Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 23, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | FXNC | ||
Entity Registrant Name | FIRST NATIONAL CORP /VA/ | ||
Entity Central Index Key | 719,402 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 4,952,575 | ||
Entity Public Float | $ 59,937,677 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and due from banks | $ 11,358 | $ 10,106 |
Interest-bearing deposits in banks | 28,628 | 30,986 |
Securities available for sale, at fair value | 89,255 | 94,802 |
Securities held to maturity, at carrying value | 48,208 | 53,398 |
Restricted securities, at cost | 1,570 | 1,548 |
Loans held for sale | 438 | 337 |
Loans, net of allowance for loan losses | 516,875 | 480,746 |
Other real estate owned, net of valuation allowance | 326 | 250 |
Premises and equipment, net | 19,891 | 20,785 |
Accrued interest receivable | 1,916 | 1,746 |
Bank owned life insurance | 13,967 | 13,928 |
Core deposit intangibles, net | 930 | 1,551 |
Other assets | 5,748 | 5,817 |
Total assets | 739,110 | 716,000 |
Deposits: | ||
Noninterest-bearing demand deposits | 180,912 | 168,076 |
Savings and interest-bearing demand deposits | 361,417 | 349,067 |
Time deposits | 122,651 | 128,427 |
Total deposits | 664,980 | 645,570 |
Subordinated debt | 4,948 | 4,930 |
Junior subordinated debt | 9,279 | 9,279 |
Accrued interest payable and other liabilities | 1,749 | 4,070 |
Total liabilities | 680,956 | 663,849 |
Shareholders’ Equity | ||
Preferred stock, par value | 0 | 0 |
Common stock, par value | 6,182 | 6,162 |
Surplus | 7,260 | 7,093 |
Retained earnings | 45,670 | 39,756 |
Accumulated other comprehensive loss, net | (958) | (860) |
Total shareholders’ equity | 58,154 | 52,151 |
Total liabilities and shareholders’ equity | $ 739,110 | $ 716,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Securities held to maturity, at fair value | $ 47,702 | $ 52,709 |
Allowance for loan losses | 5,326 | 5,321 |
Other real estate owned, valuation allowance | $ 0 | $ 0 |
Preferred stock, par value (in usd per share) | $ 1.25 | $ 1.25 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 1.25 | $ 1.25 |
Common stock, shares authorized (in shares) | 8,000,000 | 8,000,000 |
Common stock, shares issued (in shares) | 4,945,702 | 4,929,403 |
Common stock, shares outstanding (in shares) | 4,945,702 | 4,929,403 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Interest and Dividend Income | ||
Interest and fees on loans | $ 24,082 | $ 21,662 |
Interest on deposits in banks | 335 | 238 |
Interest and dividends on securities: | ||
Taxable interest | 2,569 | 2,692 |
Tax-exempt interest | 583 | 564 |
Dividends | 83 | 81 |
Total interest and dividend income | 27,652 | 25,237 |
Interest Expense | ||
Interest on deposits | 1,723 | 1,353 |
Interest on federal funds purchased | 0 | 3 |
Interest on subordinated debt | 360 | 361 |
Interest on junior subordinated debt | 303 | 259 |
Interest on other borrowings | 0 | 6 |
Total interest expense | 2,386 | 1,982 |
Net interest income | 25,266 | 23,255 |
Provision for loan losses | 100 | 0 |
Net interest income after provision for loan losses | 25,166 | 23,255 |
Noninterest Income | ||
Service charges on deposit accounts | 3,028 | 3,512 |
ATM and check card fees | 2,140 | 2,037 |
Wealth management fees | 1,447 | 1,362 |
Fees for other customer services | 570 | 581 |
Income from bank owned life insurance | 720 | 527 |
Net (losses) gains on securities available for sale | (90) | 8 |
Net gains on sale of loans | 172 | 144 |
Other operating income | 305 | 322 |
Total noninterest income | 8,292 | 8,493 |
Noninterest Expense | ||
Salaries and employee benefits | 12,923 | 12,939 |
Occupancy | 1,482 | 1,533 |
Equipment | 1,636 | 1,634 |
Marketing | 576 | 562 |
Supplies | 365 | 450 |
Legal and professional fees | 886 | 884 |
ATM and check card fees | 805 | 866 |
FDIC assessment | 316 | 426 |
Bank franchise tax | 436 | 372 |
Telecommunications expense | 416 | 451 |
Data processing expense | 620 | 593 |
Postage expense | 211 | 238 |
Amortization expense | 621 | 771 |
Other real estate owned income, net | (186) | (120) |
Net losses on disposal of premises and equipment | 252 | 8 |
Other operating expense | 1,925 | 1,881 |
Total noninterest expense | 23,284 | 23,488 |
Income before income taxes | 10,174 | 8,260 |
Income tax expense | 3,726 | 2,353 |
Net income | $ 6,448 | $ 5,907 |
Earnings per common share | ||
Basic (in usd per share) | $ 1.30 | $ 1.20 |
Diluted (in usd per share) | $ 1.30 | $ 1.20 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 6,448 | $ 5,907 |
Other comprehensive income, net of tax: | ||
Unrealized holding losses on available for sale securities, net of tax | (82) | (663) |
Reclassification adjustment for (gains) losses included in net income, net of tax | 59 | (5) |
Pension liability adjustment, net of tax | 83 | 1,396 |
Total other comprehensive income | 60 | 728 |
Total comprehensive income | $ 6,508 | $ 6,635 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized holding losses on available for sale securities, tax | $ (43) | $ (341) |
Reclassification adjustment for losses (gains) included in net income, tax | 31 | (3) |
Pension liability adjustment, tax | $ 43 | $ 719 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash Flows from Operating Activities | ||
Net income | $ 6,448 | $ 5,907 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of premises and equipment | 1,386 | 1,356 |
Amortization of core deposit intangibles | 621 | 771 |
Amortization of debt issuance costs | 18 | 17 |
Origination of loans held for sale | (9,789) | (9,281) |
Proceeds from sale of loans held for sale | 9,860 | 9,411 |
Net gains on sales of loans held for sale | (172) | (144) |
Provision for loan losses | 100 | 0 |
Net losses (gains) on securities available for sale | 90 | (8) |
Charitable donation of securities available for sale | 13 | 0 |
Provision for other real estate owned | 0 | 27 |
Net gains on sale of other real estate owned | (191) | (193) |
Increase in cash value of bank owned life insurance | (408) | (425) |
Accretion of discounts and amortization of premiums on securities, net | 631 | 842 |
Accretion of premium on time deposits | (104) | (167) |
Stock-based compensation | 141 | 113 |
Excess tax benefits on stock-based compensation | (14) | 0 |
Losses on disposal of premises and equipment | 252 | 8 |
Deferred income tax expense | 1,283 | 428 |
Changes in assets and liabilities: | ||
Increase in interest receivable | (170) | (85) |
(Increase) decrease in other assets | (1,202) | 26 |
(Decrease) increase in accrued expenses and other liabilities | (2,224) | 406 |
Net cash provided by operating activities | 6,569 | 9,009 |
Cash Flows from Investing Activities | ||
Proceeds from maturities, calls, principal payments, and sales of securities available for sale | 28,157 | 22,826 |
Proceeds from maturities, calls, principal payments, and sales of securities held to maturity | 4,981 | 12,821 |
Purchases of securities available for sale | (23,170) | (13,615) |
Net purchase of restricted securities | (22) | (157) |
Purchase of premises and equipment, net | (1,070) | (1,033) |
Proceeds from sale of premises and equipment | 0 | 23 |
Proceeds from sale of other real estate owned | 441 | 2,882 |
Purchase of bank owned life insurance | (11) | (2,011) |
Proceeds from cash value of bank owned life insurance | 380 | 250 |
Net increase in loans | (36,229) | (47,308) |
Net cash used in investing activities | (26,543) | (25,322) |
Cash Flows from Financing Activities | ||
Net increase in demand deposits and savings accounts | 25,186 | 31,128 |
Net decrease in time deposits | (5,672) | (12,507) |
Cash dividends paid on common stock, net of reinvestment | (646) | (550) |
Net cash provided by financing activities | 18,868 | 18,071 |
(Decrease) increase in cash and cash equivalents | (1,106) | 1,758 |
Cash and Cash Equivalents | ||
Cash and cash equivalents, beginning of year | 41,092 | 39,334 |
Cash and cash equivalents, end of year | 39,986 | 41,092 |
Cash payments for: | ||
Interest | 2,486 | 2,172 |
Income taxes | 3,377 | 1,974 |
Supplemental Disclosures of Noncash Transactions | ||
Unrealized losses on securities available for sale | (35) | (1,012) |
Change in pension liability | 126 | 2,115 |
Transfer from loans to other real estate owned | 0 | 37 |
Transfer from premises and equipment to other real estate owned | 326 | 250 |
Issuance of common stock, dividend reinvestment plan | $ 46 | $ 41 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Surplus | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning balance at Dec. 31, 2015 | $ 45,953 | $ 0 | $ 6,145 | $ 6,956 | $ 34,440 | $ (1,588) |
Net income | 5,907 | 5,907 | ||||
Other comprehensive income | 728 | 728 | ||||
Cash dividends on common stock | (591) | (591) | ||||
Stock-based compensation | 113 | 113 | ||||
Issuance of common stock, dividend reinvestment plan | 41 | 5 | 36 | |||
Issuance of common stock, stock incentive plan | 0 | 12 | (12) | |||
Ending balance at Dec. 31, 2016 | 52,151 | 0 | 6,162 | 7,093 | 39,756 | (860) |
Net income | 6,448 | 6,448 | ||||
Other comprehensive income | 60 | (98) | ||||
Other comprehensive income | 60 | 60 | ||||
Cash dividends on common stock | (692) | (692) | ||||
Stock-based compensation | 141 | 141 | ||||
Issuance of common stock, dividend reinvestment plan | 46 | 4 | 42 | |||
Issuance of common stock, stock incentive plan | 0 | 16 | (16) | |||
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | 0 | 158 | (158) | |||
Ending balance at Dec. 31, 2017 | $ 58,154 | $ 0 | $ 6,182 | $ 7,260 | $ 45,670 | $ (958) |
Consolidated Statements of Cha9
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Issuance of common stock dividend reinvestment plan, shares (in shares) | 3,035 | 3,949 |
Common Stock | ||
Cash dividends on common stock, per share (in usd per share) | $ 0.14 | $ 0.12 |
Issuance of common stock dividend reinvestment plan, shares (in shares) | 3,035 | 3,949 |
Issuance of common stock incentive plan, shares (in shares) | 13,264 | 9,324 |
Nature of Banking Activities an
Nature of Banking Activities and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Nature of Banking Activities and Significant Accounting Policies | Nature of Banking Activities and Significant Accounting Policies First National Corporation (the Company) is the bank holding company of First Bank (the Bank), First National (VA) Statutory Trust II (Trust II), and First National (VA) Statutory Trust III (Trust III). The Trusts were formed for the purpose of issuing redeemable capital securities, commonly known as trust preferred securities and are not included in the Company’s consolidated financial statements in accordance with authoritative accounting guidance because management has determined that the Trusts qualify as variable interest entities. The Bank owns First Bank Financial Services, Inc., which invests in entities that provide title insurance and investment services. The Bank owns Shen-Valley Land Holdings, LLC which holds other real estate owned. The Bank provides loan, deposit, wealth management, and other products and services in the Shenandoah Valley and central regions of Virginia. Loan products and services include consumer loans, residential mortgages, home equity loans, and commercial loans. Deposit products and services include checking, savings, money market accounts, individual retirement accounts, certificates of deposit, and cash management accounts. The Bank offers other services, including internet banking, mobile banking, remote deposit capture, and other traditional banking services. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America and to accepted practices within the banking industry. Principles of Consolidation The consolidated financial statements of First National Corporation include the accounts of all six companies. All material intercompany balances and transactions have been eliminated in consolidation, except for balances and transactions related to the Trusts. The subordinated debt of these Trusts is reflected as a liability of the Company. Use of Estimates In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated 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, valuation of other real estate owned, valuation of core deposit intangibles, and other-than-temporary impairment of securities. Significant Group Concentrations of Credit Risk Most of the Company’s activities are with customers located within the Shenandoah Valley and central regions of Virginia. The types of lending that the Company engages in are included in Note 3. The Company has a concentration of credit risk in commercial real estate, but does not have a significant concentration to any one customer or industry. Cash and Cash Equivalents For purposes of the consolidated statements of cash flows, the Company has defined cash equivalents as those amounts included in the balance sheet captions “Cash and due from banks” and “Interest-bearing deposits in banks.” Securities Investments in debt securities with readily determinable fair values are classified as either held to maturity (HTM), available for sale (AFS), or trading based on management’s intent. Currently, all of the Company’s debt securities are classified as either AFS or HTM. Equity investments in the FHLB, the Federal Reserve Bank of Richmond, and Community Bankers Bank are separately classified as restricted securities and are carried at cost. AFS securities are carried at estimated fair value with the corresponding unrealized gains and losses excluded from earnings and reported in other comprehensive income (loss), and HTM securities are carried at amortized cost. When an individual AFS security is sold, the Company releases the income tax effects associated with the AFS security from accumulated other comprehensive loss. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains or losses on the sale of securities are recorded on the trade date using the amortized cost of the specific security sold. Impairment of securities occurs when the fair value of a security is less than its amortized cost. For debt securities, impairment is considered other-than-temporary and recognized in its entirety in net income if either the Company (1) intends to sell the security or (2) it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If, however, the Company does not intend to sell the security and it is not more-than-likely that it will be required to sell the security before recovery, the Company must determine what portion of the impairment is attributable to a credit loss, which occurs when the amortized cost of the security exceeds the present value of the cash flows expected to be collected from the security. If there is no credit loss, there is no other-than-temporary impairment. If there is a credit loss, other-than-temporary impairment exists, and the credit loss must be recognized in net income and the remaining portion of impairment must be recognized in other comprehensive income (loss). For equity securities carried at cost, such as restricted securities, impairment is considered to be other-than-temporary based on the Company’s ability and intent to hold the investment until a recovery of fair value. Other-than-temporary impairment of an equity security results in a write-down that must be included in income. The Company regularly reviews each security for other-than-temporary impairment based on criteria that include the extent to which cost exceeds market price, the duration of that market decline, the financial health of and specific prospects for the issuer, the best estimate of the present value of cash flows expected to be collected from debt securities, the Company’s intention with regard to holding the security to maturity, and the likelihood that the Company would be required to sell the security before recovery. Loans Held for Sale Loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value. The Company, through its banking subsidiary, requires a firm purchase commitment from a permanent investor before loans held for sale can be closed, thus limiting interest rate risk. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. The Bank enters into commitments to originate mortgage loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). Rate lock commitments on mortgage loans that are intended to be sold are considered to be derivatives. The period of time between issuance of a loan commitment and closing and sale of the loan generally ranges from 30 to 60 days . The Bank protects itself from changes in interest rates through the use of best efforts forward delivery commitments, whereby the Bank commits to sell a loan at the time the borrower commits to an interest rate with the intent that the buyer has assumed interest rate risk on the loan. As a result, the Bank is not exposed to losses nor will it realize significant gains related to its rate lock commitments due to changes in interest rates. The correlation between the rate lock commitments and the best efforts contracts is very high due to their similarity. The market value of rate lock commitments and best efforts contracts is not readily ascertainable with precision because rate lock commitments and best efforts contracts are not actively traded in stand-alone markets. The Bank determines the fair value of rate lock commitments and best efforts contracts by measuring the change in the value of the underlying asset while taking into consideration the probability that the rate lock commitments will close. Because of the high correlation between rate lock commitments and best efforts contracts, no gain or loss occurs on the rate lock commitments. Loans The Company, through its banking subsidiary, grants mortgage, commercial, and consumer loans to customers. The Bank segments its loan portfolio into real estate loans, commercial and industrial loans, and consumer and other loans. Real estate loans are further divided into the following classes: Construction and Land Development; 1-4 Family Residential; and Other Real Estate Loans. Descriptions of the Company’s loan classes are as follows: Real Estate Loans – Construction and Land Development : The Company originates construction loans for the acquisition and development of land and construction of commercial buildings, condominiums, townhomes, and one-to-four family residences. Real Estate Loans – 1-4 Family : This class of loans includes loans secured by one-to-four family homes. In addition to traditional residential mortgage loans secured by a first or junior lien on the property, the Bank offers home equity lines of credit. Real Estate Loans – Other : This loan class consists primarily of loans secured by various types of commercial real estate typically in the Bank’s market area, including multi-family residential buildings, office and retail buildings, industrial and warehouse buildings, hotels, and religious facilities. Commercial and Industrial Loans: Commercial loans may be unsecured or secured with non-real estate commercial property. The Company's banking subsidiary makes commercial loans to businesses located within its market area and also to businesses outside of its market area through loan participations with other financial institutions. Consumer and Other Loans : Consumer loans include all loans made to individuals for consumer or personal purposes. They include new and used automobile loans, unsecured loans, and lines of credit. The Company's banking subsidiary makes consumer loans to individuals located within its market area and also to individuals outside of its market through the purchase of loans from another financial institution. A substantial portion of the loan portfolio is represented by residential and commercial loans secured by real estate throughout the Bank's market area. The ability of the Bank’s debtors to honor their contracts may be impacted by the real estate and general economic conditions in this area. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances less the allowance for loan losses and any deferred fees or costs on originated loans. Interest income is accrued and credited to income based on the unpaid principal balance. Loan origination fees, net of certain origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method. A loan’s past due status is based on the contractual due date of the most delinquent payment due. Loans are generally placed on non-accrual status when the collection of principal or interest is 90 days or more past due, or earlier, if collection is uncertain based on an evaluation of the net realizable value of the collateral and the financial strength of the borrower. Loans greater than 90 days past due may remain on accrual status if management determines it has adequate collateral to cover the principal and interest. For those loans that are carried on non-accrual status, payments are first applied to principal outstanding. A loan may be returned to accrual status if the borrower has demonstrated a sustained period of repayment performance in accordance with the contractual terms of the loan and there is reasonable assurance the borrower will continue to make payments as agreed. These policies are applied consistently across the loan portfolio. All interest accrued but not collected for loans that are placed on non-accrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. When a loan is returned to accrual status, interest income is recognized based on the new effective yield to maturity of the loan. Any unsecured loan that is deemed uncollectible is charged-off in full. Any secured loan that is considered by management to be uncollectible is partially charged-off and carried at the fair value of the collateral less estimated selling costs. This charge-off policy applies to all loan segments. Impaired Loans A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value (net of selling costs), and the probability of collecting scheduled principal and interest payments when due. Additionally, management generally evaluates substandard and doubtful loans greater than $250 thousand for impairment. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair market value of the collateral, net of selling costs, if the loan is collateral dependent. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. Accordingly, the Company typically does not separately identify individual consumer, residential, and certain small commercial loans that are less than $250 thousand for impairment disclosures, except for troubled debt restructurings (TDRs) as noted below. Troubled Debt Restructurings (TDR) In situations where, for economic or legal reasons related to a borrower’s financial condition, management grants a concession to the borrower that it would not otherwise consider, the related loan is classified as a TDR. TDRs are considered impaired loans. Upon designation as a TDR, the Company evaluates the borrower’s payment history, past due status, and ability to make payments based on the revised terms of the loan. If a loan was accruing prior to being modified as a TDR and if the Company concludes that the borrower is able to make such payments, and there are no other factors or circumstances that would cause it to conclude otherwise, the loan will remain on an accruing status. If a loan was on non-accrual status at the time of the TDR, the loan will remain on non-accrual status following the modification and may be returned to accrual status based on the policy for returning loans to accrual status as noted above. There were $333 thousand and $460 thousand in loans classified as TDRs as of December 31, 2017 and 2016 , respectively. Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management determines that the loan balance is uncollectible. Subsequent recoveries, if any, are credited to the allowance. For further information about the Company’s loans and the allowance for loan losses, see Notes 3 and 4. The allowance for loan losses is evaluated on a quarterly basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The Company performs regular credit reviews of the loan portfolio to review credit quality and adherence to underwriting standards. The credit reviews consist of reviews by its internal credit administration department and reviews performed by an independent third party. Upon origination, each loan is assigned a risk rating ranging from one to nine, with loans closer to one having less risk. This risk rating scale is our primary credit quality indicator. The Company has various committees that review and ensure that the allowance for loans losses methodology is in accordance with GAAP and loss factors used appropriately reflect the risk characteristics of the loan portfolio. The allowance represents an amount that, in management’s judgment, will be adequate to absorb any losses on existing loans that may become uncollectible. Management’s judgment in determining the level of the allowance is based on evaluations of the collectability of loans while taking into consideration such factors as trends in delinquencies and charge-offs, changes in the nature and volume of the loan portfolio, current economic conditions that may affect a borrower’s ability to repay and the value of the collateral, overall portfolio quality, and review of specific potential losses. The evaluation also considers the following risk characteristics of each loan portfolio class: • 1-4 family residential mortgage loans carry risks associated with the continued creditworthiness of the borrower and changes in the value of the collateral. • Real estate construction and land development loans carry risks that the project may not be finished according to schedule, the project may not be finished according to budget, and the value of the collateral may, at any point in time, be less than the principal amount of the loan. Construction loans also bear the risk that the general contractor, who may or may not be a loan customer, may be unable to finish the construction project as planned because of financial pressure or other factors unrelated to the project. • Other real estate loans carry risks associated with the successful operation of a business or a real estate project, in addition to other risks associated with the ownership of real estate, because repayment of these loans may be dependent upon the profitability and cash flows of the business or project. • Commercial and industrial loans carry risks associated with the successful operation of a business because repayment of these loans may be dependent upon the profitability and cash flows of the business. In addition, there is risk associated with the value of collateral other than real estate which may depreciate over time and cannot be appraised with as much reliability. • Consumer and other loans carry risk associated with the continued creditworthiness of the borrower and the value of the collateral, if any. These loans are typically either unsecured or secured by rapidly depreciating assets such as automobiles. They are also likely to be immediately and adversely affected by job loss, divorce, illness, personal bankruptcy, or other changes in circumstances. Consumer and other loans also include purchased consumer loans which could have been originated outside of the Company's market area. The allowance for loan losses consists of specific and general components. The specific component relates to loans that are classified as impaired, and is established when the discounted cash flows, fair value of collateral less estimated costs to sell, or observable market price of the impaired loan is lower than the carrying value of that loan. For collateral dependent loans, an updated appraisal is ordered if a current one is not on file. Appraisals are performed by independent third-party appraisers with relevant industry experience. Adjustments to the appraised value may be made based on recent sales of like properties or general market conditions among other considerations. The general component covers loans that are not considered impaired and is based on historical loss experience adjusted for qualitative factors. The historical loss experience is calculated by loan type and uses an average loss rate during the preceding twelve quarters. The qualitative factors are assigned by management based on delinquencies and asset quality, national and local economic trends, effects of the changes in the value of underlying collateral, trends in volume and nature of loans, effects of changes in the lending policy, the experience and depth of management, concentrations of credit, quality of the loan review system, and the effect of external factors such as competition and regulatory requirements. The factors assigned differ by loan type. The general allowance estimates losses whose impact on the portfolio has yet to be recognized by a specific allowance. Allowance factors and the overall size of the allowance may change from period to period based on management’s assessment of the above described factors and the relative weights given to each factor. Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost, less accumulated depreciation and amortization. Premises and equipment are depreciated over their estimated useful lives ranging from three years to forty years ; leasehold improvements are amortized over the lives of the respective leases or the estimated useful life of the leasehold improvement, whichever is less. Software is amortized over its estimated useful life ranging from three to seven years . Depreciation and amortization are recorded on the straight-line method. Costs of maintenance and repairs are charged to expense as incurred. Costs of replacing structural parts of major units are considered individually and are expensed or capitalized as the facts dictate. Gains and losses on routine dispositions are reflected in current operations. Other Real Estate Owned Other real estate owned (OREO) consists of properties obtained through a foreclosure proceeding or through an in-substance foreclosure in satisfaction of loans and properties originally acquired for branch operations or expansion but no longer intended to be used for that purpose. OREO is initially recorded at fair value less estimated costs to sell to establish a new cost basis. OREO is subsequently reported at the lower of cost or fair value less costs to sell, determined on the basis of current appraisals, comparable sales, and other estimates of fair value obtained principally from independent sources, adjusted for estimated selling costs. Management also considers other factors or recent developments, such as changes in absorption rates or market conditions from the time of valuation and anticipated sales values considering management’s plans for disposition, which could result in adjustments to the collateral value estimates indicated in the appraisals. Significant judgments and complex estimates are required in estimating the fair value of other real estate owned, and the period of time within which such estimates can be considered current is significantly shortened during periods of market volatility. In response to market conditions and other economic factors, management may utilize liquidation sales as part of its distressed asset disposition strategy. As a result of the significant judgments required in estimating fair value and the variables involved in different methods of disposition, the net proceeds realized from sales transactions could differ significantly from appraisals, comparable sales, and other estimates used to determine the fair value of other real estate owned. Management reviews the value of other real estate owned each quarter and adjusts the values as appropriate. Revenue and expenses from operations and changes in the valuation allowance are included in other real estate owned income. Bank-Owned Life Insurance The Company owns insurance on the lives of a certain group of key employees. The policies were purchased to help offset the increase in the costs of various fringe benefit plans, including healthcare. The cash surrender value of these policies is included as an asset on the consolidated balance sheets, and any increase in cash surrender value is recorded as income from bank owned life insurance on the consolidated statements of income. In the event of the death of an insured individual under these policies, the Company receives a death benefit which is also recorded as income from bank owned life insurance. The Company recorded $312 thousand and $102 thousand of death benefits received as income from bank owned life insurance under these policies for the years ended December 31, 2017 and 2016 , respectively. The Company is exposed to credit risk to the extent an insurance company is unable to fulfill its financial obligations under a policy. Intangible Assets Intangible assets consist of core deposit intangible assets arising from branch acquisitions which are amortized on an accelerated method over their estimated useful lives, which range from six to nine years . Stock Based Compensation Compensation cost is recognized for restricted stock units and other stock awards issued to employees and directors based on the fair value of the awards at the date of grant. The market price of the Company’s common stock at the date of grant is used to estimate the fair value of restricted stock units and other stock awards. Retirement Plans Pension expense is the net of service and interest cost, return on plan assets, and amortization of gains and losses not immediately recognized. Employee 401(k) and profit sharing plan expense is the amount of matching contributions and Bank discretionary matches. Transfers of Financial Assets Transfers of financial assets, including loan participations, 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 maturity. Income Taxes The Company accounts for income taxes in accordance with ASC Topic 740, “Income Taxes”. Under this guidance, deferred taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates that will apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date. The Tax Cuts and Jobs Act (the Act), which was enacted into law on December 22, 2017, reduces the corporate income tax rate to 21%. Since the Act reduces the Company's corporate tax rate from 34% to 21%, the Company recorded a $752 thousand charge to income tax expense in 2017 related to the re-measurement of net deferred tax assets resulting from the new 21% corporate tax rate. See Note 11 for details on the Company’s income taxes. The Company regularly reviews the carrying amount of its net deferred tax assets to determine if the establishment of a valuation allowance is necessary. If based on the available evidence, it is more likely than not that all or a portion of the Company’s net deferred tax assets will not be realized in future periods, a deferred tax valuation allowance would be established. Consideration is given to various positive and negative factors that could affect the realization of the deferred tax assets. In evaluating this available evidence, management considers, among other things, historical performance, expectations of future earnings, the ability to carry back losses to recoup taxes previously paid, length of statutory carry forward periods, experience with utilization of operating loss and tax credit carry forwards not expiring, tax planning strategies, and timing of reversals of temporary differences. Significant judgment is required in assessing future earnings trends and the timing of reversals of temporary differences. The Company’s evaluation is based on current tax laws as well as management’s expectations of future performance. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. There was no liability for unrecognized tax benefits recorded as of December 31, 2017 and 2016 . Interest and penalties associated with unrecognized tax benefits, if any, are classified as additional income taxes in the consolidated statements of income. Wealth Management Department Securities and other property held by the wealth management department in a fiduciary or agency capacity are not assets of the Company and are not included in the accompanying consolidated financial statements. Earnings Per Common Share Basic earnings per common share represents income available to common shareholders divided by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate to restricted stock units and are determined using the treasury method. See Note 14 for further information regarding earnings per common share. Advertising Costs The Company follows the policy of charging the production costs of advertising to expense as incurred. Total advertising expense incurred for 2017 and 2016 was $379 thousand and $402 thousand , respectively. Comprehensive Income Accounting principles generally require that recognized revenue, expenses, gains, and losses be included in net income. Although certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities and pension liability adjustments, are reported as a separate component of the equity section of the consolidated balance sheets, such items, along with net income, are components of comprehensive income. Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there are such matters that will have a material effect on the consolidated financial statements. Reclassifications Some items in the prior yea |
Securities
Securities | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities | Securities The Company invests in U.S. agency and mortgage-backed securities, obligations of states and political subdivisions, corporate equity securities, and corporate debt securities. Amortized costs and fair values of securities at December 31, 2017 and 2016 were as follows (in thousands): 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available for sale: U.S. agency and mortgage-backed securities $ 76,074 $ 67 $ (1,337 ) $ 74,804 Obligations of states and political subdivisions 14,520 86 (155 ) 14,451 Total securities available for sale $ 90,594 $ 153 $ (1,492 ) $ 89,255 Securities held to maturity: U.S. agency and mortgage-backed securities $ 32,149 $ — $ (551 ) $ 31,598 Obligations of states and political subdivisions 14,559 74 (45 ) 14,588 Corporate debt securities 1,500 16 — 1,516 Total securities held to maturity $ 48,208 $ 90 $ (596 ) $ 47,702 Total securities $ 138,802 $ 243 $ (2,088 ) $ 136,957 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available for sale: U.S. agency and mortgage-backed securities $ 81,451 $ 177 $ (1,457 ) $ 80,171 Obligations of states and political subdivisions 14,654 146 (180 ) 14,620 Corporate equity securities 1 10 — 11 Total securities available for sale $ 96,106 $ 333 $ (1,637 ) $ 94,802 Securities held to maturity: U.S. agency and mortgage-backed securities $ 37,269 $ 1 $ (483 ) $ 36,787 Obligations of states and political subdivisions 14,629 18 (211 ) 14,436 Corporate debt securities 1,500 — (14 ) 1,486 Total securities held to maturity $ 53,398 $ 19 $ (708 ) $ 52,709 Total securities $ 149,504 $ 352 $ (2,345 ) $ 147,511 At December 31, 2017 and 2016 , investments in an unrealized loss position that were temporarily impaired were as follows (in thousands): 2017 Less than 12 months 12 months or more Total Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Securities available for sale: U.S. agency and mortgage-backed securities $ 29,963 $ (286 ) $ 30,362 $ (1,051 ) $ 60,325 $ (1,337 ) Obligations of states and political subdivisions 4,469 (53 ) 1,961 (102 ) 6,430 (155 ) Total securities available for sale $ 34,432 $ (339 ) $ 32,323 $ (1,153 ) $ 66,755 $ (1,492 ) Securities held to maturity: U.S. agency and mortgage-backed securities $ 18,301 $ (205 ) $ 13,297 $ (346 ) $ 31,598 $ (551 ) Obligations of states and political subdivisions 6,889 (45 ) — — 6,889 (45 ) Total securities held to maturity $ 25,190 $ (250 ) $ 13,297 $ (346 ) $ 38,487 $ (596 ) Total securities $ 59,622 $ (589 ) $ 45,620 $ (1,499 ) $ 105,242 $ (2,088 ) 2016 Less than 12 months 12 months or more Total Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Securities available for sale: U.S. agency and mortgage-backed securities $ 60,943 $ (1,249 ) $ 5,499 $ (208 ) $ 66,442 $ (1,457 ) Obligations of states and political subdivisions 5,130 (180 ) — — 5,130 (180 ) Total securities available for sale $ 66,073 $ (1,429 ) $ 5,499 $ (208 ) $ 71,572 $ (1,637 ) Securities held to maturity: U.S. agency and mortgage-backed securities $ 34,770 $ (483 ) $ — $ — $ 34,770 $ (483 ) Obligations of states and political subdivisions 12,724 (211 ) — — 12,724 (211 ) Corporate debt securities $ 1,486 $ (14 ) $ — $ — $ 1,486 $ (14 ) Total securities held to maturity $ 48,980 $ (708 ) $ — $ — $ 48,980 $ (708 ) Total securities $ 115,053 $ (2,137 ) $ 5,499 $ (208 ) $ 120,552 $ (2,345 ) The tables above provide information about securities that have been in an unrealized loss position for less than twelve consecutive months and securities that have been in an unrealized loss position for twelve consecutive months or more. Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Impairment is considered to be other-than-temporary if the Company (1) intends to sell the security, (2) more likely than not will be required to sell the security before recovering its cost, or (3) does not expect to recover the security’s entire amortized cost basis. Presently, the Company does not intend to sell any of these securities, does not expect to be required to sell these securities, and expects to recover the entire amortized cost of all the securities. At December 31, 2017 , there were sixty-eight out of eighty-two U.S. agency and mortgage-backed securities and thirty-nine out of eighty obligations of states and political subdivisions in an unrealized loss position. One hundred percent of the Company’s investment portfolio is considered investment grade. The weighted-average re-pricing term of the portfolio was 4.7 years at December 31, 2017 . At December 31, 2016 , there were sixty-four out of eighty-three U.S. agency and mortgage-backed securities, fifty out of seventy-eight obligations of states and political subdivisions, and one corporate debt security in an unrealized loss position. One hundred percent of the Company’s investment portfolio was considered investment grade at December 31, 2016 . The weighted-average re-pricing term of the portfolio was 4.7 years at December 31, 2016 . The unrealized losses at December 31, 2017 in the U.S. agency and mortgage-backed securities portfolio and the obligations of states and political subdivisions portfolio were related to changes in market interest rates and not credit concerns of the issuers. The amortized cost and fair value of securities at December 31, 2017 by contractual maturity are shown below (in thousands). Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. Available for Sale Held to Maturity Amortized Cost Fair Value Amortized Cost Fair Value Due within one year $ 600 $ 601 $ — $ — Due after one year through five years 9,040 9,048 6,186 6,144 Due after five years through ten years 8,920 8,774 14,160 14,158 Due after ten years 72,034 70,832 27,862 27,400 $ 90,594 $ 89,255 $ 48,208 $ 47,702 Proceeds from maturities, calls, principal payments, and sales of securities available for sale during 2017 and 2016 were $28.2 million and $22.8 million , respectively. Gross gains of $49 thousand and $22 thousand were realized on calls and sales during 2017 and 2016 , respectively. Gross losses of $152 thousand and $14 thousand were realized on calls and sales during 2017 and 2016 , respectively. For the year ended December 31, 2017 , the Company donated one security from the available for sale portfolio to a not-for-profit organization. The Company recognized a gross gain of $13 thousand related to the charitable donation of the available for sale security during 2017 . There were no donations of securities from the available for sale portfolio for the year ended December 31, 2016 . Proceeds from maturities, calls, principal payments, and sales of securities held to maturity during 2017 and 2016 were $5.0 million and $12.8 million , respectively. There were zero sales of securities from the held to maturity portfolio for the year ended December 31, 2017 . For the year ended December 31, 2016 , the Company sold one security from the held to maturity portfolio. The Company recognized no gain or loss related to the sale as the carrying value of the security sold equaled the proceeds from the sale of $657 thousand . The sale of this security was in response to credit deterioration of the issuer. The Company did not realize any gross gains or gross losses on held to maturity securities during 2017 or 2016 . Securities having a fair value of $35.2 million and $27.7 million at December 31, 2017 and 2016 were pledged to secure public deposits and for other purposes required by law. Federal Home Loan Bank, Federal Reserve Bank, and Community Bankers’ Bank stock are generally viewed as long-term investments and as restricted securities, which are carried at cost, because there is a minimal market for the stock. Therefore, when evaluating restricted securities for impairment, their value is based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2017 , and no impairment has been recognized. The composition of restricted securities at December 31, 2017 and 2016 was as follows (in thousands): 2017 2016 Federal Home Loan Bank stock $ 645 $ 623 Federal Reserve Bank stock 875 875 Community Bankers’ Bank stock 50 50 $ 1,570 $ 1,548 |
Loans
Loans | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Loans | Loans Loans at December 31, 2017 and 2016 are summarized as follows (in thousands): 2017 2016 Real estate loans: Construction and land development $ 35,927 $ 34,699 Secured by 1-4 family residential 208,177 198,763 Other real estate 222,256 211,210 Commercial and industrial loans 38,763 29,981 Consumer and other loans 17,078 11,414 Total loans $ 522,201 $ 486,067 Allowance for loan losses (5,326 ) (5,321 ) Loans, net $ 516,875 $ 480,746 Net deferred loan fees included in the above loan categories were $301 thousand and $142 thousand at December 31, 2017 and 2016 , respectively. Consumer and other loans included $232 thousand and $264 thousand of demand deposit overdrafts at December 31, 2017 and 2016 , respectively. The following tables provide a summary of loan classes and an aging of past due loans as of December 31, 2017 and 2016 (in thousands): December 31, 2017 30-59 60-89 > 90 Total Current Total Non- 90 Days Real estate loans: Construction and land development $ 986 $ 30 $ 40 $ 1,056 $ 34,871 $ 35,927 $ 269 $ 40 1-4 family residential 606 203 148 957 207,220 208,177 267 106 Other real estate loans 2,042 170 10 2,222 220,034 222,256 401 10 Commercial and industrial 184 25 — 209 38,554 38,763 — — Consumer and other loans 51 49 27 127 16,951 17,078 — 27 Total $ 3,869 $ 477 $ 225 $ 4,571 $ 517,630 $ 522,201 $ 937 $ 183 December 31, 2016 30-59 60-89 > 90 Total Current Total Non- 90 Days Real estate loans: Construction and land development $ — $ 40 $ — $ 40 $ 34,659 $ 34,699 $ 1,033 $ — 1-4 family residential 980 170 410 1,560 197,203 198,763 413 84 Other real estate loans 321 701 — 1,022 210,188 211,210 74 — Commercial and industrial 36 309 32 377 29,604 29,981 — 32 Consumer and other loans 19 7 — 26 11,388 11,414 — — Total $ 1,356 $ 1,227 $ 442 $ 3,025 $ 483,042 $ 486,067 $ 1,520 $ 116 Credit Quality Indicators As part of the ongoing monitoring of the credit quality of the Company’s loan portfolio, management tracks certain credit quality indicators including trends related to the risk grading of specified classes of loans. The Company utilizes a risk grading matrix to assign a rating to each of its loans. The loan ratings are summarized into the following categories: pass, special mention, substandard, doubtful, and loss. Pass rated loans include all risk rated credits other than those included in special mention, substandard, or doubtful. Loans classified as loss are charged-off. Loan officers assign risk grades to loans at origination and as renewals arise. The Bank’s Credit Administration department reviews risk grades for accuracy on a quarterly basis and as credit issues arise. In addition, a certain amount of loans are reviewed each year through the Company’s internal and external loan review process. A description of the general characteristics of the loan grading categories is as follows: Pass – Loans classified as pass exhibit acceptable operating trends, balance sheet trends, and liquidity. Sufficient cash flow exists to service the loan. All obligations have been paid by the borrower as agreed. Special Mention – Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or the Bank’s credit position at some future date. Substandard – Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Doubtful – Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable, and improbable. The Company considers all doubtful loans to be impaired and places the loan on non-accrual status. Loss – Loans classified as loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. The following tables provide an analysis of the credit risk profile of each loan class as of December 31, 2017 and 2016 (in thousands): December 31, 2017 Pass Special Substandard Doubtful Total Real estate loans: Construction and land development $ 31,553 $ 2,268 $ 2,106 $ — $ 35,927 Secured by 1-4 family residential 204,166 1,933 2,078 — 208,177 Other real estate loans 215,773 971 5,512 — 222,256 Commercial and industrial 38,606 53 104 — 38,763 Consumer and other loans 17,078 — — — 17,078 Total $ 507,176 $ 5,225 $ 9,800 $ — $ 522,201 December 31, 2016 Pass Special Substandard Doubtful Total Real estate loans: Construction and land development $ 29,416 $ 2,402 $ 2,881 $ — $ 34,699 Secured by 1-4 family residential 193,395 3,295 2,073 — 198,763 Other real estate loans 200,009 6,990 4,211 — 211,210 Commercial and industrial 29,456 386 139 — 29,981 Consumer and other loans 11,414 — — — 11,414 Total $ 463,690 $ 13,073 $ 9,304 $ — $ 486,067 |
Allowance for Loan Losses
Allowance for Loan Losses | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Allowance for Loan Losses | Allowance for Loan Losses The following tables present, as of December 31, 2017 and 2016 , the total allowance for loan losses, the allowance by impairment methodology and loans by impairment methodology (in thousands). December 31, 2017 Construction Secured by Other Real Commercial Consumer Total Allowance for loan losses: Beginning Balance, December 31, 2016 $ 441 $ 1,019 $ 3,142 $ 380 $ 339 $ 5,321 Charge-offs — (126 ) — — (607 ) (733 ) Recoveries 11 302 50 10 265 638 Provision for (recovery of) loan losses (38 ) (420 ) (244 ) 28 774 100 Ending Balance, December 31, 2017 $ 414 $ 775 $ 2,948 $ 418 $ 771 $ 5,326 Ending Balance: Individually evaluated for impairment — — — — — — Collectively evaluated for impairment 414 775 2,948 418 771 5,326 Loans: Ending Balance 35,927 208,177 222,256 38,763 17,078 522,201 Individually evaluated for impairment 1,150 1,307 1,289 65 — 3,811 Collectively evaluated for impairment 34,777 206,870 220,967 38,698 17,078 518,390 December 31, 2016 Construction Secured by Other Real Commercial Consumer Total Allowance for loan losses: Beginning Balance, December 31, 2015 $ 1,532 $ 939 $ 2,534 $ 306 $ 213 $ 5,524 Charge-offs — (83 ) (165 ) — (540 ) (788 ) Recoveries 4 293 2 11 275 585 Provision for (recovery of) loan losses (1,095 ) (130 ) 771 63 391 — Ending Balance, December 31, 2016 $ 441 $ 1,019 $ 3,142 $ 380 $ 339 $ 5,321 Ending Balance: Individually evaluated for impairment — 37 — — — 37 Collectively evaluated for impairment 441 982 3,142 380 339 5,284 Loans: Ending Balance 34,699 198,763 211,210 29,981 11,414 486,067 Individually evaluated for impairment 1,973 1,828 984 75 — 4,860 Collectively evaluated for impairment 32,726 196,935 210,226 29,906 11,414 481,207 Impaired loans and the related allowance at December 31, 2017 and 2016 , were as follows (in thousands): December 31, 2017 Unpaid Recorded Recorded Total Related Average Interest Real estate loans: Construction and land development $ 1,627 $ 1,150 $ — $ 1,150 $ — $ 1,814 $ 63 Secured by 1-4 family 1,387 1,307 — 1,307 — 1,637 64 Other real estate loans 1,483 1,289 — 1,289 — 1,137 95 Commercial and industrial 78 65 — 65 — 68 10 Total $ 4,575 $ 3,811 $ — $ 3,811 $ — $ 4,656 $ 232 December 31, 2016 Unpaid Recorded Recorded Total Related Average Interest Real estate loans: Construction and land development $ 2,388 $ 1,973 $ — $ 1,973 $ — $ 2,407 $ 66 Secured by 1-4 family 1,851 1,675 153 1,828 37 2,013 87 Other real estate loans 1,213 984 — 984 — 2,529 22 Commercial and industrial 93 75 — 75 — 85 1 Total $ 5,545 $ 4,707 $ 153 $ 4,860 $ 37 $ 7,034 $ 176 The “Recorded Investment” amounts in the table above represent the outstanding principal balance on each loan represented in the table. The “Unpaid Principal Balance” represents the outstanding principal balance on each loan represented in the table plus any amounts that have been charged off on each loan and/or payments that have been applied towards principal on non-accrual loans. Only loan classes with balances are included in the tables above. As of December 31, 2017 , loans classified as troubled debt restructurings (TDRs) and included in impaired loans in the disclosure above totaled $333 thousand . At December 31, 2017 , $282 thousand of the loans classified as TDRs were performing under the restructured terms and were not considered non-performing assets. There were $460 thousand in TDRs at December 31, 2016 , $300 thousand of which were performing under the restructured terms. Modified terms under TDRs may include rate reductions, extension of terms that are considered to be below market, conversion to interest only, and other actions intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral. There were no loans modified under TDRs during the year ended December 31, 2017 . There was one loan secured by 1-4 family residential real estate classified as a TDR during the year ended December 31, 2016 because principal was forgiven as part of the loan modification. The recorded investment for this loan prior to modification totaled $138 thousand and the recorded investment after the modification totaled $88 thousand . The TDR described above increased the allowance for loan losses by $32 thousand and resulted in a charge-off of $50 thousand during the year ended December 31, 2016 . For the years ended December 31, 2017 and 2016 , there were no TDRs that subsequently defaulted within twelve months of the loan modification. Management defines default as over 90 days past due or the foreclosure and repossession of the collateral or charge-off of the loan during the twelve month period subsequent to the modification. There were no non-accrual loans excluded from impaired loan disclosure at December 31, 2017 and December 31, 2016 . Had non-accrual loans performed in accordance with their original contract terms, the Company would have recognized additional interest income in the amount of $107 thousand during the years ended December 31, 2017 and 2016 , respectively. |
Other Real Estate Owned
Other Real Estate Owned | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate [Abstract] | |
Other Real Estate Owned | Other Real Estate Owned Changes in the balance for OREO are as follows (in thousands): 2017 2016 Balance at the beginning of year, gross $ 250 $ 2,903 Transfers in 326 287 Charge-offs — (251 ) Sales proceeds (441 ) (2,882 ) Gain on disposition 191 193 Balance at the end of year, gross $ 326 $ 250 Less: valuation allowance — — Balance at the end of year, net $ 326 $ 250 There were no residential real estate properties included in the ending OREO balances above at December 31, 2017 and 2016 . The Bank did not have any consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceedings were in process as of December 31, 2017 . Changes in the allowance for OREO losses are as follows (in thousands): 2017 2016 Balance at beginning of year $ — $ 224 Provision for losses — 27 Charge-offs, net — (251 ) Balance at end of year $ — $ — Net expenses applicable to OREO, other than the provision for losses, were $5 thousand and $46 thousand for the years ended December 31, 2017 and 2016 , respectively. |
Premises and Equipment
Premises and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Premises and Equipment | Premises and Equipment Premises and equipment are summarized as follows at December 31, 2017 and 2016 (in thousands): 2017 2016 Land $ 4,717 $ 4,796 Buildings and leasehold improvements 18,510 18,524 Furniture and equipment 6,394 5,836 Construction in process 140 216 $ 29,761 $ 29,372 Less accumulated depreciation 9,870 8,587 $ 19,891 $ 20,785 Depreciation expense included in operating expenses for 2017 and 2016 was $1.4 million . |
Deposits
Deposits | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Deposits | Deposits The aggregate amount of time deposits, in denominations of $250 thousand or more, was $14.1 million and $10.1 million at December 31, 2017 and 2016 , respectively. The Bank obtains certain deposits through the efforts of third-party brokers. At December 31, 2017 and 2016 , brokered deposits totaled $550 thousand and $601 thousand , respectively, and were included in time deposits on the Company’s consolidated financial statements. At December 31, 2017 , the scheduled maturities of time deposits were as follows (in thousands): 2018 $ 59,833 2019 26,929 2020 16,381 2021 12,454 2022 6,745 Thereafter 309 $ 122,651 |
Other Borrowings
Other Borrowings | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Other Borrowings | Other Borrowings The Bank had unused lines of credit totaling $134.1 million and $125.6 million available with non-affiliated banks at December 31, 2017 and 2016 , respectively. These amounts primarily consist of a blanket floating lien agreement with the Federal Home Loan Bank of Atlanta (FHLB) in which the Bank can borrow up to 19% of its total assets. The unused line of credit with FHLB totaled $82.1 million at December 31, 2017 . The Bank had collateral pledged on the borrowing line at December 31, 2017 and 2016 including real estate loans totaling $117.7 million and $103.9 million , respectively, and FHLB stock with a book value of $645 thousand and $623 thousand , respectively. The Bank did not have borrowings from the FHLB at December 31, 2017 and 2016 . |
Subordinated Debt
Subordinated Debt | 12 Months Ended |
Dec. 31, 2017 | |
Brokers and Dealers [Abstract] | |
Subordinated Debt | Subordinated Debt On October 30, 2015, the Company entered into a Subordinated Loan Agreement (the Agreement) pursuant to which the Company issued an interest only subordinated term note due 2025 in the aggregate principal amount of $5.0 million (the Note). The Note bears interest at a fixed rate of 6.75% per annum. The Note qualifies as Tier 2 capital for regulatory capital purposes and at December 31, 2017 , the total amount of subordinated debt issued was included in the Company’s Tier 2 capital. Unamortized debt issuance costs related to the Note were $52 thousand and $70 thousand at December 31, 2017 and 2016 , respectively. The Note has a maturity date of October 1, 2025 . Subject to regulatory approval, the Company may prepay the Note, in part or in full, beginning on October 30, 2020 . The Note is an unsecured, subordinated obligation of the Company and ranks junior in right of payment to the Company’s senior indebtedness and to the Company’s obligations to its general creditors. The Note ranks equally with all other unsecured subordinated debt, except any which by its terms is expressly stated to be subordinated to the Note. The Note ranks senior to all current and future junior subordinated debt obligations, preferred stock, and common stock of the Company. The Note is not convertible into common stock or preferred stock. The Agreement contains customary events of default such as the bankruptcy of the Company and the non-payment of principal or interest when due. The holder of the Note may accelerate the repayment of the Note only in the event of bankruptcy or similar proceedings and not for any other event of default. |
Junior Subordinated Debt
Junior Subordinated Debt | 12 Months Ended |
Dec. 31, 2017 | |
Other Liabilities and Financial Instruments Subject to Mandatory Redemption [Abstract] | |
Junior Subordinated Debt | Junior Subordinated Debt On June 8, 2004 , First National (VA) Statutory Trust II (Trust II), a wholly-owned subsidiary of the Company, was formed for the purpose of issuing redeemable capital securities, commonly known as trust preferred securities. On June 17, 2004 , $5.0 million of trust preferred securities were issued through a pooled underwriting. The securities have a LIBOR-indexed floating rate of interest. The interest rate at December 31, 2017 and 2016 was 4.20% and 3.59% , respectively. The securities have a mandatory redemption date of June 17, 2034 , and were subject to varying call provisions that began September 17, 2009. The principal asset of Trust II is $5.2 million of the Company’s junior subordinated debt with maturities and interest rates comparable to the trust preferred securities. The Trust’s obligations under the trust preferred securities are fully and unconditionally guaranteed by the Company. The Company is current on its interest payments on the junior subordinated debt. On July 24, 2006 , First National (VA) Statutory Trust III (Trust III), a wholly-owned subsidiary of the Company, was formed for the purpose of issuing redeemable capital securities. On July 31, 2006 , $4.0 million of trust preferred securities were issued through a pooled underwriting. The securities have a LIBOR-indexed floating rate of interest. The interest rate at December 31, 2017 and 2016 was 2.94% and 2.45% , respectively. The securities have a mandatory redemption date of October 1, 2036 , and were subject to varying call provisions that began October 1, 2011. The principal asset of Trust III is $4.1 million of the Company’s junior subordinated debt with maturities and interest rates comparable to the trust preferred securities. The Trust’s obligations under the trust preferred securities are fully and unconditionally guaranteed by the Company. The Company is current on its interest payments on the junior subordinated debt. While these securities are debt obligations of the Company, they are included in capital for regulatory capital ratio calculations. Under present regulations, the junior subordinated debt may be included in Tier 1 capital for regulatory capital adequacy purposes as long as their amount does not exceed 25% of Tier 1 capital, including total junior subordinated debt. The portion of the junior subordinated debt not considered as Tier 1 capital, if any, may be included in Tier 2 capital. At December 31, 2017 and December 31, 2016 , the total amount of junior subordinated debt issued by the Trusts was included in the Company’s Tier 1 capital. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company is subject to U.S. federal and Virginia income tax as well as bank franchise tax in the state of Virginia. With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years prior to 2014 . On December 22, 2017, the Tax Cuts and Jobs Act was enacted into law, which reduces the Company's corporate tax rate from 34% to 21%. When changes in tax rates and laws are enacted, the Company must recognize the effects of changes in tax rates on deferred tax balances in the period in which the enactment occurs. Accordingly, the Company recorded a $752 thousand charge to income tax expense in 2017 related to the re-measurement of net deferred tax assets resulting from the new 21% corporate tax rate. Net deferred tax assets consisted of the following components at December 31, 2017 and 2016 (in thousands): 2017 2016 Deferred Tax Assets Allowance for loan losses $ 1,118 $ 1,809 Securities available for sale 281 447 Accrued pension — 689 Accrued health insurance 11 — Core deposit intangible 317 371 Unvested stock-based compensation 9 19 Limited partnership investments 5 17 Loan origination fees, net 63 48 $ 1,804 $ 3,400 Deferred Tax Liabilities Depreciation $ 562 $ 708 Discount accretion — 2 Overfunded pension liability 27 — $ 589 $ 710 Net deferred tax assets $ 1,215 $ 2,690 The income tax expense for the years ended December 31, 2017 and 2016 consisted of the following (in thousands): 2017 2016 Current tax expense $ 2,443 $ 1,925 Deferred tax expense (1) 1,283 428 $ 3,726 $ 2,353 (1) The deferred tax expense for the year ended December 31, 2017 includes $752 thousand of income taxes related to the re-measurement of net deferred tax assets. The income tax expense differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income for the years ended December 31, 2017 and 2016 , due to the following (in thousands): 2017 2016 Computed tax expense at statutory federal rate $ 3,459 $ 2,808 Increase in income taxes resulting from re-measurement of net deferred tax assets 752 — Decrease in income taxes resulting from: Tax-exempt interest and dividend income (241 ) (254 ) Income from bank owned life insurance (244 ) (179 ) Other — (22 ) $ 3,726 $ 2,353 |
Funds Restrictions and Reserve
Funds Restrictions and Reserve Balance | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Funds Restrictions and Reserve Balance | Funds Restrictions and Reserve Balance Transfers of funds from the banking subsidiary to the parent company in the form of loans, advances, and cash dividends are restricted by federal and state regulatory authorities. At December 31, 2017 , the aggregate amount of unrestricted funds which could be transferred from the banking subsidiary to the parent company, without prior regulatory approval, totaled $4.5 million . The amount of unrestricted funds is generally determined by subtracting the total dividend payments of the Bank from the Bank’s net income for that year, combined with the Bank’s retained net income for the preceding two years. The Bank must maintain a reserve against its deposits in accordance with Regulation D of the Federal Reserve Act. For the final weekly reporting period in the years ended December 31, 2017 and 2016 , the aggregate amounts of daily average required balances were approximately $7.4 million and $6.0 million , respectively. |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans Pension Plan The Bank had a noncontributory, defined benefit pension plan for all full-time employees over 21 years of age with at least one year of credited service and hired prior to May 1, 2011. Effective May 1, 2011, the plan was frozen to new participants. Only individuals employed on or before April 30, 2011 were eligible to become participants in the plan upon satisfaction of the eligibility requirements. Benefits were generally based upon years of service and average compensation for the five highest-paid consecutive years of service. The Bank’s funding practice was to make at least the minimum required annual contribution permitted by the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code of 1986, as amended. On September 14, 2016, the defined benefit pension plan was amended to be terminated. Under the amendment, benefit accruals ceased as of November 30, 2016. The Internal Revenue Service approved the termination on October 16, 2017 and the Company distributed all plan assets on March 8, 2018. The funding status of the plan on March 8, 2018 was not significantly different from the funded status disclosed in the table below. The benefit obligation and the fair value of assets did not change significantly prior to the distribution of plan assets. Pension plan assets remained in cash and equivalents through the distribution date. The following tables provide a reconciliation of the changes in the plan benefit obligation and the fair value of assets for the periods ended December 31, 2017 and 2016 (in thousands). 2017 2016 Change in Benefit Obligation Benefit obligation, beginning of year $ 5,777 $ 8,107 Service cost — 410 Interest cost 82 331 Actuarial (gain) loss (145 ) 245 Benefits paid (431 ) (695 ) Gain due to curtailment — (2,621 ) Benefit obligation, end of year $ 5,283 $ 5,777 Changes in Plan Assets Fair value of plan assets, beginning of year $ 3,693 $ 4,264 Actual return on plan assets 16 124 Employer contributions 1,800 — Benefits paid (431 ) (695 ) Fair value of assets, end of year $ 5,078 $ 3,693 Funded Status, end of year $ (205 ) $ (2,084 ) Amount Recognized in Other Liabilities $ (205 ) $ (2,084 ) Amounts Recognized in Accumulated Other Comprehensive Loss, net of tax Net gain $ (126 ) $ — Deferred income tax expense 27 — Amount recognized $ (99 ) $ — Weighted Average Assumptions Used to Determine Benefit Obligation Discount rate used for disclosure First five years 1.96 % 1.47 % Five years to twenty years 3.58 % 3.34 % After twenty years 4.35 % 4.30 % Expected return on plan assets 1.00 % 7.50 % Rate of compensation increase N/A 3.00 % Components of Net Periodic Benefit Cost Service cost $ — $ 410 Interest cost 82 331 Expected return on plan assets (35 ) (297 ) Recognized net gain due to curtailment — (173 ) Recognized net actuarial loss — 84 Net periodic benefit cost $ 47 $ 355 Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss) Net gain $ (126 ) $ (2,115 ) Total recognized in other comprehensive income (loss) $ (126 ) $ (2,115 ) Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income (Loss) $ (79 ) $ (1,760 ) 2017 2016 Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost Discount rate 1.47 % 4.25 % Expected return on plan assets 1.00 % 7.50 % Rate of compensation increase N/A 3.00 % The plan sponsor selected the expected rate of return on assets assumption in consultation with their investment advisors and actuary. This rate was intended to reflect the average rate of earnings expected to be earned on the funds invested or to be invested to provide plan benefits. Because assets were held in a qualified trust, anticipated returns were not reduced for taxes. Further, solely for this purpose, the plan was assumed to continue in force and not terminate during the period during which assets were invested. However, consideration was given to the potential impact of current and future investment policy, cash flow into and out of the trust, and expenses (both investment and non-investment) typically paid from plan assets (to the extent such expenses are not explicitly estimated within periodic cost). The process used to select the discount rate assumption took into account the benefit cash flow and the segmented yields on high-quality corporate bonds that were available to provide for the payment of the benefit cash flow. A single effective discount rate was then established that produced an equivalent discounted present value. The pension plan’s weighted-average asset allocations at the end of the plan year for 2017 and 2016 , by asset category were as follows: 2017 2016 Asset Category Cash and equivalents 100 % 100 % Total 100 % 100 % It was the responsibility of the trustee to administer the investments of the trust within reasonable costs, being careful to avoid sacrificing quality. These costs included, but were not limited to, management and custodial fees, consulting fees, transaction costs, and other administrative costs chargeable to the trust. The pension financial instruments measured and reported at fair value were classified and disclosed in one of the following categories: • Level 1 Inputs to the valuation methodology were quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2 Inputs to the valuation methodology included quoted prices for similar assets and liabilities in active markets, and inputs that were observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. • Level 3 Inputs to the valuation methodology were unobservable and significant to the fair value measurement. The following tables set forth by level, within the fair value hierarchy, the Company’s pension plan assets at fair value as of December 31, 2017 and 2016 (in thousands): Fair Value Measurements at December 31, 2017 Total Level 1 Level 2 Level 3 Cash and equivalents $ 5,078 $ 5,078 $ — $ — Total $ 5,078 $ 5,078 $ — $ — Fair Value Measurements at December 31, 2016 Total Level 1 Level 2 Level 3 Cash and equivalents $ 3,693 $ 3,693 $ — $ — Total $ 3,693 $ 3,693 $ — $ — The Company made a cash contribution of $1.8 million during the year ended December 31, 2017 . The Company did not make a cash contribution during the year ended December 31, 2016 . The Company made an additional contribution of $205 thousand upon the final distribution of plan assets on March 8, 2018. The accumulated benefit obligation for the defined benefit pension plan was $5.3 million and $5.8 million at December 31, 2017 and 2016 , respectively. 401(k) Plan The Company maintains a 401(k) plan for all eligible employees. Participating employees may elect to contribute up to the maximum percentage allowed by the Internal Revenue Service, as defined in the plan. The Company makes matching contributions, on a dollar-for dollar basis, for the first one percent of an employee’s compensation contributed to the Plan and fifty cents for each dollar of the employee’s contribution between two percent and six percent . The Company also makes an additional contribution based on years of service to participants who have completed at least one thousand hours of service during the year and who are employed on the last day of the Plan Year. All employees who are age nineteen or older are eligible. Employee contributions vest immediately. Employer matching contributions vest after two plan service years with the Company. The Company has the discretion to make a profit sharing contribution to the plan each year based on overall performance, profitability, and other economic factors. For the years ended December 31, 2017 and 2016 , expense attributable to the Plan amounted to $740 thousand and $482 thousand , respectively. Employee Stock Ownership Plan On January 1, 2000, the Company established an employee stock ownership plan. The ESOP provides an opportunity for the Company to award shares of First National Corporation stock to employees at its discretion. Employees are eligible to participate in the ESOP effective immediately upon beginning service with the Company. Participants become 100% vested after two years of credited service. The Board of Directors may make discretionary contributions, within certain limitations prescribed by federal tax regulations. There was no compensation expense for the ESOP for the years ended December 31, 2017 and 2016 . Shares of the Company held by the ESOP at December 31, 2017 and 2016 were 230,846 and 247,283 , respectively. On September 14, 2016, the ESOP was amended to freeze the plan to new participants and to cease all contributions, effective December 31, 2016. The amendment also directs matching contributions and certain other retirement contributions made by the Company to the 401(k) plan. The ESOP shall be maintained as a frozen plan and continue to be invested in Company stock and such other assets as permitted under the ESOP and Trust Agreement for the benefit of participants and their beneficiaries. |
Earnings per Common Share
Earnings per Common Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per Common Share Basic earnings per common share represents income available to common shareholders divided by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. The following table presents the computation of basic and diluted earnings per share for the years ended December 31, 2017 and 2016 (dollars in thousands, except per share data): 2017 2016 (Numerator): Net income $ 6,448 $ 5,907 (Denominator): Weighted average shares outstanding – basic 4,941,233 4,924,636 Potentially dilutive common shares – restricted stock units 2,665 3,548 Weighted average shares outstanding – diluted 4,943,898 4,928,184 Income per common share Basic $ 1.30 $ 1.20 Diluted $ 1.30 $ 1.20 |
Commitments and Unfunded Credit
Commitments and Unfunded Credits | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Unfunded Credits | Commitments and Unfunded Credits The Company, through its banking subsidiary, is a party to credit related financial instruments with risk not reflected in the consolidated financial statements in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, standby letters of credit, and commercial letters of credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The Bank’s exposure to credit loss is represented by the contractual amount of these commitments. The Bank follows the same credit policies in making commitments as it does for on-balance-sheet instruments. At December 31, 2017 and 2016 , the following financial instruments were outstanding whose contract amounts represent credit risk (in thousands): 2017 2016 Commitments to extend credit and unfunded commitments under lines of credit $ 77,992 $ 71,421 Stand-by letters of credit 10,379 8,983 Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The commitments for lines of credit may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Bank, is based on management’s credit evaluation of the customer. Unfunded commitments under commercial lines of credit, revolving credit lines, and overdraft protection agreements are commitments for possible future extensions of credit to existing customers. These lines of credit are collateralized as deemed necessary and usually do not contain a specified maturity date and may or may not be drawn upon to the total extent to which the Bank is committed. Commercial and standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Essentially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank generally holds collateral supporting those commitments if deemed necessary. At December 31, 2017 , the Bank had $2.8 million in locked-rate commitments to originate mortgage loans and $438 thousand in loans held for sale. Risks arise from the possible inability of counterparties to meet the terms of their contracts. The Bank does not expect any counterparty to fail to meet its obligations. The Bank has cash accounts in other commercial banks. The amount on deposit at these banks at December 31, 2017 exceeded the insurance limits of the Federal Deposit Insurance Corporation by $11 thousand . |
Transactions with Related Parti
Transactions with Related Parties | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | Transactions with Related Parties During the year, executive officers and directors (and companies controlled by them) were customers of and had transactions with the Company in the normal course of business. In management’s opinion, these transactions were made on substantially the same terms as those prevailing for other customers. At December 31, 2017 and 2016 , these loans totaled $225 thousand and $148 thousand , respectively. During 2017 , total principal additions were $99 thousand and total principal payments were $22 thousand . Deposits from related parties held by the Bank at December 31, 2017 and 2016 amounted to $4.5 million and $5.6 million , respectively. |
Lease Commitments
Lease Commitments | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Lease Commitments | Lease Commitments The Company was obligated under noncancelable leases for banking premises. Total rental expense for operating leases for 2017 and 2016 was $105 thousand and $90 thousand , respectively. Minimum rental commitments under noncancelable leases with terms in excess of one year as of December 31, 2017 were as follows (in thousands): Operating Leases 2018 $ 124 2019 102 2020 79 2021 74 2022 and thereafter 54 $ 433 |
Dividend Reinvestment Plan
Dividend Reinvestment Plan | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Dividend Reinvestment Plan | Dividend Reinvestment Plan The Company has in effect a Dividend Reinvestment Plan (DRIP) which provides an automatic conversion of dividends into common stock for enrolled shareholders. The Company may issue common shares to the DRIP or purchase on the open market. Common shares are purchased at a price which is based on the average closing prices of the shares as quoted on the Over-the-Counter Markets Group exchange for the 10 business days immediately preceding the dividend payment date. The Company issued 3,035 and 3,949 common shares to the DRIP during the years ended December 31, 2017 and 2016 , respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Determination of Fair Value The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. In accordance with the “Fair Value Measurement and Disclosures” topic of FASB ASC, the fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon 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. The fair value guidance provides a consistent definition of fair value, which focuses on exit price in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires the use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions. Fair Value Hierarchy In accordance with this guidance, the Company groups its assets and liabilities generally measured at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. Level 1 – Valuation is based on quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 assets and liabilities generally include debt and equity securities that are traded in an active exchange market. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2 – Valuation is based on inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The valuation may be based on quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. Level 3 – Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which determination of fair value requires a significant management judgment or estimation. An instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following describes the valuation techniques used by the Company to measure certain assets recorded at fair value on a recurring basis in the financial statements: Securities available for sale Securities available for sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, when available (Level 1). If quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable market data. Third party vendors compile prices from various sources and may determine the fair value of identical or similar securities by using pricing models that consider observable market data (Level 2). The following tables present the balances of assets measured at fair value on a recurring basis as of December 31, 2017 and 2016 (in thousands). Fair Value Measurements at December 31, 2017 Description Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Securities available for sale U.S. agency and mortgage-backed securities $ 74,804 $ — $ 74,804 $ — Obligations of states and political subdivisions 14,451 — 14,451 — $ 89,255 $ — $ 89,255 $ — Fair Value Measurements at December 31, 2016 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Securities available for sale U.S. agency and mortgage-backed securities $ 80,171 $ — $ 80,171 $ — Obligations of states and political subdivisions 14,620 — 14,620 — Corporate equity securities 11 11 — — $ 94,802 $ 11 $ 94,791 $ — Certain assets are measured at fair value on a nonrecurring basis in accordance with GAAP. Adjustments to the fair value of these assets usually result from the application of lower-of-cost-or-market accounting or write-downs of individual assets. The following describes the valuation techniques used by the Company to measure certain assets recorded at fair value on a nonrecurring basis in the financial statements: Loans held for sale Loans held for sale are carried at the lower of cost or market value. These loans currently consist of one-to-four family residential loans originated for sale in the secondary market. Fair value is based on the price secondary markets are currently offering for similar loans using observable market data which is not materially different than cost due to the short duration between origination and sale (Level 2). As such, the Company records any fair value adjustments on a nonrecurring basis. No nonrecurring fair value adjustments were recorded on loans held for sale during the years ended December 31, 2017 and 2016 . Impaired Loans Loans are designated as impaired when, in the judgment of management based on current information and events, it is probable that all amounts due according to the contractual terms of the loan agreements will not be collected. The measurement of loss associated with impaired loans can be based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the observable market price of the loan, or the fair value of the collateral less estimated costs to sell. Collateral may be in the form of real estate or business assets including equipment, inventory, and accounts receivable. The vast majority of the Company’s collateral is real estate. The value of real estate collateral is determined utilizing a market valuation approach based on an appraisal conducted by an independent, licensed appraiser using observable market data (Level 2) within the last twelve months . However, if the collateral is a house or building in the process of construction or if an appraisal of the property is more than one year old and not solely based on observable market comparables or management determines the fair value of the collateral is further impaired below the appraised value, then a Level 3 valuation is considered to measure the fair value. The value of business equipment is based upon an outside appraisal, of one year or less, if deemed significant, or the net book value on the applicable business’s financial statements if not considered significant using observable market data. Likewise, values for inventory and accounts receivables collateral are based on financial statement balances or aging reports (Level 3). Impaired loans allocated to the allowance for loan losses are measured at fair value on a nonrecurring basis. Any fair value adjustments are recorded in the period incurred as provision for loan losses on the Consolidated Statements of Income. Other real estate owned Loans are transferred to other real estate owned when the collateral securing them is foreclosed on or acquired through a deed in lieu of foreclosure. The measurement of loss associated with other real estate owned is based on the appraisal documents and assessed the same way as impaired loans described above. Any fair value adjustments are recorded in the period incurred as other real estate owned income on the Consolidated Statements of Income. The following tables summarize the Company’s assets that were measured at fair value on a nonrecurring basis as of December 31, 2017 and 2016 (dollars in thousands). Fair Value Measurements at December 31, 2017 Description. Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Other real estate owned $ 326 $ — $ — $ 326 Fair Value Measurements at December 31, 2016 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Impaired loans, net $ 116 $ — $ — $ 116 Other real estate owned 250 — — 250 Quantitative information about Level 3 Fair Value Measurements for December 31, 2017 Fair Value Valuation Technique Unobservable Input Range (Weighted- Other real estate owned $ 326 Contract Price Selling cost 7 % Quantitative information about Level 3 Fair Value Measurements for December 31, 2016 Fair Value Valuation Technique Unobservable Input Range (Weighted- Impaired loans, net $ 116 Property appraisals Selling cost 10 % Other real estate owned $ 250 Property appraisals Selling cost — % The amount disclosed as fair value of other real estate owned at December 31, 2016 represents the carrying value of the property. Since the appraised value of the property, net of selling costs, exceeded the Company’s carrying value on the date the property was transferred from premises and equipment to other real estate owned, the Company did not adjust the carrying value for selling costs. Accounting guidance requires disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis. The methodologies for estimating the fair value of financial assets and financial liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above. The methodologies for other financial assets and financial liabilities are discussed below: Cash and Cash Equivalents and Federal Funds Sold The carrying amounts of cash and short-term instruments approximate fair values. Securities Held to Maturity Certain debt securities that management has the positive intent and ability to hold until maturity are recorded at amortized cost. Fair values are determined in a manner that is consistent with securities available for sale. Restricted Securities The carrying value of restricted securities approximates fair value based on redemption provisions. Loans For variable-rate loans that re-price frequently and with no significant change in credit risk, fair values are based on carrying values. Fair values for all other loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Fair values for non-performing loans are estimated using discounted cash flow analyses or underlying collateral values, where applicable. Deposit Liabilities The fair value of demand deposits, savings accounts, and certain money market deposits is the amount payable on demand at the reporting date. The fair value of fixed-rate certificates of deposit is estimated using the rates currently offered for deposits of similar remaining maturities. Accrued Interest Accrued interest receivable and payable were estimated to equal the carrying value due to the short-term nature of these financial instruments. Borrowings and Federal Funds Purchased The carrying amounts of federal funds purchased and other short-term borrowings maturing within ninety days approximate their fair values. Fair values of all other borrowings are estimated using discounted cash flow analyses based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. Bank Owned Life Insurance Bank owned life insurance represents insurance policies on officers, directors, and past directors of the Company. The cash values of these policies are estimates using information provided by insurance carriers. These policies are carried at their cash surrender value, which approximates the fair value. Commitments and Unfunded Credits The fair value of commitments to extend credit is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties. For fixed-rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates. The fair value of stand-by letters of credit is based on fees currently charged for similar agreements or on the estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date. At December 31, 2017 and 2016 , fair value of loan commitments and standby letters of credit was immaterial. The carrying values and estimated fair values of the Company’s financial instruments at December 31, 2017 and 2016 are as follows (in thousands): Fair Value Measurements at December 31, 2017 Using Carrying Amount Quoted Prices in Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Fair Value Financial Assets Cash and short-term investments $ 39,986 $ 39,986 $ — $ — $ 39,986 Securities available for sale 89,255 — 89,255 — 89,255 Securities held to maturity 48,208 — 46,186 1,516 47,702 Restricted securities 1,570 — 1,570 — 1,570 Loans held for sale 438 — 438 — 438 Loans, net 516,875 — — 514,013 514,013 Bank owned life insurance 13,967 — 13,967 — 13,967 Accrued interest receivable 1,916 — 1,916 — 1,916 Financial Liabilities Deposits $ 664,980 $ — $ 542,329 $ 120,834 $ 663,163 Subordinated debt 4,948 — — 5,004 5,004 Junior subordinated debt 9,279 — — 9,653 9,653 Accrued interest payable 98 — 98 — 98 Fair Value Measurements at December 31, 2016 Using Carrying Amount Quoted Prices in Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Fair Value Financial Assets Cash and short-term investments $ 41,092 $ 41,092 $ — $ — $ 41,092 Securities available for sale 94,802 11 94,791 — 94,802 Securities held to maturity 53,398 — 51,223 1,486 52,709 Restricted securities 1,548 — 1,548 — 1,548 Loans held for sale 337 — 337 — 337 Loans, net 480,746 — — 481,475 481,475 Bank owned life insurance 13,928 — 13,928 — 13,928 Accrued interest receivable 1,746 — 1,746 — 1,746 Financial Liabilities Deposits $ 645,570 $ — $ 517,143 $ 127,179 $ 644,322 Subordinated debt 4,930 — — 4,715 4,715 Junior subordinated debt 9,279 — — 9,075 9,075 Accrued interest payable 95 — 95 — 95 The Company assumes interest rate risk (the risk that general interest rate levels will change) as a result of its normal operations. As a result, the fair values of the Company’s financial instruments will change when interest rate levels change and that change may be either favorable or unfavorable to the Company. Management attempts to match maturities of assets and liabilities to the extent believed necessary to minimize interest rate risk. However, borrowers with fixed rate obligations are less likely to prepay in a rising rate environment and more likely to prepay in a falling rate environment. Conversely, depositors who are receiving fixed rates are more likely to withdraw funds before maturity in a rising rate environment and less likely to do so in a falling rate environment. Management monitors rates and maturities of assets and liabilities and attempts to minimize interest rate risk by adjusting terms of new loans and deposits and by investing in securities with terms that mitigate the Company’s overall interest rate risk. |
Regulatory Matters
Regulatory Matters | 12 Months Ended |
Dec. 31, 2017 | |
Regulatory Capital Requirements [Abstract] | |
Regulatory Matters | Regulatory Matters The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of their 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. Prompt corrective action provisions are not applicable to bank holding companies. The final rules implementing the Basel Committee on Banking Supervision’s capital guidelines for U.S. banks (Basel III rules) became effective January 1, 2015, with full compliance of all the requirements being phased in over a multi-year schedule, and becoming fully phased in by January 1, 2019. As part of the new requirements, the common equity Tier 1 capital ratio is calculated and utilized in the assessment of capital for all institutions. The final rules also established a “capital conservation buffer” above the new regulatory minimum capital requirements. The capital conservation buffer is being phased-in over four years , which began on January 1, 2016. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the following table) of total (as defined in the regulations), Tier 1 (as defined), and common equity Tier 1 capital (as defined) to risk-weighted assets (as defined), and of Tier 1 capital to average assets. Management believes, as of December 31, 2017 and December 31, 2016 , that the Bank met all capital adequacy requirements to which it is subject. As of December 31, 2017 , the most recent notification from the Federal Reserve Bank categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum risk-based capital and leverage ratios as set forth in the following table. There are no conditions or events since that notification that management believes have changed the Bank’s category. The Bank declared and paid cash dividends on common stock to the Company totaling $5.5 million during 2017. A comparison of the capital of the Bank at December 31, 2017 and December 31, 2016 with the minimum regulatory guidelines were as follows (dollars in thousands): Actual Minimum Capital Requirement Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio December 31, 2017: Total Capital (to Risk-Weighted Assets) $ 67,624 13.12 % $ 41,239 8.00 % $ 51,548 10.00 % Tier 1 Capital (to Risk-Weighted Assets) $ 62,298 12.09 % $ 30,929 6.00 % $ 41,239 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 62,298 12.09 % $ 23,197 4.50 % $ 33,506 6.50 % Tier 1 Capital (to Average Assets) $ 62,298 8.46 % $ 29,457 4.00 % $ 36,821 5.00 % December 31, 2016: Total Capital (to Risk-Weighted Assets) $ 65,590 13.47 % $ 38,951 8.00 % $ 48,689 10.00 % Tier 1 Capital (to Risk-Weighted Assets) $ 60,269 12.38 % $ 29,213 6.00 % $ 38,951 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 60,269 12.38 % $ 21,910 4.50 % $ 31,648 6.50 % Tier 1 Capital (to Average Assets) $ 60,269 8.48 % $ 28,432 4.00 % $ 35,540 5.00 % In addition to the regulatory minimum risk-based capital amounts presented above, the Bank must maintain a capital conservation buffer as required by the Basel III final rules. The buffer began applying to the Bank on January 1, 2016, and is subject to phase-in from 2016 to 2019 in equal annual installments of 0.625% . Accordingly, the Bank was required to maintain a capital conservation buffer of 1.25% and 0.625% at December 31, 2017 and December 31, 2016 , respectively. Under the final rules, an institution is subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses if its capital level falls below the buffer amount. As of December 31, 2017 and December 31, 2016 , the capital conservation buffer of the Bank was 5.12% and 5.47% , respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Changes in each component of accumulated other comprehensive loss were as follows (in thousands): Net Unrealized Losses on Securities Adjustments Related to Pension Benefits Accumulated Other Comprehensive Loss Balance at December 31, 2015 $ (192 ) $ (1,396 ) $ (1,588 ) Unrealized holding losses (net of tax, ($341)) (663 ) — (663 ) Reclassification adjustment (net of tax, ($3)) (5 ) — (5 ) Pension liability adjustment (net of tax, $719) — 1,396 1,396 Change during period (668 ) 1,396 728 Balance at December 31, 2016 $ (860 ) $ — $ (860 ) Unrealized holding losses (net of tax, ($43)) (82 ) — (82 ) Reclassification adjustment (net of tax, $31) 59 — 59 Pension liability adjustment (net of tax, $43) — 83 83 Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change (174 ) 16 (158 ) Change during period (197 ) 99 (98 ) Balance at December 31, 2017 $ (1,057 ) $ 99 $ (958 ) The following table presents information related to reclassifications from accumulated other comprehensive loss for the years ended December 31, 2017 and 2016 (in thousands): Details About Accumulated Other Comprehensive Loss Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Consolidated Statements of Income For the year ended December 31, 2017 2016 Securities available for sale: Net securities losses (gains) reclassified into earnings $ 90 $ (8 ) Net (losses) gains on securities available for sale Related income tax (benefit) expense (31 ) 3 Income tax expense Total reclassifications $ 59 $ (5 ) Net of tax |
Stock Compensation Plans
Stock Compensation Plans | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation Plans | Stock Compensation Plans On May 13, 2014, the Company’s shareholders approved the First National Corporation 2014 Stock Incentive Plan, which makes available up to 240,000 shares of common stock for the granting of stock options, restricted stock awards, stock appreciation rights, and other stock-based awards. Awards are made at the discretion of the Board of Directors and compensation cost equal to the fair value of the award is recognized over the vesting period. Stock Awards Whenever the Company deems it appropriate to grant a stock award, the recipient receives a specified number of unrestricted shares of employer stock. Stock awards may be made by the Company at its discretion without cash consideration and may be granted as settlement of a performance-based compensation award. During 2017 , the Company granted and issued 2,000 shares of common stock to the Chief Executive Officer for his individual performance and dedicated service to the Company and 2,728 shares of common stock to members of the Board of Directors for their dedicated service and support. Compensation expense related to stock awards totaled $72 thousand and $25 thousand for the years ended December 31, 2017 and 2016 , respectively. Restricted Stock Units Restricted stock units are an award of units that correspond in number and value to a specified number of shares of employer stock which the recipient receives according to a vesting plan and distribution schedule after achieving required performance milestones or upon remaining with the employer for a particular length of time. Each restricted stock unit that vests entitles the recipient to receive one share of common stock on a specified issuance date. In 2017 , 3,939 restricted stock units were granted to employees, with 1,317 units vesting immediately and 2,622 units subject to a two year vesting schedule with one half of the units vesting each year on the grant date anniversary. The recipient does not have any stockholder rights, including voting, dividend, or liquidation rights, with respect to the shares underlying awarded restricted stock units until vesting has occurred and the recipient becomes the record holder of those shares. The unvested restricted stock units will vest on the established schedule if the employees remain employed by the Company on future vesting dates. A summary of the activity for the Company’s restricted stock units for the period indicated is presented in the following table: 2017 Shares Weighted Average Grant Date Fair Value Unvested, January 1, 2017 10,259 $ 8.88 Granted 3,939 15.20 Vested (8,536 ) 9.89 Forfeited — — Unvested, December 31, 2017 5,662 $ 11.76 At December 31, 2017 , based on restricted stock unit awards outstanding at that time, the total unrecognized pre-tax compensation expense related to unvested restricted stock unit awards was $25 thousand . This expense is expected to be recognized through 2019 . Compensation expense related to restricted stock unit awards recognized for the years ended December 31, 2017 and 2016 totaled $69 thousand and $88 thousand , respectively. As of December 31, 2017 , the Company did not expect the forfeiture of any unvested restricted stock units. |
Parent Company Only Financial S
Parent Company Only Financial Statements | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Parent Company Only Financial Statements | Parent Company Only Financial Statements FIRST NATIONAL CORPORATION (Parent Company Only) Balance Sheets December 31, 2017 and 2016 (in thousands) 2017 2016 Assets Cash $ 9,964 $ 5,690 Investment in subsidiaries, at cost, plus undistributed net income 62,094 60,344 Other assets 327 335 Total assets $ 72,385 $ 66,369 Liabilities and Shareholders’ Equity Subordinated debt $ 4,948 $ 4,930 Junior subordinated debt 9,279 9,279 Other liabilities 4 9 Total liabilities $ 14,231 $ 14,218 Preferred stock $ — $ — Common stock 6,182 6,162 Surplus 7,260 7,093 Retained earnings 45,670 39,756 Accumulated other comprehensive loss, net (958 ) (860 ) Total shareholders’ equity $ 58,154 $ 52,151 Total liabilities and shareholders’ equity $ 72,385 $ 66,369 FIRST NATIONAL CORPORATION (Parent Company Only) Statements of Income Years Ended December 31, 2017 and 2016 (in thousands) 2017 2016 Income Dividends from subsidiary $ 5,500 $ 2,325 Other income 13 — Total income $ 5,513 $ 2,325 Expense Interest expense $ 663 $ 620 Marketing 13 — Supplies 3 2 Legal and professional fees 113 104 Data processing 62 61 Management fee-subsidiary 265 258 Other expense 8 17 Total expense $ 1,127 $ 1,062 Income before allocated tax benefits and undistributed income of subsidiary $ 4,386 $ 1,263 Allocated income tax benefit 379 361 Income before equity in undistributed income of subsidiary $ 4,765 $ 1,624 Equity in undistributed income of subsidiary 1,683 4,283 Net income $ 6,448 $ 5,907 FIRST NATIONAL CORPORATION (Parent Company Only) Statements of Cash Flows Years Ended December 31, 2017 and 2016 (in thousands) 2017 2016 Cash Flows from Operating Activities Net income $ 6,448 $ 5,907 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed income of subsidiary (1,683 ) (4,283 ) Amortization of debt issuance costs 18 17 (Increase) decrease in other assets (3 ) 74 Decrease in other liabilities (1 ) — Net cash provided by operating activities $ 4,779 $ 1,715 Cash Flows from Financing Activities Cash dividends paid on common stock, net of reinvestment $ (646 ) $ (550 ) Net proceeds from issuance of common stock 141 113 Net cash used in financing activities $ (505 ) $ (437 ) Increase in cash and cash equivalents $ 4,274 $ 1,278 Cash and Cash Equivalents Beginning 5,690 4,412 Ending $ 9,964 $ 5,690 |
Nature of Banking Activities 33
Nature of Banking Activities and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of First National Corporation include the accounts of all six companies. All material intercompany balances and transactions have been eliminated in consolidation, except for balances and transactions related to the Trusts. The subordinated debt of these Trusts is reflected as a liability of the Company. |
Use of Estimates | Use of Estimates In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated 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, valuation of other real estate owned, valuation of core deposit intangibles, and other-than-temporary impairment of securities. |
Significant Group Concentrations of Credit Risk | Significant Group Concentrations of Credit Risk Most of the Company’s activities are with customers located within the Shenandoah Valley and central regions of Virginia. The types of lending that the Company engages in are included in Note 3. The Company has a concentration of credit risk in commercial real estate, but does not have a significant concentration to any one customer or industry. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the consolidated statements of cash flows, the Company has defined cash equivalents as those amounts included in the balance sheet captions “Cash and due from banks” and “Interest-bearing deposits in banks.” |
Securities | Securities Investments in debt securities with readily determinable fair values are classified as either held to maturity (HTM), available for sale (AFS), or trading based on management’s intent. Currently, all of the Company’s debt securities are classified as either AFS or HTM. Equity investments in the FHLB, the Federal Reserve Bank of Richmond, and Community Bankers Bank are separately classified as restricted securities and are carried at cost. AFS securities are carried at estimated fair value with the corresponding unrealized gains and losses excluded from earnings and reported in other comprehensive income (loss), and HTM securities are carried at amortized cost. When an individual AFS security is sold, the Company releases the income tax effects associated with the AFS security from accumulated other comprehensive loss. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains or losses on the sale of securities are recorded on the trade date using the amortized cost of the specific security sold. Impairment of securities occurs when the fair value of a security is less than its amortized cost. For debt securities, impairment is considered other-than-temporary and recognized in its entirety in net income if either the Company (1) intends to sell the security or (2) it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If, however, the Company does not intend to sell the security and it is not more-than-likely that it will be required to sell the security before recovery, the Company must determine what portion of the impairment is attributable to a credit loss, which occurs when the amortized cost of the security exceeds the present value of the cash flows expected to be collected from the security. If there is no credit loss, there is no other-than-temporary impairment. If there is a credit loss, other-than-temporary impairment exists, and the credit loss must be recognized in net income and the remaining portion of impairment must be recognized in other comprehensive income (loss). For equity securities carried at cost, such as restricted securities, impairment is considered to be other-than-temporary based on the Company’s ability and intent to hold the investment until a recovery of fair value. Other-than-temporary impairment of an equity security results in a write-down that must be included in income. The Company regularly reviews each security for other-than-temporary impairment based on criteria that include the extent to which cost exceeds market price, the duration of that market decline, the financial health of and specific prospects for the issuer, the best estimate of the present value of cash flows expected to be collected from debt securities, the Company’s intention with regard to holding the security to maturity, and the likelihood that the Company would be required to sell the security before recovery. |
Loans Held for Sale | Loans Held for Sale Loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or estimated fair value. The Company, through its banking subsidiary, requires a firm purchase commitment from a permanent investor before loans held for sale can be closed, thus limiting interest rate risk. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. The Bank enters into commitments to originate mortgage loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). Rate lock commitments on mortgage loans that are intended to be sold are considered to be derivatives. The period of time between issuance of a loan commitment and closing and sale of the loan generally ranges from 30 to 60 days . The Bank protects itself from changes in interest rates through the use of best efforts forward delivery commitments, whereby the Bank commits to sell a loan at the time the borrower commits to an interest rate with the intent that the buyer has assumed interest rate risk on the loan. As a result, the Bank is not exposed to losses nor will it realize significant gains related to its rate lock commitments due to changes in interest rates. The correlation between the rate lock commitments and the best efforts contracts is very high due to their similarity. The market value of rate lock commitments and best efforts contracts is not readily ascertainable with precision because rate lock commitments and best efforts contracts are not actively traded in stand-alone markets. The Bank determines the fair value of rate lock commitments and best efforts contracts by measuring the change in the value of the underlying asset while taking into consideration the probability that the rate lock commitments will close. Because of the high correlation between rate lock commitments and best efforts contracts, no gain or loss occurs on the rate lock commitments. |
Loans | Loans The Company, through its banking subsidiary, grants mortgage, commercial, and consumer loans to customers. The Bank segments its loan portfolio into real estate loans, commercial and industrial loans, and consumer and other loans. Real estate loans are further divided into the following classes: Construction and Land Development; 1-4 Family Residential; and Other Real Estate Loans. Descriptions of the Company’s loan classes are as follows: Real Estate Loans – Construction and Land Development : The Company originates construction loans for the acquisition and development of land and construction of commercial buildings, condominiums, townhomes, and one-to-four family residences. Real Estate Loans – 1-4 Family : This class of loans includes loans secured by one-to-four family homes. In addition to traditional residential mortgage loans secured by a first or junior lien on the property, the Bank offers home equity lines of credit. Real Estate Loans – Other : This loan class consists primarily of loans secured by various types of commercial real estate typically in the Bank’s market area, including multi-family residential buildings, office and retail buildings, industrial and warehouse buildings, hotels, and religious facilities. Commercial and Industrial Loans: Commercial loans may be unsecured or secured with non-real estate commercial property. The Company's banking subsidiary makes commercial loans to businesses located within its market area and also to businesses outside of its market area through loan participations with other financial institutions. Consumer and Other Loans : Consumer loans include all loans made to individuals for consumer or personal purposes. They include new and used automobile loans, unsecured loans, and lines of credit. The Company's banking subsidiary makes consumer loans to individuals located within its market area and also to individuals outside of its market through the purchase of loans from another financial institution. A substantial portion of the loan portfolio is represented by residential and commercial loans secured by real estate throughout the Bank's market area. The ability of the Bank’s debtors to honor their contracts may be impacted by the real estate and general economic conditions in this area. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal balances less the allowance for loan losses and any deferred fees or costs on originated loans. Interest income is accrued and credited to income based on the unpaid principal balance. Loan origination fees, net of certain origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method. A loan’s past due status is based on the contractual due date of the most delinquent payment due. Loans are generally placed on non-accrual status when the collection of principal or interest is 90 days or more past due, or earlier, if collection is uncertain based on an evaluation of the net realizable value of the collateral and the financial strength of the borrower. Loans greater than 90 days past due may remain on accrual status if management determines it has adequate collateral to cover the principal and interest. For those loans that are carried on non-accrual status, payments are first applied to principal outstanding. A loan may be returned to accrual status if the borrower has demonstrated a sustained period of repayment performance in accordance with the contractual terms of the loan and there is reasonable assurance the borrower will continue to make payments as agreed. These policies are applied consistently across the loan portfolio. All interest accrued but not collected for loans that are placed on non-accrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. When a loan is returned to accrual status, interest income is recognized based on the new effective yield to maturity of the loan. Any unsecured loan that is deemed uncollectible is charged-off in full. Any secured loan that is considered by management to be uncollectible is partially charged-off and carried at the fair value of the collateral less estimated selling costs. This charge-off policy applies to all loan segments. |
Impaired Loans | Impaired Loans A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value (net of selling costs), and the probability of collecting scheduled principal and interest payments when due. Additionally, management generally evaluates substandard and doubtful loans greater than $250 thousand for impairment. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair market value of the collateral, net of selling costs, if the loan is collateral dependent. Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. Accordingly, the Company typically does not separately identify individual consumer, residential, and certain small commercial loans that are less than $250 thousand for impairment disclosures, except for troubled debt restructurings (TDRs) as noted below. |
Troubled Debt Restructurings (TDR) | Troubled Debt Restructurings (TDR) In situations where, for economic or legal reasons related to a borrower’s financial condition, management grants a concession to the borrower that it would not otherwise consider, the related loan is classified as a TDR. TDRs are considered impaired loans. Upon designation as a TDR, the Company evaluates the borrower’s payment history, past due status, and ability to make payments based on the revised terms of the loan. If a loan was accruing prior to being modified as a TDR and if the Company concludes that the borrower is able to make such payments, and there are no other factors or circumstances that would cause it to conclude otherwise, the loan will remain on an accruing status. If a loan was on non-accrual status at the time of the TDR, the loan will remain on non-accrual status following the modification and may be returned to accrual status based on the policy for returning loans to accrual status as noted above. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management determines that the loan balance is uncollectible. Subsequent recoveries, if any, are credited to the allowance. For further information about the Company’s loans and the allowance for loan losses, see Notes 3 and 4. The allowance for loan losses is evaluated on a quarterly basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The Company performs regular credit reviews of the loan portfolio to review credit quality and adherence to underwriting standards. The credit reviews consist of reviews by its internal credit administration department and reviews performed by an independent third party. Upon origination, each loan is assigned a risk rating ranging from one to nine, with loans closer to one having less risk. This risk rating scale is our primary credit quality indicator. The Company has various committees that review and ensure that the allowance for loans losses methodology is in accordance with GAAP and loss factors used appropriately reflect the risk characteristics of the loan portfolio. The allowance represents an amount that, in management’s judgment, will be adequate to absorb any losses on existing loans that may become uncollectible. Management’s judgment in determining the level of the allowance is based on evaluations of the collectability of loans while taking into consideration such factors as trends in delinquencies and charge-offs, changes in the nature and volume of the loan portfolio, current economic conditions that may affect a borrower’s ability to repay and the value of the collateral, overall portfolio quality, and review of specific potential losses. The evaluation also considers the following risk characteristics of each loan portfolio class: • 1-4 family residential mortgage loans carry risks associated with the continued creditworthiness of the borrower and changes in the value of the collateral. • Real estate construction and land development loans carry risks that the project may not be finished according to schedule, the project may not be finished according to budget, and the value of the collateral may, at any point in time, be less than the principal amount of the loan. Construction loans also bear the risk that the general contractor, who may or may not be a loan customer, may be unable to finish the construction project as planned because of financial pressure or other factors unrelated to the project. • Other real estate loans carry risks associated with the successful operation of a business or a real estate project, in addition to other risks associated with the ownership of real estate, because repayment of these loans may be dependent upon the profitability and cash flows of the business or project. • Commercial and industrial loans carry risks associated with the successful operation of a business because repayment of these loans may be dependent upon the profitability and cash flows of the business. In addition, there is risk associated with the value of collateral other than real estate which may depreciate over time and cannot be appraised with as much reliability. • Consumer and other loans carry risk associated with the continued creditworthiness of the borrower and the value of the collateral, if any. These loans are typically either unsecured or secured by rapidly depreciating assets such as automobiles. They are also likely to be immediately and adversely affected by job loss, divorce, illness, personal bankruptcy, or other changes in circumstances. Consumer and other loans also include purchased consumer loans which could have been originated outside of the Company's market area. The allowance for loan losses consists of specific and general components. The specific component relates to loans that are classified as impaired, and is established when the discounted cash flows, fair value of collateral less estimated costs to sell, or observable market price of the impaired loan is lower than the carrying value of that loan. For collateral dependent loans, an updated appraisal is ordered if a current one is not on file. Appraisals are performed by independent third-party appraisers with relevant industry experience. Adjustments to the appraised value may be made based on recent sales of like properties or general market conditions among other considerations. The general component covers loans that are not considered impaired and is based on historical loss experience adjusted for qualitative factors. The historical loss experience is calculated by loan type and uses an average loss rate during the preceding twelve quarters. The qualitative factors are assigned by management based on delinquencies and asset quality, national and local economic trends, effects of the changes in the value of underlying collateral, trends in volume and nature of loans, effects of changes in the lending policy, the experience and depth of management, concentrations of credit, quality of the loan review system, and the effect of external factors such as competition and regulatory requirements. The factors assigned differ by loan type. The general allowance estimates losses whose impact on the portfolio has yet to be recognized by a specific allowance. Allowance factors and the overall size of the allowance may change from period to period based on management’s assessment of the above described factors and the relative weights given to each factor. |
Premises and Equipment | Premises and Equipment Land is carried at cost. Premises and equipment are stated at cost, less accumulated depreciation and amortization. Premises and equipment are depreciated over their estimated useful lives ranging from three years to forty years ; leasehold improvements are amortized over the lives of the respective leases or the estimated useful life of the leasehold improvement, whichever is less. Software is amortized over its estimated useful life ranging from three to seven years . Depreciation and amortization are recorded on the straight-line method. Costs of maintenance and repairs are charged to expense as incurred. Costs of replacing structural parts of major units are considered individually and are expensed or capitalized as the facts dictate. Gains and losses on routine dispositions are reflected in current operations. |
Other Real Estate Owned | Other Real Estate Owned Other real estate owned (OREO) consists of properties obtained through a foreclosure proceeding or through an in-substance foreclosure in satisfaction of loans and properties originally acquired for branch operations or expansion but no longer intended to be used for that purpose. OREO is initially recorded at fair value less estimated costs to sell to establish a new cost basis. OREO is subsequently reported at the lower of cost or fair value less costs to sell, determined on the basis of current appraisals, comparable sales, and other estimates of fair value obtained principally from independent sources, adjusted for estimated selling costs. Management also considers other factors or recent developments, such as changes in absorption rates or market conditions from the time of valuation and anticipated sales values considering management’s plans for disposition, which could result in adjustments to the collateral value estimates indicated in the appraisals. Significant judgments and complex estimates are required in estimating the fair value of other real estate owned, and the period of time within which such estimates can be considered current is significantly shortened during periods of market volatility. In response to market conditions and other economic factors, management may utilize liquidation sales as part of its distressed asset disposition strategy. As a result of the significant judgments required in estimating fair value and the variables involved in different methods of disposition, the net proceeds realized from sales transactions could differ significantly from appraisals, comparable sales, and other estimates used to determine the fair value of other real estate owned. Management reviews the value of other real estate owned each quarter and adjusts the values as appropriate. Revenue and expenses from operations and changes in the valuation allowance are included in other real estate owned income. |
Bank-Owned Life Insurance | Bank-Owned Life Insurance The Company owns insurance on the lives of a certain group of key employees. The policies were purchased to help offset the increase in the costs of various fringe benefit plans, including healthcare. The cash surrender value of these policies is included as an asset on the consolidated balance sheets, and any increase in cash surrender value is recorded as income from bank owned life insurance on the consolidated statements of income. In the event of the death of an insured individual under these policies, the Company receives a death benefit which is also recorded as income from bank owned life insurance. The Company recorded $312 thousand and $102 thousand of death benefits received as income from bank owned life insurance under these policies for the years ended December 31, 2017 and 2016 , respectively. The Company is exposed to credit risk to the extent an insurance company is unable to fulfill its financial obligations under a policy. |
Intangible Assets | Intangible Assets Intangible assets consist of core deposit intangible assets arising from branch acquisitions which are amortized on an accelerated method over their estimated useful lives, which range from six to nine years . |
Stock Based Compensation | Stock Based Compensation Compensation cost is recognized for restricted stock units and other stock awards issued to employees and directors based on the fair value of the awards at the date of grant. The market price of the Company’s common stock at the date of grant is used to estimate the fair value of restricted stock units and other stock awards. |
Retirement Plans | Retirement Plans Pension expense is the net of service and interest cost, return on plan assets, and amortization of gains and losses not immediately recognized. Employee 401(k) and profit sharing plan expense is the amount of matching contributions and Bank discretionary matches. |
Transfers of Financial Assets | Transfers of Financial Assets Transfers of financial assets, including loan participations, 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 maturity. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with ASC Topic 740, “Income Taxes”. Under this guidance, deferred taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates that will apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date. The Tax Cuts and Jobs Act (the Act), which was enacted into law on December 22, 2017, reduces the corporate income tax rate to 21%. Since the Act reduces the Company's corporate tax rate from 34% to 21%, the Company recorded a $752 thousand charge to income tax expense in 2017 related to the re-measurement of net deferred tax assets resulting from the new 21% corporate tax rate. See Note 11 for details on the Company’s income taxes. The Company regularly reviews the carrying amount of its net deferred tax assets to determine if the establishment of a valuation allowance is necessary. If based on the available evidence, it is more likely than not that all or a portion of the Company’s net deferred tax assets will not be realized in future periods, a deferred tax valuation allowance would be established. Consideration is given to various positive and negative factors that could affect the realization of the deferred tax assets. In evaluating this available evidence, management considers, among other things, historical performance, expectations of future earnings, the ability to carry back losses to recoup taxes previously paid, length of statutory carry forward periods, experience with utilization of operating loss and tax credit carry forwards not expiring, tax planning strategies, and timing of reversals of temporary differences. Significant judgment is required in assessing future earnings trends and the timing of reversals of temporary differences. The Company’s evaluation is based on current tax laws as well as management’s expectations of future performance. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. There was no liability for unrecognized tax benefits recorded as of December 31, 2017 and 2016 . Interest and penalties associated with unrecognized tax benefits, if any, are classified as additional income taxes in the consolidated statements of income. |
Wealth Management Department | Wealth Management Department Securities and other property held by the wealth management department in a fiduciary or agency capacity are not assets of the Company and are not included in the accompanying consolidated financial statements. |
Earnings Per Common Share | Earnings Per Common Share Basic earnings per common share represents income available to common shareholders divided by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate to restricted stock units and are determined using the treasury method. See Note 14 for further information regarding earnings per common share. |
Advertising Costs | Advertising Costs The Company follows the policy of charging the production costs of advertising to expense as incurred. |
Comprehensive Income | Comprehensive Income Accounting principles generally require that recognized revenue, expenses, gains, and losses be included in net income. Although certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities and pension liability adjustments, are reported as a separate component of the equity section of the consolidated balance sheets, such items, along with net income, are components of comprehensive income. |
Loss Contingencies | Loss Contingencies Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there are such matters that will have a material effect on the consolidated financial statements. |
Reclassifications | Reclassifications Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications had no effect on prior year net income or shareholders’ equity. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers: Topic 606.” This ASU revised guidance for the recognition, measurement, and disclosure of revenue from contracts with customers. The original guidance has been amended through subsequent accounting standard updates that resulted in technical corrections, improvements, and a one-year deferral of the effective date to January 1, 2018. The guidance, as amended, is applicable to all entities and, once effective, will replace significant portions of existing industry and transaction-specific revenue recognition rules with a more principles-based recognition model. Most revenue associated with financial instruments, including interest income, loan origination fees, and credit card fees, is outside the scope of the guidance. Gains and losses on investment securities, derivatives, and sales of financial instruments are similarly excluded from the scope. Entities can elect to adopt the guidance either on a full or modified retrospective basis. Full retrospective adoption will require a cumulative effect adjustment to retained earnings as of the beginning of the earliest comparative period presented. Modified retrospective adoption will require a cumulative effect adjustment to retained earnings as of the beginning of the reporting period in which the entity first applies the new guidance. The Company adopted this guidance on the effective date, January 1, 2018 via the modified retrospective approach. The Company has completed its assessment of the adoption of this ASU, noting the standard will result in expanded disclosures related to non-interest income and enhance the qualitative disclosures on the revenues within the scope of the new guidance. The Company does not expect the adoption of ASU 2014-09 to have a material impact on its consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” The amendments in ASU 2016-01, among other things: 1) Requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. 2) Requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes. 3) Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables). 4) Eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company does not expect the adoption of ASU 2016-01 to have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Among other things, in the amendments in ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: (1) A lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted upon issuance. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The Company does not expect the adoption of ASU 2016-02 to have a material impact on its consolidated financial statements. The Company has analyzed its current lease commitments, along with reasonable assumptions to project lease activity in future periods, to measure the potential impact on net income and relevant capital and financial ratios. During June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendments in this ASU, among other things, require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. The amendments in this ASU are effective for SEC filers for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company is currently assessing the impact that ASU 2016-13 will have on its consolidated financial statements. The Company has formed a committee to address the compliance requirements of this ASU and is currently in the process of analyzing gathered data, defining loan pools and segments, and selecting methods for applying the concepts included in this ASU. During 2018, the Company plans to test selected models, build policy and process documentation, and model the impact of the ASU on the capital and strategic plans. This guidance may result in material changes in the Company's accounting for credit losses of financial instruments. During August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments”, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The amendments should be applied using a retrospective transition method to each period presented. If retrospective application is impractical for some of the issues addressed by the update, the amendments for those issues would be applied prospectively as of the earliest date practicable. Early adoption is permitted, including adoption in an interim period. The Company does not expect the adoption of ASU 2016-15 to have a material impact on its consolidated financial statements. During January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. The amendments in this ASU clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Under the current implementation guidance in Topic 805, there are three elements of a business—inputs, processes, and outputs. While an integrated set of assets and activities (collectively referred to as a “set”) that is a business usually has outputs, outputs are not required to be present. In addition, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs. The amendments in this ASU provide a screen to determine when a set is not a business. If the screen is not met, the amendments (1) require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) remove the evaluation of whether a market participant could replace missing elements. The ASU provides a framework to assist entities in evaluating whether both an input and a substantive process are present. The amendments in this ASU are effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. The amendments in this ASU should be applied prospectively on or after the effective date. No disclosures are required at transition. The Company does not expect the adoption of ASU 2017-01 to have a material impact on its consolidated financial statements. During January 2017, the FASB issued ASU No. 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment”. The amendments in this ASU simplify how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Instead, under the amendments in this ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. Public business entities that are U.S. Securities and Exchange Commission (SEC) filers should adopt the amendments in this ASU for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect the adoption of ASU 2017-04 to have a material impact on its consolidated financial statements. During March 2017, the FASB issued ASU No. 2017-07, “Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” The amendments in this ASU require an employer that offers defined benefit pension plans, other postretirement benefit plans, or other types of benefits accounted for under Topic 715 to report the service cost component of net periodic benefit cost in the same line item(s) as other compensation costs arising from services rendered during the period. The other components of net periodic benefit cost are required to be presented in the income statement separately from the service cost component. If the other components of net periodic benefit cost are not presented on a separate line or lines, the line item(s) used in the income statement must be disclosed. In addition, only the service cost component will be eligible for capitalization as part of an asset, when applicable. The amendments are effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted. The Company does not expect the adoption of ASU 2017-07 to have a material impact on its consolidated financial statements. During March 2017, the FASB issued ASU No. 2017-08, “Receivables—Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities.” The amendments in this ASU shorten the amortization period for certain callable debt securities purchased at a premium. Upon adoption of the standard, premiums on these qualifying callable debt securities will be amortized to the earliest call date. Discounts on purchased debt securities will continue to be accreted to maturity. The amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. Upon transition, entities should apply the guidance on a modified retrospective basis, with a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption and provide the disclosures required for a change in accounting principle. The Company does not expect the adoption of ASU 2017-08 to have a material impact on its consolidated financial statements. During May 2017, the FASB issued ASU No. 2017-09, “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting.” The amendments provide guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718. The amendments are effective for all entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for reporting periods for which financial statements have not yet been issued. The Company does not expect the adoption of ASU 2017-09 to have a material impact on its consolidated financial statements. During August 2017, the FASB issued ASU No. 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities.” The amendments in this ASU modify the designation and measurement guidance for hedge accounting as well as provide for increased transparency regarding the presentation of economic results on both the financial statements and related footnotes. Certain aspects of hedge effectiveness assessments will also be simplified upon implementation of this update. The amendments are effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted, including adoption in any interim period. The Company is currently assessing the impact that ASU 2017-12 will have on its consolidated financial statements. During February 2018, the FASB issued ASU No. 2018-02, “Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” The amendments provide financial statement preparers with an option to reclassify stranded tax effects within accumulated other comprehensive income to retained earnings in each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act (or portion thereof) is recorded. The amendments are effective for all organizations for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. Organizations should apply the proposed amendments either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. The Company has elected to reclassify the stranded income tax effects from the Tax Cuts and Jobs Act in the consolidated financial statements for the period ending December 31, 2017. The amount of this reclassification in 2017 was $158 thousand . |
Determination of Fair Value | Determination of Fair Value The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. In accordance with the “Fair Value Measurement and Disclosures” topic of FASB ASC, the fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon 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. The fair value guidance provides a consistent definition of fair value, which focuses on exit price in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires the use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions. |
Securities (Tables)
Securities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Amortized Costs and Fair Values of Securities | Amortized costs and fair values of securities at December 31, 2017 and 2016 were as follows (in thousands): 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available for sale: U.S. agency and mortgage-backed securities $ 76,074 $ 67 $ (1,337 ) $ 74,804 Obligations of states and political subdivisions 14,520 86 (155 ) 14,451 Total securities available for sale $ 90,594 $ 153 $ (1,492 ) $ 89,255 Securities held to maturity: U.S. agency and mortgage-backed securities $ 32,149 $ — $ (551 ) $ 31,598 Obligations of states and political subdivisions 14,559 74 (45 ) 14,588 Corporate debt securities 1,500 16 — 1,516 Total securities held to maturity $ 48,208 $ 90 $ (596 ) $ 47,702 Total securities $ 138,802 $ 243 $ (2,088 ) $ 136,957 2016 Amortized Cost Gross Unrealized Gains Gross Unrealized (Losses) Fair Value Securities available for sale: U.S. agency and mortgage-backed securities $ 81,451 $ 177 $ (1,457 ) $ 80,171 Obligations of states and political subdivisions 14,654 146 (180 ) 14,620 Corporate equity securities 1 10 — 11 Total securities available for sale $ 96,106 $ 333 $ (1,637 ) $ 94,802 Securities held to maturity: U.S. agency and mortgage-backed securities $ 37,269 $ 1 $ (483 ) $ 36,787 Obligations of states and political subdivisions 14,629 18 (211 ) 14,436 Corporate debt securities 1,500 — (14 ) 1,486 Total securities held to maturity $ 53,398 $ 19 $ (708 ) $ 52,709 Total securities $ 149,504 $ 352 $ (2,345 ) $ 147,511 |
Summary of Investments in an Unrealized Loss Position that were Temporarily Impaired | At December 31, 2017 and 2016 , investments in an unrealized loss position that were temporarily impaired were as follows (in thousands): 2017 Less than 12 months 12 months or more Total Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Securities available for sale: U.S. agency and mortgage-backed securities $ 29,963 $ (286 ) $ 30,362 $ (1,051 ) $ 60,325 $ (1,337 ) Obligations of states and political subdivisions 4,469 (53 ) 1,961 (102 ) 6,430 (155 ) Total securities available for sale $ 34,432 $ (339 ) $ 32,323 $ (1,153 ) $ 66,755 $ (1,492 ) Securities held to maturity: U.S. agency and mortgage-backed securities $ 18,301 $ (205 ) $ 13,297 $ (346 ) $ 31,598 $ (551 ) Obligations of states and political subdivisions 6,889 (45 ) — — 6,889 (45 ) Total securities held to maturity $ 25,190 $ (250 ) $ 13,297 $ (346 ) $ 38,487 $ (596 ) Total securities $ 59,622 $ (589 ) $ 45,620 $ (1,499 ) $ 105,242 $ (2,088 ) 2016 Less than 12 months 12 months or more Total Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Fair Value Unrealized (Loss) Securities available for sale: U.S. agency and mortgage-backed securities $ 60,943 $ (1,249 ) $ 5,499 $ (208 ) $ 66,442 $ (1,457 ) Obligations of states and political subdivisions 5,130 (180 ) — — 5,130 (180 ) Total securities available for sale $ 66,073 $ (1,429 ) $ 5,499 $ (208 ) $ 71,572 $ (1,637 ) Securities held to maturity: U.S. agency and mortgage-backed securities $ 34,770 $ (483 ) $ — $ — $ 34,770 $ (483 ) Obligations of states and political subdivisions 12,724 (211 ) — — 12,724 (211 ) Corporate debt securities $ 1,486 $ (14 ) $ — $ — $ 1,486 $ (14 ) Total securities held to maturity $ 48,980 $ (708 ) $ — $ — $ 48,980 $ (708 ) Total securities $ 115,053 $ (2,137 ) $ 5,499 $ (208 ) $ 120,552 $ (2,345 ) |
Amortized Cost and Fair Value of Securities | The amortized cost and fair value of securities at December 31, 2017 by contractual maturity are shown below (in thousands). Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. Available for Sale Held to Maturity Amortized Cost Fair Value Amortized Cost Fair Value Due within one year $ 600 $ 601 $ — $ — Due after one year through five years 9,040 9,048 6,186 6,144 Due after five years through ten years 8,920 8,774 14,160 14,158 Due after ten years 72,034 70,832 27,862 27,400 $ 90,594 $ 89,255 $ 48,208 $ 47,702 |
Composition of Restricted Securities | The composition of restricted securities at December 31, 2017 and 2016 was as follows (in thousands): 2017 2016 Federal Home Loan Bank stock $ 645 $ 623 Federal Reserve Bank stock 875 875 Community Bankers’ Bank stock 50 50 $ 1,570 $ 1,548 |
Loans (Tables)
Loans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Summary of Loans | Loans at December 31, 2017 and 2016 are summarized as follows (in thousands): 2017 2016 Real estate loans: Construction and land development $ 35,927 $ 34,699 Secured by 1-4 family residential 208,177 198,763 Other real estate 222,256 211,210 Commercial and industrial loans 38,763 29,981 Consumer and other loans 17,078 11,414 Total loans $ 522,201 $ 486,067 Allowance for loan losses (5,326 ) (5,321 ) Loans, net $ 516,875 $ 480,746 |
Summary of Loan Classes and an Aging of Past Due Loans | The following tables provide a summary of loan classes and an aging of past due loans as of December 31, 2017 and 2016 (in thousands): December 31, 2017 30-59 60-89 > 90 Total Current Total Non- 90 Days Real estate loans: Construction and land development $ 986 $ 30 $ 40 $ 1,056 $ 34,871 $ 35,927 $ 269 $ 40 1-4 family residential 606 203 148 957 207,220 208,177 267 106 Other real estate loans 2,042 170 10 2,222 220,034 222,256 401 10 Commercial and industrial 184 25 — 209 38,554 38,763 — — Consumer and other loans 51 49 27 127 16,951 17,078 — 27 Total $ 3,869 $ 477 $ 225 $ 4,571 $ 517,630 $ 522,201 $ 937 $ 183 December 31, 2016 30-59 60-89 > 90 Total Current Total Non- 90 Days Real estate loans: Construction and land development $ — $ 40 $ — $ 40 $ 34,659 $ 34,699 $ 1,033 $ — 1-4 family residential 980 170 410 1,560 197,203 198,763 413 84 Other real estate loans 321 701 — 1,022 210,188 211,210 74 — Commercial and industrial 36 309 32 377 29,604 29,981 — 32 Consumer and other loans 19 7 — 26 11,388 11,414 — — Total $ 1,356 $ 1,227 $ 442 $ 3,025 $ 483,042 $ 486,067 $ 1,520 $ 116 |
Analysis of the Credit Risk Profile of Each Loan Class | The following tables provide an analysis of the credit risk profile of each loan class as of December 31, 2017 and 2016 (in thousands): December 31, 2017 Pass Special Substandard Doubtful Total Real estate loans: Construction and land development $ 31,553 $ 2,268 $ 2,106 $ — $ 35,927 Secured by 1-4 family residential 204,166 1,933 2,078 — 208,177 Other real estate loans 215,773 971 5,512 — 222,256 Commercial and industrial 38,606 53 104 — 38,763 Consumer and other loans 17,078 — — — 17,078 Total $ 507,176 $ 5,225 $ 9,800 $ — $ 522,201 December 31, 2016 Pass Special Substandard Doubtful Total Real estate loans: Construction and land development $ 29,416 $ 2,402 $ 2,881 $ — $ 34,699 Secured by 1-4 family residential 193,395 3,295 2,073 — 198,763 Other real estate loans 200,009 6,990 4,211 — 211,210 Commercial and industrial 29,456 386 139 — 29,981 Consumer and other loans 11,414 — — — 11,414 Total $ 463,690 $ 13,073 $ 9,304 $ — $ 486,067 |
Allowance for Loan Losses (Tabl
Allowance for Loan Losses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Allowance by Impairment Methodology and Loans by Impairment Methodology | The following tables present, as of December 31, 2017 and 2016 , the total allowance for loan losses, the allowance by impairment methodology and loans by impairment methodology (in thousands). December 31, 2017 Construction Secured by Other Real Commercial Consumer Total Allowance for loan losses: Beginning Balance, December 31, 2016 $ 441 $ 1,019 $ 3,142 $ 380 $ 339 $ 5,321 Charge-offs — (126 ) — — (607 ) (733 ) Recoveries 11 302 50 10 265 638 Provision for (recovery of) loan losses (38 ) (420 ) (244 ) 28 774 100 Ending Balance, December 31, 2017 $ 414 $ 775 $ 2,948 $ 418 $ 771 $ 5,326 Ending Balance: Individually evaluated for impairment — — — — — — Collectively evaluated for impairment 414 775 2,948 418 771 5,326 Loans: Ending Balance 35,927 208,177 222,256 38,763 17,078 522,201 Individually evaluated for impairment 1,150 1,307 1,289 65 — 3,811 Collectively evaluated for impairment 34,777 206,870 220,967 38,698 17,078 518,390 December 31, 2016 Construction Secured by Other Real Commercial Consumer Total Allowance for loan losses: Beginning Balance, December 31, 2015 $ 1,532 $ 939 $ 2,534 $ 306 $ 213 $ 5,524 Charge-offs — (83 ) (165 ) — (540 ) (788 ) Recoveries 4 293 2 11 275 585 Provision for (recovery of) loan losses (1,095 ) (130 ) 771 63 391 — Ending Balance, December 31, 2016 $ 441 $ 1,019 $ 3,142 $ 380 $ 339 $ 5,321 Ending Balance: Individually evaluated for impairment — 37 — — — 37 Collectively evaluated for impairment 441 982 3,142 380 339 5,284 Loans: Ending Balance 34,699 198,763 211,210 29,981 11,414 486,067 Individually evaluated for impairment 1,973 1,828 984 75 — 4,860 Collectively evaluated for impairment 32,726 196,935 210,226 29,906 11,414 481,207 |
Impaired Loans and Related Allowance | Impaired loans and the related allowance at December 31, 2017 and 2016 , were as follows (in thousands): December 31, 2017 Unpaid Recorded Recorded Total Related Average Interest Real estate loans: Construction and land development $ 1,627 $ 1,150 $ — $ 1,150 $ — $ 1,814 $ 63 Secured by 1-4 family 1,387 1,307 — 1,307 — 1,637 64 Other real estate loans 1,483 1,289 — 1,289 — 1,137 95 Commercial and industrial 78 65 — 65 — 68 10 Total $ 4,575 $ 3,811 $ — $ 3,811 $ — $ 4,656 $ 232 December 31, 2016 Unpaid Recorded Recorded Total Related Average Interest Real estate loans: Construction and land development $ 2,388 $ 1,973 $ — $ 1,973 $ — $ 2,407 $ 66 Secured by 1-4 family 1,851 1,675 153 1,828 37 2,013 87 Other real estate loans 1,213 984 — 984 — 2,529 22 Commercial and industrial 93 75 — 75 — 85 1 Total $ 5,545 $ 4,707 $ 153 $ 4,860 $ 37 $ 7,034 $ 176 |
Other Real Estate Owned (Tables
Other Real Estate Owned (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Real Estate [Abstract] | |
Summary of Changes in the Balance for OREO | Changes in the balance for OREO are as follows (in thousands): 2017 2016 Balance at the beginning of year, gross $ 250 $ 2,903 Transfers in 326 287 Charge-offs — (251 ) Sales proceeds (441 ) (2,882 ) Gain on disposition 191 193 Balance at the end of year, gross $ 326 $ 250 Less: valuation allowance — — Balance at the end of year, net $ 326 $ 250 |
Summary of Changes in the Allowance for OREO Losses | Changes in the allowance for OREO losses are as follows (in thousands): 2017 2016 Balance at beginning of year $ — $ 224 Provision for losses — 27 Charge-offs, net — (251 ) Balance at end of year $ — $ — |
Premises and Equipment (Tables)
Premises and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Summary of Premises and Equipment | Premises and equipment are summarized as follows at December 31, 2017 and 2016 (in thousands): 2017 2016 Land $ 4,717 $ 4,796 Buildings and leasehold improvements 18,510 18,524 Furniture and equipment 6,394 5,836 Construction in process 140 216 $ 29,761 $ 29,372 Less accumulated depreciation 9,870 8,587 $ 19,891 $ 20,785 |
Deposits (Tables)
Deposits (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Banking and Thrift [Abstract] | |
Scheduled Maturities of Time Deposits | At December 31, 2017 , the scheduled maturities of time deposits were as follows (in thousands): 2018 $ 59,833 2019 26,929 2020 16,381 2021 12,454 2022 6,745 Thereafter 309 $ 122,651 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Net Deferred Tax Assets | Net deferred tax assets consisted of the following components at December 31, 2017 and 2016 (in thousands): 2017 2016 Deferred Tax Assets Allowance for loan losses $ 1,118 $ 1,809 Securities available for sale 281 447 Accrued pension — 689 Accrued health insurance 11 — Core deposit intangible 317 371 Unvested stock-based compensation 9 19 Limited partnership investments 5 17 Loan origination fees, net 63 48 $ 1,804 $ 3,400 Deferred Tax Liabilities Depreciation $ 562 $ 708 Discount accretion — 2 Overfunded pension liability 27 — $ 589 $ 710 Net deferred tax assets $ 1,215 $ 2,690 |
Income Tax Expense | The income tax expense for the years ended December 31, 2017 and 2016 consisted of the following (in thousands): 2017 2016 Current tax expense $ 2,443 $ 1,925 Deferred tax expense (1) 1,283 428 $ 3,726 $ 2,353 (1) The deferred tax expense for the year ended December 31, 2017 includes $752 thousand of income taxes related to the re-measurement of net deferred tax assets. |
Income Tax Expense Differs from the Amount of Income Tax Determined by Applying the U.S. Federal Income Tax Rate to Pretax Income | The income tax expense differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income for the years ended December 31, 2017 and 2016 , due to the following (in thousands): 2017 2016 Computed tax expense at statutory federal rate $ 3,459 $ 2,808 Increase in income taxes resulting from re-measurement of net deferred tax assets 752 — Decrease in income taxes resulting from: Tax-exempt interest and dividend income (241 ) (254 ) Income from bank owned life insurance (244 ) (179 ) Other — (22 ) $ 3,726 $ 2,353 |
Benefit Plans (Tables)
Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Changes in Plan Benefit Obligation and Fair Value of Assets | The following tables provide a reconciliation of the changes in the plan benefit obligation and the fair value of assets for the periods ended December 31, 2017 and 2016 (in thousands). 2017 2016 Change in Benefit Obligation Benefit obligation, beginning of year $ 5,777 $ 8,107 Service cost — 410 Interest cost 82 331 Actuarial (gain) loss (145 ) 245 Benefits paid (431 ) (695 ) Gain due to curtailment — (2,621 ) Benefit obligation, end of year $ 5,283 $ 5,777 Changes in Plan Assets Fair value of plan assets, beginning of year $ 3,693 $ 4,264 Actual return on plan assets 16 124 Employer contributions 1,800 — Benefits paid (431 ) (695 ) Fair value of assets, end of year $ 5,078 $ 3,693 Funded Status, end of year $ (205 ) $ (2,084 ) Amount Recognized in Other Liabilities $ (205 ) $ (2,084 ) |
Amounts Recognized in Accumulated Other Comprehensive Loss, Net of Tax | Amounts Recognized in Accumulated Other Comprehensive Loss, net of tax Net gain $ (126 ) $ — Deferred income tax expense 27 — Amount recognized $ (99 ) $ — |
Weighted Average Assumptions Used to Determine Benefit Obligation | Weighted Average Assumptions Used to Determine Benefit Obligation Discount rate used for disclosure First five years 1.96 % 1.47 % Five years to twenty years 3.58 % 3.34 % After twenty years 4.35 % 4.30 % Expected return on plan assets 1.00 % 7.50 % Rate of compensation increase N/A 3.00 % |
Components of Net Periodic Benefit Cost | Components of Net Periodic Benefit Cost Service cost $ — $ 410 Interest cost 82 331 Expected return on plan assets (35 ) (297 ) Recognized net gain due to curtailment — (173 ) Recognized net actuarial loss — 84 Net periodic benefit cost $ 47 $ 355 |
Other Changes in Plan Assets and Benefit Obligations Recognized in Accumulated Other Comprehensive (Income) Loss | Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss) Net gain $ (126 ) $ (2,115 ) Total recognized in other comprehensive income (loss) $ (126 ) $ (2,115 ) Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income (Loss) $ (79 ) $ (1,760 ) |
Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost | 2017 2016 Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost Discount rate 1.47 % 4.25 % Expected return on plan assets 1.00 % 7.50 % Rate of compensation increase N/A 3.00 % |
Schedule of Pension Plan's Weighted-Average Asset Allocations | The pension plan’s weighted-average asset allocations at the end of the plan year for 2017 and 2016 , by asset category were as follows: 2017 2016 Asset Category Cash and equivalents 100 % 100 % Total 100 % 100 % |
Schedule of Fair Value Hierarchy, the Company's Pension Plan Assets | The following tables set forth by level, within the fair value hierarchy, the Company’s pension plan assets at fair value as of December 31, 2017 and 2016 (in thousands): Fair Value Measurements at December 31, 2017 Total Level 1 Level 2 Level 3 Cash and equivalents $ 5,078 $ 5,078 $ — $ — Total $ 5,078 $ 5,078 $ — $ — Fair Value Measurements at December 31, 2016 Total Level 1 Level 2 Level 3 Cash and equivalents $ 3,693 $ 3,693 $ — $ — Total $ 3,693 $ 3,693 $ — $ — |
Earnings per Common Share (Tabl
Earnings per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table presents the computation of basic and diluted earnings per share for the years ended December 31, 2017 and 2016 (dollars in thousands, except per share data): 2017 2016 (Numerator): Net income $ 6,448 $ 5,907 (Denominator): Weighted average shares outstanding – basic 4,941,233 4,924,636 Potentially dilutive common shares – restricted stock units 2,665 3,548 Weighted average shares outstanding – diluted 4,943,898 4,928,184 Income per common share Basic $ 1.30 $ 1.20 Diluted $ 1.30 $ 1.20 |
Commitments and Unfunded Cred43
Commitments and Unfunded Credits (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Financial Instruments Representing Credit Risk | At December 31, 2017 and 2016 , the following financial instruments were outstanding whose contract amounts represent credit risk (in thousands): 2017 2016 Commitments to extend credit and unfunded commitments under lines of credit $ 77,992 $ 71,421 Stand-by letters of credit 10,379 8,983 |
Lease Commitments (Tables)
Lease Commitments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Leases [Abstract] | |
Minimum Rental Commitments under Noncancelable Leases | Minimum rental commitments under noncancelable leases with terms in excess of one year as of December 31, 2017 were as follows (in thousands): Operating Leases 2018 $ 124 2019 102 2020 79 2021 74 2022 and thereafter 54 $ 433 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Balances of Assets Measured at Fair Value on a Recurring Basis | The following tables present the balances of assets measured at fair value on a recurring basis as of December 31, 2017 and 2016 (in thousands). Fair Value Measurements at December 31, 2017 Description Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Securities available for sale U.S. agency and mortgage-backed securities $ 74,804 $ — $ 74,804 $ — Obligations of states and political subdivisions 14,451 — 14,451 — $ 89,255 $ — $ 89,255 $ — Fair Value Measurements at December 31, 2016 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Securities available for sale U.S. agency and mortgage-backed securities $ 80,171 $ — $ 80,171 $ — Obligations of states and political subdivisions 14,620 — 14,620 — Corporate equity securities 11 11 — — $ 94,802 $ 11 $ 94,791 $ — |
Summary of Assets Measured at Fair Value on a Nonrecurring Basis | The following tables summarize the Company’s assets that were measured at fair value on a nonrecurring basis as of December 31, 2017 and 2016 (dollars in thousands). Fair Value Measurements at December 31, 2017 Description. Balance as of December 31, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Other real estate owned $ 326 $ — $ — $ 326 Fair Value Measurements at December 31, 2016 Description Balance as of December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Impaired loans, net $ 116 $ — $ — $ 116 Other real estate owned 250 — — 250 |
Quantitative Information about Level 3 Fair Value Measurements | Quantitative information about Level 3 Fair Value Measurements for December 31, 2017 Fair Value Valuation Technique Unobservable Input Range (Weighted- Other real estate owned $ 326 Contract Price Selling cost 7 % Quantitative information about Level 3 Fair Value Measurements for December 31, 2016 Fair Value Valuation Technique Unobservable Input Range (Weighted- Impaired loans, net $ 116 Property appraisals Selling cost 10 % Other real estate owned $ 250 Property appraisals Selling cost — % |
Carrying Values and Estimated Fair Values of Company's Financial Instruments | The carrying values and estimated fair values of the Company’s financial instruments at December 31, 2017 and 2016 are as follows (in thousands): Fair Value Measurements at December 31, 2017 Using Carrying Amount Quoted Prices in Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Fair Value Financial Assets Cash and short-term investments $ 39,986 $ 39,986 $ — $ — $ 39,986 Securities available for sale 89,255 — 89,255 — 89,255 Securities held to maturity 48,208 — 46,186 1,516 47,702 Restricted securities 1,570 — 1,570 — 1,570 Loans held for sale 438 — 438 — 438 Loans, net 516,875 — — 514,013 514,013 Bank owned life insurance 13,967 — 13,967 — 13,967 Accrued interest receivable 1,916 — 1,916 — 1,916 Financial Liabilities Deposits $ 664,980 $ — $ 542,329 $ 120,834 $ 663,163 Subordinated debt 4,948 — — 5,004 5,004 Junior subordinated debt 9,279 — — 9,653 9,653 Accrued interest payable 98 — 98 — 98 Fair Value Measurements at December 31, 2016 Using Carrying Amount Quoted Prices in Active Markets for Identical Assets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Fair Value Financial Assets Cash and short-term investments $ 41,092 $ 41,092 $ — $ — $ 41,092 Securities available for sale 94,802 11 94,791 — 94,802 Securities held to maturity 53,398 — 51,223 1,486 52,709 Restricted securities 1,548 — 1,548 — 1,548 Loans held for sale 337 — 337 — 337 Loans, net 480,746 — — 481,475 481,475 Bank owned life insurance 13,928 — 13,928 — 13,928 Accrued interest receivable 1,746 — 1,746 — 1,746 Financial Liabilities Deposits $ 645,570 $ — $ 517,143 $ 127,179 $ 644,322 Subordinated debt 4,930 — — 4,715 4,715 Junior subordinated debt 9,279 — — 9,075 9,075 Accrued interest payable 95 — 95 — 95 |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Regulatory Capital Requirements [Abstract] | |
Comparison of Capital of Company and Bank with Minimum Regulatory Guidelines | A comparison of the capital of the Bank at December 31, 2017 and December 31, 2016 with the minimum regulatory guidelines were as follows (dollars in thousands): Actual Minimum Capital Requirement Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio December 31, 2017: Total Capital (to Risk-Weighted Assets) $ 67,624 13.12 % $ 41,239 8.00 % $ 51,548 10.00 % Tier 1 Capital (to Risk-Weighted Assets) $ 62,298 12.09 % $ 30,929 6.00 % $ 41,239 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 62,298 12.09 % $ 23,197 4.50 % $ 33,506 6.50 % Tier 1 Capital (to Average Assets) $ 62,298 8.46 % $ 29,457 4.00 % $ 36,821 5.00 % December 31, 2016: Total Capital (to Risk-Weighted Assets) $ 65,590 13.47 % $ 38,951 8.00 % $ 48,689 10.00 % Tier 1 Capital (to Risk-Weighted Assets) $ 60,269 12.38 % $ 29,213 6.00 % $ 38,951 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 60,269 12.38 % $ 21,910 4.50 % $ 31,648 6.50 % Tier 1 Capital (to Average Assets) $ 60,269 8.48 % $ 28,432 4.00 % $ 35,540 5.00 % |
Accumulated Other Comprehensi47
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Changes in Component of Accumulated Other Comprehensive Loss | Changes in each component of accumulated other comprehensive loss were as follows (in thousands): Net Unrealized Losses on Securities Adjustments Related to Pension Benefits Accumulated Other Comprehensive Loss Balance at December 31, 2015 $ (192 ) $ (1,396 ) $ (1,588 ) Unrealized holding losses (net of tax, ($341)) (663 ) — (663 ) Reclassification adjustment (net of tax, ($3)) (5 ) — (5 ) Pension liability adjustment (net of tax, $719) — 1,396 1,396 Change during period (668 ) 1,396 728 Balance at December 31, 2016 $ (860 ) $ — $ (860 ) Unrealized holding losses (net of tax, ($43)) (82 ) — (82 ) Reclassification adjustment (net of tax, $31) 59 — 59 Pension liability adjustment (net of tax, $43) — 83 83 Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change (174 ) 16 (158 ) Change during period (197 ) 99 (98 ) Balance at December 31, 2017 $ (1,057 ) $ 99 $ (958 ) |
Reclassifications from Accumulated Other Comprehensive Income (Loss) | The following table presents information related to reclassifications from accumulated other comprehensive loss for the years ended December 31, 2017 and 2016 (in thousands): Details About Accumulated Other Comprehensive Loss Amount Reclassified from Accumulated Other Comprehensive Loss Affected Line Item in the Consolidated Statements of Income For the year ended December 31, 2017 2016 Securities available for sale: Net securities losses (gains) reclassified into earnings $ 90 $ (8 ) Net (losses) gains on securities available for sale Related income tax (benefit) expense (31 ) 3 Income tax expense Total reclassifications $ 59 $ (5 ) Net of tax |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Restricted Stock Units | A summary of the activity for the Company’s restricted stock units for the period indicated is presented in the following table: 2017 Shares Weighted Average Grant Date Fair Value Unvested, January 1, 2017 10,259 $ 8.88 Granted 3,939 15.20 Vested (8,536 ) 9.89 Forfeited — — Unvested, December 31, 2017 5,662 $ 11.76 |
Parent Company Only Financial49
Parent Company Only Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Balance Sheets | FIRST NATIONAL CORPORATION (Parent Company Only) Balance Sheets December 31, 2017 and 2016 (in thousands) 2017 2016 Assets Cash $ 9,964 $ 5,690 Investment in subsidiaries, at cost, plus undistributed net income 62,094 60,344 Other assets 327 335 Total assets $ 72,385 $ 66,369 Liabilities and Shareholders’ Equity Subordinated debt $ 4,948 $ 4,930 Junior subordinated debt 9,279 9,279 Other liabilities 4 9 Total liabilities $ 14,231 $ 14,218 Preferred stock $ — $ — Common stock 6,182 6,162 Surplus 7,260 7,093 Retained earnings 45,670 39,756 Accumulated other comprehensive loss, net (958 ) (860 ) Total shareholders’ equity $ 58,154 $ 52,151 Total liabilities and shareholders’ equity $ 72,385 $ 66,369 |
Statements of Income | FIRST NATIONAL CORPORATION (Parent Company Only) Statements of Income Years Ended December 31, 2017 and 2016 (in thousands) 2017 2016 Income Dividends from subsidiary $ 5,500 $ 2,325 Other income 13 — Total income $ 5,513 $ 2,325 Expense Interest expense $ 663 $ 620 Marketing 13 — Supplies 3 2 Legal and professional fees 113 104 Data processing 62 61 Management fee-subsidiary 265 258 Other expense 8 17 Total expense $ 1,127 $ 1,062 Income before allocated tax benefits and undistributed income of subsidiary $ 4,386 $ 1,263 Allocated income tax benefit 379 361 Income before equity in undistributed income of subsidiary $ 4,765 $ 1,624 Equity in undistributed income of subsidiary 1,683 4,283 Net income $ 6,448 $ 5,907 |
Statements of Cash Flows | FIRST NATIONAL CORPORATION (Parent Company Only) Statements of Cash Flows Years Ended December 31, 2017 and 2016 (in thousands) 2017 2016 Cash Flows from Operating Activities Net income $ 6,448 $ 5,907 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed income of subsidiary (1,683 ) (4,283 ) Amortization of debt issuance costs 18 17 (Increase) decrease in other assets (3 ) 74 Decrease in other liabilities (1 ) — Net cash provided by operating activities $ 4,779 $ 1,715 Cash Flows from Financing Activities Cash dividends paid on common stock, net of reinvestment $ (646 ) $ (550 ) Net proceeds from issuance of common stock 141 113 Net cash used in financing activities $ (505 ) $ (437 ) Increase in cash and cash equivalents $ 4,274 $ 1,278 Cash and Cash Equivalents Beginning 5,690 4,412 Ending $ 9,964 $ 5,690 |
Nature of Banking Activities 50
Nature of Banking Activities and Significant Accounting policies - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2017USD ($)Entity | Dec. 31, 2016USD ($) | |
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Number of accounts included by parent company | Entity | 6 | |
Gain (loss) on rate lock commitments | $ 0 | |
Accrual status of loan | 90 days | |
Troubled debt restructurings (TDRs), amount | $ 333,000 | $ 460,000 |
Bank-owned life insurance, death benefits received | 720,000 | 527,000 |
Tax Cuts and Jobs Act of 2017, Income tax expense | $ 752,000 | |
Largest amount of tax benefit realized by taxing authority | 50.00% | |
Liability for unrecognized tax benefits | $ 0 | 0 |
Advertising cost | 379,000 | 402,000 |
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | 0 | |
Life Insurance Product Line | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Bank-owned life insurance, death benefits received | $ 312,000 | $ 102,000 |
Minimum | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Period of time between issuance of a loan commitment and closing and sale of the loan | 30 days | |
Management's policy on evaluation of impairment | $ 250,000 | |
Company not considered value of impairment on individual consumer, residential and small commercial loans | $ 250,000 | |
Minimum | Software | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Estimated useful lives | 3 years | |
Minimum | Core Deposits | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Intangible assets, estimated useful lives | 6 years | |
Minimum | Premises and Equipment | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Estimated useful lives | 3 years | |
Maximum | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Period of time between issuance of a loan commitment and closing and sale of the loan | 60 days | |
Maximum | Software | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Estimated useful lives | 7 years | |
Maximum | Core Deposits | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Intangible assets, estimated useful lives | 9 years | |
Maximum | Premises and Equipment | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Estimated useful lives | 40 years | |
Retained Earnings | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | $ 158,000 | |
Accumulated Other Comprehensive Loss | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | (158,000) | |
ASU 2018-02 | Retained Earnings | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | 158,000 | |
ASU 2018-02 | Accumulated Other Comprehensive Loss | ||
Nature Of Banking Activities And Significant Accounting Policies [Line Items] | ||
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | $ (158,000) |
Securities - Summary of Amortiz
Securities - Summary of Amortized Costs and Fair Values of Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Securities available for sale: | ||
Amortized Cost | $ 90,594 | $ 96,106 |
Gross Unrealized Gains | 153 | 333 |
Gross Unrealized (Losses) | (1,492) | (1,637) |
Fair Value | 89,255 | 94,802 |
Securities held to maturity: | ||
Amortized Cost | 48,208 | 53,398 |
Gross Unrealized Gains | 90 | 19 |
Gross Unrealized (Losses) | (596) | (708) |
Fair Value | 47,702 | 52,709 |
Total securities, Amortized cost | 138,802 | 149,504 |
Total securities, Gross unrealized gains | 243 | 352 |
Total securities, Gross unrealized (losses) | (2,088) | (2,345) |
Total securities, Fair value | 136,957 | 147,511 |
U.S. agency and mortgage-backed securities | ||
Securities available for sale: | ||
Amortized Cost | 76,074 | 81,451 |
Gross Unrealized Gains | 67 | 177 |
Gross Unrealized (Losses) | (1,337) | (1,457) |
Fair Value | 74,804 | 80,171 |
Securities held to maturity: | ||
Amortized Cost | 32,149 | 37,269 |
Gross Unrealized Gains | 0 | 1 |
Gross Unrealized (Losses) | (551) | (483) |
Fair Value | 31,598 | 36,787 |
Obligations of states and political subdivisions | ||
Securities available for sale: | ||
Amortized Cost | 14,520 | 14,654 |
Gross Unrealized Gains | 86 | 146 |
Gross Unrealized (Losses) | (155) | (180) |
Fair Value | 14,451 | 14,620 |
Securities held to maturity: | ||
Amortized Cost | 14,559 | 14,629 |
Gross Unrealized Gains | 74 | 18 |
Gross Unrealized (Losses) | (45) | (211) |
Fair Value | 14,588 | 14,436 |
Corporate equity securities | ||
Securities available for sale: | ||
Amortized Cost | 1 | |
Gross Unrealized Gains | 10 | |
Gross Unrealized (Losses) | 0 | |
Fair Value | 11 | |
Corporate debt securities | ||
Securities held to maturity: | ||
Amortized Cost | 1,500 | 1,500 |
Gross Unrealized Gains | 16 | 0 |
Gross Unrealized (Losses) | 0 | (14) |
Fair Value | $ 1,516 | $ 1,486 |
Securities - Summary of Investm
Securities - Summary of Investments in an Unrealized Loss Position that were Temporarily Impaired (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Securities available for sale: | ||
Less than 12 months - Fair value | $ 34,432 | $ 66,073 |
Less than 12 months - Unrealized (loss) | (339) | (1,429) |
12 months or more - Fair value | 32,323 | 5,499 |
12 months or more - Unrealized (loss) | (1,153) | (208) |
Fair Value | 66,755 | 71,572 |
Unrealized (Loss) | (1,492) | (1,637) |
Securities held to maturity: | ||
Less than 12 months - Fair value | 25,190 | 48,980 |
Less than 12 months - Unrealized (loss) | (250) | (708) |
12 months or more - Fair value | 13,297 | 0 |
12 months or more - Unrealized (loss) | (346) | 0 |
Fair Value | 38,487 | 48,980 |
Unrealized (Loss) | (596) | (708) |
Total securities, Less than 12 months - Fair value | 59,622 | 115,053 |
Total securities, Less than 12 months - Unrealized (loss) | (589) | (2,137) |
Total securities, 12 months or more - Fair value | 45,620 | 5,499 |
Total securities, 12 months or more - Unrealized (loss) | (1,499) | (208) |
Total securities, Fair value | 105,242 | 120,552 |
Total securities, Unrealized (loss) | (2,088) | (2,345) |
U.S. agency and mortgage-backed securities | ||
Securities available for sale: | ||
Less than 12 months - Fair value | 29,963 | 60,943 |
Less than 12 months - Unrealized (loss) | (286) | (1,249) |
12 months or more - Fair value | 30,362 | 5,499 |
12 months or more - Unrealized (loss) | (1,051) | (208) |
Fair Value | 60,325 | 66,442 |
Unrealized (Loss) | (1,337) | (1,457) |
Securities held to maturity: | ||
Less than 12 months - Fair value | 18,301 | 34,770 |
Less than 12 months - Unrealized (loss) | (205) | (483) |
12 months or more - Fair value | 13,297 | 0 |
12 months or more - Unrealized (loss) | (346) | 0 |
Fair Value | 31,598 | 34,770 |
Unrealized (Loss) | (551) | (483) |
Obligations of states and political subdivisions | ||
Securities available for sale: | ||
Less than 12 months - Fair value | 4,469 | 5,130 |
Less than 12 months - Unrealized (loss) | (53) | (180) |
12 months or more - Fair value | 1,961 | 0 |
12 months or more - Unrealized (loss) | (102) | 0 |
Fair Value | 6,430 | 5,130 |
Unrealized (Loss) | (155) | (180) |
Securities held to maturity: | ||
Less than 12 months - Fair value | 6,889 | 12,724 |
Less than 12 months - Unrealized (loss) | (45) | (211) |
12 months or more - Fair value | 0 | 0 |
12 months or more - Unrealized (loss) | 0 | 0 |
Fair Value | 6,889 | 12,724 |
Unrealized (Loss) | $ (45) | (211) |
Corporate debt securities | ||
Securities held to maturity: | ||
Less than 12 months - Fair value | 1,486 | |
Less than 12 months - Unrealized (loss) | (14) | |
12 months or more - Fair value | 0 | |
12 months or more - Unrealized (loss) | 0 | |
Fair Value | 1,486 | |
Unrealized (Loss) | $ (14) |
Securities - Additional Informa
Securities - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2017USD ($)SecurityObligation | Dec. 31, 2016USD ($)SecurityObligation | |
Schedule Of Available For Sale And Held To Maturity Securities [Line Items] | ||
Number of obligations of state and political subdivisions in an unrealized loss position | Obligation | 39 | 50 |
Number of obligations of state and political subdivisions | Obligation | 80 | 78 |
Percentage of investment portfolio | 100.00% | 100.00% |
Weighted-average period of re-pricing of portfolio | 4 years 8 months 12 days | 4 years 8 months 12 days |
Proceeds from maturities, calls, principal payments and sales of securities available for sale | $ 28,157,000 | $ 22,826,000 |
Gross realized gains on securities available for sale | 49,000 | 22,000 |
Gross realized losses on securities available for sale | $ 152,000 | $ 14,000 |
Available-for-sale securities, number of securities donated to not-for-profit organization | Security | 1 | 0 |
Gross gain on charitable donations of available for sale securities | $ 13,000 | |
Proceeds from maturities, calls and principal payments of securities held to maturity | $ 4,981,000 | $ 12,821,000 |
Held to maturity securities, number of securities sold | Security | 0 | 1 |
Gross gains or losses on held to maturity securities | $ 0 | $ 0 |
Proceeds from sales of securities held to maturity | 657,000 | |
Securities book value | 35,200,000 | $ 27,700,000 |
Impairment recognized | $ 0 | |
U.S. agency and mortgage-backed securities | ||
Schedule Of Available For Sale And Held To Maturity Securities [Line Items] | ||
Number of securities in unrealized loss position | Security | 68 | 64 |
Number of securities | Security | 82 | 83 |
Corporate debt securities | ||
Schedule Of Available For Sale And Held To Maturity Securities [Line Items] | ||
Number of securities in unrealized loss position | Security | 1 |
Securities - Amortized Cost and
Securities - Amortized Cost and Fair Value of Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Due within one year | $ 600 | |
Due after one year through five years | 9,040 | |
Due after five years through ten years | 8,920 | |
Due after ten years | 72,034 | |
Amortized Cost | 90,594 | $ 96,106 |
Fair Value | ||
Due within one year | 601 | |
Due after one year through five years | 9,048 | |
Due after five years through ten years | 8,774 | |
Due after ten years | 70,832 | |
Fair Value | 89,255 | 94,802 |
Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 6,186 | |
Due after five years through ten years | 14,160 | |
Due after ten years | 27,862 | |
Amortized Cost | 48,208 | 53,398 |
Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 6,144 | |
Due after five years through ten years | 14,158 | |
Due after ten years | 27,400 | |
Fair Value | $ 47,702 | $ 52,709 |
Securities - Composition of Res
Securities - Composition of Restricted Securities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Investments, Debt and Equity Securities [Abstract] | ||
Federal Home Loan Bank stock | $ 645 | $ 623 |
Federal Reserve Bank stock | 875 | 875 |
Community Bankers’ Bank stock | 50 | 50 |
Total restricted securities | $ 1,570 | $ 1,548 |
Loans - Summary of Loans (Detai
Loans - Summary of Loans (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Real estate loans: | |||
Loans | $ 522,201 | $ 486,067 | |
Allowance for loan losses | (5,326) | (5,321) | $ (5,524) |
Loans, net | 516,875 | 480,746 | |
Real estate loans | Construction and land development | |||
Real estate loans: | |||
Loans | 35,927 | 34,699 | |
Allowance for loan losses | (414) | (441) | (1,532) |
Real estate loans | Secured by 1-4 family residential | |||
Real estate loans: | |||
Loans | 208,177 | 198,763 | |
Allowance for loan losses | (775) | (1,019) | (939) |
Real estate loans | Other real estate | |||
Real estate loans: | |||
Loans | 222,256 | 211,210 | |
Allowance for loan losses | (2,948) | (3,142) | (2,534) |
Commercial and industrial loans | |||
Real estate loans: | |||
Loans | 38,763 | 29,981 | |
Allowance for loan losses | (418) | (380) | (306) |
Consumer and other loans | |||
Real estate loans: | |||
Loans | 17,078 | 11,414 | |
Allowance for loan losses | $ (771) | $ (339) | $ (213) |
Loans - Additional Information
Loans - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment [Line Items] | ||
Net deferred loan fees and costs | $ 301 | $ 142 |
Total loans | 522,201 | 486,067 |
Consumer and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | 17,078 | 11,414 |
Consumer and other loans | Demand Deposit Overdrafts | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total loans | $ 232 | $ 264 |
Loans - Summary of Loan Classes
Loans - Summary of Loan Classes and an Aging of Past Due Loans (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 4,571 | $ 3,025 |
Current | 517,630 | 483,042 |
Total Loans | 522,201 | 486,067 |
Non- Accrual Loans | 937 | 1,520 |
90 Days or More Past Due and Accruing | 183 | 116 |
30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 3,869 | 1,356 |
60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 477 | 1,227 |
90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 225 | 442 |
Real estate loans | Construction and land development | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 1,056 | 40 |
Current | 34,871 | 34,659 |
Total Loans | 35,927 | 34,699 |
Non- Accrual Loans | 269 | 1,033 |
90 Days or More Past Due and Accruing | 40 | 0 |
Real estate loans | Construction and land development | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 986 | 0 |
Real estate loans | Construction and land development | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 30 | 40 |
Real estate loans | Construction and land development | 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 40 | 0 |
Real estate loans | Secured by 1-4 family residential | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 957 | 1,560 |
Current | 207,220 | 197,203 |
Total Loans | 208,177 | 198,763 |
Non- Accrual Loans | 267 | 413 |
90 Days or More Past Due and Accruing | 106 | 84 |
Real estate loans | Secured by 1-4 family residential | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 606 | 980 |
Real estate loans | Secured by 1-4 family residential | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 203 | 170 |
Real estate loans | Secured by 1-4 family residential | 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 148 | 410 |
Real estate loans | Other real estate | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 2,222 | 1,022 |
Current | 220,034 | 210,188 |
Total Loans | 222,256 | 211,210 |
Non- Accrual Loans | 401 | 74 |
90 Days or More Past Due and Accruing | 10 | 0 |
Real estate loans | Other real estate | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 2,042 | 321 |
Real estate loans | Other real estate | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 170 | 701 |
Real estate loans | Other real estate | 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 10 | 0 |
Commercial and industrial loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 209 | 377 |
Current | 38,554 | 29,604 |
Total Loans | 38,763 | 29,981 |
Non- Accrual Loans | 0 | 0 |
90 Days or More Past Due and Accruing | 0 | 32 |
Commercial and industrial loans | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 184 | 36 |
Commercial and industrial loans | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 25 | 309 |
Commercial and industrial loans | 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 0 | 32 |
Consumer and other loans | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 127 | 26 |
Current | 16,951 | 11,388 |
Total Loans | 17,078 | 11,414 |
Non- Accrual Loans | 0 | 0 |
90 Days or More Past Due and Accruing | 27 | 0 |
Consumer and other loans | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 51 | 19 |
Consumer and other loans | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 49 | 7 |
Consumer and other loans | 90 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 27 | $ 0 |
Loans - Analysis of the Credit
Loans - Analysis of the Credit Risk Profile of Each Loan Class (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financing Receivable, Recorded Investment [Line Items] | ||
Total | $ 522,201 | $ 486,067 |
Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 507,176 | 463,690 |
Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 5,225 | 13,073 |
Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 9,800 | 9,304 |
Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Real estate loans | Construction and land development | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 35,927 | 34,699 |
Real estate loans | Construction and land development | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 31,553 | 29,416 |
Real estate loans | Construction and land development | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 2,268 | 2,402 |
Real estate loans | Construction and land development | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 2,106 | 2,881 |
Real estate loans | Construction and land development | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Real estate loans | Secured by 1-4 family residential | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 208,177 | 198,763 |
Real estate loans | Secured by 1-4 family residential | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 204,166 | 193,395 |
Real estate loans | Secured by 1-4 family residential | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 1,933 | 3,295 |
Real estate loans | Secured by 1-4 family residential | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 2,078 | 2,073 |
Real estate loans | Secured by 1-4 family residential | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Real estate loans | Other real estate | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 222,256 | 211,210 |
Real estate loans | Other real estate | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 215,773 | 200,009 |
Real estate loans | Other real estate | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 971 | 6,990 |
Real estate loans | Other real estate | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 5,512 | 4,211 |
Real estate loans | Other real estate | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Commercial and industrial loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 38,763 | 29,981 |
Commercial and industrial loans | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 38,606 | 29,456 |
Commercial and industrial loans | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 53 | 386 |
Commercial and industrial loans | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 104 | 139 |
Commercial and industrial loans | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Consumer and other loans | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 17,078 | 11,414 |
Consumer and other loans | Pass | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 17,078 | 11,414 |
Consumer and other loans | Special Mention | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Consumer and other loans | Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | 0 | 0 |
Consumer and other loans | Doubtful | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Total | $ 0 | $ 0 |
Allowance for Loan Losses - All
Allowance for Loan Losses - Allowance by Impairment Methodology and Loans by Impairment Methodology (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Allowance for loan losses: | ||
Beginning balance | $ 5,321 | $ 5,524 |
Charge-offs | (733) | (788) |
Recoveries | 638 | 585 |
Provision for (recovery of) loan losses | 100 | 0 |
Ending balance | 5,326 | 5,321 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 37 |
Collectively evaluated for impairment | 5,326 | 5,284 |
Loans: | ||
Total Loans | 522,201 | 486,067 |
Individually evaluated for impairment | 3,811 | 4,860 |
Collectively evaluated for impairment | 518,390 | 481,207 |
Real estate loans | Construction and land development | ||
Allowance for loan losses: | ||
Beginning balance | 441 | 1,532 |
Charge-offs | 0 | 0 |
Recoveries | 11 | 4 |
Provision for (recovery of) loan losses | (38) | (1,095) |
Ending balance | 414 | 441 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 414 | 441 |
Loans: | ||
Total Loans | 35,927 | 34,699 |
Individually evaluated for impairment | 1,150 | 1,973 |
Collectively evaluated for impairment | 34,777 | 32,726 |
Real estate loans | Secured by 1-4 family residential | ||
Allowance for loan losses: | ||
Beginning balance | 1,019 | 939 |
Charge-offs | (126) | (83) |
Recoveries | 302 | 293 |
Provision for (recovery of) loan losses | (420) | (130) |
Ending balance | 775 | 1,019 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 37 |
Collectively evaluated for impairment | 775 | 982 |
Loans: | ||
Total Loans | 208,177 | 198,763 |
Individually evaluated for impairment | 1,307 | 1,828 |
Collectively evaluated for impairment | 206,870 | 196,935 |
Real estate loans | Other real estate | ||
Allowance for loan losses: | ||
Beginning balance | 3,142 | 2,534 |
Charge-offs | 0 | (165) |
Recoveries | 50 | 2 |
Provision for (recovery of) loan losses | (244) | 771 |
Ending balance | 2,948 | 3,142 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 2,948 | 3,142 |
Loans: | ||
Total Loans | 222,256 | 211,210 |
Individually evaluated for impairment | 1,289 | 984 |
Collectively evaluated for impairment | 220,967 | 210,226 |
Commercial and industrial loans | ||
Allowance for loan losses: | ||
Beginning balance | 380 | 306 |
Charge-offs | 0 | 0 |
Recoveries | 10 | 11 |
Provision for (recovery of) loan losses | 28 | 63 |
Ending balance | 418 | 380 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 418 | 380 |
Loans: | ||
Total Loans | 38,763 | 29,981 |
Individually evaluated for impairment | 65 | 75 |
Collectively evaluated for impairment | 38,698 | 29,906 |
Consumer and other loans | ||
Allowance for loan losses: | ||
Beginning balance | 339 | 213 |
Charge-offs | (607) | (540) |
Recoveries | 265 | 275 |
Provision for (recovery of) loan losses | 774 | 391 |
Ending balance | 771 | 339 |
Ending Balance: | ||
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 771 | 339 |
Loans: | ||
Total Loans | 17,078 | 11,414 |
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | $ 17,078 | $ 11,414 |
Allowance for Loan losses - Imp
Allowance for Loan losses - Impaired Loans and Related Allowance (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance | $ 4,575 | $ 5,545 |
Recorded Investment with No Allowance | 3,811 | 4,707 |
Recorded Investment with Allowance | 0 | 153 |
Total Recorded Investment | 3,811 | 4,860 |
Related Allowance | 0 | 37 |
Average Recorded Investment | 4,656 | 7,034 |
Interest Income Recognized | 232 | 176 |
Real estate loans | Construction and land development | ||
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance | 1,627 | 2,388 |
Recorded Investment with No Allowance | 1,150 | 1,973 |
Recorded Investment with Allowance | 0 | 0 |
Total Recorded Investment | 1,150 | 1,973 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 1,814 | 2,407 |
Interest Income Recognized | 63 | 66 |
Real estate loans | Secured by 1-4 family residential | ||
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance | 1,387 | 1,851 |
Recorded Investment with No Allowance | 1,307 | 1,675 |
Recorded Investment with Allowance | 0 | 153 |
Total Recorded Investment | 1,307 | 1,828 |
Related Allowance | 0 | 37 |
Average Recorded Investment | 1,637 | 2,013 |
Interest Income Recognized | 64 | 87 |
Real estate loans | Other real estate | ||
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance | 1,483 | 1,213 |
Recorded Investment with No Allowance | 1,289 | 984 |
Recorded Investment with Allowance | 0 | 0 |
Total Recorded Investment | 1,289 | 984 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 1,137 | 2,529 |
Interest Income Recognized | 95 | 22 |
Commercial and industrial loans | ||
Financing Receivable, Impaired [Line Items] | ||
Unpaid Principal Balance | 78 | 93 |
Recorded Investment with No Allowance | 65 | 75 |
Recorded Investment with Allowance | 0 | 0 |
Total Recorded Investment | 65 | 75 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 68 | 85 |
Interest Income Recognized | $ 10 | $ 1 |
Allowance for Loan Losses - Add
Allowance for Loan Losses - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2017USD ($)Contract | Dec. 31, 2016USD ($)Contract | |
Allowance For Loan Losses [Line Items] | ||
TDRs performing under the restructured terms | $ 333,000 | $ 460,000 |
Loans modified under TDRs | Contract | 0 | 1 |
Pre-modification recorded investment totaled | $ 138,000 | |
Post-modification recorded investment totaled | 88,000 | |
Increase (decrease) in allowance for loan losses | 32,000 | |
Charge offs | 50,000 | |
Troubled debt restructuring loan subsequent default | $ 0 | 0 |
Troubled debt restructuring loan subsequent default period | 90 days | |
Non-accrual loans excluded from impaired loan disclosure | $ 0 | 0 |
Interest accrued on loan | 107,000 | 107,000 |
Performing Financing Receivable | ||
Allowance For Loan Losses [Line Items] | ||
TDRs performing under the restructured terms | $ 282,000 | $ 300,000 |
Other Real Estate Owned - Summa
Other Real Estate Owned - Summary of Changes in the Balance for OREO (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Real Estate [Abstract] | ||
Balance at the beginning of year, gross | $ 250 | $ 2,903 |
Transfers in | 326 | 287 |
Charge-offs | 0 | (251) |
Sales proceeds | (441) | (2,882) |
Gain on disposition | 191 | 193 |
Balance at the end of year, gross | 326 | 250 |
Less: valuation allowance | 0 | 0 |
Balance at the end of year, net | $ 326 | $ 250 |
Other Real Estate Owned - Addit
Other Real Estate Owned - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Real Estate [Line Items] | |||
Residential real estate carrying amount included in OREO | $ 326,000 | $ 250,000 | $ 2,903,000 |
Net expenses applicable to other real estate owned | 5,000 | 46,000 | |
Residential Real Estate Properties | |||
Other Real Estate [Line Items] | |||
Residential real estate carrying amount included in OREO | 0 | $ 0 | |
Mortgage loans foreclosed | $ 0 |
Other Real Estate Owned - Sum65
Other Real Estate Owned - Summary of Changes in the Valuation Allowance (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Real Estate [Abstract] | ||
Balance at beginning of year | $ 0 | $ 224 |
Provision for losses | 0 | 27 |
Charge-offs, net | 0 | (251) |
Balance at end of year | $ 0 | $ 0 |
Premises and Equipment - Summar
Premises and Equipment - Summary of Premises and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 29,761 | $ 29,372 |
Less accumulated depreciation | 9,870 | 8,587 |
Premises and equipment, net | 19,891 | 20,785 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 4,717 | 4,796 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 18,510 | 18,524 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 6,394 | 5,836 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 140 | $ 216 |
Premises and Equipment - Additi
Premises and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense included in operating expenses | $ 1.4 | $ 1.4 |
Deposits - Additional Informati
Deposits - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Banking and Thrift [Abstract] | ||
Time deposits, in denominations of $250 thousand or more | $ 14,100 | $ 10,100 |
Brokered deposits | $ 550 | $ 601 |
Deposits - Scheduled Maturities
Deposits - Scheduled Maturities of Time Deposits (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Banking and Thrift [Abstract] | ||
2,018 | $ 59,833 | |
2,019 | 26,929 | |
2,020 | 16,381 | |
2,021 | 12,454 | |
2,022 | 6,745 | |
Thereafter | 309 | |
Time deposits | $ 122,651 | $ 128,427 |
Other Borrowings - Additional I
Other Borrowings - Additional Information (Detail) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Unused lines of credit | $ 134,100,000 | $ 125,600,000 |
Blanket floating lien agreement | 19.00% | |
Collateral pledged on borrowings including real estate loans | $ 117,700,000 | 103,900,000 |
FHLB stock book value | 645,000 | 623,000 |
Borrowings from FHLB | 0 | $ 0 |
FHLB | ||
Debt Instrument [Line Items] | ||
Unused lines of credit | $ 82,100,000 |
Subordinated Debt - Additional
Subordinated Debt - Additional Information (Detail) - 6.75% Fixed Interest Subordinate Term Note - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 30, 2015 |
Subordinated Borrowing [Line Items] | |||
Aggregate principal amount | $ 5,000 | ||
Fixed interest rate | 6.75% | ||
Unsecured Debt | |||
Subordinated Borrowing [Line Items] | |||
Unamortized debt issuance costs | $ 52 | $ 70 |
Junior Subordinated Debt - Addi
Junior Subordinated Debt - Additional Information (Detail) - USD ($) $ in Millions | Jul. 31, 2006 | Jun. 17, 2004 | Dec. 31, 2017 | Dec. 31, 2016 |
First National (VA) Statutory Trust II | ||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||
Issuance of trust preferred securities | $ 5 | |||
LIBOR-indexed floating rate of interest | 4.20% | 3.59% | ||
Junior subordinated debt | $ 5.2 | |||
First National (VA) Statutory Trust III | ||||
Financial Instruments Subject to Mandatory Redemption by Settlement Terms [Line Items] | ||||
Issuance of trust preferred securities | $ 4 | |||
LIBOR-indexed floating rate of interest | 2.94% | 2.45% | ||
Junior subordinated debt | $ 4.1 | |||
Maximum capital required for capital adequacy | 25.00% |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred Tax Assets | ||
Allowance for loan losses | $ 1,118 | $ 1,809 |
Securities available for sale | 281 | 447 |
Accrued pension | 0 | 689 |
Accrued health insurance | 11 | 0 |
Core deposit intangible | 317 | 371 |
Unvested stock-based compensation | 9 | 19 |
Limited partnership investments | 5 | 17 |
Loan origination fees, net | 63 | 48 |
Deferred tax assets, Total | 1,804 | 3,400 |
Deferred Tax Liabilities | ||
Depreciation | 562 | 708 |
Discount accretion | 0 | 2 |
Overfunded pension liability | 27 | 0 |
Deferred tax liabilities, Total | 589 | 710 |
Net deferred tax assets | $ 1,215 | $ 2,690 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Current tax expense | $ 2,443 | $ 1,925 |
Deferred tax expense | 1,283 | 428 |
Income tax expense | 3,726 | $ 2,353 |
Income tax expense due to re-measurement of net deferred tax assets | $ 752 |
Income Taxes - Income Tax Exp75
Income Taxes - Income Tax Expense Differs from the Amount of Income Tax Determined by Applying the U.S. Federal Income Tax Rate to Pretax Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Computed tax expense at statutory federal rate | $ 3,459 | $ 2,808 |
Increase in income taxes resulting from re-measurement of net deferred tax assets | 752 | 0 |
Decrease in income taxes resulting from: | ||
Tax-exempt interest and dividend income | (241) | (254) |
Income from bank owned life insurance | (244) | (179) |
Other | 0 | (22) |
Income tax expense | $ 3,726 | $ 2,353 |
Funds Restrictions and Reserv76
Funds Restrictions and Reserve Balance - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Aggregate amount of unrestricted funds | $ 4.5 | |
First Bank | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Aggregate amounts of daily average required balances of reserve against its deposits | $ 7.4 | $ 6 |
Benefit Plans - Additional Info
Benefit Plans - Additional Information (Detail) - USD ($) | Mar. 08, 2018 | Jan. 01, 2000 | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | ||||
Minimum eligibility for full-time employees, age | 21 years | |||
Number of highest-paid consecutive years for benefits | 5 years | |||
Employer contributions | $ 1,800,000 | $ 0 | ||
Amount of accumulated benefit obligation for the defined benefit pension plan | $ 5,300,000 | 5,800,000 | ||
Percentage of first employee compensation for which company makes matching contribution | 1.00% | |||
Company contribution on employee specific contribution | 50.00% | |||
Number of hours in service required for the contribution to be allocated | 1000 hours | |||
Minimum eligibility for employees under 401(k) Plan age | 19 years | |||
Number of plan service years after which employer matching contribution vest | 2 years | |||
Expense attributable to the Plan amounted | $ 740,000 | 482,000 | ||
Percentage of vested participants | 100.00% | |||
Participants years of credited service | 2 years | |||
Compensation expense for ESOP | $ 0 | $ 0 | ||
Shares of the Company held by the ESOP (in shares) | 230,846 | 247,283 | ||
Minimum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Period of service credit by employee | 1 year | |||
Percentage of employee for which company makes specified contribution | 2.00% | |||
Maximum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Percentage of employee for which company makes specified contribution | 6.00% | |||
Subsequent Event | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employer contributions | $ 205,000 |
Benefit Plans - Schedule of Cha
Benefit Plans - Schedule of Changes in Plan Benefit Obligation and Fair Value of Assets (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Change in Benefit Obligation | ||
Benefit obligation, beginning of year | $ 5,777,000 | $ 8,107,000 |
Service cost | 0 | 410,000 |
Interest cost | 82,000 | 331,000 |
Actuarial (gain) loss | (145,000) | 245,000 |
Benefits paid | (431,000) | (695,000) |
Gain due to curtailment | 0 | (2,621,000) |
Benefit obligation, end of year | 5,283,000 | 5,777,000 |
Changes in Plan Assets | ||
Fair value of plan assets, beginning of year | 3,693,000 | 4,264,000 |
Actual return on plan assets | 16,000 | 124,000 |
Employer contributions | 1,800,000 | 0 |
Benefits paid | (431,000) | (695,000) |
Fair value of assets, end of year | 5,078,000 | 3,693,000 |
Funded Status, end of year | (205,000) | (2,084,000) |
Amount Recognized in Other Liabilities | $ (205,000) | $ (2,084,000) |
Benefit Plans - Amounts Recogni
Benefit Plans - Amounts Recognized in Accumulated Other Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Amounts Recognized in Accumulated Other Comprehensive Loss, net of tax | ||
Net gain | $ (126) | $ 0 |
Deferred income tax expense | 27 | 0 |
Amount recognized | $ (99) | $ 0 |
Benefit Plans - Weighted Averag
Benefit Plans - Weighted Average Assumptions Used to Determine Benefit Obligation (Detail) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Weighted Average Assumptions Used to Determine Benefit Obligation | ||
First five years | 1.96% | 1.47% |
Five years to twenty years | 3.58% | 3.34% |
After twenty years | 4.35% | 4.30% |
Expected return on plan assets | 1.00% | 7.50% |
Rate of compensation increase | 3.00% |
Benefit Plans - Components of N
Benefit Plans - Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Components of Net Periodic Benefit Cost | ||
Service cost | $ 0 | $ 410 |
Interest cost | 82 | 331 |
Expected return on plan assets | (35) | (297) |
Recognized net gain due to curtailment | 0 | (173) |
Recognized net actuarial loss | 0 | 84 |
Net periodic benefit cost | $ 47 | $ 355 |
Benefit Plans - Other Changes i
Benefit Plans - Other Changes in Plan Assets and Benefit Obligations Recognized in Accumulated Other Comprehensive (Income) Loss (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss) | ||
Net gain | $ (126) | $ (2,115) |
Total recognized in other comprehensive income (loss) | (126) | (2,115) |
Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income (Loss) | $ (79) | $ (1,760) |
Benefit Plans - Weighted Aver83
Benefit Plans - Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost (Detail) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Weighted Average Assumptions Used to Determine Net Periodic Benefit Cost | ||
Discount rate | 1.47% | 4.25% |
Expected return on plan assets | 1.00% | 7.50% |
Rate of compensation increase | 3.00% |
Benefit Plans - Schedule of Pen
Benefit Plans - Schedule of Pension Plan's Weighted-Average Asset Allocations (Detail) | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | ||
Total | 100.00% | 100.00% |
Cash and equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Total | 100.00% | 100.00% |
Benefit Plans - Schedule of Fai
Benefit Plans - Schedule of Fair Value Hierarchy, the Company's Pension Plan Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | |||
Total | $ 5,078 | $ 3,693 | $ 4,264 |
Cash and equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 5,078 | 3,693 | |
Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 5,078 | 3,693 | |
Level 1 | Cash and equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 5,078 | 3,693 | |
Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 0 | 0 | |
Level 2 | Cash and equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 0 | 0 | |
Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | 0 | 0 | |
Level 3 | Cash and equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Total | $ 0 | $ 0 |
Earnings per Common Share - Com
Earnings per Common Share - Computation of Basic and Diluted Earnings per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Numerator [Abstract] | ||
Net income | $ 6,448 | $ 5,907 |
Denominator [Abstract] | ||
Weighted average shares outstanding - basic (in shares) | 4,941,233 | 4,924,636 |
Potentially dilutive common shares - restricted stock units (in shares) | 2,665 | 3,548 |
Weighted average shares outstanding - diluted (in shares) | 4,943,898 | 4,928,184 |
Basic (in usd per share) | $ 1.30 | $ 1.20 |
Diluted (in usd per share) | $ 1.30 | $ 1.20 |
Commitments and Unfunded Cred87
Commitments and Unfunded Credits - Financial Instruments Representing Credit Risk (Detail) - First Bank - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Stand-by letters of credit | ||
Other Commitments [Line Items] | ||
Contract amounts represent credit risk | $ 10,379 | $ 8,983 |
Commitments to extend credit and unfunded commitments under lines of credit | ||
Other Commitments [Line Items] | ||
Contract amounts represent credit risk | $ 77,992 | $ 71,421 |
Commitments and Unfunded Cred88
Commitments and Unfunded Credits - Additional Information (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Locked-rate commitments to originate mortgage loans | $ 2,800 |
Loans held for sale | 438 |
Amount on deposit in banks exceeded the insurance limits of the Federal Deposit Insurance Corporation | $ 11 |
Transactions with Related Par89
Transactions with Related Parties - Additional Information (Detail) - First Bank - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | ||
Total loans | $ 225 | $ 148 |
Total principal additions | 99 | |
Total principal payments | 22 | |
Deposits held by Bank from related parties | $ 4,500 | $ 5,600 |
Lease Commitments - Additional
Lease Commitments - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Leases [Abstract] | ||
Total rental expense for operating leases | $ 105 | $ 90 |
Lease Commitments - Minimum Ren
Lease Commitments - Minimum Rental commitments under Noncancelable Leases (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Leases [Abstract] | |
2,018 | $ 124 |
2,019 | 102 |
2,020 | 79 |
2,021 | 74 |
2022 and thereafter | 54 |
Total minimum payments | $ 433 |
Dividend Reinvestment Plan - Ad
Dividend Reinvestment Plan - Additional Information (Detail) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | ||
Period preceding the dividend payment date | 10 days | |
Issuance of common stock dividend reinvestment plan, shares (in shares) | 3,035 | 3,949 |
Fair Value Measurements - Balan
Fair Value Measurements - Balances of Assets Measured at Fair Value on a Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | $ 89,255 | $ 94,802 |
U.S. agency and mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 74,804 | 80,171 |
Obligations of states and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 14,451 | 14,620 |
Corporate equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 11 | |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 89,255 | 94,802 |
Fair Value, Measurements, Recurring | U.S. agency and mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 74,804 | 80,171 |
Fair Value, Measurements, Recurring | Obligations of states and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 14,451 | 14,620 |
Fair Value, Measurements, Recurring | Corporate equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 11 | |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | 11 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. agency and mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Obligations of states and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 11 | |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 89,255 | 94,791 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. agency and mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 74,804 | 80,171 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Obligations of states and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 14,451 | 14,620 |
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Corporate equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | U.S. agency and mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Obligations of states and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | $ 0 | 0 |
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Corporate equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities available for sale, at fair value | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Period of maturity as classifies as short-term borrowings | 90 days | |
Loans Held For Sale | Fair Value, Measurements, Nonrecurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Non recurring fair value adjustments on loans held for sale | $ 0 | $ 0 |
Maximum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Period under consideration for valuation of real estate collateral | 12 months | |
Period under consideration for valuation of business equipment | 1 year | |
Minimum | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Period under consideration for valuation of house or building in the process of construction | 1 year |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Assets Measured at Fair Value on a Nonrecurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other real estate owned | $ 326 | $ 250 |
Fair Value, Measurements, Nonrecurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 116 | |
Other real estate owned | 326 | 250 |
Fair Value, Measurements, Nonrecurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Other real estate owned | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 0 | |
Other real estate owned | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans, net | 116 | |
Other real estate owned | $ 326 | $ 250 |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative Information about Level 3 Fair Value Measurements (Detail) - Fair Value, Measurements, Nonrecurring - Significant Unobservable Inputs (Level 3) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Impaired loans, net | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair Value | $ 116 | |
Range (Weighted- Average) | 10.00% | |
Other real estate owned | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair Value | $ 326 | $ 250 |
Range (Weighted- Average) | 7.00% | 0.00% |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Values and Estimated Fair Values of Company's Financial Instruments (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Financial Assets | ||
Securities available for sale, at fair value | $ 89,255 | $ 94,802 |
Securities held to maturity | 48,208 | 53,398 |
Restricted securities | 1,570 | 1,548 |
Bank owned life insurance | 13,967 | 13,928 |
Accrued interest receivable | 1,916 | 1,746 |
Carrying Amount | ||
Financial Assets | ||
Cash and short-term investments | 39,986 | 41,092 |
Securities available for sale, at fair value | 89,255 | 94,802 |
Securities held to maturity | 48,208 | 53,398 |
Restricted securities | 1,570 | 1,548 |
Loans held for sale | 438 | 337 |
Loans, net | 516,875 | 480,746 |
Bank owned life insurance | 13,967 | 13,928 |
Accrued interest receivable | 1,916 | 1,746 |
Financial Liabilities | ||
Deposits | 664,980 | 645,570 |
Subordinated debt | 4,948 | 4,930 |
Junior subordinated debt | 9,279 | 9,279 |
Accrued interest payable | 98 | 95 |
Fair Value | ||
Financial Assets | ||
Cash and short-term investments | 39,986 | 41,092 |
Securities available for sale, at fair value | 89,255 | 94,802 |
Securities held to maturity | 47,702 | 52,709 |
Restricted securities | 1,570 | 1,548 |
Loans held for sale | 438 | 337 |
Loans, net | 514,013 | 481,475 |
Bank owned life insurance | 13,967 | 13,928 |
Accrued interest receivable | 1,916 | 1,746 |
Financial Liabilities | ||
Deposits | 663,163 | 644,322 |
Subordinated debt | 5,004 | 4,715 |
Junior subordinated debt | 9,653 | 9,075 |
Accrued interest payable | 98 | 95 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair Value | ||
Financial Assets | ||
Cash and short-term investments | 39,986 | 41,092 |
Securities available for sale, at fair value | 0 | 11 |
Securities held to maturity | 0 | 0 |
Restricted securities | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 0 | 0 |
Bank owned life insurance | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities | ||
Deposits | 0 | 0 |
Subordinated debt | 0 | 0 |
Junior subordinated debt | 0 | 0 |
Accrued interest payable | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Fair Value | ||
Financial Assets | ||
Cash and short-term investments | 0 | 0 |
Securities available for sale, at fair value | 89,255 | 94,791 |
Securities held to maturity | 46,186 | 51,223 |
Restricted securities | 1,570 | 1,548 |
Loans held for sale | 438 | 337 |
Loans, net | 0 | 0 |
Bank owned life insurance | 13,967 | 13,928 |
Accrued interest receivable | 1,916 | 1,746 |
Financial Liabilities | ||
Deposits | 542,329 | 517,143 |
Subordinated debt | 0 | 0 |
Junior subordinated debt | 0 | 0 |
Accrued interest payable | 98 | 95 |
Significant Unobservable Inputs (Level 3) | Fair Value | ||
Financial Assets | ||
Cash and short-term investments | 0 | 0 |
Securities available for sale, at fair value | 0 | 0 |
Securities held to maturity | 1,516 | 1,486 |
Restricted securities | 0 | 0 |
Loans held for sale | 0 | 0 |
Loans, net | 514,013 | 481,475 |
Bank owned life insurance | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial Liabilities | ||
Deposits | 120,834 | 127,179 |
Subordinated debt | 5,004 | 4,715 |
Junior subordinated debt | 9,653 | 9,075 |
Accrued interest payable | $ 0 | $ 0 |
Regulatory Matters - Additional
Regulatory Matters - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2019 | Jan. 01, 2018 | Jan. 01, 2017 | Jan. 01, 2016 | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||||||
Capital conservation buffer period | 4 years | |||||
Cash dividends on common stock | $ 692 | $ 591 | ||||
Capital conservation buffer percentage | 1.25% | 0.625% | 0.625% | 0.625% | ||
Capital conservation buffer percentage maintained at bank | 5.12% | 5.47% | ||||
Scenario, Forecast | ||||||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||||||
Capital conservation buffer percentage | 0.625% | 0.625% | ||||
First Bank | ||||||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||||||
Cash dividends on common stock | $ 5,500 |
Regulatory Matters - Comparison
Regulatory Matters - Comparison of Capital of Company and Bank with Minimum Regulatory Guidelines (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Regulatory Capital Requirements [Abstract] | ||
Actual amount total capital (to risk weighted assets) | $ 67,624 | $ 65,590 |
Actual amount tier 1 capital (to risk weighted assets) | 62,298 | 60,269 |
Actual amount common equity tier 1 capital (to risk weighted assets) | 62,298 | 60,269 |
Actual amount tier 1 capital (to average assets) | $ 62,298 | $ 60,269 |
Actual ratio total capital (to risk weighted assets) | 13.12% | 13.47% |
Actual ratio tier 1 capital (to risk weighted assets) | 12.09% | 12.38% |
Actual ratio common equity tier 1 capital (to risk weighted assets) | 12.09% | 12.38% |
Actual ratio tier 1 capital (to average assets) | 8.46% | 8.48% |
Minimum capital requirement amount total capital (to risk weighted assets) | $ 41,239 | $ 38,951 |
Minimum capital requirement amount tier 1 capital (to risk weighted assets) | 30,929 | 29,213 |
Minimum capital requirement amount common equity tier 1 capital (to risk weighted assets) | 23,197 | 21,910 |
Minimum capital requirement amount tier 1 capital (to average assets) | $ 29,457 | $ 28,432 |
Minimum capital requirement ratio total capital (to risk weighted assets) | 8.00% | 8.00% |
Minimum capital requirement ratio tier 1 capital (to risk weighted assets) | 6.00% | 6.00% |
Minimum capital requirement ratio common equity tier 1 capital (to risk weighted assets) | 4.50% | 4.50% |
Minimum capital requirement ratio tier 1 capital (to average assets) | 4.00% | 4.00% |
Minimum to be well capitalized under prompt corrective action provisions amount total capital (to risk weighted assets) | $ 51,548 | $ 48,689 |
Minimum to be well capitalized under prompt corrective action provisions amount tier 1 capital (to risk weighted assets) | 41,239 | 38,951 |
Minimum to be well capitalized under prompt corrective action provisions amount common equity tier 1 capital (to risk weighted assets) | 33,506 | 31,648 |
Minimum to be well capitalized under prompt corrective action provisions amount tier 1 capital (to average assets) | $ 36,821 | $ 35,540 |
Minimum to be well capitalized under prompt corrective action provisions ratio total capital (to risk weighted assets) | 10.00% | 10.00% |
Minimum to be well capitalized under prompt corrective action provisions ratio tier 1 capital (to risk weighted assets) | 8.00% | 8.00% |
Minimum to be well capitalized under prompt corrective action provisions ratio common equity tier 1 capital (to risk weighted assets) | 6.50% | 6.50% |
Minimum to be well capitalized under prompt corrective action provisions ratio tier 1 capital (to average assets) | 5.00% | 5.00% |
Accumulated Other Comprehens100
Accumulated Other Comprehensive Loss - Schedule of Changes in Component of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 52,151 | $ 45,953 |
Unrealized holding losses, net of tax | (82) | (663) |
Reclassification adjustment, net of tax | 59 | (5) |
Pension liability adjustment, net of tax | 83 | 1,396 |
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | 0 | |
Total other comprehensive income | 60 | 728 |
Ending balance | 58,154 | 52,151 |
Unrealized holding losses, tax | (43) | (341) |
Reclassification adjustment, tax | 31 | (3) |
Pension liability adjustment, tax | 43 | 719 |
Net Unrealized Losses on Securities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (860) | (192) |
Unrealized holding losses, net of tax | (82) | (663) |
Reclassification adjustment, net of tax | 59 | (5) |
Pension liability adjustment, net of tax | 0 | 0 |
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | (174) | |
Total other comprehensive income | (197) | (668) |
Ending balance | (1,057) | (860) |
Adjustments Related to Pension Benefits | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 0 | (1,396) |
Unrealized holding losses, net of tax | 0 | 0 |
Reclassification adjustment, net of tax | 0 | 0 |
Pension liability adjustment, net of tax | 83 | 1,396 |
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | 16 | |
Total other comprehensive income | 99 | 1,396 |
Ending balance | 99 | 0 |
Accumulated Other Comprehensive Loss | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (860) | (1,588) |
Unrealized holding losses, net of tax | (82) | (663) |
Reclassification adjustment, net of tax | 59 | (5) |
Pension liability adjustment, net of tax | 83 | 1,396 |
Reclassification of tax effects stranded in accumulated other comprehensive loss by tax rate change | (158) | |
Total other comprehensive income | (98) | 728 |
Ending balance | $ (958) | $ (860) |
Accumulated Other Comprehens101
Accumulated Other Comprehensive Loss - Reclassifications from Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net securities losses (gains) reclassified into earnings | $ 90 | $ (8) |
Related income tax (benefit) expense | 3,726 | 2,353 |
Total reclassifications | (6,448) | (5,907) |
Amount Reclassified from Accumulated Other Comprehensive Loss | Securities Available for Sale | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||
Net securities losses (gains) reclassified into earnings | 90 | (8) |
Related income tax (benefit) expense | (31) | 3 |
Total reclassifications | $ 59 | $ (5) |
Stock Compensation Plans - Addi
Stock Compensation Plans - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | May 13, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense related to stock awards | $ 72 | $ 25 | |
Stock-based compensation | $ 141 | $ 113 | |
2014 Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant (in shares) | 240,000 | ||
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock units, granted (in shares) | 3,939 | ||
Restricted stock units, vested (in shares) | 8,536 | ||
Restricted stock units, nonvested (in shares) | 5,662 | 10,259 | |
Vesting period | 2 years | ||
Total unrecognized pre-tax compensation expense related to unvested restricted stock unit awards | $ 25 | ||
Stock-based compensation | $ 69 | $ 88 | |
Restricted Stock Units | Vested Immediately | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock units, vested (in shares) | 1,317 | ||
Restricted Stock Units | Vesting Within One Year | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock units, nonvested (in shares) | 2,622 | ||
Percentage of units vesting | 50.00% | ||
Restricted Stock Units | Vesting Within Two Years | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of units vesting | 50.00% | ||
CEO | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock units, granted (in shares) | 2,000 | ||
Board of Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock units, granted (in shares) | 2,728 |
Stock Compensation Plans - Summ
Stock Compensation Plans - Summary of Restricted Stock Units (Detail) - Restricted Stock Units | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Shares | |
Beginning of period (in shares) | shares | 10,259 |
Granted (in shares) | shares | 3,939 |
Vested (in shares) | shares | (8,536) |
Forfeited (in shares) | shares | 0 |
End of period (in shares) | shares | 5,662 |
Weighted Average Grant Date Fair Value | |
Beginning balance (in usd per share) | $ / shares | $ 8.88 |
Granted (in usd per share) | $ / shares | 15.20 |
Vested (in usd per share) | $ / shares | 9.89 |
Forfeited (in usd per share) | $ / shares | 0 |
Ending balance (in usd per share) | $ / shares | $ 11.76 |
Parent Company Only Financia104
Parent Company Only Financial Statements - Balance Sheets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | |||
Other assets | $ 5,748 | $ 5,817 | |
Total assets | 739,110 | 716,000 | |
Liabilities and Shareholders’ Equity | |||
Subordinated debt | 4,948 | 4,930 | |
Junior subordinated debt | 9,279 | 9,279 | |
Other liabilities | 1,749 | 4,070 | |
Total liabilities | 680,956 | 663,849 | |
Preferred stock | 0 | 0 | |
Common stock | 6,182 | 6,162 | |
Surplus | 7,260 | 7,093 | |
Retained earnings | 45,670 | 39,756 | |
Accumulated other comprehensive loss, net | (958) | (860) | |
Total shareholders’ equity | 58,154 | 52,151 | $ 45,953 |
Total liabilities and shareholders’ equity | 739,110 | 716,000 | |
Parent Company | |||
Assets | |||
Cash | 9,964 | 5,690 | |
Investment in subsidiaries, at cost, plus undistributed net income | 62,094 | 60,344 | |
Other assets | 327 | 335 | |
Total assets | 72,385 | 66,369 | |
Liabilities and Shareholders’ Equity | |||
Subordinated debt | 4,948 | 4,930 | |
Junior subordinated debt | 9,279 | 9,279 | |
Other liabilities | 4 | 9 | |
Total liabilities | 14,231 | 14,218 | |
Preferred stock | 0 | 0 | |
Common stock | 6,182 | 6,162 | |
Surplus | 7,260 | 7,093 | |
Retained earnings | 45,670 | 39,756 | |
Accumulated other comprehensive loss, net | (958) | (860) | |
Total shareholders’ equity | 58,154 | 52,151 | |
Total liabilities and shareholders’ equity | $ 72,385 | $ 66,369 |
Parent Company Only Financia105
Parent Company Only Financial Statements - Statements of Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Expense | ||
Interest expense | $ 2,386 | $ 1,982 |
Marketing | 576 | 562 |
Supplies | 365 | 450 |
Legal and professional fees | 886 | 884 |
Allocated income tax benefit | (3,726) | (2,353) |
Net income | 6,448 | 5,907 |
Parent Company | ||
Income | ||
Dividends from subsidiary | 5,500 | 2,325 |
Other income | 13 | 0 |
Total income | 5,513 | 2,325 |
Expense | ||
Interest expense | 663 | 620 |
Marketing | 13 | 0 |
Supplies | 3 | 2 |
Legal and professional fees | 113 | 104 |
Data processing | 62 | 61 |
Management fee-subsidiary | 265 | 258 |
Other expense | 8 | 17 |
Total expense | 1,127 | 1,062 |
Income before allocated tax benefits and undistributed income of subsidiary | 4,386 | 1,263 |
Allocated income tax benefit | 379 | 361 |
Income before equity in undistributed income of subsidiary | 4,765 | 1,624 |
Equity in undistributed income of subsidiary | 1,683 | 4,283 |
Net income | $ 6,448 | $ 5,907 |
Parent Company Only Financia106
Parent Company Only Financial Statements - Statements of Cash Flows (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash Flows from Operating Activities | ||
Net income | $ 6,448 | $ 5,907 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of debt issuance costs | 18 | 17 |
(Increase) decrease in other assets | (1,202) | 26 |
Decrease in other liabilities | (2,224) | 406 |
Net cash provided by operating activities | 6,569 | 9,009 |
Cash Flows from Financing Activities | ||
Cash dividends paid on common stock, net of reinvestment | (646) | (550) |
Net cash provided by financing activities | 18,868 | 18,071 |
(Decrease) increase in cash and cash equivalents | (1,106) | 1,758 |
Cash and Cash Equivalents | ||
Cash and cash equivalents, beginning of year | 41,092 | 39,334 |
Cash and cash equivalents, end of year | 39,986 | 41,092 |
Parent Company | ||
Cash Flows from Operating Activities | ||
Net income | 6,448 | 5,907 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Equity in undistributed income of subsidiary | (1,683) | (4,283) |
Amortization of debt issuance costs | 18 | 17 |
(Increase) decrease in other assets | (3) | 74 |
Decrease in other liabilities | (1) | 0 |
Net cash provided by operating activities | 4,779 | 1,715 |
Cash Flows from Financing Activities | ||
Cash dividends paid on common stock, net of reinvestment | (646) | (550) |
Net proceeds from issuance of common stock | 141 | 113 |
Net cash provided by financing activities | (505) | (437) |
(Decrease) increase in cash and cash equivalents | 4,274 | 1,278 |
Cash and Cash Equivalents | ||
Cash and cash equivalents, beginning of year | 5,690 | 4,412 |
Cash and cash equivalents, end of year | $ 9,964 | $ 5,690 |