500 | ||
Loans acquired | 203,376 | 214,723 | |
Residential Real Estate and Consumer [Member] | |||
Loans granted | 91,728 | 95,505 | |
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | |||
Loans granted | 27,968 | 32,638 | |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | |||
Loans granted | $ 28,356 | $ 30,548 |
Loans (Major Classifications of
Loans (Major Classifications of Loans) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Subtotal loans | $ 206,558 | $ 217,958 | ||
Deferred loan fees | (369) | (424) | ||
Allowance for loan losses | (2,813) | (2,811) | $ (2,307) | $ (2,264) |
Net loans | 203,376 | 214,723 | ||
Commercial Portfolio Segment [Member] | ||||
Subtotal loans | 114,830 | 122,453 | ||
Allowance for loan losses | (1,892) | (1,834) | (1,301) | (1,251) |
Commercial Portfolio Segment [Member] | Development [Member] | ||||
Subtotal loans | 14,565 | 14,090 | ||
Commercial Portfolio Segment [Member] | Real Estate Loan [Member] | ||||
Subtotal loans | 80,224 | 87,605 | ||
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | ||||
Subtotal loans | 20,041 | 20,758 | ||
Residential Real Estate and Consumer [Member] | ||||
Subtotal loans | 91,728 | 95,505 | ||
Allowance for loan losses | (921) | (977) | $ (1,006) | $ (1,013) |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | ||||
Subtotal loans | 28,356 | 30,548 | ||
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | ||||
Subtotal loans | 27,968 | 32,638 | ||
Residential Real Estate and Consumer [Member] | Multifamily Loan [Member] | ||||
Subtotal loans | 30,432 | 29,303 | ||
Residential Real Estate and Consumer [Member] | Consumer [Member] | ||||
Subtotal loans | $ 4,972 | $ 3,016 |
Loans (Allowance for Loan Losse
Loans (Allowance for Loan Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | |
Beginning balance | $ 2,811 | $ 2,264 | ||
Provision for loan losses | 40 | |||
Recoveries of loans previously charged off | 2 | 3 | ||
Total ending allowance balance | 2,813 | 2,307 | ||
Loans, individually evaluated for impairment | $ 2,072 | $ 2,020 | ||
Loans, collectively evaluated for impairment | 204,486 | 215,938 | ||
Total loans | 206,558 | 217,958 | ||
Allowance for loan losses, individually evaluated for impairment | 450 | 450 | ||
Allowance for loan losses, collectively evaluated for impairment | 2,363 | 2,361 | ||
Total allowance for loan losses | 2,813 | 2,307 | 2,813 | 2,811 |
Commercial Portfolio Segment [Member] | ||||
Beginning balance | 1,834 | 1,251 | ||
Provision for loan losses | 58 | 50 | ||
Recoveries of loans previously charged off | ||||
Total ending allowance balance | 1,892 | 1,301 | ||
Loans, individually evaluated for impairment | 827 | 792 | ||
Loans, collectively evaluated for impairment | 114,003 | 121,661 | ||
Total loans | 114,830 | 122,453 | ||
Allowance for loan losses, individually evaluated for impairment | 450 | 450 | ||
Allowance for loan losses, collectively evaluated for impairment | 1,442 | 1,384 | ||
Total allowance for loan losses | 1,892 | 1,301 | 1,892 | 1,834 |
Residential Real Estate and Consumer [Member] | ||||
Beginning balance | 977 | 1,013 | ||
Provision for loan losses | (58) | (10) | ||
Recoveries of loans previously charged off | 2 | 3 | ||
Total ending allowance balance | 921 | 1,006 | ||
Loans, individually evaluated for impairment | 1,245 | 1,228 | ||
Loans, collectively evaluated for impairment | 90,483 | 94,277 | ||
Total loans | 91,728 | 95,505 | ||
Allowance for loan losses, individually evaluated for impairment | ||||
Allowance for loan losses, collectively evaluated for impairment | 921 | 977 | ||
Total allowance for loan losses | $ 921 | $ 1,006 | $ 921 | $ 977 |
Loans (Impaired Financing Recei
Loans (Impaired Financing Receivable) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Principal balance with related allowance | $ 713 | $ 713 |
Recorded investment with related allowance | 704 | 704 |
Related allowance | 450 | 450 |
Average investment with related allowance | 708 | 713 |
Interest recognized with related allowance | 19 | |
Principal balance with no related allowance | 1,477 | 1,419 |
Recorded investment with no related allowance | 1,368 | 1,316 |
Average investment with no related allowance | 1,423 | 1,384 |
Interest recognized with no related allowance | 10 | 14 |
Impaired Financing Receivable, Unpaid Principal Balance, Total | 2,190 | 2,132 |
Impaired Financing Receivable, Recorded Investment, Total | 2,072 | 2,020 |
Impaired Financing Receivable, Average Recorded Investment, Total | 2,131 | 2,097 |
Impaired Financing Receivable, Interest Income, Accrual Method, Total | 10 | 33 |
Commercial and Industrial [Member] | Commercial Portfolio Segment [Member] | ||
Principal balance with related allowance | 713 | 713 |
Recorded investment with related allowance | 704 | 704 |
Related allowance | 450 | 450 |
Average investment with related allowance | 708 | 713 |
Interest recognized with related allowance | 19 | |
Principal balance with no related allowance | 146 | 108 |
Recorded investment with no related allowance | 123 | 88 |
Average investment with no related allowance | 135 | 109 |
Interest recognized with no related allowance | 1 | 5 |
One-to-Four Family Owner-occupied [Member] | Residential Real Estate and Consumer [Member] | ||
Principal balance with no related allowance | 1,039 | 1,017 |
Recorded investment with no related allowance | 992 | 971 |
Average investment with no related allowance | 1,016 | 979 |
Interest recognized with no related allowance | 9 | 9 |
One-to-Four Family Investor-owned [Member] | Residential Real Estate and Consumer [Member] | ||
Principal balance with no related allowance | 242 | 242 |
Recorded investment with no related allowance | 203 | 206 |
Average investment with no related allowance | 222 | 242 |
Consumer [Member] | Residential Real Estate and Consumer [Member] | ||
Principal balance with no related allowance | 50 | 52 |
Recorded investment with no related allowance | 50 | 51 |
Average investment with no related allowance | $ 50 | $ 54 |
Loans (Credit Quality Indicator
Loans (Credit Quality Indicators) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Total loans for credit quality indicators | $ 173,230 | $ 184,394 |
Pass [Member] | ||
Total loans for credit quality indicators | 172,441 | 183,402 |
Substandard [Member] | ||
Total loans for credit quality indicators | 85 | 288 |
Doubtful [Member] | ||
Total loans for credit quality indicators | 704 | 704 |
Commercial Portfolio Segment [Member] | Development [Member] | ||
Total loans for credit quality indicators | 14,565 | 14,090 |
Commercial Portfolio Segment [Member] | Development [Member] | Pass [Member] | ||
Total loans for credit quality indicators | 14,565 | 14,090 |
Commercial Portfolio Segment [Member] | Real Estate Loan [Member] | ||
Total loans for credit quality indicators | 80,224 | 87,605 |
Commercial Portfolio Segment [Member] | Real Estate Loan [Member] | Pass [Member] | ||
Total loans for credit quality indicators | 80,224 | 87,605 |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | ||
Total loans for credit quality indicators | 20,041 | 20,758 |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | Pass [Member] | ||
Total loans for credit quality indicators | 19,252 | 20,046 |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | Substandard [Member] | ||
Total loans for credit quality indicators | 85 | 8 |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | Doubtful [Member] | ||
Total loans for credit quality indicators | 704 | 704 |
Residential Real Estate and Consumer [Member] | ||
Total loans for credit quality indicators | 33,328 | 33,564 |
Residential Real Estate and Consumer [Member] | Performing Financial Instruments [Member] | ||
Total loans for credit quality indicators | 33,171 | 33,564 |
Residential Real Estate and Consumer [Member] | Nonperforming Financial Instruments [Member] | ||
Total loans for credit quality indicators | 157 | |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | ||
Total loans for credit quality indicators | 28,356 | 30,548 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | Performing Financial Instruments [Member] | ||
Total loans for credit quality indicators | 28,199 | 30,548 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | Nonperforming Financial Instruments [Member] | ||
Total loans for credit quality indicators | 157 | |
Residential Real Estate and Consumer [Member] | Consumer [Member] | ||
Total loans for credit quality indicators | 4,972 | 3,016 |
Residential Real Estate and Consumer [Member] | Consumer [Member] | Performing Financial Instruments [Member] | ||
Total loans for credit quality indicators | 4,972 | 3,016 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | ||
Total loans for credit quality indicators | 27,968 | 32,638 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | Pass [Member] | ||
Total loans for credit quality indicators | 27,968 | 32,358 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | Substandard [Member] | ||
Total loans for credit quality indicators | 280 | |
Residential Real Estate and Consumer [Member] | Multifamily Loan [Member] | ||
Total loans for credit quality indicators | 30,432 | 29,303 |
Residential Real Estate and Consumer [Member] | Multifamily Loan [Member] | Pass [Member] | ||
Total loans for credit quality indicators | $ 30,432 | $ 29,303 |
Loans (Loans Aging Information)
Loans (Loans Aging Information) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current loans | $ 206,443 | $ 216,488 |
Total loans | 206,558 | 217,958 |
Nonaccrual loans | 1,149 | 1,067 |
Financing Receivables, 30 to 89 Days Past Due [Member] | ||
Loans past due | 115 | 1,470 |
Commercial Portfolio Segment [Member] | ||
Total loans | 114,830 | 122,453 |
Commercial Portfolio Segment [Member] | Development [Member] | ||
Current loans | 14,565 | 14,090 |
Total loans | 14,565 | 14,090 |
Commercial Portfolio Segment [Member] | Real Estate Loan [Member] | ||
Current loans | 80,224 | 87,040 |
Total loans | 80,224 | 87,605 |
Commercial Portfolio Segment [Member] | Real Estate Loan [Member] | Financing Receivables, 30 to 89 Days Past Due [Member] | ||
Loans past due | 565 | |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | ||
Current loans | 20,041 | 20,054 |
Total loans | 20,041 | 20,758 |
Nonaccrual loans | 789 | 792 |
Commercial Portfolio Segment [Member] | Commercial and Industrial [Member] | Financing Receivables, 30 to 89 Days Past Due [Member] | ||
Loans past due | 704 | |
Residential Real Estate and Consumer [Member] | ||
Total loans | 91,728 | 95,505 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | ||
Current loans | 28,241 | 30,347 |
Total loans | 28,356 | 30,548 |
Nonaccrual loans | 157 | 69 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Owner-occupied [Member] | Financing Receivables, 30 to 89 Days Past Due [Member] | ||
Loans past due | 115 | 201 |
Residential Real Estate and Consumer [Member] | One-to-Four Family Investor-owned [Member] | ||
Current loans | 27,968 | 32,638 |
Total loans | 27,968 | 32,638 |
Nonaccrual loans | 203 | 206 |
Residential Real Estate and Consumer [Member] | Multifamily Loan [Member] | ||
Current loans | 30,432 | 29,303 |
Total loans | 30,432 | 29,303 |
Residential Real Estate and Consumer [Member] | Consumer [Member] | ||
Current loans | 4,972 | 3,016 |
Total loans | $ 4,972 | $ 3,016 |
Deposits (Narrative) (Details)
Deposits (Narrative) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Deposits | ||
Time deposits, at or above FDIC insurance limit | $ 9,752 | $ 9,485 |
Deposits (Composition of Deposi
Deposits (Composition of Deposits) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Deposits | ||
Non-interest bearing checking | $ 52,852 | $ 51,802 |
Interest bearing checking | 10,523 | 10,899 |
Money market | 69,119 | 70,455 |
Statement savings accounts | 35,152 | 31,977 |
Health savings accounts | 10,859 | 10,854 |
Certificates of deposit | 51,072 | 50,511 |
Total | $ 229,577 | $ 226,498 |
Deposits (Maturities of Certifi
Deposits (Maturities of Certificates of Deposit) (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Deposits | |
2021 | $ 28,530 |
2022 | 17,780 |
2023 | 2,999 |
2024 | 1,200 |
2025 | 460 |
2026 | 103 |
Total | $ 51,072 |
FHLB Advances (Narrative) (Deta
FHLB Advances (Narrative) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
FHLB Advances [Abstract] | ||
FHLB advances, general debt obligations, Disclosures, Collateral Pledged | $ 172,647 | $ 149,304 |
Amount secured by FHLB stock | 851 | |
FHLB advances, general debt obligations, amount of available unused funds | 14,459 | |
Federal funds line of credit not withdrawn | $ 7,000 |
FHLB Advances (FHLB Advances) (
FHLB Advances (FHLB Advances) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fixed rate, fixed term advances, amount | $ 5,500 | $ 5,500 |
Fixed term advances with floating spread, amount | 2,000 | 2,000 |
Total FHLB advances | $ 7,500 | $ 7,500 |
Minimum [Member] | ||
Fixed rate advances, weighted average rate | 0.00% | 0.00% |
Fixed term advances with floating spread | 2.10% | 2.10% |
Maximum [Member] | ||
Fixed rate advances, weighted average rate | 1.71% | 1.71% |
FHLB Advances (Summary of Sched
FHLB Advances (Summary of Scheduled Maturities of Fixed Term FHLB Advances) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fixed rate advances, amount, 2021 | $ 4,000 | |
Adjustable rate advances, amount, 2021 | 2,000 | |
Total Amount, 2021 | 6,000 | |
Fixed rate advances, amount, 2022 | 1,500 | |
Total Amount, 2022 | 1,500 | |
Fixed rate advances, amount, total | 5,500 | $ 5,500 |
Adjustable rate advances, amount, total | 2,000 | 2,000 |
Total FHLB advances | $ 7,500 | $ 7,500 |
Weighted Average [Member] | ||
Fixed rate advances, weighted average rate, 2021 | 0.00% | |
Adjustable rate advances, weighted average rate, 2021 | 2.10% | |
Fixed rate advances, weighted average rate, 2022 | 1.71% | |
Fixed rate advances, weighted average rate | 0.47% | |
Adjustable rate advances, weighted average rate | 2.10% |
Employee Stock Ownership Plan_2
Employee Stock Ownership Plan (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Employee Stock Ownership Plan | ||
Employee Stock Ownership Plan (ESOP), number of committed-to-be-released shares | 7,647 | 7,647 |
Average fair value of per share | $ 10.77 | $ 10.15 |
Employee Stock Ownership Plan (ESOP), Compensation expense | $ 82 | $ 61 |
Employee Stock Ownership Plan_3
Employee Stock Ownership Plan (Summary of ESOP Shares) (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | |
Employee Stock Ownership Plan | ||
Shares allocated to active participants (in shares) | 62,305 | 33,861 |
Shares committed to be released and allocated to participants (in shares) | 7,647 | 30,584 |
Shares distributed (in shares) | (2,140) | |
Total unallocated shares (in shares) | 573,446 | 581,093 |
Total ESOP shares (in shares) | 643,398 | 643,398 |
Fair value of unallocated shares (based on $11.25 and $10.52 share price at March 31, 2021 and December 31, 2020, respectively) | $ | $ 6,451 | $ 5,823 |
Share price (in dollars per share) | $ / shares | $ 11.25 | $ 10.02 |
Exchange ratio applied in the offering | 1.1730 |
Share-based Compensation Plan_2
Share-based Compensation Plans (Narrative) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($)shares | |
Share based awards granted | shares | |
Exchange ratio applied in the offering | 1.1730 |
The 2018 Equity Incentive Plan [Member] | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | $ | $ 1 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 10 months 24 days |
The 2018 Equity Incentive Plan [Member] | Restricted Stock [Member] | |
Share based award vesting period | 5 years |
The 2018 Equity Incentive Plan [Member] | Restricted Stock [Member] | Share-based Payment Arrangement, Tranche One [Member] | |
Share based award vesting right percentage | 20.00% |
The 2018 Equity Incentive Plan [Member] | Employee Stock Option [Member] | |
Share based award vesting period | 5 years |
Share based award expiration period | 10 years |
Share-based Compensation Plan_3
Share-based Compensation Plans (Impact of Share-based Payment Plans in Financial Statements) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cost of share-based payment plans | $ 81 | $ 87 |
Amount of related income tax benefit recognized in income | 19 | 23 |
Restricted Stock [Member] | ||
Cost of share-based payment plans | 44 | 50 |
Employee Stock Option [Member] | ||
Cost of share-based payment plans | $ 37 | $ 37 |
Share-based Compensation Plan_4
Share-based Compensation Plans (Stock Options Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Stock Option Awards, Outstanding | ||
Beginning Balance (in shares) | 269,220 | |
Granted (in shares) | ||
Exercised (in shares) | ||
Forfeited, (in shares) | ||
Ending Balance (in shares) | 269,220 | |
Exercisable as of December 31, (in shares) | 81,964 | |
Stock Option Awards, Weighted Average Exercise Price | ||
Beginning Balance (in dollars per share) | $ 10.51 | |
Granted, (in dollars per share) | ||
Exercised, (in dollars per share) | ||
Forfeited, (in dollars per share) | ||
Ending Balance (in dollars per share) | 10.51 | |
Exercisable as of December 31, (in dollars per share) | $ 10.81 | |
Stock Option Awards, Additional Disclosures | ||
Options outstanding, weighted average remaining contractual term (Year) | 8 years 3 months 4 days | |
Options outstanding, weighted average remaining contractual term, exercisable (Year) | 7 years 11 months 23 days | |
Options outstanding, Aggregate intrinsic value | $ 201,772 | |
Options outstanding, aggregate intrinsic value, exercisable | $ 19,926 | |
Number of Options, Nonvested | ||
Granted |
Share-based Compensation Plan_5
Share-based Compensation Plans (Summary of Changes in Restricted Shares) (Details) - Restricted Stock [Member] | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Shares outstanding, number of shares (in shares) | shares | 62,060 |
Shares outstanding, weighted average grant date fair value (in dollars per share) | $ / shares | $ 10.73 |
Granted, number of shares (in shares) | shares | |
Granted, weighted average grant date fair value (in dollars per share) | $ / shares | |
Vested, number of shares (in shares) | shares | |
Vested, weighted average grant date fair value (in dollars per share) | $ / shares | |
Forfeited, number of shares (in shares) | shares | |
Forfeited, weighted average grant date fair value (in dollars per share) | $ / shares | |
Shares outstanding, number of shares (in shares) | shares | 62,060 |
Shares outstanding, weighted average grant date fair value (in dollars per share) | $ / shares | $ 10.73 |
Equity and Regulatory Matters_2
Equity and Regulatory Matters (Capital Amounts and Ratios) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Equity and Regulatory Matters | ||
Common Equity Tier 1 capital (to risk-weighted assets) | $ 74,087 | $ 73,665 |
Common Equity Tier 1 capital (to risk-weighted assets), ratio | 33.9 | 33.1 |
Common Equity Tier 1 capital (to risk-weighted assets), for capital adequacy | $ 9,832 | $ 10,018 |
Common Equity Tier 1 capital (to risk-weighted assets), for capital adequacy, ratio | 4.50% | 4.50% |
Common Equity Tier 1 capital (to risk-weighted assets), to be capitalized | $ 14,202 | $ 14,471 |
Common Equity Tier 1 capital (to risk-weighted assets), to be capitalized, ratio | 6.50% | 6.50% |
Tier 1 capital (to risk-weighted assets) | $ 74,087 | $ 73,665 |
Tier 1 capital (to risk-weighted assets), ratio | 33.3 | 33.1 |
Tier 1 capital (to risk-weighted assets), for capital adequacy | $ 13,110 | $ 13,358 |
Tier 1 capital (to risk-weighted assets), for capital adequacy, ratio | 6 | 6 |
Tier 1 capital (to risk-weighted assets), to be capitalized | $ 17,479 | $ 17,810 |
Tier 1 capital (to risk-weighted assets), to be capitalized, ratio | 8 | 8 |
Total capital (to risk-weighted assets) | $ 76,819 | $ 76,448 |
Total capital (to risk-weighted assets), ratio | 34.5 | 34.3 |
Total capital (to risk-weighted assets), for capital adequacy | $ 17,479 | $ 17,810 |
Total capital (to risk-weighted assets), for capital adequacy, ratio | 8 | 8 |
Total capital (to risk-weighted assets), to be capitalized | $ 21,849 | $ 22,263 |
Total capital (to risk-weighted assets), to be capitalized, ratio | 10 | 10 |
Tier 1 capital (to average assets) | $ 74,087 | $ 73,665 |
Tier 1 capital (to average assets), ratio | 22.3 | 25.2 |
Tier 1 capital (to average assets), for capital adequacy | $ 13,309 | $ 11,700 |
Tier 1 capital (to average assets), for capital adequacy, ratio | 4 | 4 |
Tier 1 capital (to average assets), to be capitalized | $ 16,637 | $ 14,625 |
Tier 1 capital (to average assets), to be capitalized, ratio | 5 | 5 |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value | ||
Impaired financing receivable, with related allowance, recorded investment | $ 704 | $ 704 |
Loans, fair value | 254 | 254 |
Impaired financing receivable, related allowance | 450 | 450 |
Foreclosed asset, fair value | $ 0 | $ 125 |
Fair Value (Fair Value of Asset
Fair Value (Fair Value of Assets on Recurring Basis) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Available for sale securities | $ 56,463 | $ 64,243 |
Fair Value, Measurements, Recurring [Member] | ||
Available for sale securities | 56,463 | 64,243 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 56,463 | 64,243 |
Fair Value, Measurements, Recurring [Member] | Obligations of the US Government and US Government Sponsored Agencies [Member] | ||
Available for sale securities | 684 | 754 |
Fair Value, Measurements, Recurring [Member] | Obligations of the US Government and US Government Sponsored Agencies [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 684 | 754 |
Fair Value, Measurements, Recurring [Member] | Obligations of States and Political Subdivisions [Member] | ||
Available for sale securities | 15,292 | 15,605 |
Fair Value, Measurements, Recurring [Member] | Obligations of States and Political Subdivisions [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 15,292 | 15,605 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Securities [Member] | ||
Available for sale securities | 33,983 | 37,680 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 33,983 | 37,680 |
Fair Value, Measurements, Recurring [Member] | Certificates of Deposit [Member] | ||
Available for sale securities | 4,201 | 7,937 |
Fair Value, Measurements, Recurring [Member] | Certificates of Deposit [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 4,201 | 7,937 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | ||
Available for sale securities | 2,303 | 2,267 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | $ 2,303 | $ 2,267 |
Fair Value (Fair Value of Ass_2
Fair Value (Fair Value of Assets on Nonrecurring Basis) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Loans, fair value | $ 254 | $ 254 |
Foreclosed asset, fair value | 0 | 125 |
Fair Value, Measurements, Nonrecurring [Member] | ||
Loans, fair value | 254 | 254 |
Foreclosed asset, fair value | 125 | |
Other equity investments, fair value | 225 | 225 |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Other equity investments, fair value | 225 | 225 |
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Loans, fair value | $ 254 | 254 |
Foreclosed asset, fair value | $ 125 |
Fair Value (Quantitative Inform
Fair Value (Quantitative Information) (Details) $ in Thousands | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impaired loans | $ 254 | $ 254 |
Foreclosed assets | 0 | 125 |
Measurement Input, Discount Rate [Member] | Valuation, Market and Income Approach [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impaired loans | 254 | 254 |
Foreclosed assets | $ 0 | $ 125 |
Measurement Input, Discount Rate [Member] | Valuation, Market and Income Approach [Member] | Minimum [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impaired loans, measurement input | 0.10 | 0.10 |
Foreclosed assets, measurement input | 0.10 | 0.10 |
Measurement Input, Discount Rate [Member] | Valuation, Market and Income Approach [Member] | Maximum [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Impaired loans, measurement input | 0.20 | 0.20 |
Foreclosed assets, measurement input | 0.20 | 0.20 |
Fair Value (Carrying Value and
Fair Value (Carrying Value and Estimated Fair Value) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Available for sale securities | $ 56,463 | $ 64,243 |
Reported Value Measurement [Member] | ||
Cash and cash equivalents | 59,125 | 41,479 |
Available for sale securities | 56,463 | 64,243 |
Loans held for sale | 1,098 | 1,708 |
Loans | 203,376 | 214,723 |
Accrued interest receivable | 912 | 995 |
Cash value of life insurance | 8,576 | 7,272 |
Other equity investments | 1,278 | 1,279 |
Deposits | 229,577 | 226,498 |
Advance payments by borrowers for taxes and insurance | 391 | 127 |
FHLB advances | 7,500 | 7,500 |
Accrued interest payable | 117 | 17 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Cash and cash equivalents | 59,125 | 41,479 |
Accrued interest receivable | 912 | 995 |
Deposits | 175,987 | 175,987 |
Advance payments by borrowers for taxes and insurance | 391 | 127 |
Accrued interest payable | 117 | 17 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available for sale securities | 56,463 | 64,243 |
Loans held for sale | 1,098 | 1,708 |
Other equity investments | 225 | 225 |
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Loans | 205,155 | 217,893 |
Cash value of life insurance | 8,576 | 7,272 |
Other equity investments | 1,053 | 1,054 |
Deposits | 51,164 | 50,732 |
FHLB advances | $ 7,535 | $ 7,544 |
Business Combination (Narrative
Business Combination (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Mitchell Bank [Member] | |
Business Acquisition [Line Items] | |
Bargain purchase price gain | $ 7,000 |
Business Combination (Assets Ac
Business Combination (Assets Acquired and Liabilities Assumed) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Mar. 31, 2021 | |
Business Acquisition [Line Items] | ||
Cash and due from banks | $ 41,454,000 | $ 50,725,000 |
Available for sale securities | 64,243,000 | 56,463,000 |
Loans, net of allowance | 214,723,000 | 203,376,000 |
Premises and equipment | 5,594,000 | 5,551,000 |
Accrued interest receivable | 995,000 | 912,000 |
Foreclosed Assets | 125,000 | |
Other assets | 1,554,000 | 1,371,000 |
TOTAL ASSETS | 338,972,000 | 337,751,000 |
Deposits | 226,498,000 | 229,577,000 |
Other liabilities | 1,565,000 | 1,091,000 |
Total liabilities | 235,707,000 | $ 238,676,000 |
Fair Value and Other Merger Related Adjustments | ||
Securities | 16,000 | |
Other equity securities | 177,000 | |
Loans, net of allowance | (217,000) | |
Premises and equipment | 499,000 | |
Core deposit intangibles | 369,000 | |
Foreclosed Assets | (60,000) | |
Deferred tax asset | (228,000) | |
Other assets | (88,000) | |
Total assets acquired | 468,000 | |
Total identifiable assets | 468,000 | |
As Recorded by Mitchell Bank [Member] | ||
Business Acquisition [Line Items] | ||
Cash and due from banks | 38,266,000 | |
Available for sale securities | 7,133,000 | |
Other equity securities | 51,000 | |
Loans, net of allowance | 14,512,000 | |
Premises and equipment | 529,000 | |
Accrued interest receivable | 83,000 | |
Foreclosed Assets | 185,000 | |
Deferred tax asset | 228,000 | |
Other assets | 209,000 | |
TOTAL ASSETS | 61,196,000 | |
Deposits | 56,641,000 | |
Other liabilities | 38,000 | |
Total liabilities | 56,679,000 | |
Total identifiable assets | 4,517,000 | |
Mitchell Bank [Member] | ||
Business Combination, Consideration Transferred [Abstract] | ||
Consideration Paid | 4,978,000 | |
Recognized amounts of identifiable assets acquired and liabilities assumed: | ||
Cash and due from banks | 38,266,000 | |
Securities | 7,149,000 | |
Other equity securities | 228,000 | |
Loans, net of allowance | 14,295,000 | |
Premises and equipment | 1,028,000 | |
Core deposit intangibles | 369,000 | |
Accrued interest receivable | 83,000 | |
Foreclosed Assets | 125,000 | |
Other assets | 121,000 | |
Total assets acquired | 61,664,000 | |
Deposits | 56,641,000 | |
Other liabilities | 38,000 | |
Total liabilities assumed | 56,679,000 | |
Total identifiable assets | 4,985,000 | |
Bargain purchase gain resulting from acquisition | $ (7,000) |