Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 01, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | FIRST KEYSTONE CORP | ||
Entity Central Index Key | 0000737875 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 130,935,652 | ||
Trading Symbol | FKYS | ||
Entity Common Stock, Shares Outstanding | 5,764,710 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Ex Transition Period | false | ||
Entity Small Business | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and due from banks | $ 9,822 | $ 7,913 |
Interest-bearing deposits in other banks | 1,128 | 826 |
Total cash and cash equivalents | 10,950 | 8,739 |
Time deposits with other banks | 1,482 | 1,482 |
Available-for-sale debt securities, at fair value | 316,054 | 348,586 |
Marketable equity securities, at fair value | 1,560 | 1,632 |
Restricted investment in bank stocks | 8,681 | 4,058 |
Loans | 606,027 | 558,563 |
Loans held for sale | 365 | 834 |
Allowance for loan losses | (6,745) | (7,487) |
Net loans | 599,647 | 551,910 |
Premises and equipment, net | 19,946 | 20,623 |
Accrued interest receivable | 4,041 | 4,237 |
Cash surrender value of bank owned life insurance | 22,963 | 22,354 |
Investments in low-income housing partnerships | 2,096 | 2,626 |
Goodwill | 19,133 | 19,133 |
Foreclosed assets held for resale | 1,163 | 1,071 |
Deferred income taxes | 1,469 | 936 |
Other assets | 2,815 | 2,734 |
TOTAL ASSETS | 1,012,000 | 990,121 |
Deposits: | ||
Non-interest bearing | 126,361 | 121,415 |
Interest bearing | 545,192 | 656,731 |
Total deposits | 671,553 | 778,146 |
Short-term borrowings | 174,445 | 26,296 |
Long-term borrowings | 45,000 | 65,000 |
Accrued interest payable | 785 | 490 |
Other liabilities | 3,461 | 3,470 |
TOTAL LIABILITIES | 895,244 | 873,402 |
STOCKHOLDERS' EQUITY | ||
Preferred stock, par value $2.00 per share; authorized 1,000,000 shares as of December 31, 2018 and 2017; issued 0 in 2018 and 2017 | 0 | 0 |
Common stock, par value $2.00 per share; authorized 20,000,000 shares as of December 31, 2018 and 2017; issued 5,996,322 as of December 31, 2018 and 5,950,951 as of December 31, 2017; outstanding 5,764,710 as of December 31, 2018 and 5,719,339 as of December 31, 2017 | 11,993 | 11,902 |
Surplus | 37,255 | 36,193 |
Retained earnings | 75,798 | 72,507 |
Accumulated other comprehensive (loss) income | (2,581) | 1,826 |
Treasury stock, at cost, 231,612 shares in 2018 and 2017 | (5,709) | (5,709) |
TOTAL STOCKHOLDERS' EQUITY | 116,756 | 116,719 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,012,000 | $ 990,121 |
CONSOLIDATED BALANCE SHEETS _Pa
CONSOLIDATED BALANCE SHEETS [Parenthetical] - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred stock, par value (in dollars per share) | $ 2 | $ 2 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 2 | $ 2 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 5,996,322 | 5,950,951 |
Common stock, shares outstanding | 5,764,710 | 5,719,339 |
Treasury stock, shares | 231,612 | 231,612 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
INTEREST INCOME | ||
Interest and fees on loans | $ 25,886 | $ 22,615 |
Interest and dividend income on investment securities: | ||
Taxable | 4,585 | 4,304 |
Tax-exempt | 4,576 | 4,979 |
Dividends | 47 | 47 |
Dividend income on restricted investment in bank stocks | 443 | 289 |
Interest on interest-bearing deposits in other banks | 36 | 34 |
Total interest income | 35,573 | 32,268 |
INTEREST EXPENSE | ||
Interest on deposits | 5,193 | 4,232 |
Interest on short-term borrowings | 2,277 | 844 |
Interest on long-term borrowings | 1,150 | 1,472 |
Total interest expense | 8,620 | 6,548 |
Net interest income | 26,953 | 25,720 |
Provision for loan losses | 200 | 267 |
Net interest income after provision for loan losses | 26,753 | 25,453 |
NON-INTEREST INCOME | ||
Trust department | 943 | 880 |
Service charges and fees | 2,059 | 1,803 |
Bank owned life insurance income | 609 | 636 |
ATM fees and debit card income | 1,567 | 1,396 |
Gains on sales of mortgage loans | 188 | 316 |
Net securities (losses) gains | (65) | 938 |
Other | 261 | 202 |
Total non-interest income | 5,562 | 6,171 |
NON-INTEREST EXPENSE | ||
Salaries and employee benefits | 11,770 | 11,170 |
Occupancy, net | 1,741 | 1,777 |
Furniture and equipment | 598 | 569 |
Computer expense | 1,017 | 1,025 |
Professional services | 1,051 | 866 |
Pennsylvania shares tax | 780 | 742 |
FDIC insurance | 311 | 321 |
ATM and debit card fees | 806 | 697 |
Data processing fees | 1,032 | 992 |
Foreclosed assets held for resale | 148 | 135 |
Advertising | 507 | 530 |
Other | 2,884 | 2,697 |
Total non-interest expense | 22,645 | 21,521 |
Income before income tax expense | 9,670 | 10,103 |
Income tax expense | 459 | 1,455 |
NET INCOME | $ 9,211 | $ 8,648 |
Net income per share: | ||
Basic | $ 1.60 | $ 1.52 |
Diluted | 1.60 | 1.52 |
Dividends per share | $ 1.08 | $ 1.08 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Net Income | $ 9,211 | $ 8,648 | |
Other comprehensive (loss) income: | |||
Unrealized net holding (losses) gains on debt securities arising during the period, net of income taxes of $(1,097) and $2,002, respectively | (4,127) | 3,859 | |
Less reclassification adjustment for net gains included in net income, net of income taxes of $(1) and $(324), respectively (a) (b) | [1],[2] | (6) | (614) |
Total other comprehensive (loss) income | (4,133) | 3,245 | |
Total Comprehensive Income | $ 5,078 | $ 11,893 | |
[1] | Gross amounts are included in net securities (losses) gains on the Consolidated Statements of Income in non-interest income. | ||
[2] | Income tax amounts are included in income tax expense on the Consolidated Statements of Income. |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Parenthetical] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax | $ (1,097) | $ 2,002 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | $ (1) | $ (324) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Surplus [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Treasury Stock [Member] | |
Balance at Dec. 31, 2016 | $ 109,685 | $ 11,809 | $ 35,047 | $ 70,004 | $ (1,419) | $ (5,756) | |
Balance (in shares) at Dec. 31, 2016 | 5,904,563 | ||||||
Net Income | 8,648 | 8,648 | |||||
Other comprehensive loss, net of taxes | 3,245 | 3,245 | |||||
Issuance of common stock under dividend reinvestment plan | 1,286 | $ 93 | 1,146 | 47 | |||
Issuance of common stock under dividend reinvestment plan (in shares) | 46,388 | ||||||
Dividends - $1.08 per share | (6,145) | (6,145) | |||||
Balance at Dec. 31, 2017 | 116,719 | $ 11,902 | 36,193 | 72,507 | 1,826 | (5,709) | |
Balance (in shares) at Dec. 31, 2017 | 5,950,951 | ||||||
Net Income | 9,211 | 9,211 | |||||
Other comprehensive loss, net of taxes | (4,133) | (4,133) | |||||
Issuance of common stock under dividend reinvestment plan | 1,153 | $ 91 | 1,062 | ||||
Issuance of common stock under dividend reinvestment plan (in shares) | 45,371 | ||||||
Impact of adoption of accounting standards | [1] | 0 | 274 | (274) | |||
Dividends - $1.08 per share | (6,194) | (6,194) | |||||
Balance at Dec. 31, 2018 | $ 116,756 | $ 11,993 | $ 37,255 | $ 75,798 | $ (2,581) | $ (5,709) | |
Balance (in shares) at Dec. 31, 2018 | 5,996,322 | ||||||
[1] | Represents the impact of adopting Accounting Standard Updates (“ASU”) 2018-02 and ASU 2016-01 effective January 1, 2018. See Note 1 to the consolidated financial statements for more information. |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY [Parenthetical] - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash dividends, per share | $ 1.08 | $ 1.08 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 9,211 | $ 8,648 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision for loan losses | 200 | 267 |
Depreciation and amortization | 1,056 | 1,112 |
Net premium amortization on debt securities | 3,343 | 4,546 |
Deferred income tax expense | 566 | 146 |
Gains on sales of mortgage loans | (188) | (316) |
Proceeds from sales of mortgage loans originated for resale | 8,948 | 11,484 |
Originations of mortgage loans originated for resale | (8,926) | (11,906) |
Net securities losses (gains) | 65 | (938) |
Net losses (gains) on sales of foreclosed real estate held for resale, including write-downs | 162 | (19) |
Decrease (increase) in accrued interest receivable | 196 | (320) |
Earnings on investment in bank owned life insurance | (609) | (636) |
Net (gains) losses on disposals of premises and equipment | (10) | 2 |
(Increase) decrease in other assets | (81) | 203 |
Amortization of investment in low-income housing partnerships | 530 | 181 |
Increase in accrued interest payable | 295 | 63 |
Decrease in other liabilities | (17) | (313) |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 14,741 | 12,204 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sales of debt securities available-for-sale | 44,122 | 81,807 |
Proceeds from maturities and redemptions of debt securities available-for-sale | 22,058 | 21,662 |
Purchases of debt securities available-for-sale | (42,216) | (72,735) |
Proceeds from maturities and redemptions of investment securities held-to-maturity | 0 | 4 |
Net change in restricted investment in bank stocks | (4,623) | 1,419 |
Net increase in loans | (48,203) | (36,506) |
Purchase of premises and equipment | (446) | (2,585) |
Purchase of investment in low-income housing partnerships | 0 | (252) |
Proceeds from sales of foreclosed assets held for resale | 263 | 398 |
NET CASH USED IN INVESTING ACTIVITIES | (29,045) | (6,788) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net (decrease) increase in deposits | (106,593) | 52,164 |
Net increase (decrease) in short-term borrowings | 148,149 | (42,994) |
Proceeds from long-term borrowings | 3,000 | 0 |
Repayment of long-term borrowings | (23,000) | (10,116) |
Common stock issued | 1,153 | 1,261 |
Proceeds from exercise of stock options | 0 | 25 |
Dividends paid | (6,194) | (6,145) |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 16,515 | (5,805) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 2,211 | (389) |
CASH AND CASH EQUIVALENTS, BEGINNING | 8,739 | 9,128 |
CASH AND CASH EQUIVALENTS, ENDING | 10,950 | 8,739 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Interest paid | 8,325 | 6,485 |
Income taxes paid | 672 | 1,292 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES | ||
Loans transferred to foreclosed assets held for resale | 517 | 177 |
Loans transferred from held for sale portfolio | $ (611) | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies [Text Block] | NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of First Keystone Corporation and Subsidiary (the “Corporation”) are in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and conform to common practices within the banking industry. The more significant accounting policies follow: Principles of Consolidation The consolidated financial statements include the accounts of First Keystone Corporation and its wholly-owned subsidiary, First Keystone Community Bank (the “Bank”). All significant inter-company balances and transactions have been eliminated in consolidation. Nature of Operations The Corporation, headquartered in Berwick, Pennsylvania, provides a full range of banking, trust and related services through its wholly-owned Bank subsidiary and is subject to competition from other financial institutions in connection with these services. The Bank serves a customer base which includes individuals, businesses, governments, and public and institutional customers primarily located in the Northeast Region of Pennsylvania. The Bank has 18 full service offices, one loan production office, and 20 Automated Teller Machines (“ATM”) located in Columbia, Luzerne, Montour, Monroe, and Northampton counties. The Corporation and its subsidiary must also adhere to certain federal and state banking laws and regulations and are subject to periodic examinations made by various state and federal agencies. Segment Reporting The Corporation’s subsidiary acts as an independent community financial services provider, and offers traditional banking and related financial services to individual, business, government, and public and institutional customers. Through its branch and ATM network, the Bank offers a full array of commercial and retail financial services, including the taking of time, savings and demand deposits; the making of commercial, consumer and mortgage loans; and the providing of other financial services. The Bank also performs personal, corporate, pension and fiduciary services through its Trust Department. Management does not separately allocate expenses, including the cost of funding loan demand, between the commercial, retail, trust and mortgage banking operations of the Corporation. As such, discrete financial information is not available and segment reporting would not be meaningful. Significant Concentrations of Credit Risk The majority of the Corporation’s activities involve customers located primarily in Columbia, Luzerne, Montour, Monroe, Northampton, and Lehigh counties in Pennsylvania. The types of securities in which the Corporation invests are presented in Note 3 – Securities. Credit risk as it relates to investment activities is moderated through the monitoring of ratings and geographic concentrations residing in the portfolio and the observance of minimum rating levels in the investment policy. Note 4 – Loans and Allowance for Loan Losses summarizes the types of lending in which the Corporation engages. The inherent risks associated with lending activities are mitigated by adhering to conservative underwriting practices and policies, as well as portfolio diversification and thorough monitoring of the loan portfolio. It is management’s opinion that the investment and loan portfolios were well balanced at December 31, 2018, to the extent necessary to avoid any significant concentrations of credit risk. Use of Estimates The preparation of these consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant changes include the determination of other-than-temporary impairment on securities and the determination of the allowance for loan losses. Subsequent Events The Corporation has evaluated events and transactions occurring subsequent to the consolidated balance sheet date of December 31, 2018, for items that should potentially be recognized or disclosed in the consolidated financial statements. The evaluation was conducted through the date these consolidated financial statements were issued. Cash and Cash Equivalents For purposes of reporting consolidated cash flows, cash and cash equivalents include cash on hand and due from banks, interest-bearing deposits in other banks, and federal funds sold. The Corporation considers cash classified as interest-bearing deposits with other banks as a cash equivalent since they are represented by cash accounts essentially on a demand basis and mature within one year. Federal funds are also included as a cash equivalent because they are generally purchased and sold for one-day periods. Time Deposits with Other Banks Time deposits with other banks consist of fully insured certificates of deposit in other banks with maturity dates between one and five years. Securities The Corporation classifies its securities as either “Held-to-Maturity” or “Available-for-Sale” at the time of purchase. Securities are accounted for on a trade date basis. Debt securities are classified as Held-to-Maturity when the Corporation has the ability and positive intent to hold the securities to maturity. Securities classified as Held-to-Maturity are carried at cost adjusted for amortization of premium and accretion of discount to maturity. Debt securities not classified as Held-to-Maturity are included in the Available-for-Sale category and are carried at fair value. The amount of any unrealized gain or loss, net of the effect of deferred income taxes, is reported as accumulated other comprehensive (loss) income (AOCI) in the Consolidated Balance Sheets and Consolidated Statements of Changes in Stockholders’ Equity. Management’s decision to sell Available-for-Sale securities is based on changes in economic conditions controlling the sources and applications of funds, terms, availability of and yield of alternative investments, interest rate risk and the need for liquidity. The cost of debt securities classified as Held-to-Maturity or Available-for-Sale is adjusted for amortization of premiums and accretion of discounts to expected maturity. Such amortization and accretion, as well as interest and dividends, are included in interest and dividend income on investment securities. Realized gains and losses are included in net investment securities gains and losses. The cost of investment securities sold, redeemed or matured is based on the specific identification method. Beginning January 1, 2018, upon adoption of ASU 2016-01, equity securities with readily determinable fair values are stated at fair value with realized and unrealized gains and losses reported in income. For periods prior to January 1, 2018, equity securities were classified as available-for-sale and stated at fair value with unrealized gains and losses reported as a separate component of AOCI, net of tax. Equity securities without readily determinable fair values are recorded at cost less impairment, if any. Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. Securities classified as available-for-sale or held-to-maturity are generally evaluated for OTTI under FASB ASC 320, Investments - Debt and Equity Securities . In determining OTTI under the FASB ASC 320 model, management considers many factors, including (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the entity has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time. When other-than-temporary impairment occurs on debt securities, the amount of the other-than-temporary impairment recognized in earnings depends on whether an entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss. If an entity intends to sell or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before recovery of its amortized cost basis less any current-period loss, the other-than-temporary impairment shall be separated into the amount representing the credit loss and the amount related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is determined based on the present value of cash flows expected to be collected, and the realized loss is recognized as impairment charges on securities on the Consolidated Statements of Income. The amount of the total other-than-temporary impairment related to the other factors shall be recognized in other comprehensive (loss) income, net of applicable taxes. The previous amortized cost basis less the other-than-temporary impairment recognized in earnings becomes the new amortized cost basis of the investment. The fair market value of the equity securities tends to fluctuate with the overall equity markets as well as the trends specific to each institution. The equity securities portfolio is reviewed in a similar manner as that of the debt securities with greater emphasis placed on the length of time the market value has been less than the carrying value and the financial sector outlook. The Corporation also reviews dividend payment activities, levels of non-performing assets and loan loss reserves. The starting point for the equity analysis is the length and severity of market value decline. The realized loss is recognized as impairment charges on securities on the Consolidated Statements of Income. The previous cost basis less the other-than-temporary impairment recognized in earnings becomes the new cost basis of the investment. Restricted Investment in Bank Stocks The Bank owns restricted stock investments in the Federal Home Loan Bank of Pittsburgh (“FHLB-Pittsburgh”) and Atlantic Community Bankers Bank (“ACBB”). These investments do not have a readily determinable fair value because their ownership is restricted and they can be sold back only to the FHLB-Pittsburgh, ACBB or to another member institution. Therefore, these investments are carried at cost. At December 31, 2018, the Corporation held $8,646,000 in stock of FHLB-Pittsburgh and $35,000 in stock of ACBB. At December 31, 2017, the Corporation held $4,023,000 in stock of FHLB-Pittsburgh and $35,000 in stock of ACBB. Management evaluates the restricted investment in bank stocks for impairment on an annual basis. Management’s determination of whether these investments are impaired is based on management’s assessment of the ultimate recoverability of the cost of these investments rather than by recognizing temporary declines in value. The following factors were evaluated to determine the ultimate recoverability of the cost of the Corporation’s restricted investment in bank stocks; (i) the significance of the decline in net assets of the correspondent bank as compared to the capital stock amount for the correspondent bank and the length of time this situation has persisted; (ii) commitments by the correspondent bank to make payments required by law or regulation and the level of such payments in relation to the operating performance of the correspondent bank; (iii) the impact of legislative and regulatory changes on the institutions and, accordingly, on the customer base of the correspondent bank; and (iv) the liquidity position of the correspondent bank. Based on the analysis of these factors, management determined that no impairment charge was necessary related to the restricted investment in bank stocks during 2018 or 2017. Loans Net loans are stated at their outstanding recorded investment, net of deferred fees and costs, unearned income and the allowance for loan losses. Interest on loans is recognized as income over the term of each loan, generally, by the accrual method. Loan origination fees and certain direct loan origination costs have been deferred with the net amount amortized using the straight line method or the interest method over the contractual life of the related loans as an interest yield adjustment. Residential mortgage loans held for sale are carried at the lower of cost or market on an aggregate basis determined by independent pricing from appropriate federal or state agency investors. These loans are sold without recourse. Loans held for sale amounted to $365,000 at December 31, 2018 and $834,000 at December 31, 2017. The loans receivable portfolio is segmented into commercial, residential and consumer loans. Commercial loans consist of the following classes: Commercial and Industrial and Commercial Real Estate. Commercial and Industrial Lending The Corporation originates commercial and industrial loans primarily to businesses located in its primary market area and surrounding areas. These loans are used for various business purposes, which include short-term loans and lines of credit to finance machinery and equipment, inventory and accounts receivable. Generally, the maximum term for loans extended on machinery and equipment is based on the projected useful life of such machinery and equipment. Most business lines of credit are written on demand and are reviewed annually. Commercial and industrial loans are generally secured with short-term assets; however, in many cases, additional collateral such as real estate is provided as additional security for the loan. Loan-to-value maximum thresholds have been established by the Corporation and are specific to the type of collateral. Collateral values may be determined using invoices, inventory reports, accounts receivable aging reports, business financial statements, collateral appraisals, etc. Commercial and industrial loans are typically secured by personal guarantees of the borrower. In underwriting commercial and industrial loans, an analysis is performed to evaluate the borrower's character and capacity to repay the loan, the adequacy of the borrower's capital and collateral, as well as the conditions affecting the borrower. Evaluation of the borrower's past, present and future cash flows is also an important aspect of the Corporation's analysis of the borrower’s ability to repay. Commercial and industrial loans generally present a higher level of risk than other types of loans due primarily to the effect of general economic conditions. Commercial and industrial loans are typically made on the basis of the borrower’s ability to make repayment from cash flows from the borrower’s primary business activities. As a result, the availability of funds for the repayment of commercial and industrial loans is dependent on the success of the business itself, which in turn, is likely to be dependent upon the general economic environment. Commercial Real Estate Lending The Corporation engages in commercial real estate lending in its primary market area and surrounding areas. The Corporation’s commercial real estate portfolio is secured primarily by commercial retail space, commercial office buildings, residential housing and hotels. Generally, commercial real estate loans have terms that do not exceed twenty years, have loan-to-value ratios of up to eighty percent of the value of the collateral property, and are typically secured by personal guarantees of the borrowers. In underwriting these loans, the Corporation performs a thorough analysis of the financial condition of the borrower, the borrower’s credit history, and the reliability and predictability of the cash flow generated by the property securing the loan. The value of the property is determined by either independent appraisers or internal evaluations by Bank officers. Commercial real estate loans generally present a higher level of risk than residential real estate secured loans. Repayment of loans secured by commercial real estate is typically dependent upon the successful operation of the related real estate project and/or the effect of the general economic conditions on income producing properties. Residential Real Estate Lending (Including Home Equity) The Corporation’s residential real estate portfolio is comprised of one-to-four family residential mortgage loan originations, home equity term loans and home equity lines of credit. These loans are generated by the Corporation’s marketing efforts, its present customers, walk-in customers and referrals. These loans originate primarily within or with customers from the Corporation’s market area. The Corporation’s one-to-four family residential mortgage originations are secured primarily by properties located in its primary market area and surrounding areas. The Corporation offers fixed-rate mortgage loans with terms up to a maximum of thirty years for both permanent structures and those under construction. Loans with terms of thirty years are normally held for sale and sold without recourse; most of the residential mortgages held in the Corporation’s residential real estate portfolio have maximum terms of twenty years. Generally, the majority of the Corporation’s residential mortgage loans originate with a loan-to-value of eighty percent or less, or those with primary mortgage insurance at ninety-five percent or less. Home equity term loans are secured by the borrower’s primary residence and typically have a maximum loan-to-value of eighty percent and a maximum term of fifteen years. In general, home equity lines of credit are secured by the borrower’s primary residence with a maximum loan-to-value of eighty percent and a maximum term of twenty years. In underwriting one-to-four family residential mortgage loans, the Corporation evaluates the borrower’s ability to make monthly payments, the borrower’s repayment history and the value of the property securing the loan. The ability and willingness to repay is determined by the borrower’s employment history, current financial conditions and credit background. A majority of the properties securing residential real estate loans made by the Corporation are appraised by independent appraisers. The Corporation generally requires mortgage loan borrowers to obtain an attorney’s title opinion or title insurance and fire and property insurance, including flood insurance, if applicable. Residential mortgage loans, home equity term loans and home equity lines of credit generally present a lower level of risk than consumer loans because they are secured by the borrower’s primary residence. Risk is increased when the Corporation is in a subordinate position, especially to another lender, for the loan collateral. Consumer Lending The Corporation offers a variety of secured and unsecured consumer loans, including vehicle loans, stock loans and loans secured by financial institution deposits. These loans originate primarily within or with customers from the market area. Consumer loan terms vary according to the type and value of collateral and creditworthiness of the borrower. In underwriting personal loans, a thorough analysis is performed regarding the borrower’s willingness and financial ability to repay the loan as agreed. The ability to repay is determined by the borrower’s employment history, current financial condition and credit background. Consumer loans may entail greater credit risk than residential real estate loans, particularly in the case of personal loans which are unsecured or are secured by rapidly depreciable assets, such as automobiles or recreational equipment. In such cases, repossessed collateral for a defaulted personal loan may not provide an adequate source of repayment of the outstanding loan balance as a result of the greater likelihood of damage, loss or depreciation. In addition, personal loan collections are dependent on the borrower’s continuing financial stability and therefore, are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount which can be recovered on such loans. Delinquent Loans Generally, a loan is considered to be past-due when scheduled loan payments are in arrears 10 days or more. Delinquent notices are generated automatically when a loan is 10 or 15 days past-due, depending on loan type. Collection efforts continue on past-due loans that have not been brought current, when it is believed that some chance exists for improvement in the status of the loan. Past-due loans are continually evaluated with the determination for charge-off being made when no reasonable chance remains that the status of the loan can be improved. Commercial and Industrial and Commercial Real Estate loans are charged off in whole or in part when they become sufficiently delinquent based upon the terms of the underlying loan contract and when a collateral deficiency exists. Because all or part of the contractual cash flows are not expected to be collected, the loan is considered to be impaired, and the Bank estimates the impairment based on its analysis of the cash flows or collateral estimated at fair value less cost to sell. Residential Real Estate and Consumer loans are charged off when they become sufficiently delinquent based upon the terms of the underlying loan contract and when the value of the underlying collateral is not sufficient to support the loan balance and a loss is expected. At that time, the amount of estimated collateral deficiency, if any, is charged off for loans secured by collateral, and all other loans are charged off in full. Loans with collateral are charged down to the estimated fair value of the collateral less cost to sell. Loans in which the borrower is in bankruptcy are considered on a case by case basis and are either charged off or reaffirmed by the borrower. Generally, a loan is classified as non-accrual and the accrual of interest on such a loan is discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan may currently be performing. A loan may remain on accrual status if it is well secured (or supported by a strong guarantee) and in the process of collection. When a loan is placed on non-accrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against interest income. Certain non-accrual loans may continue to perform; that is, payments are still being received. Generally, the payments are applied to principal. These loans remain under constant scrutiny, and if performance continues, interest income may be recorded on a cash basis based on management's judgment as to collectability of principal. Allowance for Loan Losses The allowance for loan losses is established through provisions for loan losses charged against income. Loans deemed to be uncollectible are charged against the allowance for loan losses and subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is maintained at a level estimated by management to be adequate to absorb potential loan losses. Management’s periodic evaluation of the adequacy of the allowance for loan losses is based on the Corporation’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay (including the timing of future payments), the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions, and other relevant factors. This evaluation is inherently subjective as it requires material estimates including the amounts and timing of future cash flows expected to be received on impaired loans that may be susceptible to significant change. The allowance consists of specific, general and unallocated components. The specific component relates to loans that are individually classified as impaired. Select loans are not aggregated for collective impairment evaluation, as such; all loans are subject to individual impairment evaluation should the facts and circumstances pertinent to a particular loan suggest that such evaluation is necessary. Factors considered by management in determining impairment include payment status and the probability of collecting scheduled principal and interest payments when due. 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. If a loan is impaired, a portion of the allowance may be allocated so that the loan is reported, net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral if repayment is expected solely from collateral. Troubled debt restructurings are separately identified for impairment disclosures and are measured at the present value of estimated future cash flows using the loan’s effective rate at inception. If a troubled debt restructuring is considered to be a collateral dependent loan, the loan may be reported, net, at the fair value of the collateral. For troubled debt restructurings that subsequently default, the Corporation determines the amount of reserve in accordance with the accounting policy for the allowance for loan losses. The general component covers all other loans not identified as impaired and is based on historical losses and qualitative factors. The historical loss component of the allowance is determined by losses recognized by portfolio segment over a time period that management has determined represents the current credit cycle. Qualitative factors impacting each portfolio segment may include: delinquency trends, loan volume trends, Bank policy changes, management processes and oversight, economic trends (including change in consumer and business disposable incomes, unemployment and under-employment levels, and other conditions), concentrations by industry or product, internal and external loan review processes, collateral value and market conditions, and external factors including regulatory issues and competition. The unallocated component of the allowance is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. A reserve for unfunded lending commitments is provided for possible credit losses on off-balance sheet credit exposures. The reserve for unfunded lending commitments represents management’s estimate of losses inherent in its unfunded loan commitments and, if necessary, is recorded in other liabilities on the Consolidated Balance Sheets. As of December 31, 2018 and 2017 the amount of the reserve for unfunded lending commitments was $117,000 and $116,000, respectively. The Corporation is subject to periodic examination by its federal and state examiners, and may be required by such regulators to recognize additions to the allowance for loan losses based on their assessment of credit information available to them at the time of their examinations. A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect all amounts due according to the contractual terms of the original loan agreement. Under current accounting standards, the allowance for loan losses related to impaired loans is based on discounted cash flows using the loan’s effective interest rate at inception or the fair value of the collateral for certain collateral dependent loans. The restructuring of a loan is considered a “troubled debt restructuring” if both the following conditions are met: (i) the borrower is experiencing financial difficulties, and (ii) the Bank has granted a concession. The most common concessions granted include one or more modifications to the terms of the debt, such as (a) a reduction in the interest rate for the remaining life of the debt, (b) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (c) a temporary period of interest-only payments, and (d) a reduction in the contractual payment amount for either a short period or remaining term of the loan. A less common concession is the forgiveness of a portion of the principal. The determination of whether a borrower is experiencing financial difficulties takes into account not only the current financial condition of the borrower, but also the potential financial condition of the borrower were a concession not granted. Similarly, the determination of whether a concession has been granted is very subjective in nature. For example, simply extending the term of a loan at its original interest rate or even at a higher interest rate could be interpreted as a concession unless the borrower could readily obtain similar credit terms from a different lender. Loans modified in a troubled debt restructuring are considered impaired and may or may not be placed on non-accrual status until the Bank determines the future collection of principal and interest is reasonably assured, which generally requires that the borrower demonstrates a period of performance according to the restructured terms of six months. The Bank utilizes a risk grading matrix as a tool for managing credit risk in the loan portfolio and assigns an asset quality rating (risk grade) to all Commercial and Industrial, Commercial Real Estate, Residential Real Estate and Consumer borrowings. An asset quality rating is assigned using the guidance provided in the Bank’s loan policy. Primary responsibility for assigning the asset quality rating rests with the lender. The asset quality rating is validated periodically by both an internal and external loan review process. The commercial loan grading system focuses on a borrower’s financial strength and performance, experience and depth of management, primary and secondary sources of repayment, the nature of the business and the outlook for the particular industry. Primary emphasis is placed on financial condition and trends. The grade also reflects current economic and industry conditions; as well as other variables such as liquidity, cash flow, revenue/earnings trends, management strengths or weaknesses, quality of financial information, and credit history. The loan grading system for Residential Real Estate and Consumer loans focuses on the borrower’s credit score and credit history, debt-to-income ratio and income sources, collateral position and loan-to-value ratio, as well as other variables such as current economic conditions, and individual strengths and weaknesses. Risk grade characteristics are as follows: Risk Grade 1 – MINIMAL RISK through Risk Grade 6 – MANAGEMENT ATTENTION (Pass Grade Categories) Risk is evaluated via examination of several attributes including but not limited to financial trends, strengths and weaknesses, likelihood of repayment when considering both cash flow and collateral, sources of repayment, leverage position, management expertise, and repayment history. At the low-risk end of the rating scale, a risk grade o |
RESTRICTED CASH BALANCES
RESTRICTED CASH BALANCES | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents Disclosure [Text Block] | NOTE 2 — RESTRICTED CASH BALANCES The Bank is required to maintain certain average reserve balances as established by the Federal Reserve Bank. The amount of those reserve balances for the reserve computation period which included December 31, 2018 and 2017, was $1,178,000 and $1,402,000, respectively, which was satisfied through the restriction of vault cash. In addition, the Bank maintains a clearing balance at the Federal Reserve Bank to offset daily cash management activities and specific charges for services. At December 31, 2018 and 2017, the amount of this balance was $1,118,000 and $815,000, respectively. |
SECURITIES
SECURITIES | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | NOTE 3 — SECURITIES The amortized cost, related estimated fair value, and unrealized gains and losses for debt securities classified as were as follows at December 31, 2018 and 2017: Available-for-Sale Debt Securities (Dollars in thousands) Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018: Cost Gains Losses Value U.S. Treasury securities $ 5,307 $ — $ (12 ) $ 5,295 Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 66,300 105 (1,529 ) 64,876 Other 18,706 21 (484 ) 18,243 Other mortgage backed securities 4,767 — (18 ) 4,749 Obligations of state and political subdivisions 182,621 1,678 (2,021 ) 182,278 Asset backed securities 14,323 47 — 14,370 Corporate debt securities 27,297 24 (1,078 ) 26,243 Total $ 319,321 $ 1,875 $ (5,142 ) $ 316,054 Available-for-Sale Debt Securities (Dollars in thousands) Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017: Cost Gains Losses Value U.S. Treasury securities $ — $ — $ — $ — Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 82,825 210 (1,175 ) 81,860 Other 22,409 132 (308 ) 22,233 Other mortgage backed debt securities — — — — Obligations of state and political subdivisions 211,743 4,690 (911 ) 215,522 Asset backed securities — — — — Corporate debt securities 29,645 90 (764 ) 28,971 Total $ 346,622 $ 5,122 $ (3,158 ) $ 348,586 Available-for-sale debt s with an aggregate fair value of $149,993,000 at December 31, 2018 and $290,104,000 at December 31, 2017, were pledged to secure public funds, trust funds, securities sold under agreements to repurchase, debtor in possession funds and the Federal Discount Window aggregating $112,528,000 at December 31, 2018 and $224,659,000 at December 31, 2017. The amortized cost and fair value of securities, by contractual maturity, are shown below at December 31, 2018. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (Dollars in thousands) Available for Sale Amortized Cost Fair Value 1 year or less $ 4,268 $ 4,264 Over 1 year through 5 years 55,283 54,544 Over 5 years through 10 years 86,076 84,779 Over 10 years 102,627 102,842 Mortgage-backed securities 71,067 69,625 Total $ 319,321 $ 316,054 There were no aggregate securities with a single issuer (excluding the U.S. Government and U.S. Government Agencies and Corporations) which exceeded ten percent of consolidated stockholders’ equity at December 31, 2018. The quality rating of the obligations of state and political subdivisions are generally investment grade, as rated by Moody’s, Standard and Poor’s or Fitch. The typical exceptions are local issues which are not rated, but are secured by the full faith and credit obligations of the communities that issued these securities. Proceeds from sales of investments in available-for-sale debt securities during 2018 and 2017 were $44,122,000 and $81,807,000, respectively. Gross gains realized on these sales were $122,000 and $1,024,000, respectively. Gross losses on these sales were $115,000 and $86,000, respectively. There were no impairment losses realized on available-for-sale debt securities during 2018 or 2017. At December 31, 2018 and 2017, the Corporation had $1,560,000 and $1,632,000, respectively, in equity securities recorded at fair value. Prior to January 1, 2018, equity securities were stated at fair value with unrealized gains and losses reported as a separate component of accumulated other comprehensive income (AOCI), net of tax. At December 31, 2017, net unrealized gains, net of tax, of $634,000 had been recognized in AOCI. On January 1, 2018, these unrealized gains and losses were reclassified out of AOCI and into retained earnings with subsequent changes in fair value being recognized in net income. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during 2018: (Dollars in thousands) December 31, 2018 Net losses recognized during the period on equity securities $ (72 ) Net gains and (losses) recognized during the period on equity securities sold during the period — Net losses recognized during the reporting period on equity securities still held at the reporting date $ (72 ) The Corporation and its investment advisors monitor the entire portfolio at least quarterly with particular attention given to securities in a continuous loss position of at least ten percent for over twelve months. Based on the factors described above, management did not consider any securities to be other-than-temporarily impaired at December 31, 2018 and 2017. In accordance with disclosures required by FASB ASC 320-10-50, Investments - Debt and Equity Securities , the summary below shows the gross unrealized losses and fair value of the Corporation’s debt securities, aggregated by investment category, of which individual securities have been in a continuous unrealized loss position for less than 12 months or 12 months or more as of December 31, 2018 and 2017: December 31, 2018 (Dollars in thousands) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss Available-for-Sale: U.S. Treasury securities $ 5,295 $ (12 ) $ — $ — $ 5,295 $ (12 ) Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 3,690 (17 ) 55,443 (1,512 ) 59,133 (1,529 ) Other 7,553 (66 ) 7,067 (418 ) 14,620 (484 ) Other mortgage backed debt securities 4,749 (18 ) — — 4,749 (18 ) Obligations of state and political subdivisions 14,453 (75 ) 66,583 (1,946 ) 81,036 (2,021 ) Asset backed securities — — — — — — Corporate debt securities 1,823 (29 ) 19,477 (1,049 ) 21,300 (1,078 ) Total $ 37,563 $ (217 ) $ 148,570 $ (4,925 ) $ 186,133 $ (5,142 ) December 31, 2017 (Dollars in thousands) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss Available-for-Sale: U.S. Treasury securities $ — $ — $ — $ — $ — $ — Obligations of U.S. Government Mortgage-backed 30,555 (300 ) 33,943 (875 ) 64,498 (1,175 ) Other 2,905 (4 ) 7,179 (304 ) 10,084 (308 ) Other mortgage backed securities — — — — — — Obligations of state and political subdivisions 36,149 (329 ) 22,566 (582 ) 58,715 (911 ) Asset backed securities — — — — — — Corporate debt securities 6,746 (24 ) 15,174 (740 ) 21,920 (764 ) Total $ 76,355 $ (657 ) $ 78,862 $ (2,501 ) $ 155,217 $ (3,158 ) The Corporation invests in various forms of agency debt including mortgage backed securities and callable debt. The mortgage backed securities are issued by FHLMC (“Federal Home Loan Mortgage Corporation”), FNMA (“Federal National Mortgage Association”) or GNMA (“Government National Mortgage Association”). The municipal securities consist of general obligations and revenue bonds. The fair market value of the above securities is influenced by market interest rates, prepayment speeds on mortgage securities, bid-offer spreads in the market place and credit premiums for various types of agency debt. These factors change continuously and therefore the market value of these securities may be higher or lower than the Corporation’s carrying value at any measurement date. Management does not believe any of their 27 debt securities with a less than one year unrealized loss position, or any of their 103 debt securities with a one year or greater unrealized loss position, as of December 31, 2018, represent an other-than-temporary impairment, as these unrealized losses relate principally to changes in interest rates subsequent to the acquisition of the specific securities. |
LOANS AND ALLOWANCE FOR LOAN LO
LOANS AND ALLOWANCE FOR LOAN LOSSES | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Financing Receivables [Text Block] | NOTE 4 — LOANS AND ALLOWANCE FOR LOAN LOSSES The following table presents the classes of the loan portfolio summarized by risk rating as of December 31, 2018 and 2017: Commercial and (Dollars in thousands) Industrial Commercial Real Estate 2018 2017 2018 2017 Grade: 1-6 Pass $ 90,835 $ 97,832 $ 329,126 $ 276,682 7 Special Mention 6 10 5,249 1,514 8 Substandard 1,219 1,334 13,403 12,210 9 Doubtful — — ― — Add (deduct): Unearned discount and — — ― — Net deferred loan fees and costs 160 161 698 564 Total loans $ 92,220 $ 99,337 $ 348,476 $ 290,970 Residential Real Estate Including Home Equity Consumer Loans 2018 2017 2018 2017 Grade: 1-6 Pass $ 158,755 $ 161,405 $ 5,854 $ 5,997 7 Special Mention 121 124 1 52 8 Substandard 941 1,444 9 24 9 Doubtful — — ― — Add (deduct): Unearned discount and — (1 ) — — Net deferred loan fees and costs (76 ) (47 ) 91 92 Total loans $ 159,741 $ 162,925 $ 5,955 $ 6,165 Total Loans 2018 2017 Grade: 1-6 Pass $ 584,570 $ 541,916 7 Special Mention 5,377 1,700 8 Substandard 15,572 15,012 9 Doubtful — — Add (deduct): Unearned discount and — (1 ) Net deferred loan fees and costs 873 770 Total loans $ 606,392 $ 559,397 Commercial and Industrial and Commercial Real Estate include loans categorized as tax-free in the amounts of $24,161,000 and $2,164,000 at December 31, 2018 and $40,926,000 and $2,315,000 at December 31, 2017. Loans held for sale amounted to $365,000 at December 31, 2018 and $834,000 at December 31, 2017. The activity in the allowance for loan losses, by loan class, is summarized below for the years indicated. (Dollars in thousands) Commercial Commercial Residential and Industrial Real Estate Real Estate Consumer Unallocated Total 2018 Allowance for Loan Losses: Beginning balance $ 949 $ 4,067 $ 1,656 $ 111 $ 704 $ 7,487 Charge-offs (18 ) (783 ) (181 ) (57 ) — (1,039 ) Recoveries 31 60 — 6 — 97 Provision (238 ) 356 175 57 (150 ) 200 Ending Balance $ 724 $ 3,700 $ 1,650 $ 117 $ 554 $ 6,745 Ending balance: individually evaluated for impairment $ — $ 1 $ — $ — $ — $ 1 Ending balance: collectively evaluated for impairment $ 724 $ 3,699 $ 1,650 $ 117 $ 554 $ 6,744 Loans Receivable: Ending Balance $ 92,220 $ 348,476 $ 159,741 $ 5,955 $ — $ 606,392 Ending balance: individually evaluated for impairment $ 1,126 $ 15,890 $ 577 $ — $ — $ 17,593 Ending balance: collectively evaluated for impairment $ 91,094 $ 332,586 $ 159,164 $ 5,955 $ — $ 588,799 (Dollars in thousands) Commercial Commercial Residential and Industrial Real Estate Real Estate Consumer Unallocated Total 2017 Allowance for Loan Losses: Beginning balance $ 836 $ 4,421 $ 1,777 $ 95 $ 228 $ 7,357 Charge-offs — (189 ) (62 ) (82 ) — (333 ) Recoveries 74 103 9 10 — 196 Provision 39 (268 ) (68 ) 88 476 267 Ending Balance $ 949 $ 4,067 $ 1,656 $ 111 $ 704 $ 7,487 Ending balance: individually evaluated for impairment $ — $ 305 $ 22 $ — $ — $ 327 Ending balance: collectively evaluated for impairment $ 949 $ 3,762 $ 1,634 $ 111 $ 704 $ 7,160 Loans Receivable: Ending Balance $ 99,337 $ 290,970 $ 162,925 $ 6,165 $ — $ 559,397 Ending balance: individually evaluated for impairment $ 1,203 $ 11,673 $ 1,050 $ — $ — $ 13,926 Ending balance: collectively evaluated for impairment $ 98,134 $ 279,297 $ 161,875 $ 6,165 $ — $ 545,471 Of the $1,163,000 in foreclosed assets held for resale at December 31, 2018, $268,000 was secured by residential real estate, $39,000 was secured by land, and $856,000 was secured by commercial real estate. All foreclosed assets were held as the result of obtaining physical possession. Of the $1,071,000 in foreclosed assets held for resale at December 31, 2017, $15,000 was secured by residential real estate, $50,000 was secured by land, and $1,006,000 was secured by commercial real estate. Consumer mortgage loans secured by residential real estate for which the Bank has entered into formal foreclosure proceedings but for which physical possession of the property has yet to be obtained amounted to $718,000 at December 31, 2018 and $485,000 at December 31, 2017. These balances were not included in foreclosed assets held for resale at December 31, 2018 and 2017. From time to time, the Bank may agree to modify the contractual terms of a borrower’s loan. In cases where the modifications represent a concession to a borrower experiencing financial difficulty, the modification is considered a troubled debt restructuring (“TDR”). The outstanding recorded investment of loans categorized as TDRs as of December 31, 2018 and December 31, 2017 was $13,777,000 and $9,109,000, respectively. The increase in TDRs at December 31, 2018 is mainly attributable to a loan in the amount of $ 4,296,000 For the year ended December 31, 2018, twelve loans with a combined post modification balance of $5,627,000 were classified as TDRs, as compared to the year ended December 31, 2017 when four loans with a combined post modification balance of $1,170,000 were classified as TDRs. The loan modifications for the year ended December 31, 2018 consisted of one interest rate modification, three term modifications beyond the original stated term and eight payment modifications. The loan modifications for the year ended December 31, 2017 consisted of one term modification beyond the original stated term and three payment modifications. The following table presents the outstanding recorded investment of TDRs at the dates indicated: (Dollars in thousands) December 31, December 31, 2018 2017 Non-accrual TDRs $ 80 $ 273 Accruing TDRs 13,697 8,836 Total $ 13,777 $ 9,109 At December 31, 2018, nine Commercial Real Estate loans classified as TDRs with a combined recorded investment of $499,000 and one Commercial and Industrial loan classified as a TDR with a recorded investment of $6,000 were not in compliance with the terms of their restructure, compared to December 31, 2017 when six Commercial Real Estate loans classified as TDRs with a combined recorded investment of $340,000 and one Residential Real Estate loan classified as a TDR with a recorded investment of $60,000 were not in compliance with the terms of their restructure. During the year ended December 31, 2018, five Commercial Real Estate loans totaling $163,000 that were modified as TDRs within the twelve months preceding December 31, 2018 had experienced payment defaults, as compared to the year ended December 31, 2017 when no loans that were modified as TDRs within the twelve months preceding December 31, 2017 had experienced payment defaults. The following table presents information regarding the loan modifications categorized as TDRs during the years ended December 31, 2018 and 2017. (Dollars in thousands) Year Ended December 31, 2018 Pre-Modification Post-Modification Year-End Number Outstanding Recorded Outstanding Recorded Recorded of Contracts Investment Investment Investment Commercial and Industrial 3 $ 751 $ 751 $ 771 Commercial Real Estate 8 4,833 4,850 4,688 Residential Real Estate 1 26 26 25 Total 12 $ 5,610 $ 5,627 $ 5,484 (Dollars in thousands) Year Ended December 31, 2017 Pre-Modification Post-Modification Year-End Number Outstanding Recorded Outstanding Recorded Recorded of Contracts Investment Investment Investment Commercial and Industrial 1 $ 38 $ 38 $ 36 Commercial Real Estate 2 1,064 1,072 1,069 Residential Real Estate 1 32 60 60 Total 4 $ 1,134 $ 1,170 $ 1,165 The following table provides detail regarding the types of loan modifications made for loans categorized as TDRs during the years ended December 31, 2018 and 2017 with the total number of each type of modification performed. Year Ended December 31, 2018 Year Ended December 31, 2017 Rate Term Payment Number Rate Term Payment Number Modification Modification Modification Modified Modification Modification Modification Modified Commercial and Industrial ― — 3 3 ― — 1 1 Commercial Real Estate 1 2 5 8 — 1 1 2 Residential Real Estate ― 1 — 1 ― ― 1 1 Total 1 3 8 12 — 1 3 4 The recorded investment, unpaid principal balance, and the related allowance of the Corporation’s impaired loans are summarized below for the periods ended December 31, 2018 and 2017. (Dollars in thousands) December 31, 2018 December 31, 2017 Unpaid Unpaid Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance With no related allowance recorded: Commercial and Industrial $ 1,126 $ 1,126 $ — $ 1,203 $ 1,203 $ — Commercial Real Estate 15,807 20,107 — 9,199 11,383 — Residential Real Estate 577 619 — 878 1,024 — With an allowance recorded: Commercial and Industrial — — — — — — Commercial Real Estate 83 83 1 2,474 3,889 305 Residential Real Estate — — — 172 172 22 Total $ 17,593 $ 21,935 $ 1 $ 13,926 $ 17,671 $ 327 Total consists of: Commercial and Industrial $ 1,126 $ 1,126 $ — $ 1,203 $ 1,203 $ — Commercial Real Estate $ 15,890 $ 20,190 $ 1 $ 11,673 $ 15,272 $ 305 Residential Real Estate $ 577 $ 619 $ — $ 1,050 $ 1,196 $ 22 At December 31, 2018 and 2017, $13,777,000 and $9,109,000 of loans classified as TDRs were included in impaired loans with a total allocated allowance of $1,000 and $2,000, respectively. The recorded investment represents the loan balance reflected on the Consolidated Balance Sheets net of any charge-offs. The unpaid balance is equal to the gross amount due on the loan. The average recorded investment and interest income recognized for the Corporation’s impaired loans are summarized below for the years ended December 31, 2018 and 2017. (Dollars in thousands) For the Year Ended For the Year Ended December 31, 2018 December 31, 2017 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized With no related allowance recorded: Commercial and Industrial $ 1,157 $ 53 $ 1,032 $ 25 Commercial Real Estate 11,575 623 11,140 485 Residential Real Estate 794 11 789 7 With an allowance recorded: Commercial and Industrial — — — — Commercial Real Estate 662 3 1,630 4 Residential Real Estate 138 — 215 — Total $ 14,326 $ 690 $ 14,806 $ 521 Total consists of: Commercial and Industrial $ 1,157 $ 53 $ 1,032 $ 25 Commercial Real Estate $ 12,237 $ 626 $ 12,770 $ 489 Residential Real Estate $ 932 $ 11 $ 1,004 $ 7 Of the $690,000 and $521,000 in interest income recognized on impaired loans for the years ended December 31, 2018 and 2017, respectively, $9,000 and $20,000 was recognized with respect to non-accrual loans. Total non-performing assets (which includes loans receivable on non-accrual status, foreclosed assets held for resale and loans past-due 90 days or more and still accruing interest) as of December 31, 2018 and 2017 were as follows: (Dollars in thousands) December 31, December 31, 2018 2017 Commercial and Industrial $ — $ 798 Commercial Real Estate 3,402 3,302 Residential Real Estate 494 990 Total non-accrual loans 3,896 5,090 Foreclosed assets held for resale 1,163 1,071 Loans past-due 90 days or more and still accruing interest 228 70 Total non-performing assets $ 5,287 $ 6,231 If interest on non-accrual loans had been accrued at original contract rates, interest income would have increased by $784,000 in 2018 and $328,000 in 2017. The following tables present the classes of the loan portfolio summarized by the past-due status at December 31, 2018 and 2017: (Dollars in thousands) 90 Days Or Greater Past Due 90 Days and Still 30-59 Days 60-89 Days or Greater Total Total Accruing Past Due Past Due Past Due Past Due Current Loans Interest December 31, 2018: Commercial and Industrial $ 16 $ 30 $ — $ 46 $ 92,174 $ 92,220 $ — Commercial Real Estate 1,990 630 3,477 6,097 342,379 348,476 145 Residential Real Estate 1,519 228 456 2,203 157,538 159,741 83 Consumer 12 — — 12 5,943 5,955 — Total $ 3,537 $ 888 $ 3,933 $ 8,358 $ 598,034 $ 606,392 $ 228 (Dollars in thousands) 90 Days Or Greater Past Due 90 Days and Still 30-59 Days 60-89 Days or Greater Total Total Accruing Past Due Past Due Past Due Past Due Current Loans Interest December 31, 2017: Commercial and Industrial $ 68 $ 42 $ — $ 110 $ 99,227 $ 99,337 $ — Commercial Real Estate 603 201 2,606 3,410 287,560 290,970 50 Residential Real Estate 1,952 484 584 3,020 159,905 162,925 20 Consumer 21 2 — 23 6,142 6,165 — Total $ 2,644 $ 729 $ 3,190 $ 6,563 $ 552,834 $ 559,397 $ 70 At December 31, 2018, commitments to lend additional funds with respect to impaired loans consisted of one irrevocable letter of credit in the amount of $1,249,000 that was associated with a loan to a developer of a residential sub-division. At December 31, 2017, commitments to lend additional funds with respect to impaired loans consisted of three irrevocable letters of credit totaling $1,268,000. One irrevocable letter of credit in the amount of $1,249,000 was associated with a loan to a developer of a residential sub-division. Two irrevocable letters of credit totaling $19,000 were associated with a loan to a non-profit community recreation facility. |
PREMISES AND EQUIPMENT
PREMISES AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PREMISES AND EQUIPMENT [Text Block] | NOTE 5 — PREMISES AND EQUIPMENT Premises and equipment at December 31, 2018 and 2017 is as follows: (Dollars in thousands) Estimated Useful Life (in years) 2018 2017 Land N/A $ 3,744 $ 3,744 Buildings 5-40 20,639 20,562 Leasehold improvements 3-20 174 147 Equipment 3-25 8,283 8,331 32,840 32,784 Less: Accumulated depreciation 12,894 12,161 Total $ 19,946 $ 20,623 Depreciation amounted to $1,141,000 for 2018 and $1,197,000 for 2017. The banking subsidiary previously leased land and a bank building in Stroudsburg, Pennsylvania, under a lease that expired in the fourth quarter of 2017. At the time of lease expiration, the land and bank building were purchased for a total cost of $2,384,000. |
DEPOSITS
DEPOSITS | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
DEPOSITS [Text Block] | NOTE 6 — DEPOSITS Major classifications of deposits at December 31, 2018 and 2017 consisted of: (Dollars in thousands) 2018 2017 Non-interest bearing demand $ 126,361 $ 121,415 Interest bearing demand 180,328 265,379 Savings 167,572 183,724 Time certificates of deposits less than $250,000 172,550 171,556 Time certificates of deposits $250,000 or greater 23,597 34,933 Other time 1,145 1,139 Total deposits $ 671,553 $ 778,146 The following is a schedule reflecting classification and remaining maturities of time deposits at December 31, 2018: ( Dollars in thousands) Year Ending 2019 $ 96,639 2020 41,642 2021 33,030 2022 18,822 2023 6,684 Thereafter 475 $ 197,292 At December 31, 2018, the largest two depositors had aggregate deposits of approximately $43,107,000 as follows: (Dollars in thousands) School district $ 22,457 School district 20,650 Total $ 43,107 |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2018 | |
Short-term Debt [Abstract] | |
SHORT-TERM BORROWINGS [Text Block] | NOTE 7 — SHORT-TERM BORROWINGS Short-term borrowings include federal funds purchased, securities sold under agreements to repurchase, Federal Discount Window, and Federal Home Loan Bank (“FHLB”) advances, which generally represent overnight or less than 30-day borrowings. Short-term borrowings and weighted-average interest rates at and for the years ended December 31, 2018 and 2017 are as follows: (Dollars in thousands) 2018 2017 Average Average Amount Rate Amount Rate Federal funds purchased $ — 2.19 % $ — 1.82 % Securities sold under agreements to repurchase 12,957 0.56 % 22,844 0.41 % Federal Discount Window — 2.19 % — 1.71 % Federal Home Loan Bank 161,488 2.28 % 3,452 1.16 % $ 174,445 2.04 % $ 26,296 0.97 % At December 31, 2018, the maximum borrowing capacity of federal funds purchased and the Federal Discount Window was $15,000,000 and $4,741,000, respectively. Please refer to Note 8 ― Long-Term Borrowings for the Corporation’s maximum borrowing capacity at FHLB. Securities Sold Under Agreements to Repurchase (“Repurchase Agreements”) The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Corporation may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Corporation to repurchase the assets. As a result, these repurchase agreements are accounted for as collateralized financing agreements (i.e., secured borrowings) and not as a sale and subsequent repurchase of securities. The obligation to repurchase the securities is reflected as a liability on the Corporation’s Consolidated Balance Sheets, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts. In other words, there is not offsetting or netting of the investment securities assets with the repurchase agreement liabilities. In addition, as the Corporation does not enter into reverse repurchase agreements, there is no such offsetting to be done with the repurchase agreements. The right of setoff for a repurchase agreement resembles a secured borrowing, whereby the collateral would be used to settle the fair value of the repurchase agreement should the Corporation be in default (e.g., fails to make an interest payment to the counterparty). The collateral is held by a correspondent bank in the counterparty’s custodial account. The counterparty has the right to sell or repledge the investment securities. The following table presents the short-term borrowings subject to an enforceable master netting arrangement or repurchase agreements as of December 31, 2018 and 2017. (Dollars in thousands) Gross Net Amounts Amounts of Liabilities Offset Presented Gross in the in the Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral Net Liabilities Sheet Sheet Instruments Pledge Amount December 31, 2018 Repurchase agreements (a) $ 12,957 $ ― $ 12,957 $ (12,957 ) $ ― $ ― December 31, 2017 Repurchase agreements (a) $ 22,844 $ ― $ 22,844 $ (22,844 ) $ ― $ ― (a) As of December 31, 2018 and 2017, the fair value of securities pledged in connection with repurchase agreements was $16,970,000 and $26,023,000, respectively. The following table presents the remaining contractual maturity of the master netting arrangement or repurchase agreements as of December 31, 2018. (Dollars in thousands) Remaining Contractual Maturity of the Agreements Overnight Greater and Up to 30 -90 than Continuous 30 days Days 90 Days Total Repurchase agreements and repurchase-to-maturity transactions: U.S. Treasury and/or agency securities $ 12,957 $ ― $ ― $ ― $ 12,957 Total $ 12,957 $ ― $ ― $ ― $ 12,957 |
LONG-TERM BORROWINGS
LONG-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2018 | |
Long-term Debt, Unclassified [Abstract] | |
LONG-TERM BORROWINGS [Text Block] | NOTE 8 — LONG-TERM BORROWINGS Long-term borrowings are comprised of advances from FHLB. Under terms of a blanket agreement, collateral for the FHLB loans is certain qualifying assets of the Corporation’s banking subsidiary. The qualifying assets are real estate mortgages and certain investment securities. A schedule of long-term borrowings by maturity as of December 31, 2018 and 2017 follows: (Dollars in thousands) 2018 2017 Due 2018, 1.27% to 4.86% $ — $ 23,000 Due 2019, 1.79% to 2.11% 20,000 20,000 Due 2020, 1.62% to 1.95% 10,000 10,000 Due 2021, 1.42% to 1.58% 10,000 10,000 Due 2023, 2.96% 3,000 — Due 2028, 5.14% 2,000 2,000 $ 45,000 $ 65,000 The Corporation’s long-term borrowings consist of notes at fixed interest rates. Upon any default, under the terms of a master agreement, FHLB may declare all indebtedness of the Corporation immediately due. In addition, FHLB shall not be required to fund advances under any outstanding commitments. At December 31, 2018, the Corporation’s maximum borrowing capacity at FHLB, which takes into account FHLB long-term notes and FHLB short-term borrowings, was $313,923,000. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES [Text Block] | NOTE 9 — INCOME TAXES The current and deferred components of the income tax expense consisted of the following: (Dollars in thousands) 2018 2017 Federal Current $ (107 ) $ 1,309 Deferred 566 146 Income tax expense $ 459 $ 1,455 The following is a reconciliation between the income tax expense and the amount of income taxes which would have been provided at the statutory rate of 21% in 2018 and 34% in 2017: (Dollars in thousands) 2018 2017 Amount Rate Amount Rate Federal income tax at statutory rate $ 2,031 21.0 % $ 3,435 34.0 % Tax-exempt income (1,043 ) (10.8 ) (1,897 ) (18.8 ) Low-income housing credits (405 ) (4.2 ) (323 ) (3.2 ) Bank owned life insurance income (128 ) (1.3 ) (216 ) (2.1 ) Effect of tax rate change — — 379 3.8 Other 4 — 77 0.7 Income tax expense and rate $ 459 4.7 % $ 1,455 14.4 % The components of the net deferred tax asset at December 31, 2018 and 2017 are as follows: (Dollars in thousands) 2018 2017 Deferred Tax Assets: Allowance for loan losses $ 1,417 $ 1,572 Provision for unfunded commitments 25 24 Deferred compensation 241 316 Contributions 1 8 Leases 53 66 Limited partnership investments 66 57 Alternative minimum tax credits 7 379 Net unrealized investment securities losses 449 — Impairment loss on investment securities 4 4 Writedowns on OREO properties 34 5 Capital and net operating loss carry forwards — 25 Total 2,297 2,456 Deferred Tax Liabilities: Net unrealized investment securities gains 670 Loan fees and costs 183 162 Accumulated depreciation 311 332 Accretion 35 77 Mortgage servicing rights 42 38 Intangibles 257 241 Total 828 1,520 Net Deferred Tax Asset $ 1,469 $ 936 A valuation allowance for deferred tax assets was recorded at December 31, 2018 and 2017 in the amount of $70,000 and $16,000, respectively. The valuation allowance relates to state net operating loss carryforwards for which realizability is uncertain. At December 31, 2018 and 2017, the Corporation had state net operating loss carryforwards, net of a valuation allowance, of $0 and $320,000, respectively, which are available to offset future state taxable income, and expire at various dates through 2038. In 2017, the Corporation recognized a reduction in the carrying value of the net deferred tax asset of $379,000 as a result of the December 2017 enactment of a reduction in the federal corporate income tax rate to 21% effective January 1, 2018, from the 34% marginal tax rate in effect throughout 2017. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the tax effects of the Tax Cuts and Job Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Cuts and Jobs Act’s enactment date for companies to complete the accounting under ASC 740, Income Taxes. The Corporation’s financial results reflect the income tax effects of the Tax Cuts and Jobs Act for which the accounting under ASC Topic 740 is complete. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible and tax planning strategies, management believes it is more likely than not that the Corporation will realize the benefits of these deferred tax assets, net of any valuation allowance at December 31, 2018. The Corporation did not have any uncertain tax positions at December 31, 2018 and 2017. The Corporation and its subsidiary file a consolidated federal income tax return. The Corporation is no longer subject to examination by Federal or State taxing authorities for the years before 2015. |
EMPLOYEE BENEFIT PLANS AND DEFE
EMPLOYEE BENEFIT PLANS AND DEFERRED COMPENSATION AGREEMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS AND DEFERRED COMPENSATION AGREEMENTS [Text Block] | NOTE 10 — EMPLOYEE BENEFIT PLANS AND DEFERRED COMPENSATION AGREEMENTS The Corporation maintains a 401k Plan which has a combined tax qualified savings feature and profit sharing feature for the benefit of its employees. Effective January 1, 2014, the plan became a Safe Harbor Plan. Under the savings feature, the Corporation makes safe harbor matching contributions of 100% of the first 3% of compensation an employee contributes to the Plan and 50% of the next 2% of compensation an employee contributes to the Plan. The safe harbor matching contributions amounted to $296,000 and $274,000 in 2018 and 2017, respectively. Under the profit sharing feature, contributions, at the discretion of the Board of Directors, are funded currently and amounted to $304,000 and $215,000 in 2018 and 2017, respectively. The Bank also has non-qualified deferred compensation agreements with one of its officers and five retired officers. These agreements are essentially unsecured promises by the Bank to make monthly payments to the officers over a twenty year period. Payments begin based upon specific criteria — generally, when the officer retires. To account for the cost of payments yet to be made in the future, the Bank recognizes an accrued liability in years prior to when payments begin based on the present value of those future payments. The Bank’s accrued liability for these deferred compensation agreements, reported in other liabilities on the consolidated balance sheets, as of December 31, 2018 and 2017, was $1,109,000 and $1,464,000, respectively. The related expense for these agreements, reported in salaries and employee benefits on the consolidated statements of income, amounted to $(229,000) and $117,000 in 2018 and 2017, respectively. In 2018, there was a $(305,000) plan expense reversal associated with the resignation of a previously covered officer. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES [Text Block] | NOTE 11 — COMMITMENTS AND CONTINGENCIES The Corporation’s banking subsidiary currently leases three branch banking facilities, one loan processing office and one parcel of land under operating leases. Rent expense for the years ended December 31, 2018 and 2017 was $170,000 and $155,000, respectively. Minimum rental payments required under these operating leases are: 2019 - $123,000, 2020 - $72,000, 2021 - $65,000, 2022 - $68,000, 2023 - $68,000 and thereafter $2,394,000. In the normal course of business, there are various pending legal actions and proceedings that are not reflected in the consolidated financial statements. Management does not believe the outcome of these actions and proceedings will have a material effect on the consolidated financial position of the Corporation. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS [Text Block] | NOTE 12 — RELATED PARTY TRANSACTIONS Certain directors, executive officers and immediate family members of First Keystone Corporation and its subsidiary, and companies in which they are principal owners (i.e., at least 10% ownership), were indebted to the Corporation at December 31, 2018 and 2017. The loans do not involve more than the normal risk of collectability nor present other unfavorable features. A summary of the activity on the related party loans consists of the following: (Dollars in thousands) 2018 2017 Balance at January 1 $ 10,997 $ 2,159 Additions 13,642 15,574 Deductions (4,691 ) (6,736 ) Balance at December 31 $ 19,948 $ 10,997 The summary of activity on the related party loans represent funds drawn and outstanding at the date of the consolidated financial statements. Commitments by the Bank to related parties on lines of credit and letters of credit for 2018 and 2017, presented an additional off-balance sheet risk to the extent of undisbursed funds in the amounts of $4,958,000 and $6,214,000 respectively, on the above loans. Deposits from certain officers, directors and/or their related companies held by the Bank amounted to $18,696,000 and $15,180,000 at December 31, 2018 and 2017, respectively. |
REGULATORY MATTERS
REGULATORY MATTERS | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory Matters [Abstract] | |
REGULATORY MATTERS [Text Block] | NOTE 13 — REGULATORY MATTERS Under Pennsylvania banking law, the Bank is subject to certain restrictions on the amount of dividends that it may declare without prior regulatory approval. At December 31, 2018, $8,776,000 of retained earnings were available for dividends without prior regulatory approval, subject to the regulatory capital requirements discussed below. Regulations also limit the amount of loans and advances from the Bank to the Corporation to 10% of consolidated net assets. The Corporation 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 Corporation’s consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Corporation must meet specific capital guidelines that involve quantitative measures of the Corporation’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Corporation’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Management believes, as of December 31, 2018 and 2017, that the Corporation and the Bank met all capital adequacy requirements to which they are subject. On July 2, 2013, the Board of Governors of the Federal Reserve System finalized its rule implementing the Basel III regulatory capital framework, which the FDIC adopted on July 9, 2013. Under the rule, minimum requirements increased both the quantity and quality of capital held by banking organizations. Consistent with the Basel III framework, the rule included a new minimum ratio of common equity tier 1 capital to risk-weighted assets of 4.5 percent, and a common equity tier 1 conservation buffer of 2.5 percent of risk-weighted assets, that applies to all supervised financial institutions, which is to be phased in over a three year period beginning January 1, 2016, with the full 2.5 percent required as of January 1, 2019. The rule also raised the minimum ratio of tier 1 capital to risk-weighted assets from 4 percent to 6 percent, and includes a minimum leverage ratio of 4 percent for all banking organizations. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total capital, tier I capital and common equity tier 1 capital (as defined in the regulations) to risk weighted assets (as defined), and of tier I capital (as defined) to average assets (as defined). As of December 31, 2018 the most recent notification from the Federal Deposit Insurance Corporation 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 total risk-based, tier I risk-based, common equity tier 1 risk-based and tier I leverage ratios as set forth in the table. There are no conditions or events since the notification that management believes have changed the Bank’s category. (Dollars in thousands) Minimum To Be Well Capital Capitalized For Capital Adequacy Under Prompt Adequacy with Capital Corrective Actual Purposes Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio As of December 31, 2018: Total Capital (to Risk-Weighted Assets) $ 96,065 13.87 % $ 55,395 8.00 % $ 68,378 9.88 % $ 69,243 10.00 % Tier I Capital (to Risk-Weighted Assets) $ 89,203 12.88 % $ 41,546 6.00 % $ 54,529 7.88 % $ 55,395 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 89,203 12.88 % $ 31,160 4.50 % $ 44,143 6.38 % $ 45,008 6.50 % Tier I Capital (to Average Assets) $ 89,203 9.01 % $ 39,616 4.00 % $ 39,616 4.00 % $ 49,521 5.00 % (Dollars in thousands) Minimum To Be Well Capital Capitalized For Capital Adequacy Under Prompt Adequacy with Capital Corrective Actual Purposes Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017: Total Capital (to Risk-Weighted Assets) $ 93,566 14.21 % $ 52,676 8.00 % $ 60,907 9.25 % $ 65,845 10.00 % Tier I Capital (to Risk-Weighted Assets) $ 85,963 13.06 % $ 39,507 6.00 % $ 47,738 7.25 % $ 52,676 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 85,963 13.06 % $ 29,630 4.50 % $ 37,861 5.75 % $ 42,800 6.50 % Tier I Capital (to Average Assets) $ 85,963 8.84 % $ 38,901 4.00 % $ 38,901 4.00 % $ 48,626 5.00 % The capital conservation buffer phase-in began January 1, 2016. The capital conservation buffer increased from 1.250% in 2017 to 1.875% in 2018. The Corporation’s capital ratios are not materially different from those of the Bank. |
FINANCIAL INSTRUMENTS WITH OFF-
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule Off Balance Sheet Credit Risks And Concentrations Of Credit Risk [Text Block] | NOTE 14 — FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK Financial Instruments with Off-Balance Sheet Risk The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Balance Sheets. The contract or notional amounts of those instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments. The Corporation does not engage in trading activities with respect to any of its financial instruments with off-balance sheet risk. The Corporation’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The Corporation may require collateral or other security to support financial instruments with off-balance sheet credit risk. The contract or notional amounts at December 31, 2018 and 2017 were as follows: (Dollars in thousands) 2018 2017 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 107,126 $ 90,373 Financial standby letters of credit $ 331 $ 450 Performance standby letters of credit $ 3,107 $ 2,901 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 that may require payment of a fee. Since some of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Corporation evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the borrower. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, owner-occupied income-producing commercial properties, and residential real estate. Standby letters of credit are conditional commitments issued by the Corporation to guarantee payment to a third party when a customer either fails to repay an obligation or fails to perform some non-financial obligation. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Corporation may hold collateral (similar to the items held as collateral for commitments to extend credit) to support standby letters of credit for which collateral is deemed necessary. Financial Instruments with Concentrations of Credit Risk The Corporation originates primarily commercial and residential real estate loans to customers in northeastern Pennsylvania. The ability of the majority of the Corporation’s customers to honor their contractual loan obligations is dependent on the economy and real estate market in this area. At December 31, 2018, the Corporation had $508,217,000 in loans secured by real estate, which represented 83.8% of total loans. The real estate loan portfolio is largely secured by lessors of residential buildings and dwellings, lessors of non-residential buildings, and lessors of hotels/motels. As of December 31, 2018 and 2017, management is of the opinion that there were no concentrations exceeding 10% of total loans with regard to loans to borrowers who were engaged in similar activities that were similarly impacted by economic or other conditions. As all financial instruments are subject to some level of credit risk, the Corporation requires collateral and/or guarantees for all loans. Collateral may include, but is not limited to property, plant, and equipment, commercial and/or residential real estate property, land, and pledge of securities. In the event of a borrower’s default, the collateral supporting the loan may be seized in order to recoup losses associated with the loan. The Corporation also establishes an allowance for loan losses that constitutes the amount available to absorb losses within the loan portfolio that may exist due to deficiencies in collateral values. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 15 — STOCKHOLDERS’ EQUITY The Corporation also offers to its shareholders a Dividend Reinvestment and Stock Purchase Plan. Participation in this plan by shareholders began in 2001. The plan provides First Keystone shareholders a convenient and economical way to purchase additional shares of common stock by reinvesting dividends. A plan participant can elect full dividend reinvestment or partial dividend reinvestment provided at least 25 shares are enrolled in the plan. In addition, plan participants may make additional voluntary cash purchases of common stock under the plan of not less than $100 per calendar quarter or more than $2,500 in any calendar quarter. Shares transferred under this Dividend Reinvestment and Stock Purchase Plan were 45,371 in 2018 and 46,388 in 2017. Remaining shares authorized in the plan were 577,048 as of December 31, 2018. Shares of First Keystone common stock are purchased for the plan either in the open market by an independent broker on behalf of the plan, directly from First Keystone as original issue shares, or through negotiated transactions. A combination of the previous methods could also occur. |
STOCK COMPENSATION PLAN
STOCK COMPENSATION PLAN | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 16 — STOCK COMPENSATION PLAN On February 10, 1998, the Board of Directors adopted the 1998 Employee Stock Option Plan and initially reserved 100,000 shares of common stock for issuance under the plan for certain employees of the Bank. After adjustments for the effects of stock dividends, options exercised and options forfeited, there are no exercisable options issued and outstanding. Under the Plan, options are granted at fair market value and the time period during which any option granted may be exercised may not commence before six months or continue beyond the expiration of ten years after the option is awarded. Upon exercise of the stock options, shares of the Corporation’s stock are issued from Treasury Stock. The Plan expired in 2008, and therefore, no stock options are available for issuance. The fair value of stock options issued to employees is measured on the date of the grant and is recognized as compensation expense over the requisite service period. Expected volatility and dividend yield are based on historical stock prices and dividend amounts over past time periods equal in length to the life of the options. The risk-free interest rate is determined using the U.S. Treasury yield curve in effect at the date of the grant. The expected life of the options is calculated using the average term of the vesting period and the maximum term. Information about stock options outstanding at December 31, 2018 and 2017, is summarized as follows: 2018 2017 Weighted Weighted Average Average Stock Exercise Stock Exercise Options Price Options Price Balance at January 1 — — 1,500 $ 16.75 Exercised — — (1,500 ) 16.75 Forfeited/Expired — — — — Balance at December 31 — — — — Exercisable at December 31 — — — — Under the terms of the Plan, the stock options including amendments as to price and terms were adjusted for the stock dividend in 2006. The total intrinsic value of the options exercised during the years ended December 31, 2018 and 2017 was $0 and $18,000, respectively. Cash received from stock options exercised for the years ended December 31, 2018 and 2017 was $0 and $25,000, respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | NOTE 17 — FAIR VALUE MEASUREMENTS Fair value measurement and disclosure guidance defines fair value as the price that would be received to sell the asset or transfer the liability in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. This guidance provides additional information on determining when the volume and level of activity for the asset or liability has significantly decreased. The guidance also includes information on identifying circumstances when a transaction may not be considered orderly. Fair value measurement and disclosure guidance provides a list of factors that a reporting entity should evaluate to determine whether there has been a significant decrease in the volume and level of activity for the asset or liability in relation to normal market activity for the asset or liability. When the reporting entity concludes there has been a significant decrease in the volume and level of activity for the asset or liability, further analysis of the information from that market is needed and significant adjustments to the related prices may be necessary to estimate fair value in accordance with the fair value measurement and disclosure guidance. This guidance clarifies that when there has been a significant decrease in the volume and level of activity for the asset or liability, some transactions may not be orderly. In those situations, the entity must evaluate the weight of the evidence to determine whether the transaction is orderly. The guidance provides a list of circumstances that may indicate that a transaction is not orderly. A transaction price that is not associated with an orderly transaction is given little, if any, weight when estimating fair value. Fair value 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. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability. Inputs may be observable, meaning those that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources, or unobservable, meaning those that reflect the reporting entity’s own belief about the assumptions market participants would use in pricing the asset or liability based upon the best information available in the circumstances. Fair value measurement and disclosure guidance establishes a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: Level 1 Inputs Level 2 Inputs Level 3 Inputs: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth as follows. Financial Assets Measured at Fair Value on a Recurring Basis At December 31, 2018 and 2017, securities measured at fair value on a recurring basis and the valuation methods used are as follows: (Dollars in thousands) December 31, 2018 Level 1 Level 2 Level 3 Total Available-for-Sale Debt Securities: U.S. Treasury securities $ — $ 5,295 $ — $ 5,295 Obligations of U.S. Government Corporations and Agencies: Mortgaged-backed — 64,876 — 64,876 Other — 18,243 — 18,243 Other mortgage backed debt securities — 4,749 — 4,749 Obligations of state and political subdivisions — 182,278 — 182,278 Asset backed securities — 14,370 — 14,370 Corporate debt securities — 26,243 — 26,243 Total debt securities available-for-sale — 316,054 — 316,054 Marketable equity securities 1,560 — — 1,560 Total $ 1,560 $ 316,054 $ — $ 317,614 (Dollars in thousands) December 31, 2017 Level 1 Level 2 Level 3 Total Available-for-Sale Debt Securities: U.S. Treasury securities $ — $ — $ — $ — Obligations of U.S. Government Corporations and Agencies: Mortgaged-backed — 81,860 — 81,860 Other — 22,233 — 22,233 Other mortgage backed debt securities — — — — Obligations of state and political subdivisions — 215,522 — 215,522 Asset backed securities — — — — Corporate debt securities — 28,971 — 28,971 Total debt securities available-for-sale — 348,586 — 348,586 Marketable equity securities 1,632 — — 1,632 Total $ 1,632 $ 348,586 $ — $ 350,218 The estimated fair values of equity securities classified as Level 1 are derived from quoted market prices in active markets; these assets consist mainly of stocks held in other banks. The estimated fair values of all debt securities classified as Level 2 are obtained from nationally-recognized third-party pricing agencies. The estimated fair values are derived primarily from cash flow models, which include assumptions for interest rates, credit losses, and prepayment speeds. The significant inputs utilized in the cash flow models are based on market data obtained from sources independent of the Corporation (observable inputs), and are therefore classified as Level 2 within the fair value hierarchy. The Corporation does not have any Level 3 inputs for securities. There were no transfers between Level 1 and Level 2 during 2018 and 2017. Financial Assets Measured at Fair Value on a Nonrecurring Basis At December 31, 2018 and 2017, impaired loans measured at fair value on a nonrecurring basis and the valuation methods used are as follows: (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2018 Impaired loans: Commercial Real Estate $ — $ — $ 6,400 $ 6,400 Residential Real Estate — — 81 81 Total impaired loans $ — $ — $ 6,481 $ 6,481 (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2017 Impaired loans: Commercial Real Estate $ — $ — $ 5,498 $ 5,498 Residential Real Estate — — 254 254 Total impaired loans $ — $ — $ 5,752 $ 5,752 The Bank’s impaired loan valuation procedure for any loans greater than $250,000 requires an appraisal to be obtained and reviewed annually at year end. A quarterly collateral evaluation is performed which may include a site visit, property pictures and discussions with realtors and other similar business professionals to ascertain current values. For impaired loans less than $250,000 upon classification and annually at year end, the Bank completes a Certificate of Inspection, which includes an onsite inspection, insured values, tax assessed values, recent sales comparisons and a review of the previous evaluations. These assets are included as Level 3 fair values, based upon the lowest level that is significant to the fair value measurements. The fair value consists of the impaired loan balances less the valuation allowance and/or charge-offs. There were no transfers between valuation levels in 2018 and 2017. Nonfinancial Assets Measured at Fair Value on a Nonrecurring Basis At December 31, 2018 and 2017, foreclosed assets held for resale measured at fair value on a nonrecurring basis and the valuation methods used are as follows: (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2018 Foreclosed assets held for resale: Commercial Real Estate $ — $ — $ 856 $ 856 Residential Real Estate — — — — Total foreclosed assets held for resale $ — $ — $ 856 $ 856 (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2017 Foreclosed assets held for resale: Commercial Real Estate $ — $ — $ 81 $ 81 Residential Real Estate — — 13 13 Total foreclosed assets held for resale $ — $ — $ 94 $ 94 The Bank’s foreclosed asset valuation procedure requires an appraisal, which considers the sales prices of similar properties in the proximate vicinity, to be completed periodically with the exception of those cases in which the Bank has obtained a sales agreement. These assets are included as Level 3 fair values, based upon the lowest level that is significant to the fair value measurements. There were no transfers between valuation levels in 2018 and 2017. The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Bank has utilized Level 3 inputs to determine the fair value: (Dollars in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Weighted December 31, 2018 Estimate Valuation Technique Unobservable Input Range Average Impaired loans $ 3,346 Appraisal of collateral 1,3 Appraisal adjustments 2 (15%) – (82%) (18%) Impaired loans $ 3,135 Discounted cash flow Discount rate (6%) – (7%) ( 7 Foreclosed assets held for resale $ 856 Appraisal of collateral 1,3 Appraisal adjustments 2 (16%) – (35%) ( 18 December 31, 2017 Impaired loans $ 2,495 Appraisal of collateral 1,3 Appraisal adjustments 2 (7%) – (65%) ( 15 Impaired loans $ 3,257 Discounted cash flow Discount rate (7%) – (8%) ( 7 Foreclosed assets held for resale $ 94 Appraisal of collateral 1,3 Appraisal adjustments 2 (35%) – (37%) ( 36 1 2 3 Fair Value of Financial Instruments The estimated fair values, and related carrying amounts, of the Corporation’s financial instruments that are not recorded at fair value are as follows: (Dollars in thousands) Carrying Fair Value Measurements at December 31, 2018 Amount Level 1 Level 2 Level 3 Total FINANCIAL ASSETS: Cash and due from banks $ 9,822 $ 9,822 $ — $ — $ 9,822 Interest-bearing deposits in other banks 1,128 — 1,128 — 1,128 Time deposits with other banks 1,482 — 1,469 — 1,469 Restricted investment in bank stocks 8,681 — 8,681 — 8,681 Net loans 599,647 — — 597,548 597,548 Mortgage servicing rights 316 — — 316 316 Accrued interest receivable 4,041 — 4,041 — 4,041 FINANCIAL LIABILITIES: Demand, savings and other deposits 474,261 — 474,261 — 474,261 Time deposits 197,292 — 195,136 — 195,136 Short-term borrowings 174,445 — 174,491 — 174,491 Long-term borrowings 45,000 — 45,077 — 45,077 Accrued interest payable 785 — 785 — 785 OFF-BALANCE SHEET FINANCIAL INSTRUMENTS — — — — — (Dollars in thousands) Carrying Fair Value Measurements at December 31, 2017 Amount Level 1 Level 2 Level 3 Total FINANCIAL ASSETS: Cash and due from banks $ 7,913 $ 7,913 $ — $ — $ 7,913 Interest-bearing deposits in other banks 826 — 826 — 826 Time deposits with other banks 1,482 — 1,482 — 1,482 Restricted investment in bank stocks 4,058 — 4,058 — 4,058 Net loans 551,910 — — 550,696 550,696 Mortgage servicing rights 379 — — 379 379 Accrued interest receivable 4,237 — 4,237 — 4,237 FINANCIAL LIABILITIES: Demand, savings and other deposits 570,518 — 570,518 — 570,518 Time deposits 207,628 — 206,299 — 206,299 Short-term borrowings 26,296 — 26,296 — 26,296 Long-term borrowings 65,000 — 65,336 — 65,336 Accrued interest payable 490 — 490 — 490 OFF-BALANCE SHEET FINANCIAL INSTRUMENTS — — — — — |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | NOTE 18 — REVENUE RECOGNITION As disclosed in Note 1, as of January 1, 2018, the Corporation adopted ASU 2014-09 Revenue from Contracts with Customers - Topic 606 and all subsequent ASUs that modified ASC 606. The Corporation has elected to apply the ASU and all related ASUs using the modified retrospective implementation method. The implementation of the guidance had no material impact on the measurement or recognition of revenue of prior periods, however, additional disclosures have been added in accordance with the ASU. The main types of revenue contracts included in non-interest income within the Consolidated Statements of Income which are subject to ASC 606 are as follows: Deposits related fees and service charges Service charges and fees on deposits, which are included as liabilities in the consolidated balance sheets, consist of fees related to monthly fees for various retail and business checking accounts, automated teller machine (“ATM”) fees (charged for withdrawals by our deposit customers from other bank ATMs) and insufficient funds fees (“NSF”) (which are charged when customers overdraw their accounts beyond available funds). All deposit liabilities are considered to have one-day terms and therefore related fees are recognized in income at the time when the services are provided to the customers. The Corporation elected to adopt practical expedient related to incremental costs of obtaining deposit contracts. As such, any costs associated with acquiring the deposits, except for certificate of deposits (“CDs”) with maturities in excess of one year, are recognized as an expense within the non-interest expense in the consolidated statements of income when incurred as the amortization period of the deposit liabilities that otherwise would have been recognized is one year or less. Wealth/Asset/Trust Management Fees Wealth management services are delivered to individuals, corporations and retirement funds located primarily within our geographic markets. The Trust Department of the Corporation conducts the wealth management operations, which provides a broad range of personal and corporate fiduciary services, including the administration of estates. Assets held in a fiduciary capacity by the Trust Department are not assets of the Corporation and, therefore, are not included in our Consolidated Financial Statements. Wealth management fees, which are contractually agreed with each customer, are earned each month and recognized on a cash basis based on average fair value of the trust assets under management. The services provided under such a contract are considered a single performance obligation under ASC 606 because they embody a series of distinct goods or services that are substantially the same and have the same pattern of transfer to the customer. Wealth management fees charged by the Trust Department follow a tiered structure based on the type and size of the assets under management. Wealth management fees are included within non-interest income in the consolidated statements of income. As of December 31, 2018 and December 31, 2017, the fair value of trust assets under management was $105,917,000 and $111,130,000, respectively. The costs of acquiring asset management customers are incremental and recognized within the non-interest expense of the consolidated statements of income. Interchange Fees and Surcharges Interchange fees are related to the acceptance and settlement of debit card transactions, both point-of-sale and ATM, to cover operating costs and risks associated with the approval and settlement of the transactions. Interchange fees vary by type of transaction and each merchant sector. Net income recognized from interchange fees is included in non-interest income on the consolidated statements of income. A surcharge is assessed for use of the Corporation’s ATMs by non-customers. All interchange fees and surcharges are recognized as received on a daily basis for the prior business day’s transactions. All expenses related to the settlement of debit card transactions (both point-of-sale and ATM) are recognized on a monthly basis and included in non-interest expense on the consolidated statements of income. |
PARENT COMPANY FINANCIAL INFORM
PARENT COMPANY FINANCIAL INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Parent Company Only Disclosure [Text Block] | NOTE 19 — PARENT COMPANY FINANCIAL INFORMATION Condensed financial information for First Keystone Corporation (parent company only) was as follows: BALANCE SHEETS (Dollars in thousands) December 31, 2018 2017 ASSETS Cash $ 9,988 $ 8,984 Investment in banking subsidiary 105,755 106,647 Marketable equity securities 1,560 1,632 Prepaid expenses and other assets 232 30 TOTAL ASSETS $ 117,535 $ 117,293 LIABILITIES Advances from banking subsidiary $ 536 $ 325 Accrued expenses and other liabilities 243 249 TOTAL LIABILITIES 779 574 STOCKHOLDERS’ EQUITY Common stock 11,993 11,902 Surplus 37,255 36,193 Retained earnings 75,798 72,507 Accumulated other comprehensive (loss) income (2,581 ) 1,826 Treasury stock, at cost (5,709 ) (5,709 ) TOTAL STOCKHOLDERS’ EQUITY 116,756 116,719 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 117,535 $ 117,293 STATEMENTS OF INCOME (Dollars in thousands) Years Ended December 31, 2018 2017 INCOME Dividends from subsidiary bank $ 6,102 $ 6,102 Net securities (losses) gains (72 ) 74 Other income 76 73 TOTAL INCOME 6,106 6,249 OPERATING EXPENSES 176 117 5,930 6,132 INCOME TAX BENEFIT (41 ) (110 ) 5,971 6,242 EQUITY IN UNDISTRIBUTED EARNINGS OF BANKING SUBSIDIARY 3,240 2,406 NET INCOME $ 9,211 $ 8,648 STATEMENTS OF COMPREHENSIVE INCOME (Dollars in thousands) Years Ended December 31, 2018 2017 Net Income $ 9,211 $ 8,648 Other comprehensive (loss) income: Unrealized net holding gains on available-for-sale investment securities arising during the period, net of income taxes of $0 and $55, respectively — 81 Less reclassification adjustment for net gains included in net income, net of income taxes of $0 and $(30), respectively — (44 ) Equity in other comprehensive (loss) income of banking subsidiary (4,133 ) 3,208 Total other comprehensive (loss) income (4,133 ) 3,245 Total Comprehensive Income $ 5,078 $ 11,893 STATEMENTS OF CASH FLOWS (Dollars in thousands) Years Ended December 31, 2018 2017 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 9,211 $ 8,648 Adjustments to reconcile net income to net cash provided by operating activities: Losses (gains) on securities 72 (74 ) Deferred income tax expense (benefit) 5 (110 ) Equity in undistributed earnings of banking subsidiary (3,240 ) (2,406 ) Increase in prepaid/accrued expenses and other assets/liabilities (214 ) (235 ) Increase in advances from banking subsidiary 211 216 NET CASH PROVIDED BY OPERATING ACTIVITIES 6,045 6,039 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sales of investment securities available-for-sale — 144 NET CASH PROVIDED BY INVESTING ACTIVITIES — 144 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock 1,153 1,261 Proceeds from exercise of stock options — 25 Dividends paid (6,194 ) (6,145 ) NET CASH USED IN FINANCING ACTIVITIES (5,041 ) (4,859 ) INCREASE IN CASH AND CASH EQUIVALENTS 1,004 1,324 CASH AND CASH EQUIVALENTS, BEGINNING 8,984 7,660 CASH AND CASH EQUIVALENTS, ENDING $ 9,988 $ 8,984 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements include the accounts of First Keystone Corporation and its wholly-owned subsidiary, First Keystone Community Bank (the “Bank”). All significant inter-company balances and transactions have been eliminated in consolidation. |
Nature of Operations [Policy Text Block] | Nature of Operations The Corporation, headquartered in Berwick, Pennsylvania, provides a full range of banking, trust and related services through its wholly-owned Bank subsidiary and is subject to competition from other financial institutions in connection with these services. The Bank serves a customer base which includes individuals, businesses, governments, and public and institutional customers primarily located in the Northeast Region of Pennsylvania. The Bank has 18 full service offices, one loan production office, and 20 Automated Teller Machines (“ATM”) located in Columbia, Luzerne, Montour, Monroe, and Northampton counties. The Corporation and its subsidiary must also adhere to certain federal and state banking laws and regulations and are subject to periodic examinations made by various state and federal agencies. |
Segment Reporting, Policy [Policy Text Block] | Segment Reporting The Corporation’s subsidiary acts as an independent community financial services provider, and offers traditional banking and related financial services to individual, business, government, and public and institutional customers. Through its branch and ATM network, the Bank offers a full array of commercial and retail financial services, including the taking of time, savings and demand deposits; the making of commercial, consumer and mortgage loans; and the providing of other financial services. The Bank also performs personal, corporate, pension and fiduciary services through its Trust Department. Management does not separately allocate expenses, including the cost of funding loan demand, between the commercial, retail, trust and mortgage banking operations of the Corporation. As such, discrete financial information is not available and segment reporting would not be meaningful. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Significant Concentrations of Credit Risk The majority of the Corporation’s activities involve customers located primarily in Columbia, Luzerne, Montour, Monroe, Northampton, and Lehigh counties in Pennsylvania. The types of securities in which the Corporation invests are presented in Note 3 – Securities. Credit risk as it relates to investment activities is moderated through the monitoring of ratings and geographic concentrations residing in the portfolio and the observance of minimum rating levels in the investment policy. Note 4 – Loans and Allowance for Loan Losses summarizes the types of lending in which the Corporation engages. The inherent risks associated with lending activities are mitigated by adhering to conservative underwriting practices and policies, as well as portfolio diversification and thorough monitoring of the loan portfolio. It is management’s opinion that the investment and loan portfolios were well balanced at December 31, 2018, to the extent necessary to avoid any significant concentrations of credit risk. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of these consolidated financial statements, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant changes include the determination of other-than-temporary impairment on securities and the determination of the allowance for loan losses. |
Subsequent Events, Policy [Policy Text Block] | Subsequent Events The Corporation has evaluated events and transactions occurring subsequent to the consolidated balance sheet date of December 31, 2018, for items that should potentially be recognized or disclosed in the consolidated financial statements. The evaluation was conducted through the date these consolidated financial statements were issued. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents For purposes of reporting consolidated cash flows, cash and cash equivalents include cash on hand and due from banks, interest-bearing deposits in other banks, and federal funds sold. The Corporation considers cash classified as interest-bearing deposits with other banks as a cash equivalent since they are represented by cash accounts essentially on a demand basis and mature within one year. Federal funds are also included as a cash equivalent because they are generally purchased and sold for one-day periods. |
Time Deposits with Other Banks [Policy Text Block] | Time Deposits with Other Banks Time deposits with other banks consist of fully insured certificates of deposit in other banks with maturity dates between one and five years. |
Investment, Policy [Policy Text Block] | Securities The Corporation classifies its securities as either “Held-to-Maturity” or “Available-for-Sale” at the time of purchase. Securities are accounted for on a trade date basis. Debt securities are classified as Held-to-Maturity when the Corporation has the ability and positive intent to hold the securities to maturity. Securities classified as Held-to-Maturity are carried at cost adjusted for amortization of premium and accretion of discount to maturity. Debt securities not classified as Held-to-Maturity are included in the Available-for-Sale category and are carried at fair value. The amount of any unrealized gain or loss, net of the effect of deferred income taxes, is reported as accumulated other comprehensive (loss) income (AOCI) in the Consolidated Balance Sheets and Consolidated Statements of Changes in Stockholders’ Equity. Management’s decision to sell Available-for-Sale securities is based on changes in economic conditions controlling the sources and applications of funds, terms, availability of and yield of alternative investments, interest rate risk and the need for liquidity. The cost of debt securities classified as Held-to-Maturity or Available-for-Sale is adjusted for amortization of premiums and accretion of discounts to expected maturity. Such amortization and accretion, as well as interest and dividends, are included in interest and dividend income on investment securities. Realized gains and losses are included in net investment securities gains and losses. The cost of investment securities sold, redeemed or matured is based on the specific identification method. Beginning January 1, 2018, upon adoption of ASU 2016-01, equity securities with readily determinable fair values are stated at fair value with realized and unrealized gains and losses reported in income. For periods prior to January 1, 2018, equity securities were classified as available-for-sale and stated at fair value with unrealized gains and losses reported as a separate component of AOCI, net of tax. Equity securities without readily determinable fair values are recorded at cost less impairment, if any. Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. Securities classified as available-for-sale or held-to-maturity are generally evaluated for OTTI under FASB ASC 320, Investments - Debt and Equity Securities . In determining OTTI under the FASB ASC 320 model, management considers many factors, including (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the entity has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time. When other-than-temporary impairment occurs on debt securities, the amount of the other-than-temporary impairment recognized in earnings depends on whether an entity intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss. If an entity intends to sell or more likely than not will be required to sell the security before recovery of its amortized cost basis less any current-period credit loss, the other-than-temporary impairment shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. If an entity does not intend to sell the security and it is not more likely than not that the entity will be required to sell the security before recovery of its amortized cost basis less any current-period loss, the other-than-temporary impairment shall be separated into the amount representing the credit loss and the amount related to all other factors. The amount of the total other-than-temporary impairment related to the credit loss is determined based on the present value of cash flows expected to be collected, and the realized loss is recognized as impairment charges on securities on the Consolidated Statements of Income. The amount of the total other-than-temporary impairment related to the other factors shall be recognized in other comprehensive (loss) income, net of applicable taxes. The previous amortized cost basis less the other-than-temporary impairment recognized in earnings becomes the new amortized cost basis of the investment. The fair market value of the equity securities tends to fluctuate with the overall equity markets as well as the trends specific to each institution. The equity securities portfolio is reviewed in a similar manner as that of the debt securities with greater emphasis placed on the length of time the market value has been less than the carrying value and the financial sector outlook. The Corporation also reviews dividend payment activities, levels of non-performing assets and loan loss reserves. The starting point for the equity analysis is the length and severity of market value decline. The realized loss is recognized as impairment charges on securities on the Consolidated Statements of Income. The previous cost basis less the other-than-temporary impairment recognized in earnings becomes the new cost basis of the investment. |
Restricted Investments [Policy Text Block] | Restricted Investment in Bank Stocks The Bank owns restricted stock investments in the Federal Home Loan Bank of Pittsburgh (“FHLB-Pittsburgh”) and Atlantic Community Bankers Bank (“ACBB”). These investments do not have a readily determinable fair value because their ownership is restricted and they can be sold back only to the FHLB-Pittsburgh, ACBB or to another member institution. Therefore, these investments are carried at cost. At December 31, 2018, the Corporation held $8,646,000 in stock of FHLB-Pittsburgh and $35,000 in stock of ACBB. At December 31, 2017, the Corporation held $4,023,000 in stock of FHLB-Pittsburgh and $35,000 in stock of ACBB. Management evaluates the restricted investment in bank stocks for impairment on an annual basis. Management’s determination of whether these investments are impaired is based on management’s assessment of the ultimate recoverability of the cost of these investments rather than by recognizing temporary declines in value. The following factors were evaluated to determine the ultimate recoverability of the cost of the Corporation’s restricted investment in bank stocks; (i) the significance of the decline in net assets of the correspondent bank as compared to the capital stock amount for the correspondent bank and the length of time this situation has persisted; (ii) commitments by the correspondent bank to make payments required by law or regulation and the level of such payments in relation to the operating performance of the correspondent bank; (iii) the impact of legislative and regulatory changes on the institutions and, accordingly, on the customer base of the correspondent bank; and (iv) the liquidity position of the correspondent bank. Based on the analysis of these factors, management determined that no impairment charge was necessary related to the restricted investment in bank stocks during 2018 or 2017. |
Finance, Loans and Leases Receivable, Policy [Policy Text Block] | Loans Net loans are stated at their outstanding recorded investment, net of deferred fees and costs, unearned income and the allowance for loan losses. Interest on loans is recognized as income over the term of each loan, generally, by the accrual method. Loan origination fees and certain direct loan origination costs have been deferred with the net amount amortized using the straight line method or the interest method over the contractual life of the related loans as an interest yield adjustment. Residential mortgage loans held for sale are carried at the lower of cost or market on an aggregate basis determined by independent pricing from appropriate federal or state agency investors. These loans are sold without recourse. Loans held for sale amounted to $365,000 at December 31, 2018 and $834,000 at December 31, 2017. The loans receivable portfolio is segmented into commercial, residential and consumer loans. Commercial loans consist of the following classes: Commercial and Industrial and Commercial Real Estate. Commercial and Industrial Lending The Corporation originates commercial and industrial loans primarily to businesses located in its primary market area and surrounding areas. These loans are used for various business purposes, which include short-term loans and lines of credit to finance machinery and equipment, inventory and accounts receivable. Generally, the maximum term for loans extended on machinery and equipment is based on the projected useful life of such machinery and equipment. Most business lines of credit are written on demand and are reviewed annually. Commercial and industrial loans are generally secured with short-term assets; however, in many cases, additional collateral such as real estate is provided as additional security for the loan. Loan-to-value maximum thresholds have been established by the Corporation and are specific to the type of collateral. Collateral values may be determined using invoices, inventory reports, accounts receivable aging reports, business financial statements, collateral appraisals, etc. Commercial and industrial loans are typically secured by personal guarantees of the borrower. In underwriting commercial and industrial loans, an analysis is performed to evaluate the borrower's character and capacity to repay the loan, the adequacy of the borrower's capital and collateral, as well as the conditions affecting the borrower. Evaluation of the borrower's past, present and future cash flows is also an important aspect of the Corporation's analysis of the borrower’s ability to repay. Commercial and industrial loans generally present a higher level of risk than other types of loans due primarily to the effect of general economic conditions. Commercial and industrial loans are typically made on the basis of the borrower’s ability to make repayment from cash flows from the borrower’s primary business activities. As a result, the availability of funds for the repayment of commercial and industrial loans is dependent on the success of the business itself, which in turn, is likely to be dependent upon the general economic environment. Commercial Real Estate Lending The Corporation engages in commercial real estate lending in its primary market area and surrounding areas. The Corporation’s commercial real estate portfolio is secured primarily by commercial retail space, commercial office buildings, residential housing and hotels. Generally, commercial real estate loans have terms that do not exceed twenty years, have loan-to-value ratios of up to eighty percent of the value of the collateral property, and are typically secured by personal guarantees of the borrowers. In underwriting these loans, the Corporation performs a thorough analysis of the financial condition of the borrower, the borrower’s credit history, and the reliability and predictability of the cash flow generated by the property securing the loan. The value of the property is determined by either independent appraisers or internal evaluations by Bank officers. Commercial real estate loans generally present a higher level of risk than residential real estate secured loans. Repayment of loans secured by commercial real estate is typically dependent upon the successful operation of the related real estate project and/or the effect of the general economic conditions on income producing properties. Residential Real Estate Lending (Including Home Equity) The Corporation’s residential real estate portfolio is comprised of one-to-four family residential mortgage loan originations, home equity term loans and home equity lines of credit. These loans are generated by the Corporation’s marketing efforts, its present customers, walk-in customers and referrals. These loans originate primarily within or with customers from the Corporation’s market area. The Corporation’s one-to-four family residential mortgage originations are secured primarily by properties located in its primary market area and surrounding areas. The Corporation offers fixed-rate mortgage loans with terms up to a maximum of thirty years for both permanent structures and those under construction. Loans with terms of thirty years are normally held for sale and sold without recourse; most of the residential mortgages held in the Corporation’s residential real estate portfolio have maximum terms of twenty years. Generally, the majority of the Corporation’s residential mortgage loans originate with a loan-to-value of eighty percent or less, or those with primary mortgage insurance at ninety-five percent or less. Home equity term loans are secured by the borrower’s primary residence and typically have a maximum loan-to-value of eighty percent and a maximum term of fifteen years. In general, home equity lines of credit are secured by the borrower’s primary residence with a maximum loan-to-value of eighty percent and a maximum term of twenty years. In underwriting one-to-four family residential mortgage loans, the Corporation evaluates the borrower’s ability to make monthly payments, the borrower’s repayment history and the value of the property securing the loan. The ability and willingness to repay is determined by the borrower’s employment history, current financial conditions and credit background. A majority of the properties securing residential real estate loans made by the Corporation are appraised by independent appraisers. The Corporation generally requires mortgage loan borrowers to obtain an attorney’s title opinion or title insurance and fire and property insurance, including flood insurance, if applicable. Residential mortgage loans, home equity term loans and home equity lines of credit generally present a lower level of risk than consumer loans because they are secured by the borrower’s primary residence. Risk is increased when the Corporation is in a subordinate position, especially to another lender, for the loan collateral. Consumer Lending The Corporation offers a variety of secured and unsecured consumer loans, including vehicle loans, stock loans and loans secured by financial institution deposits. These loans originate primarily within or with customers from the market area. Consumer loan terms vary according to the type and value of collateral and creditworthiness of the borrower. In underwriting personal loans, a thorough analysis is performed regarding the borrower’s willingness and financial ability to repay the loan as agreed. The ability to repay is determined by the borrower’s employment history, current financial condition and credit background. Consumer loans may entail greater credit risk than residential real estate loans, particularly in the case of personal loans which are unsecured or are secured by rapidly depreciable assets, such as automobiles or recreational equipment. In such cases, repossessed collateral for a defaulted personal loan may not provide an adequate source of repayment of the outstanding loan balance as a result of the greater likelihood of damage, loss or depreciation. In addition, personal loan collections are dependent on the borrower’s continuing financial stability and therefore, are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount which can be recovered on such loans. |
Delinquent Loans [Policy Text Block] | Delinquent Loans Generally, a loan is considered to be past-due when scheduled loan payments are in arrears 10 days or more. Delinquent notices are generated automatically when a loan is 10 or 15 days past-due, depending on loan type. Collection efforts continue on past-due loans that have not been brought current, when it is believed that some chance exists for improvement in the status of the loan. Past-due loans are continually evaluated with the determination for charge-off being made when no reasonable chance remains that the status of the loan can be improved. Commercial and Industrial and Commercial Real Estate loans are charged off in whole or in part when they become sufficiently delinquent based upon the terms of the underlying loan contract and when a collateral deficiency exists. Because all or part of the contractual cash flows are not expected to be collected, the loan is considered to be impaired, and the Bank estimates the impairment based on its analysis of the cash flows or collateral estimated at fair value less cost to sell. Residential Real Estate and Consumer loans are charged off when they become sufficiently delinquent based upon the terms of the underlying loan contract and when the value of the underlying collateral is not sufficient to support the loan balance and a loss is expected. At that time, the amount of estimated collateral deficiency, if any, is charged off for loans secured by collateral, and all other loans are charged off in full. Loans with collateral are charged down to the estimated fair value of the collateral less cost to sell. Loans in which the borrower is in bankruptcy are considered on a case by case basis and are either charged off or reaffirmed by the borrower. Generally, a loan is classified as non-accrual and the accrual of interest on such a loan is discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan may currently be performing. A loan may remain on accrual status if it is well secured (or supported by a strong guarantee) and in the process of collection. When a loan is placed on non-accrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against interest income. Certain non-accrual loans may continue to perform; that is, payments are still being received. Generally, the payments are applied to principal. These loans remain under constant scrutiny, and if performance continues, interest income may be recorded on a cash basis based on management's judgment as to collectability of principal. |
Loans and Leases Receivable, Allowance for Loan Losses Policy [Policy Text Block] | Allowance for Loan Losses The allowance for loan losses is established through provisions for loan losses charged against income. Loans deemed to be uncollectible are charged against the allowance for loan losses and subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is maintained at a level estimated by management to be adequate to absorb potential loan losses. Management’s periodic evaluation of the adequacy of the allowance for loan losses is based on the Corporation’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay (including the timing of future payments), the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions, and other relevant factors. This evaluation is inherently subjective as it requires material estimates including the amounts and timing of future cash flows expected to be received on impaired loans that may be susceptible to significant change. The allowance consists of specific, general and unallocated components. The specific component relates to loans that are individually classified as impaired. Select loans are not aggregated for collective impairment evaluation, as such; all loans are subject to individual impairment evaluation should the facts and circumstances pertinent to a particular loan suggest that such evaluation is necessary. Factors considered by management in determining impairment include payment status and the probability of collecting scheduled principal and interest payments when due. 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. If a loan is impaired, a portion of the allowance may be allocated so that the loan is reported, net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral if repayment is expected solely from collateral. Troubled debt restructurings are separately identified for impairment disclosures and are measured at the present value of estimated future cash flows using the loan’s effective rate at inception. If a troubled debt restructuring is considered to be a collateral dependent loan, the loan may be reported, net, at the fair value of the collateral. For troubled debt restructurings that subsequently default, the Corporation determines the amount of reserve in accordance with the accounting policy for the allowance for loan losses. The general component covers all other loans not identified as impaired and is based on historical losses and qualitative factors. The historical loss component of the allowance is determined by losses recognized by portfolio segment over a time period that management has determined represents the current credit cycle. Qualitative factors impacting each portfolio segment may include: delinquency trends, loan volume trends, Bank policy changes, management processes and oversight, economic trends (including change in consumer and business disposable incomes, unemployment and under-employment levels, and other conditions), concentrations by industry or product, internal and external loan review processes, collateral value and market conditions, and external factors including regulatory issues and competition. The unallocated component of the allowance is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio. A reserve for unfunded lending commitments is provided for possible credit losses on off-balance sheet credit exposures. The reserve for unfunded lending commitments represents management’s estimate of losses inherent in its unfunded loan commitments and, if necessary, is recorded in other liabilities on the Consolidated Balance Sheets. As of December 31, 2018 and 2017 the amount of the reserve for unfunded lending commitments was $117,000 and $116,000, respectively. The Corporation is subject to periodic examination by its federal and state examiners, and may be required by such regulators to recognize additions to the allowance for loan losses based on their assessment of credit information available to them at the time of their examinations. A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect all amounts due according to the contractual terms of the original loan agreement. Under current accounting standards, the allowance for loan losses related to impaired loans is based on discounted cash flows using the loan’s effective interest rate at inception or the fair value of the collateral for certain collateral dependent loans. The restructuring of a loan is considered a “troubled debt restructuring” if both the following conditions are met: (i) the borrower is experiencing financial difficulties, and (ii) the Bank has granted a concession. The most common concessions granted include one or more modifications to the terms of the debt, such as (a) a reduction in the interest rate for the remaining life of the debt, (b) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (c) a temporary period of interest-only payments, and (d) a reduction in the contractual payment amount for either a short period or remaining term of the loan. A less common concession is the forgiveness of a portion of the principal. The determination of whether a borrower is experiencing financial difficulties takes into account not only the current financial condition of the borrower, but also the potential financial condition of the borrower were a concession not granted. Similarly, the determination of whether a concession has been granted is very subjective in nature. For example, simply extending the term of a loan at its original interest rate or even at a higher interest rate could be interpreted as a concession unless the borrower could readily obtain similar credit terms from a different lender. Loans modified in a troubled debt restructuring are considered impaired and may or may not be placed on non-accrual status until the Bank determines the future collection of principal and interest is reasonably assured, which generally requires that the borrower demonstrates a period of performance according to the restructured terms of six months. The Bank utilizes a risk grading matrix as a tool for managing credit risk in the loan portfolio and assigns an asset quality rating (risk grade) to all Commercial and Industrial, Commercial Real Estate, Residential Real Estate and Consumer borrowings. An asset quality rating is assigned using the guidance provided in the Bank’s loan policy. Primary responsibility for assigning the asset quality rating rests with the lender. The asset quality rating is validated periodically by both an internal and external loan review process. The commercial loan grading system focuses on a borrower’s financial strength and performance, experience and depth of management, primary and secondary sources of repayment, the nature of the business and the outlook for the particular industry. Primary emphasis is placed on financial condition and trends. The grade also reflects current economic and industry conditions; as well as other variables such as liquidity, cash flow, revenue/earnings trends, management strengths or weaknesses, quality of financial information, and credit history. The loan grading system for Residential Real Estate and Consumer loans focuses on the borrower’s credit score and credit history, debt-to-income ratio and income sources, collateral position and loan-to-value ratio, as well as other variables such as current economic conditions, and individual strengths and weaknesses. Risk grade characteristics are as follows: Risk Grade 1 – MINIMAL RISK through Risk Grade 6 – MANAGEMENT ATTENTION (Pass Grade Categories) Risk is evaluated via examination of several attributes including but not limited to financial trends, strengths and weaknesses, likelihood of repayment when considering both cash flow and collateral, sources of repayment, leverage position, management expertise, and repayment history. At the low-risk end of the rating scale, a risk grade of 1 - Minimal Risk is the grade reserved for loans with exceptional credit fundamentals and virtually no risk of default or loss. Loan grades then progress through escalating ratings of 2 through 6 based upon risk. Risk Grade 2 - Modest Risk are loans with sufficient cash flows; Risk Grade 3 - Average Risk are loans with key balance sheet ratios slightly above the borrower’s peers; Risk Grade 4 - Acceptable Risk are loans with key balance sheet ratios usually near the borrower’s peers, but one or more ratios may be higher; and Risk Grade 5 – Marginally Acceptable are loans with strained cash flow, increasing leverage and/or weakening markets. Risk Grade 6 - Management Attention are loans with weaknesses resulting from declining performance trends and the borrower’s cash flows may be temporarily strained. Loans in this category are performing according to terms, but present some type of potential concern. Risk Grade 7 − SPECIAL MENTION (Non-Pass Category) Generally, these loans or assets are currently protected, but are “potentially weak.” They constitute an undue and unwarranted credit risk but not to the point of justifying a classification of substandard. Assets in this category are currently protected but have potential weakness which may, if not checked or corrected, weaken the asset or inadequately protect the Bank’s credit position at some future date. No loss of principal or interest is envisioned; however, they constitute an undue credit risk that may be minor but is unwarranted in light of the circumstances surrounding a specific asset. Risk is increasing beyond that at which the loan originally would have been granted. Historically, cash flows are inconsistent; financial trends show some deterioration. Liquidity and leverage are above industry averages. Financial information could be incomplete or inadequate. A Special Mention asset has potential weaknesses that deserve management’s close attention. Risk Grade 8 − SUBSTANDARD (Non-Pass Category) Generally, these assets are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Assets so classified must have “well-defined” weaknesses that jeopardize the full liquidation of the debt. These loans are characterized by the distinct possibility that the Bank will sustain some loss if the aggregate amount of substandard assets is not fully covered by the liquidation of the collateral used as security. Substandard loans have a high probability of payment default and require more intensive supervision by Bank management. Risk Grade 9 − DOUBTFUL (Non-Pass Category) Generally, loans graded doubtful have all the weaknesses inherent in a substandard loan with the added factor that the weaknesses are pronounced to a point whereby the basis of current information, conditions, and values, collection or liquidation in full is deemed to be highly improbable. The possibility of loss is extremely high, but because of certain important and reasonably specific pending factors that may work to strengthen the asset, its classification is deferred until, for example, a proposed merger, acquisition, liquidation procedure, capital injection, perfection of liens on additional collateral and/or refinancing plan is completed. Loans are graded doubtful if they contain weaknesses so serious that collection or liquidation in full is questionable. |
Property, Plant and Equipment, Policy [Policy Text Block] | Premises and Equipment Premises, improvements, and equipment are stated at cost less accumulated depreciation computed principally utilizing the straight-line method over the estimated useful lives of the assets. Long-lived assets are reviewed for impairment whenever events or changes in business circumstances indicate that the carrying value may not be recovered. Maintenance and minor repairs are charged to operations as incurred. The cost and accumulated depreciation of the premises and equipment retired or sold are eliminated from the property accounts at the time of retirement or sale, and the resulting gain or loss is reflected in current operations. |
Servicing Asset [Policy Text Block] | Mortgage Servicing Rights The Corporation originates and sells real estate loans to investors in the secondary mortgage market. After the sale, the Corporation may retain the right to service these loans. The mortgage loans sold and serviced for others are not included in the Consolidated Balance Sheets. The unpaid principal balances of mortgage loans serviced for others were $97,201,000 and $100,179,000 at December 31, 2018 and 2017, respectively. When originated mortgage loans are sold and servicing is retained, a servicing asset is capitalized based on relative fair value at the date of the sale. Servicing assets are amortized as an offset to other fees in proportion to, and over the period of, estimated net servicing income. The servicing asset is included in other assets in the Consolidated Balance Sheets and amounted to $316,000 at December 31, 2018 and $379,000 at December 31, 2017. The amount of servicing income earned was $247,000 and $246,000 at December 31, 2018 and 2017, respectively. Amortization recognized in relation to mortgage servicing rights was $129,000 and $135,000 at December 31, 2018 and 2017, respectively. Both income and amortization are included in service charges and fees on the Consolidated Statements of Income. Gains or losses on sales of mortgage loans are recognized based on the differences between the selling price and the carrying value of the related mortgage loans sold. |
Life Settlement Contracts, Policy [Policy Text Block] | Bank Owned Life Insurance The cash surrender value of bank owned life insurance is carried as an asset, and changes in cash surrender value are recorded as non-interest income. The Bank entered into agreements to provide post-retirement benefits to two retired employees in the form of life insurance payable to the employee’s beneficiaries upon their death through endorsement split dollar life insurance arrangements. The Bank’s accrued liabilities for this benefit agreement as of December 31, 2018 and 2017 was $40,000 and $41,000, respectively. The related expense for this benefit agreement amounted to $(1,000) for the years ended December 31, 2018 and 2017. |
Interest in Unincorporated Joint Ventures or Partnerships, Policy [Policy Text Block] | Investments in Low-Income Housing Partnerships The Bank is a limited partner in real estate ventures that own and operate affordable residential low-income housing apartment buildings for elderly and mentally challenged adult residents. The investments are accounted for under the cost method. Under the cost method, the Bank recognizes tax credits as they are allocated and amortizes the initial cost of the investment over the period that the tax credits are allocated to the Bank. The amount of tax credits allocated to the Bank were $405,000 in 2018 and $323,000 in 2017, and the amortization of the investments in the limited partnerships were $530,000 and $181,000 in 2018 and 2017, respectively. During 2015, the Bank became a limited partner in a real estate venture with an initial investment of $590,000, and additional capital contributions of $1,178,000 made in 2016 and $252,000 made in 2017. The construction was completed and the property was occupied in 2017. |
Goodwill and Intangible Assets, Policy [Policy Text Block] | Goodwill and Core Deposit Intangibles Goodwill resulted from the acquisition of the Pocono Community Bank in November 2007 and of certain fixed and operating assets acquired and deposit liabilities assumed of the branch of another financial institution in Danville, Pennsylvania, in January 2004. Such goodwill represents the excess cost of the acquired assets relative to the assets fair value at the dates of acquisition. During the first quarter of 2008, $152,000 of liabilities related to the Pocono acquisition were recorded as a purchase accounting adjustment resulting in an increase in the excess purchase price. The amount was comprised of the finalization of severance agreements and contract terminations related to the acquisition. In accordance with current accounting standards, goodwill is not amortized. Management performs an annual evaluation for impairment. Any impairment of goodwill results in a charge to income. The Corporation periodically assesses whether events or changes in circumstances indicate that the carrying amounts of goodwill and other intangible assets may be impaired. Goodwill is evaluated for impairment at the reporting unit level and an impairment loss is recorded to the extent that the carrying amount of goodwill exceeds its implied fair value. The Corporation has evaluated the goodwill included in its consolidated balance sheet at September 30, 2018, and has determined there was no impairment as of that date. In addition, the Corporation did not identify any impairment in 2017. No assurance can be given that future impairment tests will not result in a charge to earnings. Intangible assets are comprised of core deposit intangibles and premium discount (negative premium) on certificates of deposit acquired. The core deposit intangible was being amortized over the average life of the deposits acquired as determined by an independent third party. Premium discount (negative premium) on acquired certificates of deposit resulted from the valuation of certificate of deposit accounts by an independent third party. The book value of certificates of deposit acquired was greater than their fair value at the date of acquisition which resulted in a negative premium due to higher cost of the certificates of deposit compared to the cost of similar term financing. The core deposit intangible was subject to impairment testing whenever events or changes in circumstances indicate its carrying amount may not reflect its benefit. As of June 30, 2015, the core deposit intangible was fully amortized. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock Based Compensation The Corporation adopted a stock option incentive plan in 1998. Compensation cost is recognized for stock options to employees based on the fair value of these awards at the date of grant. A Black-Scholes Option Pricing Model is utilized to estimate the fair value of stock options. Compensation expense is recognized over the requisite service period. The Plan expired in 2008, and therefore, no stock options are available for issuance. After adjustments for the effects of stock dividends, options exercised and options forfeited, there are no exercisable options issued and outstanding as of December 31, 2018. |
Loans and Leases Receivable, Real Estate Acquired Through Foreclosure, Policy [Policy Text Block] | Foreclosed Assets Held for Resale Real estate properties acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less costs to sell on the date of foreclosure establishing a new cost basis. After foreclosure, valuations are periodically performed and if fair value less costs to sell declines subsequent to foreclosure, a valuation allowance is recorded through expense. Revenues derived from and costs to maintain the assets and subsequent gains and losses on sales are included in non-interest expense on the Consolidated Statements of Income. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Corporation accounts for income taxes in accordance with income tax accounting guidance FASB ASC Topic 740, Income Taxes. Current income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Corporation determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of the evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Corporation accounts for uncertain tax positions if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more-likely-than-not means a likelihood of more than 50%; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management’s judgment. The Corporation recognizes interest and penalties on income taxes, if any, as a component of income tax expense. |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Corporation. Potential common shares that may be issued by the Corporation relate solely to outstanding stock options and are determined using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share. (In thousands, except earnings per share) Year Ended December 31, 2018 2017 Net income $ 9,211 $ 8,648 Weighted-average common shares outstanding 5,737 5,689 Basic earnings per share $ 1.60 $ 1.52 Weighted-average common shares outstanding 5,737 5,689 Common stock equivalents due to effect of stock options — — Total weighted-average common shares and equivalents 5,737 5,689 Diluted earnings per share $ 1.60 $ 1.52 |
Treasury Stock [Policy Text Block] | Treasury Stock The purchase of the Corporation’s common stock is recorded at cost. At the date of subsequent reissue, the treasury stock account is reduced by the cost of such stock on a first-in-first-out basis. |
Trust Assets And Income [Policy Text Block] | Trust Assets and Revenues Property held by the Corporation in a fiduciary or agency capacity for its customers is not included in the accompanying consolidated financial statements since such items are not assets of the Corporation. Assets held in Trust were $105,917,000 and $111,130,000 at December 31, 2018 and 2017, respectively. Trust Department income is generally recognized on a cash basis and is not materially different than if it were reported on an accrual basis. |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive Income (Loss) The Corporation is required to present accumulated other comprehensive income (loss) in a full set of general-purpose financial statements for all periods presented. Accumulated other comprehensive income (loss) is comprised of net unrealized holding gains (losses) on the available-for-sale securities portfolio. The Corporation has elected to report these effects on the Consolidated Statements of Comprehensive Income. |
Advertising Costs, Policy [Policy Text Block] | Advertising Costs It is the Corporation’s policy to expense advertising costs in the period in which they are incurred. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Standards Updates (“ASU”) – Adopted: Except as disclosed below, there were no new accounting pronouncements affecting the Corporation during the year ended December 31, 2018 that were not already adopted by the Corporation in previous periods. On January 1, 2018, the Corporation adopted ASU 2014-09, Revenue from Contracts with Customers, and all subsequent amendments to the ASU (collectively “ASC 606”), which (i) creates a single framework for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize a gain (loss) from the transfer of nonfinancial assets, such as OREO. The majority of the Corporation’s revenue comes from interest income, including loans and securities, which are outside the scope of ASC 606. The Corporation’s services that fall within the scope of ASC 606 are presented within other income on the consolidated statements of income and are recognized as revenue as the Corporation satisfies its obligation to the customer. Services within the scope of ASC 606 include deposit related fees and service charges, interchange fees and surcharges, and income from wealth management activities. ASC 606 did not result in a change to the accounting for any in-scope revenue streams; as such, no cumulative effect adjustment was recorded. New disclosures required by the ASU are included in Note 18, “Revenue Recognition”. On January 1, 2018, the Corporation adopted ASU 2016-01, Financial Instruments-Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which amended the guidance on the classification and measurement of financial instruments. Adoption of ASU 2016-01 resulted in: (1) separate classification of marketable equity securities previously included in investment securities available-for-sale on the consolidated balance sheets, (2) changes in the fair value of the equity securities being captured in the consolidated statements of income and (3) an increase in retained earnings and corresponding decrease in accumulated other comprehensive loss of $634,000 at January 1, 2018 for the after-tax impact of the change in accounting for the unrealized gain on the equity securities. Adoption of the standard also resulted in the use of an exit price to determine the fair value of financial instruments not measured at fair value in the consolidated balance sheets. For more information about fair value disclosures, refer to Note 17, “Fair Value Measurements”. In August 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-15 – Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force). ASU No. 2016-15 addresses eight cash flow issues with specific guidance on how certain cash receipts and cash payments should be presented on the statement of cash flows. ASU No. 2016-15 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2017. The adoption of ASU No. 2016-15 in 2018 had no material effect on the Corporation’s cash flows. In November 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-18, Statement of Cash Flows-Restricted Cash (Topic 230) . The amendments in this Update clarify the inclusion of restricted cash in the cash and cash equivalents beginning-of-period and end-of period reconciliation on the consolidated statement of cash flows. For public business entities that are SEC filers, such as the Corporation, the amendments in this Update are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The implementation of this ASU in 2018 had no material effect on the Corporation’s cash flows. In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715) : Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments apply to all entities that offer employees defined benefit pension plans, other postretirement benefit plans, or other types of benefits accounted for under Topic 715, Compensation — Retirement Benefits. The amendments require that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. The amendments also allow only the service cost component to be eligible for capitalization when applicable (e.g., as a cost of internally manufactured inventory or a self-constructed asset). The ASU is effective for public business entities for annual periods beginning after December 15, 2017, including interim periods within those annual periods. The adoption of this update in 2018 had no material impact on the Corporation’s consolidated financial position or results of operations. In February 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“AOCI”). This ASU provides financial statement preparers with an option to reclassify stranded tax effects within AOCI 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) are recorded. 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 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 Corporation elected to early adopt this standard update, effective January 1, 2018. Adoption resulted in a reclassification between retained earnings and accumulated other comprehensive loss of $360,000 at January 1, 2018, which is included in the consolidated statements of changes in stockholders’ equity. Pending ASUs: In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , respectively, on its Consolidated Balance Sheets, with no expected adjustment to stockholders’ equity and no material impact to its consolidated statements of income. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 requires financial assets measured at amortized cost to be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2019. Early adoption is permitted for annual and interim periods beginning after December 15, 2018. While the Corporation is currently evaluating the provisions of ASU 2016-13 to determine the potential impact of the new standard will have on the Corporation’s Consolidated Financial Statements, it has taken steps to prepare for the implementation when it becomes effective, such as: forming an internal committee, gathering pertinent data, consulting with outside professionals, and subscribed to a new software system. In January 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350) : Simplifying the Test for Goodwill Impairment. The ASU simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Instead, under the amendments, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value with its carrying amount. Additionally, an entity should consider income tax effects from any tax deductible goodwill on the carrying amount when measuring the goodwill impairment loss, if applicable. The update also eliminated the requirements for zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. The amendments are effective for public business entities for its annual or any 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 adoption of this update is not expected to have a material impact on the Corporation’s consolidated financial position or results of operations. In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-08, Receivables- Nonrefundable Fees and Other Costs (Subtopic 310-20) : Premium Amortization on Purchased Callable Debt Securities. In August 2018, The Financial Accounting Standards Board (“FASB”) issued ASU 2018-13, Fair Value Measurement (Topic 820) – Disclosure Framework – Changes to Disclosure Requirements for Fair Value Measurement. The amendments in this Update removed required disclosures regarding as follows: 1. The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, 2. The policy for timing of transfers between levels, 3. The valuation processes for Level 3 fair value measurements, and 4. The Update modified the disclosure requirements on fair value measurements in Topic 820: 1. The changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and 2. The range and weighted average significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. The amendments in this Update are effective for all entities for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this Update and delay adoption of the additional disclosures until their effective date. The Corporation will be assessing the impact that this guidance will have on its consolidated financial statements and related disclosures. |
Transfers and Servicing of Financial Assets, Policy [Policy Text Block] | Transfer of Financial Assets Transfers of financial assets are accounted for as sales when control over assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Corporation, (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 Corporation does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. |
Off-Balance-Sheet Credit Exposure, Policy [Policy Text Block] | Off-Balance Sheet Financial Instruments In the ordinary course of business, the Bank has entered into off-balance sheet financial instruments consisting of commitments to extend credit and letters of credit. Such financial instruments are recorded in the Consolidated Balance Sheets when they are funded. |
Reclassification, Policy [Policy Text Block] | Reclassifications Certain amounts previously reported have been reclassified, when necessary, to conform with presentations used in the 2018 consolidated financial statements. Such reclassifications have no effect on the Corporation’s net income. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted earnings per share. (In thousands, except earnings per share) Year Ended December 31, 2018 2017 Net income $ 9,211 $ 8,648 Weighted-average common shares outstanding 5,737 5,689 Basic earnings per share $ 1.60 $ 1.52 Weighted-average common shares outstanding 5,737 5,689 Common stock equivalents due to effect of stock options — — Total weighted-average common shares and equivalents 5,737 5,689 Diluted earnings per share $ 1.60 $ 1.52 |
SECURITIES (Tables)
SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Unrealized Gain (Loss) on Investments [Table Text Block] | The amortized cost, related estimated fair value, and unrealized gains and losses for debt securities classified as were as follows at December 31, 2018 and 2017: Available-for-Sale Debt Securities (Dollars in thousands) Gross Gross Amortized Unrealized Unrealized Fair December 31, 2018: Cost Gains Losses Value U.S. Treasury securities $ 5,307 $ — $ (12 ) $ 5,295 Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 66,300 105 (1,529 ) 64,876 Other 18,706 21 (484 ) 18,243 Other mortgage backed securities 4,767 — (18 ) 4,749 Obligations of state and political subdivisions 182,621 1,678 (2,021 ) 182,278 Asset backed securities 14,323 47 — 14,370 Corporate debt securities 27,297 24 (1,078 ) 26,243 Total $ 319,321 $ 1,875 $ (5,142 ) $ 316,054 Available-for-Sale Debt Securities (Dollars in thousands) Gross Gross Amortized Unrealized Unrealized Fair December 31, 2017: Cost Gains Losses Value U.S. Treasury securities $ — $ — $ — $ — Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 82,825 210 (1,175 ) 81,860 Other 22,409 132 (308 ) 22,233 Other mortgage backed debt securities — — — — Obligations of state and political subdivisions 211,743 4,690 (911 ) 215,522 Asset backed securities — — — — Corporate debt securities 29,645 90 (764 ) 28,971 Total $ 346,622 $ 5,122 $ (3,158 ) $ 348,586 |
Investments Classified by Contractual Maturity Date [Table Text Block] | The amortized cost and fair value of securities, by contractual maturity, are shown below at December 31, 2018. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. (Dollars in thousands) Available for Sale Amortized Cost Fair Value 1 year or less $ 4,268 $ 4,264 Over 1 year through 5 years 55,283 54,544 Over 5 years through 10 years 86,076 84,779 Over 10 years 102,627 102,842 Mortgage-backed securities 71,067 69,625 Total $ 319,321 $ 316,054 |
Unrealized And Realized Gain Loss On Investments [Table Text Block] | The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during 2018: (Dollars in thousands) December 31, 2018 Net losses recognized during the period on equity securities $ (72 ) Net gains and (losses) recognized during the period on equity securities sold during the period — Net losses recognized during the reporting period on equity securities still held at the reporting date $ (72 ) |
Schedule of Unrealized Loss on Investments [Table Text Block] | In accordance with disclosures required by FASB ASC 320-10-50, Investments - Debt and Equity Securities , the summary below shows the gross unrealized losses and fair value of the Corporation’s debt securities, aggregated by investment category, of which individual securities have been in a continuous unrealized loss position for less than 12 months or 12 months or more as of December 31, 2018 and 2017: December 31, 2018 (Dollars in thousands) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss Available-for-Sale: U.S. Treasury securities $ 5,295 $ (12 ) $ — $ — $ 5,295 $ (12 ) Obligations of U.S. Government Corporations and Agencies: Mortgage-backed 3,690 (17 ) 55,443 (1,512 ) 59,133 (1,529 ) Other 7,553 (66 ) 7,067 (418 ) 14,620 (484 ) Other mortgage backed debt securities 4,749 (18 ) — — 4,749 (18 ) Obligations of state and political subdivisions 14,453 (75 ) 66,583 (1,946 ) 81,036 (2,021 ) Asset backed securities — — — — — — Corporate debt securities 1,823 (29 ) 19,477 (1,049 ) 21,300 (1,078 ) Total $ 37,563 $ (217 ) $ 148,570 $ (4,925 ) $ 186,133 $ (5,142 ) December 31, 2017 (Dollars in thousands) Less Than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Value Loss Value Loss Value Loss Available-for-Sale: U.S. Treasury securities $ — $ — $ — $ — $ — $ — Obligations of U.S. Government Mortgage-backed 30,555 (300 ) 33,943 (875 ) 64,498 (1,175 ) Other 2,905 (4 ) 7,179 (304 ) 10,084 (308 ) Other mortgage backed securities — — — — — — Obligations of state and political subdivisions 36,149 (329 ) 22,566 (582 ) 58,715 (911 ) Asset backed securities — — — — — — Corporate debt securities 6,746 (24 ) 15,174 (740 ) 21,920 (764 ) Total $ 76,355 $ (657 ) $ 78,862 $ (2,501 ) $ 155,217 $ (3,158 ) |
LOANS AND ALLOWANCE FOR LOAN _2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Financing Receivable Credit Quality Indicators [Table Text Block] | The following table presents the classes of the loan portfolio summarized by risk rating as of December 31, 2018 and 2017: Commercial and (Dollars in thousands) Industrial Commercial Real Estate 2018 2017 2018 2017 Grade: 1-6 Pass $ 90,835 $ 97,832 $ 329,126 $ 276,682 7 Special Mention 6 10 5,249 1,514 8 Substandard 1,219 1,334 13,403 12,210 9 Doubtful — — ― — Add (deduct): Unearned discount and — — ― — Net deferred loan fees and costs 160 161 698 564 Total loans $ 92,220 $ 99,337 $ 348,476 $ 290,970 Residential Real Estate Including Home Equity Consumer Loans 2018 2017 2018 2017 Grade: 1-6 Pass $ 158,755 $ 161,405 $ 5,854 $ 5,997 7 Special Mention 121 124 1 52 8 Substandard 941 1,444 9 24 9 Doubtful — — ― — Add (deduct): Unearned discount and — (1 ) — — Net deferred loan fees and costs (76 ) (47 ) 91 92 Total loans $ 159,741 $ 162,925 $ 5,955 $ 6,165 Total Loans 2018 2017 Grade: 1-6 Pass $ 584,570 $ 541,916 7 Special Mention 5,377 1,700 8 Substandard 15,572 15,012 9 Doubtful — — Add (deduct): Unearned discount and — (1 ) Net deferred loan fees and costs 873 770 Total loans $ 606,392 $ 559,397 |
Allowance for Credit Losses on Financing Receivables [Table Text Block] | The activity in the allowance for loan losses, by loan class, is summarized below for the years indicated. (Dollars in thousands) Commercial Commercial Residential and Industrial Real Estate Real Estate Consumer Unallocated Total 2018 Allowance for Loan Losses: Beginning balance $ 949 $ 4,067 $ 1,656 $ 111 $ 704 $ 7,487 Charge-offs (18 ) (783 ) (181 ) (57 ) — (1,039 ) Recoveries 31 60 — 6 — 97 Provision (238 ) 356 175 57 (150 ) 200 Ending Balance $ 724 $ 3,700 $ 1,650 $ 117 $ 554 $ 6,745 Ending balance: individually evaluated for impairment $ — $ 1 $ — $ — $ — $ 1 Ending balance: collectively evaluated for impairment $ 724 $ 3,699 $ 1,650 $ 117 $ 554 $ 6,744 Loans Receivable: Ending Balance $ 92,220 $ 348,476 $ 159,741 $ 5,955 $ — $ 606,392 Ending balance: individually evaluated for impairment $ 1,126 $ 15,890 $ 577 $ — $ — $ 17,593 Ending balance: collectively evaluated for impairment $ 91,094 $ 332,586 $ 159,164 $ 5,955 $ — $ 588,799 (Dollars in thousands) Commercial Commercial Residential and Industrial Real Estate Real Estate Consumer Unallocated Total 2017 Allowance for Loan Losses: Beginning balance $ 836 $ 4,421 $ 1,777 $ 95 $ 228 $ 7,357 Charge-offs — (189 ) (62 ) (82 ) — (333 ) Recoveries 74 103 9 10 — 196 Provision 39 (268 ) (68 ) 88 476 267 Ending Balance $ 949 $ 4,067 $ 1,656 $ 111 $ 704 $ 7,487 Ending balance: individually evaluated for impairment $ — $ 305 $ 22 $ — $ — $ 327 Ending balance: collectively evaluated for impairment $ 949 $ 3,762 $ 1,634 $ 111 $ 704 $ 7,160 Loans Receivable: Ending Balance $ 99,337 $ 290,970 $ 162,925 $ 6,165 $ — $ 559,397 Ending balance: individually evaluated for impairment $ 1,203 $ 11,673 $ 1,050 $ — $ — $ 13,926 Ending balance: collectively evaluated for impairment $ 98,134 $ 279,297 $ 161,875 $ 6,165 $ — $ 545,471 |
Troubled Debt Restructurings on Financing Receivables [Table Text Block] | The following table presents the outstanding recorded investment of TDRs at the dates indicated: (Dollars in thousands) December 31, December 31, 2018 2017 Non-accrual TDRs $ 80 $ 273 Accruing TDRs 13,697 8,836 Total $ 13,777 $ 9,109 |
Troubled Debt Restructurings On Financing Receivables By Type [Table Text Block] | The following table presents information regarding the loan modifications categorized as TDRs during the years ended December 31, 2018 and 2017. (Dollars in thousands) Year Ended December 31, 2018 Pre-Modification Post-Modification Year-End Number Outstanding Recorded Outstanding Recorded Recorded of Contracts Investment Investment Investment Commercial and Industrial 3 $ 751 $ 751 $ 771 Commercial Real Estate 8 4,833 4,850 4,688 Residential Real Estate 1 26 26 25 Total 12 $ 5,610 $ 5,627 $ 5,484 (Dollars in thousands) Year Ended December 31, 2017 Pre-Modification Post-Modification Year-End Number Outstanding Recorded Outstanding Recorded Recorded of Contracts Investment Investment Investment Commercial and Industrial 1 $ 38 $ 38 $ 36 Commercial Real Estate 2 1,064 1,072 1,069 Residential Real Estate 1 32 60 60 Total 4 $ 1,134 $ 1,170 $ 1,165 |
Loan Modifications By Type [Table Text Block] | The following table provides detail regarding the types of loan modifications made for loans categorized as TDRs during the years ended December 31, 2018 and 2017 with the total number of each type of modification performed. Year Ended December 31, 2018 Year Ended December 31, 2017 Rate Term Payment Number Rate Term Payment Number Modification Modification Modification Modified Modification Modification Modification Modified Commercial and Industrial ― — 3 3 ― — 1 1 Commercial Real Estate 1 2 5 8 — 1 1 2 Residential Real Estate ― 1 — 1 ― ― 1 1 Total 1 3 8 12 — 1 3 4 |
Impaired Financing Receivables [Table Text Block] | The recorded investment, unpaid principal balance, and the related allowance of the Corporation’s impaired loans are summarized below for the periods ended December 31, 2018 and 2017. (Dollars in thousands) December 31, 2018 December 31, 2017 Unpaid Unpaid Recorded Principal Related Recorded Principal Related Investment Balance Allowance Investment Balance Allowance With no related allowance recorded: Commercial and Industrial $ 1,126 $ 1,126 $ — $ 1,203 $ 1,203 $ — Commercial Real Estate 15,807 20,107 — 9,199 11,383 — Residential Real Estate 577 619 — 878 1,024 — With an allowance recorded: Commercial and Industrial — — — — — — Commercial Real Estate 83 83 1 2,474 3,889 305 Residential Real Estate — — — 172 172 22 Total $ 17,593 $ 21,935 $ 1 $ 13,926 $ 17,671 $ 327 Total consists of: Commercial and Industrial $ 1,126 $ 1,126 $ — $ 1,203 $ 1,203 $ — Commercial Real Estate $ 15,890 $ 20,190 $ 1 $ 11,673 $ 15,272 $ 305 Residential Real Estate $ 577 $ 619 $ — $ 1,050 $ 1,196 $ 22 The average recorded investment and interest income recognized for the Corporation’s impaired loans are summarized below for the years ended December 31, 2018 and 2017. (Dollars in thousands) For the Year Ended For the Year Ended December 31, 2018 December 31, 2017 Average Interest Average Interest Recorded Income Recorded Income Investment Recognized Investment Recognized With no related allowance recorded: Commercial and Industrial $ 1,157 $ 53 $ 1,032 $ 25 Commercial Real Estate 11,575 623 11,140 485 Residential Real Estate 794 11 789 7 With an allowance recorded: Commercial and Industrial — — — — Commercial Real Estate 662 3 1,630 4 Residential Real Estate 138 — 215 — Total $ 14,326 $ 690 $ 14,806 $ 521 Total consists of: Commercial and Industrial $ 1,157 $ 53 $ 1,032 $ 25 Commercial Real Estate $ 12,237 $ 626 $ 12,770 $ 489 Residential Real Estate $ 932 $ 11 $ 1,004 $ 7 |
Schedule of Non-Performing Assets [Table Text Block] | Total non-performing assets (which includes loans receivable on non-accrual status, foreclosed assets held for resale and loans past-due 90 days or more and still accruing interest) as of December 31, 2018 and 2017 were as follows: (Dollars in thousands) December 31, December 31, 2018 2017 Commercial and Industrial $ — $ 798 Commercial Real Estate 3,402 3,302 Residential Real Estate 494 990 Total non-accrual loans 3,896 5,090 Foreclosed assets held for resale 1,163 1,071 Loans past-due 90 days or more and still accruing interest 228 70 Total non-performing assets $ 5,287 $ 6,231 |
Past Due Financing Receivables [Table Text Block] | The following tables present the classes of the loan portfolio summarized by the past-due status at December 31, 2018 and 2017: (Dollars in thousands) 90 Days Or Greater Past Due 90 Days and Still 30-59 Days 60-89 Days or Greater Total Total Accruing Past Due Past Due Past Due Past Due Current Loans Interest December 31, 2018: Commercial and Industrial $ 16 $ 30 $ — $ 46 $ 92,174 $ 92,220 $ — Commercial Real Estate 1,990 630 3,477 6,097 342,379 348,476 145 Residential Real Estate 1,519 228 456 2,203 157,538 159,741 83 Consumer 12 — — 12 5,943 5,955 — Total $ 3,537 $ 888 $ 3,933 $ 8,358 $ 598,034 $ 606,392 $ 228 (Dollars in thousands) 90 Days Or Greater Past Due 90 Days and Still 30-59 Days 60-89 Days or Greater Total Total Accruing Past Due Past Due Past Due Past Due Current Loans Interest December 31, 2017: Commercial and Industrial $ 68 $ 42 $ — $ 110 $ 99,227 $ 99,337 $ — Commercial Real Estate 603 201 2,606 3,410 287,560 290,970 50 Residential Real Estate 1,952 484 584 3,020 159,905 162,925 20 Consumer 21 2 — 23 6,142 6,165 — Total $ 2,644 $ 729 $ 3,190 $ 6,563 $ 552,834 $ 559,397 $ 70 |
PREMISES AND EQUIPMENT (Tables)
PREMISES AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Premises and equipment at December 31, 2018 and 2017 is as follows: (Dollars in thousands) Estimated Useful Life (in years) 2018 2017 Land N/A $ 3,744 $ 3,744 Buildings 5-40 20,639 20,562 Leasehold improvements 3-20 174 147 Equipment 3-25 8,283 8,331 32,840 32,784 Less: Accumulated depreciation 12,894 12,161 Total $ 19,946 $ 20,623 |
DEPOSITS (Tables)
DEPOSITS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits [Abstract] | |
Schedule Of Deposit Liabilities [Table Text Block] | Major classifications of deposits at December 31, 2018 and 2017 consisted of: (Dollars in thousands) 2018 2017 Non-interest bearing demand $ 126,361 $ 121,415 Interest bearing demand 180,328 265,379 Savings 167,572 183,724 Time certificates of deposits less than $250,000 172,550 171,556 Time certificates of deposits $250,000 or greater 23,597 34,933 Other time 1,145 1,139 Total deposits $ 671,553 $ 778,146 |
Schedule Of Maturities Of Time Deposits [Table Text Block] | The following is a schedule reflecting classification and remaining maturities of time deposits at December 31, 2018: ( Dollars in thousands) Year Ending 2019 $ 96,639 2020 41,642 2021 33,030 2022 18,822 2023 6,684 Thereafter 475 $ 197,292 |
Schedule Of Discrete Deposits [Table Text Block] | At December 31, 2018, the largest two depositors had aggregate deposits of approximately $43,107,000 as follows: (Dollars in thousands) School district $ 22,457 School district 20,650 Total $ 43,107 |
SHORT-TERM BORROWINGS (Tables)
SHORT-TERM BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Short-term Debt [Table Text Block] | Short-term borrowings and weighted-average interest rates at and for the years ended December 31, 2018 and 2017 are as follows: (Dollars in thousands) 2018 2017 Average Average Amount Rate Amount Rate Federal funds purchased $ — 2.19 % $ — 1.82 % Securities sold under agreements to repurchase 12,957 0.56 % 22,844 0.41 % Federal Discount Window — 2.19 % — 1.71 % Federal Home Loan Bank 161,488 2.28 % 3,452 1.16 % $ 174,445 2.04 % $ 26,296 0.97 % |
Schedule of Repurchase Agreements [Table Text Block] | The following table presents the short-term borrowings subject to an enforceable master netting arrangement or repurchase agreements as of December 31, 2018 and 2017. (Dollars in thousands) Gross Net Amounts Amounts of Liabilities Offset Presented Gross in the in the Amounts of Consolidated Consolidated Cash Recognized Balance Balance Financial Collateral Net Liabilities Sheet Sheet Instruments Pledge Amount December 31, 2018 Repurchase agreements (a) $ 12,957 $ ― $ 12,957 $ (12,957 ) $ ― $ ― December 31, 2017 Repurchase agreements (a) $ 22,844 $ ― $ 22,844 $ (22,844 ) $ ― $ ― (a) As of December 31, 2018 and 2017, the fair value of securities pledged in connection with repurchase agreements was $16,970,000 and $26,023,000, respectively. |
Schedule Of Remaining Contractual Maturity Of Repurchase Agreements [Table Text Block] | The following table presents the remaining contractual maturity of the master netting arrangement or repurchase agreements as of December 31, 2018. (Dollars in thousands) Remaining Contractual Maturity of the Agreements Overnight Greater and Up to 30 -90 than Continuous 30 days Days 90 Days Total Repurchase agreements and repurchase-to-maturity transactions: U.S. Treasury and/or agency securities $ 12,957 $ ― $ ― $ ― $ 12,957 Total $ 12,957 $ ― $ ― $ ― $ 12,957 |
LONG-TERM BORROWINGS (Tables)
LONG-TERM BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | A schedule of long-term borrowings by maturity as of December 31, 2018 and 2017 follows: (Dollars in thousands) 2018 2017 Due 2018, 1.27% to 4.86% $ — $ 23,000 Due 2019, 1.79% to 2.11% 20,000 20,000 Due 2020, 1.62% to 1.95% 10,000 10,000 Due 2021, 1.42% to 1.58% 10,000 10,000 Due 2023, 2.96% 3,000 — Due 2028, 5.14% 2,000 2,000 $ 45,000 $ 65,000 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The current and deferred components of the income tax expense consisted of the following: (Dollars in thousands) 2018 2017 Federal Current $ (107 ) $ 1,309 Deferred 566 146 Income tax expense $ 459 $ 1,455 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | The following is a reconciliation between the income tax expense and the amount of income taxes which would have been provided at the statutory rate of 21% in 2018 and 34% in 2017: (Dollars in thousands) 2018 2017 Amount Rate Amount Rate Federal income tax at statutory rate $ 2,031 21.0 % $ 3,435 34.0 % Tax-exempt income (1,043 ) (10.8 ) (1,897 ) (18.8 ) Low-income housing credits (405 ) (4.2 ) (323 ) (3.2 ) Bank owned life insurance income (128 ) (1.3 ) (216 ) (2.1 ) Effect of tax rate change — — 379 3.8 Other 4 — 77 0.7 Income tax expense and rate $ 459 4.7 % $ 1,455 14.4 % |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The components of the net deferred tax asset at December 31, 2018 and 2017 are as follows: (Dollars in thousands) 2018 2017 Deferred Tax Assets: Allowance for loan losses $ 1,417 $ 1,572 Provision for unfunded commitments 25 24 Deferred compensation 241 316 Contributions 1 8 Leases 53 66 Limited partnership investments 66 57 Alternative minimum tax credits 7 379 Net unrealized investment securities losses 449 — Impairment loss on investment securities 4 4 Writedowns on OREO properties 34 5 Capital and net operating loss carry forwards — 25 Total 2,297 2,456 Deferred Tax Liabilities: Net unrealized investment securities gains 670 Loan fees and costs 183 162 Accumulated depreciation 311 332 Accretion 35 77 Mortgage servicing rights 42 38 Intangibles 257 241 Total 828 1,520 Net Deferred Tax Asset $ 1,469 $ 936 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions [Table Text Block] | A summary of the activity on the related party loans consists of the following: (Dollars in thousands) 2018 2017 Balance at January 1 $ 10,997 $ 2,159 Additions 13,642 15,574 Deductions (4,691 ) (6,736 ) Balance at December 31 $ 19,948 $ 10,997 |
REGULATORY MATTERS (Tables)
REGULATORY MATTERS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory Matters [Abstract] | |
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations [Table Text Block] | As of December 31, 2018 the most recent notification from the Federal Deposit Insurance Corporation 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 total risk-based, tier I risk-based, common equity tier 1 risk-based and tier I leverage ratios as set forth in the table. There are no conditions or events since the notification that management believes have changed the Bank’s category. (Dollars in thousands) Minimum To Be Well Capital Capitalized For Capital Adequacy Under Prompt Adequacy with Capital Corrective Actual Purposes Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio As of December 31, 2018: Total Capital (to Risk-Weighted Assets) $ 96,065 13.87 % $ 55,395 8.00 % $ 68,378 9.88 % $ 69,243 10.00 % Tier I Capital (to Risk-Weighted Assets) $ 89,203 12.88 % $ 41,546 6.00 % $ 54,529 7.88 % $ 55,395 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 89,203 12.88 % $ 31,160 4.50 % $ 44,143 6.38 % $ 45,008 6.50 % Tier I Capital (to Average Assets) $ 89,203 9.01 % $ 39,616 4.00 % $ 39,616 4.00 % $ 49,521 5.00 % (Dollars in thousands) Minimum To Be Well Capital Capitalized For Capital Adequacy Under Prompt Adequacy with Capital Corrective Actual Purposes Buffer Action Provisions Amount Ratio Amount Ratio Amount Ratio Amount Ratio As of December 31, 2017: Total Capital (to Risk-Weighted Assets) $ 93,566 14.21 % $ 52,676 8.00 % $ 60,907 9.25 % $ 65,845 10.00 % Tier I Capital (to Risk-Weighted Assets) $ 85,963 13.06 % $ 39,507 6.00 % $ 47,738 7.25 % $ 52,676 8.00 % Common Equity Tier 1 Capital (to Risk-Weighted Assets) $ 85,963 13.06 % $ 29,630 4.50 % $ 37,861 5.75 % $ 42,800 6.50 % Tier I Capital (to Average Assets) $ 85,963 8.84 % $ 38,901 4.00 % $ 38,901 4.00 % $ 48,626 5.00 % |
FINANCIAL INSTRUMENTS WITH OF_2
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule Of Concentration Risk, Credit Risk, Financial Instruments, Off-Balance Sheet Risk [Table Text Block] | The contract or notional amounts at December 31, 2018 and 2017 were as follows: (Dollars in thousands) 2018 2017 Financial instruments whose contract amounts represent credit risk: Commitments to extend credit $ 107,126 $ 90,373 Financial standby letters of credit $ 331 $ 450 Performance standby letters of credit $ 3,107 $ 2,901 |
STOCK COMPENSATION PLAN (Tables
STOCK COMPENSATION PLAN (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation, Stock Options, Activity [Table Text Block] | Information about stock options outstanding at December 31, 2018 and 2017, is summarized as follows: 2018 2017 Weighted Weighted Average Average Stock Exercise Stock Exercise Options Price Options Price Balance at January 1 — — 1,500 $ 16.75 Exercised — — (1,500 ) 16.75 Forfeited/Expired — — — — Balance at December 31 — — — — Exercisable at December 31 — — — — |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | At December 31, 2018 and 2017, securities measured at fair value on a recurring basis and the valuation methods used are as follows: (Dollars in thousands) December 31, 2018 Level 1 Level 2 Level 3 Total Available-for-Sale Debt Securities: U.S. Treasury securities $ — $ 5,295 $ — $ 5,295 Obligations of U.S. Government Corporations and Agencies: Mortgaged-backed — 64,876 — 64,876 Other — 18,243 — 18,243 Other mortgage backed debt securities — 4,749 — 4,749 Obligations of state and political subdivisions — 182,278 — 182,278 Asset backed securities — 14,370 — 14,370 Corporate debt securities — 26,243 — 26,243 Total debt securities available-for-sale — 316,054 — 316,054 Marketable equity securities 1,560 — — 1,560 Total $ 1,560 $ 316,054 $ — $ 317,614 (Dollars in thousands) December 31, 2017 Level 1 Level 2 Level 3 Total Available-for-Sale Debt Securities: U.S. Treasury securities $ — $ — $ — $ — Obligations of U.S. Government Corporations and Agencies: Mortgaged-backed — 81,860 — 81,860 Other — 22,233 — 22,233 Other mortgage backed debt securities — — — — Obligations of state and political subdivisions — 215,522 — 215,522 Asset backed securities — — — — Corporate debt securities — 28,971 — 28,971 Total debt securities available-for-sale — 348,586 — 348,586 Marketable equity securities 1,632 — — 1,632 Total $ 1,632 $ 348,586 $ — $ 350,218 |
Fair Value Measurements, Nonrecurring [Table Text Block] | At December 31, 2018 and 2017, impaired loans measured at fair value on a nonrecurring basis and the valuation methods used are as follows: (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2018 Impaired loans: Commercial Real Estate $ — $ — $ 6,400 $ 6,400 Residential Real Estate — — 81 81 Total impaired loans $ — $ — $ 6,481 $ 6,481 (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2017 Impaired loans: Commercial Real Estate $ — $ — $ 5,498 $ 5,498 Residential Real Estate — — 254 254 Total impaired loans $ — $ — $ 5,752 $ 5,752 |
Fair Value Non Financial Assets Measured On Nonrecurring Basis [Table Text Block] | At December 31, 2018 and 2017, foreclosed assets held for resale measured at fair value on a nonrecurring basis and the valuation methods used are as follows: (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2018 Foreclosed assets held for resale: Commercial Real Estate $ — $ — $ 856 $ 856 Residential Real Estate — — — — Total foreclosed assets held for resale $ — $ — $ 856 $ 856 (Dollars in thousands) Level 1 Level 2 Level 3 Total Assets at December 31, 2017 Foreclosed assets held for resale: Commercial Real Estate $ — $ — $ 81 $ 81 Residential Real Estate — — 13 13 Total foreclosed assets held for resale $ — $ — $ 94 $ 94 |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Bank has utilized Level 3 inputs to determine the fair value: (Dollars in thousands) Quantitative Information about Level 3 Fair Value Measurements Fair Value Weighted December 31, 2018 Estimate Valuation Technique Unobservable Input Range Average Impaired loans $ 3,346 Appraisal of collateral 1,3 Appraisal adjustments 2 (15%) – (82%) (18%) Impaired loans $ 3,135 Discounted cash flow Discount rate (6%) – (7%) ( 7 Foreclosed assets held for resale $ 856 Appraisal of collateral 1,3 Appraisal adjustments 2 (16%) – (35%) ( 18 December 31, 2017 Impaired loans $ 2,495 Appraisal of collateral 1,3 Appraisal adjustments 2 (7%) – (65%) ( 15 Impaired loans $ 3,257 Discounted cash flow Discount rate (7%) – (8%) ( 7 Foreclosed assets held for resale $ 94 Appraisal of collateral 1,3 Appraisal adjustments 2 (35%) – (37%) ( 36 1 2 3 |
Fair Value, by Balance Sheet Grouping [Table Text Block] | The estimated fair values, and related carrying amounts, of the Corporation’s financial instruments that are not recorded at fair value are as follows: (Dollars in thousands) Carrying Fair Value Measurements at December 31, 2018 Amount Level 1 Level 2 Level 3 Total FINANCIAL ASSETS: Cash and due from banks $ 9,822 $ 9,822 $ — $ — $ 9,822 Interest-bearing deposits in other banks 1,128 — 1,128 — 1,128 Time deposits with other banks 1,482 — 1,469 — 1,469 Restricted investment in bank stocks 8,681 — 8,681 — 8,681 Net loans 599,647 — — 597,548 597,548 Mortgage servicing rights 316 — — 316 316 Accrued interest receivable 4,041 — 4,041 — 4,041 FINANCIAL LIABILITIES: Demand, savings and other deposits 474,261 — 474,261 — 474,261 Time deposits 197,292 — 195,136 — 195,136 Short-term borrowings 174,445 — 174,491 — 174,491 Long-term borrowings 45,000 — 45,077 — 45,077 Accrued interest payable 785 — 785 — 785 OFF-BALANCE SHEET FINANCIAL INSTRUMENTS — — — — — (Dollars in thousands) Carrying Fair Value Measurements at December 31, 2017 Amount Level 1 Level 2 Level 3 Total FINANCIAL ASSETS: Cash and due from banks $ 7,913 $ 7,913 $ — $ — $ 7,913 Interest-bearing deposits in other banks 826 — 826 — 826 Time deposits with other banks 1,482 — 1,482 — 1,482 Restricted investment in bank stocks 4,058 — 4,058 — 4,058 Net loans 551,910 — — 550,696 550,696 Mortgage servicing rights 379 — — 379 379 Accrued interest receivable 4,237 — 4,237 — 4,237 FINANCIAL LIABILITIES: Demand, savings and other deposits 570,518 — 570,518 — 570,518 Time deposits 207,628 — 206,299 — 206,299 Short-term borrowings 26,296 — 26,296 — 26,296 Long-term borrowings 65,000 — 65,336 — 65,336 Accrued interest payable 490 — 490 — 490 OFF-BALANCE SHEET FINANCIAL INSTRUMENTS — — — — — |
PARENT COMPANY FINANCIAL INFO_2
PARENT COMPANY FINANCIAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Balance Sheet [Table Text Block] | BALANCE SHEETS (Dollars in thousands) December 31, 2018 2017 ASSETS Cash $ 9,988 $ 8,984 Investment in banking subsidiary 105,755 106,647 Marketable equity securities 1,560 1,632 Prepaid expenses and other assets 232 30 TOTAL ASSETS $ 117,535 $ 117,293 LIABILITIES Advances from banking subsidiary $ 536 $ 325 Accrued expenses and other liabilities 243 249 TOTAL LIABILITIES 779 574 STOCKHOLDERS’ EQUITY Common stock 11,993 11,902 Surplus 37,255 36,193 Retained earnings 75,798 72,507 Accumulated other comprehensive (loss) income (2,581 ) 1,826 Treasury stock, at cost (5,709 ) (5,709 ) TOTAL STOCKHOLDERS’ EQUITY 116,756 116,719 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 117,535 $ 117,293 |
Condensed Income Statement [Table Text Block] | STATEMENTS OF INCOME (Dollars in thousands) Years Ended December 31, 2018 2017 INCOME Dividends from subsidiary bank $ 6,102 $ 6,102 Net securities (losses) gains (72 ) 74 Other income 76 73 TOTAL INCOME 6,106 6,249 OPERATING EXPENSES 176 117 5,930 6,132 INCOME TAX BENEFIT (41 ) (110 ) 5,971 6,242 EQUITY IN UNDISTRIBUTED EARNINGS OF BANKING SUBSIDIARY 3,240 2,406 NET INCOME $ 9,211 $ 8,648 |
Condensed Statement of Comprehensive Income [Table Text Block] | STATEMENTS OF COMPREHENSIVE INCOME (Dollars in thousands) Years Ended December 31, 2018 2017 Net Income $ 9,211 $ 8,648 Other comprehensive (loss) income: Unrealized net holding gains on available-for-sale investment securities arising during the period, net of income taxes of $0 and $55, respectively — 81 Less reclassification adjustment for net gains included in net income, net of income taxes of $0 and $(30), respectively — (44 ) Equity in other comprehensive (loss) income of banking subsidiary (4,133 ) 3,208 Total other comprehensive (loss) income (4,133 ) 3,245 Total Comprehensive Income $ 5,078 $ 11,893 |
Condensed Cash Flow Statement [Table Text Block] | STATEMENTS OF CASH FLOWS (Dollars in thousands) Years Ended December 31, 2018 2017 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 9,211 $ 8,648 Adjustments to reconcile net income to net cash provided by operating activities: Losses (gains) on securities 72 (74 ) Deferred income tax expense (benefit) 5 (110 ) Equity in undistributed earnings of banking subsidiary (3,240 ) (2,406 ) Increase in prepaid/accrued expenses and other assets/liabilities (214 ) (235 ) Increase in advances from banking subsidiary 211 216 NET CASH PROVIDED BY OPERATING ACTIVITIES 6,045 6,039 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sales of investment securities available-for-sale — 144 NET CASH PROVIDED BY INVESTING ACTIVITIES — 144 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock 1,153 1,261 Proceeds from exercise of stock options — 25 Dividends paid (6,194 ) (6,145 ) NET CASH USED IN FINANCING ACTIVITIES (5,041 ) (4,859 ) INCREASE IN CASH AND CASH EQUIVALENTS 1,004 1,324 CASH AND CASH EQUIVALENTS, BEGINNING 8,984 7,660 CASH AND CASH EQUIVALENTS, ENDING $ 9,988 $ 8,984 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Net income | $ 9,211 | $ 8,648 |
Weighted-average common shares outstanding | 5,737 | 5,689 |
Basic earnings per share | $ 1.60 | $ 1.52 |
Weighted-average common shares outstanding | 5,737 | 5,689 |
Common stock equivalents due to effect of stock options | 0 | 0 |
Total weighted-average common shares and equivalents | 5,737 | 5,689 |
Diluted earnings per share | $ 1.60 | $ 1.52 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2008USD ($) | Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 01, 2019USD ($) | Jan. 02, 2018USD ($) | |
Available-for-sale Securities, Restricted, Total | $ 8,681,000 | $ 4,058,000 | |||||
Tax Credits On Investments In Low Income Housing Partnerships | 405,000 | 323,000 | |||||
Amortization Of Investments In Limited Partnerships | $ 530,000 | 181,000 | |||||
Loan Payments Delinquency Period Beyond Which Loans Considered Past Due | 10 days | ||||||
Loan Payments Delinquency Period Beyond Which Loans Considered Non Accrual | 90 days | ||||||
Assets Held-in-trust | $ 105,917,000 | 111,130,000 | |||||
Loans Receivable Held-for-sale, Amount | 365,000 | 834,000 | |||||
Payments to Acquire Real Estate Held-for-investment | 0 | 252,000 | $ 1,178,000 | $ 590,000 | |||
Servicing Asset at Fair Value, Amount | $ 316,000 | 379,000 | |||||
Operating Lease, Right-of-Use Asset | $ 1,465,000 | ||||||
Operating Lease, Liability | $ 1,556,000 | ||||||
Loan Payments Delinquency Period At Which Time Delinquency NoticeIs Automatically Generated | 10 or 15 days | ||||||
Mortgage Loan Service [Member] | |||||||
Principal Amount Outstanding on Loans Managed and Securitized or Asset-backed Financing Arrangement | $ 97,201,000 | 100,179,000 | |||||
Servicing Asset at Fair Value, Amount | 316,000 | 379,000 | |||||
Fees and Commissions, Mortgage Banking and Servicing | 247,000 | 246,000 | |||||
Amortization of Mortgage Servicing Rights (MSRs) | $ 129,000 | 135,000 | |||||
Accounting Standards Update 2016-16 [Member] | |||||||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | $ (634,000) | ||||||
Accounting Standards Update 2018-02 [Member] | |||||||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | $ (360,000) | ||||||
Commercial Real Estate Loans [Member] | Maximum [Member] | |||||||
Term of Loan Offering | 20 years | ||||||
Maximum Loan to Value Ratio | eighty percent | ||||||
Residential Mortgage Loans [Member] | Maximum [Member] | Held For Investment [Member] | |||||||
Term of Loan Offering | 20 years | ||||||
Maximum Loan to Value Ratio | eighty percent | ||||||
Residential Mortgage Loans [Member] | Maximum [Member] | Originated For Resale [Member] | |||||||
Term of Loan Offering | 30 years | ||||||
Maximum Loan to Value Ratio | eighty percent | ||||||
Residential Mortgage Loans [Member] | Primary Mortgage Insurance [Member] | Maximum [Member] | Held For Investment [Member] | |||||||
Term of Loan Offering | 20 years | ||||||
Maximum Loan to Value Ratio | ninety-five percent | ||||||
Residential Portfolio Segment [Member] | Line of Credit [Member] | Maximum [Member] | |||||||
Term of Loan Offering | 20 years | ||||||
Maximum Loan to Value Ratio | eighty percent | ||||||
Residential Portfolio Segment [Member] | Home Equity Term Loans [Member] | Maximum [Member] | |||||||
Term of Loan Offering | 15 years | ||||||
Maximum Loan to Value Ratio | eighty percent | ||||||
Reserve for Off-balance Sheet Activities [Member] | |||||||
Valuation Allowances and Reserves, Balance, Ending Balance | $ 117,000 | 116,000 | |||||
Bank Owned Life Insurance [Member] | |||||||
Deferred Compensation Arrangement with Individual, Recorded Liability | 40,000 | 41,000 | |||||
Deferred Compensation Arrangement with Individual, Compensation Expense | (1,000) | (1,000) | |||||
Pocono Community Bank [Member] | |||||||
Goodwill, Purchase Accounting Adjustments | $ 152,000 | ||||||
Federal Home Loan Bank of Pittsburgh [Member] | |||||||
Available-for-sale Securities, Restricted, Total | 8,646,000 | 4,023,000 | |||||
Atlantic Central Bankers Bank [Member] | |||||||
Available-for-sale Securities, Restricted, Total | $ 35,000 | $ 35,000 | |||||
Full Service Offices [Member] | |||||||
Number of Stores | 18 | ||||||
Loan Production Office [Member] | |||||||
Number of Stores | Number | 1 | ||||||
Automated Teller [Member] | |||||||
Number of Stores | 20 |
RESTRICTED CASH BALANCES (Detai
RESTRICTED CASH BALANCES (Details Textual) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Cash Segregated under Other Regulations | $ 1,178,000 | $ 1,402,000 |
Deposits with Other Federal Home Loan Banks | $ 1,118,000 | $ 815,000 |
SECURITIES (Details)
SECURITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available-for-Sale Securities | ||
Amortized Cost | $ 319,321 | $ 346,622 |
Gross Unrealized Gains | 1,875 | 5,122 |
Gross Unrealized Losses | (5,142) | (3,158) |
Fair Value | 316,054 | 348,586 |
Other mortgage backed debt securities [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 4,767 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (18) | 0 |
Fair Value | 4,749 | 0 |
US Treasury securities [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 5,307 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (12) | 0 |
Fair Value | 5,295 | 0 |
Obligations of U.S. Government Corporations and Agencies Mortgage-backed [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 66,300 | 82,825 |
Gross Unrealized Gains | 105 | 210 |
Gross Unrealized Losses | (1,529) | (1,175) |
Fair Value | 64,876 | 81,860 |
Other Obligations of U.S. Government Corporations and Agencies [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 18,706 | 22,409 |
Gross Unrealized Gains | 21 | 132 |
Gross Unrealized Losses | (484) | (308) |
Fair Value | 18,243 | 22,233 |
Obligations of State and Political Subdivisions [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 182,621 | 211,743 |
Gross Unrealized Gains | 1,678 | 4,690 |
Gross Unrealized Losses | (2,021) | (911) |
Fair Value | 182,278 | 215,522 |
Asset backed securities [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 14,323 | 0 |
Gross Unrealized Gains | 47 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 14,370 | 0 |
Corporate debt securities [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 27,297 | 29,645 |
Gross Unrealized Gains | 24 | 90 |
Gross Unrealized Losses | (1,078) | (764) |
Fair Value | $ 26,243 | $ 28,971 |
SECURITIES (Details 1)
SECURITIES (Details 1) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Available-For-Sale - Amortized cost | ||
Within 1 Year | $ 4,268 | |
1 - 5 Years | 55,283 | |
5 - 10 Years | 86,076 | |
After 10 Years | 102,627 | |
Total | 319,321 | |
Available-For-Sale - Estimated fair value | ||
Within 1 Year | 4,264 | |
1 - 5 Years | 54,544 | |
5 - 10 Years | 84,779 | |
After 10 Years | 102,842 | |
Total | 316,054 | $ 348,586 |
Mortgage backed securities [Member] | ||
Available-For-Sale - Amortized cost | ||
Total | 71,067 | |
Available-For-Sale - Estimated fair value | ||
Total | $ 69,625 |
SECURITIES (Details 2)
SECURITIES (Details 2) - Available-for-sale Securities [Member] - Equity Securities [Member] $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Net losses recognized during the period on equity securities | $ (72) |
Net gains and (losses) recognized during the period on equity securities sold during the period | 0 |
Net losses recognized during the reporting period on equity securities still held at the reporting date | $ (72) |
SECURITIES (Details 3)
SECURITIES (Details 3) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Less Than 12 Months | ||
Fair Value | $ 37,563 | $ 76,355 |
Unrealized Loss | (217) | (657) |
12 Months or More | ||
Fair Value | 148,570 | 78,862 |
Unrealized Loss | (4,925) | (2,501) |
Total | ||
Fair Value | 186,133 | 155,217 |
Unrealized Loss | (5,142) | (3,158) |
Other mortgage backed debt securities [Member] | ||
Less Than 12 Months | ||
Fair Value | 4,749 | 0 |
Unrealized Loss | (18) | 0 |
12 Months or More | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Total | ||
Fair Value | 4,749 | 0 |
Unrealized Loss | (18) | 0 |
US Treasury Securities [Member] | ||
Less Than 12 Months | ||
Fair Value | 5,295 | 0 |
Unrealized Loss | (12) | 0 |
12 Months or More | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Total | ||
Fair Value | 5,295 | 0 |
Unrealized Loss | (12) | 0 |
Obligations of U.S. Government Corporations and Agencies Mortgage-backed [Member] | ||
Less Than 12 Months | ||
Fair Value | 3,690 | 30,555 |
Unrealized Loss | (17) | (300) |
12 Months or More | ||
Fair Value | 55,443 | 33,943 |
Unrealized Loss | (1,512) | (875) |
Total | ||
Fair Value | 59,133 | 64,498 |
Unrealized Loss | (1,529) | (1,175) |
Other Obligations of U.S. Government Corporations and Agencies [Member] | ||
Less Than 12 Months | ||
Fair Value | 7,553 | 2,905 |
Unrealized Loss | (66) | (4) |
12 Months or More | ||
Fair Value | 7,067 | 7,179 |
Unrealized Loss | (418) | (304) |
Total | ||
Fair Value | 14,620 | 10,084 |
Unrealized Loss | (484) | (308) |
Obligations of State and Political Subdivisions [Member] | ||
Less Than 12 Months | ||
Fair Value | 14,453 | 36,149 |
Unrealized Loss | (75) | (329) |
12 Months or More | ||
Fair Value | 66,583 | 22,566 |
Unrealized Loss | (1,946) | (582) |
Total | ||
Fair Value | 81,036 | 58,715 |
Unrealized Loss | (2,021) | (911) |
Asset backed securities [Member] | ||
Less Than 12 Months | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
12 Months or More | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Total | ||
Fair Value | 0 | 0 |
Unrealized Loss | 0 | 0 |
Corporate debt securities [Member] | ||
Less Than 12 Months | ||
Fair Value | 1,823 | 6,746 |
Unrealized Loss | (29) | (24) |
12 Months or More | ||
Fair Value | 19,477 | 15,174 |
Unrealized Loss | (1,049) | (740) |
Total | ||
Fair Value | 21,300 | 21,920 |
Unrealized Loss | $ (1,078) | $ (764) |
SECURITIES (Details Textual)
SECURITIES (Details Textual) | 12 Months Ended | |
Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($) | |
Available-for-sale Securities Pledged as Collateral | $ 149,993,000 | $ 290,104,000 |
Carrying Value Of Public Funds, Trust Funds, Securities Sold Under Agreements To Repurchase, FHLB Advances, And Other Balances | 112,528,000 | 224,659,000 |
Proceeds from Sale of Available-for-sale Securities, Total | 44,122,000 | 81,807,000 |
Available-for-sale Securities, Gross Realized Gains | 122,000 | 1,024,000 |
Available-for-sale Securities, Gross Realized Losses | $ 115,000 | 86,000 |
Available For Sale Securities In Unrealized Loss Positions Qualitative Disclosure Number Of Positions Less Than Or Equal To One Year | Number | 27 | |
Available For Sale Securities In Unrealized Loss Positions Qualitative Disclosure Number Of Positions Greater Than One Year | Number | 103 | |
Accumulated other comprehensive (loss) income | $ (2,581,000) | 1,826,000 |
Equity Securities [Member] | ||
Available-for-sale Securities | $ 1,560,000 | 1,632,000 |
Accumulated other comprehensive (loss) income | $ 634,000 |
LOANS AND ALLOWANCE FOR LOAN _3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment [Line Items] | ||
Add (deduct): Unearned discount and | $ 0 | $ (1) |
Net deferred loan fees and costs | 873 | 770 |
Total loans | 606,392 | 559,397 |
Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 584,570 | 541,916 |
Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 5,377 | 1,700 |
Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 15,572 | 15,012 |
Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Commercial and Industrial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Add (deduct): Unearned discount and | 0 | 0 |
Net deferred loan fees and costs | 160 | 161 |
Total loans | 92,220 | 99,337 |
Commercial and Industrial [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 90,835 | 97,832 |
Commercial and Industrial [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 6 | 10 |
Commercial and Industrial [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,219 | 1,334 |
Commercial and Industrial [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Add (deduct): Unearned discount and | 0 | 0 |
Net deferred loan fees and costs | 698 | 564 |
Total loans | 348,476 | 290,970 |
Commercial Real Estate [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 329,126 | 276,682 |
Commercial Real Estate [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 5,249 | 1,514 |
Commercial Real Estate [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 13,403 | 12,210 |
Commercial Real Estate [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Residential Real Estate Including Home Equity [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Add (deduct): Unearned discount and | 0 | (1) |
Net deferred loan fees and costs | (76) | (47) |
Total loans | 159,741 | 162,925 |
Residential Real Estate Including Home Equity [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 158,755 | 161,405 |
Residential Real Estate Including Home Equity [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 121 | 124 |
Residential Real Estate Including Home Equity [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 941 | 1,444 |
Residential Real Estate Including Home Equity [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Consumer Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Add (deduct): Unearned discount and | 0 | 0 |
Net deferred loan fees and costs | 91 | 92 |
Total loans | 5,955 | 6,165 |
Consumer Loans [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 5,854 | 5,997 |
Consumer Loans [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1 | 52 |
Consumer Loans [Member] | Substandard [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 9 | 24 |
Consumer Loans [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN _4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Beginning balance | $ 7,487 | $ 7,357 |
Charge-offs | (1,039) | (333) |
Recoveries | 97 | 196 |
Provision | 200 | 267 |
Ending Balance | 6,745 | 7,487 |
Ending balance: individually evaluated for impairment | 1 | 327 |
Ending balance: collectively evaluated for impairment | 6,744 | 7,160 |
Ending Balance | 606,392 | 559,397 |
Ending balance: individually evaluated for impairment | 17,593 | 13,926 |
Ending balance: collectively evaluated for impairment | 588,799 | 545,471 |
Commercial and Industrial [Member] | ||
Beginning balance | 949 | 836 |
Charge-offs | (18) | 0 |
Recoveries | 31 | 74 |
Provision | (238) | 39 |
Ending Balance | 724 | 949 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 724 | 949 |
Ending Balance | 92,220 | 99,337 |
Ending balance: individually evaluated for impairment | 1,126 | 1,203 |
Ending balance: collectively evaluated for impairment | 91,094 | 98,134 |
Commercial Real Estate [Member] | ||
Beginning balance | 4,067 | 4,421 |
Charge-offs | (783) | (189) |
Recoveries | 60 | 103 |
Provision | 356 | (268) |
Ending Balance | 3,700 | 4,067 |
Ending balance: individually evaluated for impairment | 1 | 305 |
Ending balance: collectively evaluated for impairment | 3,699 | 3,762 |
Ending Balance | 348,476 | 290,970 |
Ending balance: individually evaluated for impairment | 15,890 | 11,673 |
Ending balance: collectively evaluated for impairment | 332,586 | 279,297 |
Residential Real Estate [Member] | ||
Beginning balance | 1,656 | 1,777 |
Charge-offs | (181) | (62) |
Recoveries | 0 | 9 |
Provision | 175 | (68) |
Ending Balance | 1,650 | 1,656 |
Ending balance: individually evaluated for impairment | 0 | 22 |
Ending balance: collectively evaluated for impairment | 1,650 | 1,634 |
Ending Balance | 159,741 | 162,925 |
Ending balance: individually evaluated for impairment | 577 | 1,050 |
Ending balance: collectively evaluated for impairment | 159,164 | 161,875 |
Consumer [Member] | ||
Beginning balance | 111 | 95 |
Charge-offs | (57) | (82) |
Recoveries | 6 | 10 |
Provision | 57 | 88 |
Ending Balance | 117 | 111 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 117 | 111 |
Ending Balance | 5,955 | 6,165 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 5,955 | 6,165 |
Unallocated Financing Receivables [Member] | ||
Beginning balance | 704 | 228 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | (150) | 476 |
Ending Balance | 554 | 704 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 554 | 704 |
Ending Balance | 0 | 0 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN _5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Modifications, Recorded Investment | $ 13,777 | $ 9,109 |
Non-accrual TDRs [Member] | ||
Financing Receivable, Modifications, Recorded Investment | 80 | 273 |
Accruing TDRs [Member] | ||
Financing Receivable, Modifications, Recorded Investment | $ 13,697 | $ 8,836 |
LOANS AND ALLOWANCE FOR LOAN _6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($)Number | |
Financing Receivable, Modifications, Number of Contracts | Number | 12 | 4 |
Financing Receivable, Modifications, Pre-Modification Outstanding Recorded Investment | $ 5,610 | $ 1,134 |
Financing Receivable, Modifications, Post-Modification Outstanding Recorded Investment | 5,627 | 1,170 |
Financing Receivable, Modifications, Year-End Recorded Investment | $ 5,484 | $ 1,165 |
Residential Real Estate [Member] | ||
Financing Receivable, Modifications, Number of Contracts | Number | 1 | 1 |
Financing Receivable, Modifications, Pre-Modification Outstanding Recorded Investment | $ 26 | $ 32 |
Financing Receivable, Modifications, Post-Modification Outstanding Recorded Investment | 26 | 60 |
Financing Receivable, Modifications, Year-End Recorded Investment | $ 25 | $ 60 |
Commercial and Industrial [Member] | ||
Financing Receivable, Modifications, Number of Contracts | Number | 3 | 1 |
Financing Receivable, Modifications, Pre-Modification Outstanding Recorded Investment | $ 751 | $ 38 |
Financing Receivable, Modifications, Post-Modification Outstanding Recorded Investment | 751 | 38 |
Financing Receivable, Modifications, Year-End Recorded Investment | $ 771 | $ 36 |
Commercial Real Estate [Member] | ||
Financing Receivable, Modifications, Number of Contracts | Number | 8 | 2 |
Financing Receivable, Modifications, Pre-Modification Outstanding Recorded Investment | $ 4,833 | $ 1,064 |
Financing Receivable, Modifications, Post-Modification Outstanding Recorded Investment | 4,850 | 1,072 |
Financing Receivable, Modifications, Year-End Recorded Investment | $ 4,688 | $ 1,069 |
LOANS AND ALLOWANCE FOR LOAN _7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) - Number | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Financing Receivable, Modifications, Number of Contracts | 12 | 4 |
Rate Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 1 | 0 |
Term Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 3 | 1 |
Payment Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 8 | 3 |
Residential Real Estate [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 1 | 1 |
Residential Real Estate [Member] | Rate Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 0 | 0 |
Residential Real Estate [Member] | Term Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 1 | 0 |
Residential Real Estate [Member] | Payment Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 0 | 1 |
Commercial and Industrial [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 3 | 1 |
Commercial and Industrial [Member] | Rate Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 0 | 0 |
Commercial and Industrial [Member] | Term Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 0 | 0 |
Commercial and Industrial [Member] | Payment Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 3 | 1 |
Commercial Real Estate [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 8 | 2 |
Commercial Real Estate [Member] | Rate Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 1 | 0 |
Commercial Real Estate [Member] | Term Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 2 | 1 |
Commercial Real Estate [Member] | Payment Modification [Member] | ||
Financing Receivable, Modifications, Number of Contracts | 5 | 1 |
LOANS AND ALLOWANCE FOR LOAN _8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Recorded Investment | ||
With an allowance recorded | $ 17,593 | $ 13,926 |
Unpaid Principal Balance | ||
With an allowance recorded | 21,935 | 17,671 |
Related Allowance | ||
With an allowance recorded | 1 | 327 |
Average Recorded Investment | ||
Total | 14,326 | 14,806 |
Interest Income Recognized | ||
Total | 690 | 521 |
Commercial and Industrial [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 1,126 | 1,203 |
With an allowance recorded | 0 | 0 |
Total | 1,126 | 1,203 |
Unpaid Principal Balance | ||
With no related allowance recorded | 1,126 | 1,203 |
With an allowance recorded | 0 | 0 |
Total | 1,126 | 1,203 |
Related Allowance | ||
With no related allowance recorded | 0 | 0 |
With an allowance recorded | 0 | 0 |
Total | 0 | 0 |
Average Recorded Investment | ||
With no related allowance recorded | 1,157 | 1,032 |
With an allowance recorded | 0 | 0 |
Total | 1,157 | 1,032 |
Interest Income Recognized | ||
With no related allowance recorded | 53 | 25 |
With an allowance recorded | 0 | 0 |
Total | 53 | 25 |
Commercial Real Estate [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 15,807 | 9,199 |
With an allowance recorded | 83 | 2,474 |
Total | 15,890 | 11,673 |
Unpaid Principal Balance | ||
With no related allowance recorded | 20,107 | 11,383 |
With an allowance recorded | 83 | 3,889 |
Total | 20,190 | 15,272 |
Related Allowance | ||
With no related allowance recorded | 0 | 0 |
With an allowance recorded | 1 | 305 |
Total | 1 | 305 |
Average Recorded Investment | ||
With no related allowance recorded | 11,575 | 11,140 |
With an allowance recorded | 662 | 1,630 |
Total | 12,237 | 12,770 |
Interest Income Recognized | ||
With no related allowance recorded | 623 | 485 |
With an allowance recorded | 3 | 4 |
Total | 626 | 489 |
Residential Real Estate [Member] | ||
Recorded Investment | ||
With no related allowance recorded | 577 | 878 |
With an allowance recorded | 0 | 172 |
Total | 577 | 1,050 |
Unpaid Principal Balance | ||
With no related allowance recorded | 619 | 1,024 |
With an allowance recorded | 0 | 172 |
Total | 619 | 1,196 |
Related Allowance | ||
With no related allowance recorded | 0 | 0 |
With an allowance recorded | 0 | 22 |
Total | 0 | 22 |
Average Recorded Investment | ||
With no related allowance recorded | 794 | 789 |
With an allowance recorded | 138 | 215 |
Total | 932 | 1,004 |
Interest Income Recognized | ||
With no related allowance recorded | 11 | 7 |
With an allowance recorded | 0 | 0 |
Total | $ 11 | $ 7 |
LOANS AND ALLOWANCE FOR LOAN _9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Total non-accrual loans | $ 3,896 | $ 5,090 |
Foreclosed assets held for resale | 1,163 | 1,071 |
Loans past-due 90 days or more and still accruing interest | 228 | 70 |
Total non-performing assets | 5,287 | 6,231 |
Commercial real estate [Member] | ||
Total non-accrual loans | 3,402 | 3,302 |
Loans past-due 90 days or more and still accruing interest | 145 | 50 |
Residential real estate [Member] | ||
Total non-accrual loans | 494 | 990 |
Loans past-due 90 days or more and still accruing interest | 83 | 20 |
Commercial and Industrial [Member] | ||
Total non-accrual loans | $ 0 | $ 798 |
LOANS AND ALLOWANCE FOR LOAN_10
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 7) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Total Past Due | $ 8,358 | $ 6,563 |
Current | 598,034 | 552,834 |
Total Loans | 606,392 | 559,397 |
90 Days or Greater Past Due and Still Accruing | 228 | 70 |
Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 3,537 | 2,644 |
Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 888 | 729 |
Financing Receivables, 90 Days or Greater Past Due [Member] | ||
Total Past Due | 3,933 | 3,190 |
Commercial and Industrial [Member] | ||
Total Past Due | 46 | 110 |
Current | 92,174 | 99,227 |
Total Loans | 92,220 | 99,337 |
90 Days or Greater Past Due and Still Accruing | 0 | 0 |
Commercial and Industrial [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 16 | 68 |
Commercial and Industrial [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 30 | 42 |
Commercial and Industrial [Member] | Financing Receivables, 90 Days or Greater Past Due [Member] | ||
Total Past Due | 0 | 0 |
Commercial Real Estate [Member] | ||
Total Past Due | 6,097 | 3,410 |
Current | 342,379 | 287,560 |
Total Loans | 348,476 | 290,970 |
90 Days or Greater Past Due and Still Accruing | 145 | 50 |
Commercial Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 1,990 | 603 |
Commercial Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 630 | 201 |
Commercial Real Estate [Member] | Financing Receivables, 90 Days or Greater Past Due [Member] | ||
Total Past Due | 3,477 | 2,606 |
Residential Real Estate [Member] | ||
Total Past Due | 2,203 | 3,020 |
Current | 157,538 | 159,905 |
Total Loans | 159,741 | 162,925 |
90 Days or Greater Past Due and Still Accruing | 83 | 20 |
Residential Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 1,519 | 1,952 |
Residential Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 228 | 484 |
Residential Real Estate [Member] | Financing Receivables, 90 Days or Greater Past Due [Member] | ||
Total Past Due | 456 | 584 |
Consumer [Member] | ||
Total Past Due | 12 | 23 |
Current | 5,943 | 6,142 |
Total Loans | 5,955 | 6,165 |
90 Days or Greater Past Due and Still Accruing | 0 | 0 |
Consumer [Member] | Financing Receivables, 30 to 59 Days Past Due [Member] | ||
Total Past Due | 12 | 21 |
Consumer [Member] | Financing Receivables, 60 to 89 Days Past Due [Member] | ||
Total Past Due | 0 | 2 |
Consumer [Member] | Financing Receivables, 90 Days or Greater Past Due [Member] | ||
Total Past Due | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN_11
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Financing Receivable, Modifications, Post-Modification Recorded Investment | $ 5,627,000 | $ 1,170,000 |
Allowance for Credit Losses, Change in Method of Calculating Impairment | 1,000 | 2,000 |
Loans Receivable Held-for-sale, Amount | 365,000 | 834,000 |
Interest on non-accrual loans, Estimate of accrual amount | 784,000 | 328,000 |
Impaired Financing Receivable, Interest Income, Accrual Method, Total | 690,000 | 521,000 |
Impaired Financing Receivable Interest Income Non-accrual Method | 9,000 | 20,000 |
Financing Receivable, Modifications, Recorded Investment | 13,777,000 | 9,109,000 |
Foreclosed Assets Held For Resale | 1,163,000 | 1,071,000 |
Foreclosed Assets Held For Resale Secured By Land | 39,000 | 50,000 |
Foreclosed Assets Held For Resale Secured By Commercial Real Estate | 856,000 | 1,006,000 |
Foreclosed Assets Held For Resale Secured By Residential Real Estate | 268,000 | 15,000 |
Residential Real Estate [Member] | ||
Financing Receivable, Modifications, Post-Modification Recorded Investment | 26,000 | 60,000 |
Financing Receivable Modification Not In Compliance Of Terms | 0 | 60,000 |
Commercial Real Estate [Member] | ||
Financing Receivable Modification Not In Compliance Of Terms | 499,000 | 340,000 |
Commercial and Industrial [Member] | ||
Tax free loans | 24,161,000 | 40,926,000 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 751,000 | 38,000 |
Impaired Financing Receivable, Interest Income, Accrual Method, Total | 53,000 | 25,000 |
Financing Receivable Modification Not In Compliance Of Terms | 6,000 | 0 |
Commercial Real Estate [Member] | ||
Tax free loans | 2,164,000 | 2,315,000 |
Financing Receivable, Modifications, Post-Modification Recorded Investment | 4,850,000 | 1,072,000 |
Impaired Financing Receivable, Interest Income, Accrual Method, Total | 626,000 | 489,000 |
Commercial Real Estate [Member] | TDRs [Member] | ||
Financing Receivable, Modifications, Subsequent Default, Recorded Investment | 163,000 | |
Residential Portfolio Segment [Member] | ||
Consumer Mortgage Loans Secured by Residential Real Estate in Process of Foreclosure | 718,000 | 485,000 |
Impaired Financing Receivable, Interest Income, Accrual Method, Total | 11,000 | 7,000 |
Irrevocable Letter of credit [Member] | ||
Loans and Leases Receivable, Impaired, Commitment to Lend | 1,249,000 | 1,268,000 |
Irrevocable Letter of credit [Member] | Developer of a Residential Sub-Division [Member] | ||
Loans and Leases Receivable, Impaired, Commitment to Lend | 1,249,000 | 1,249,000 |
Irrevocable Letter of credit [Member] | Non-Profit Community Recreation Facility [Member] | ||
Loans and Leases Receivable, Impaired, Commitment to Lend | 0 | $ 19,000 |
Loan to Real Estate Developer Specializing in Commercial Office Space [Member] | TDRs [Member] | ||
Financing Receivable Modifications Year End Recorded Investment | $ 4,296,000 |
PREMISES AND EQUIPMENT (Details
PREMISES AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Cost | $ 32,840 | $ 32,784 |
Less: Accumulated depreciation | 12,894 | 12,161 |
Total | 19,946 | 20,623 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 3,744 | 3,744 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | $ 20,639 | $ 20,562 |
Building [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Building [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 40 years | 40 years |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | $ 174 | $ 147 |
Leasehold Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | 3 years |
Leasehold Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 20 years | 20 years |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | $ 8,283 | $ 8,331 |
Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | 3 years |
Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 25 years | 25 years |
PREMISES AND EQUIPMENT (Detai_2
PREMISES AND EQUIPMENT (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 1,141,000 | $ 1,197,000 |
Leased Assets Purchase Price | $ 2,384,000 |
DEPOSITS (Details)
DEPOSITS (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Non-interest bearing demand | $ 126,361 | $ 121,415 |
Interest bearing demand | 180,328 | 265,379 |
Savings | 167,572 | 183,724 |
Time certificates of deposits less than $250,000 | 172,550 | 171,556 |
Time certificates of deposits $250,000 or greater | 23,597 | 34,933 |
Other time | 1,145 | 1,139 |
Total deposits | $ 671,553 | $ 778,146 |
DEPOSITS (Details 1)
DEPOSITS (Details 1) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
2019 | $ 96,639 | |
2020 | 41,642 | |
2021 | 33,030 | |
2022 | 18,822 | |
2023 | 6,684 | |
Thereafter | 475 | |
Time Deposits | $ 197,292 | $ 207,628 |
DEPOSITS (Details 2)
DEPOSITS (Details 2) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits | $ 671,553 | $ 778,146 |
Two Largest Depositors [Member] | ||
Deposits | 43,107 | |
School district [Member] | ||
Deposits | 22,457 | |
School district 2 [Member] | Deposits [Member] | ||
Deposits | $ 20,650 |
SHORT-TERM BORROWINGS (Details)
SHORT-TERM BORROWINGS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Short-term Debt [Line Items] | ||
Short-term borrowings, Amount | $ 174,445 | $ 26,296 |
Short-term borrowings, Average Rate | 2.04% | 0.97% |
Federal funds purchased [Member] | ||
Short-term Debt [Line Items] | ||
Short-term borrowings, Amount | $ 0 | $ 0 |
Short-term borrowings, Average Rate | 2.19% | 1.82% |
Securities sold under agreements to repurchase [Member] | ||
Short-term Debt [Line Items] | ||
Short-term borrowings, Amount | $ 12,957 | $ 22,844 |
Short-term borrowings, Average Rate | 0.56% | 0.41% |
Federal Discount Window [Member] | ||
Short-term Debt [Line Items] | ||
Short-term borrowings, Amount | $ 0 | $ 0 |
Short-term borrowings, Average Rate | 2.19% | 1.71% |
Federal Home Loan Bank [Member] | ||
Short-term Debt [Line Items] | ||
Short-term borrowings, Amount | $ 161,488 | $ 3,452 |
Short-term borrowings, Average Rate | 2.28% | 1.16% |
SHORT-TERM BORROWINGS (Details
SHORT-TERM BORROWINGS (Details 1) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |
Repurchase agreements | |||
Gross Amounts of Recognized Liabilities | [1] | $ 12,957 | $ 22,844 |
Gross Amounts Offset in the Consolidated Balance Sheet | [1] | 0 | 0 |
Net Amounts of Liabilities Presented in the Consolidated Balance Sheet | [1] | 12,957 | 22,844 |
Financial Instruments | [1] | (12,957) | (22,844) |
Cash Collateral Pledge | [1] | 0 | 0 |
Net Amount | [1] | $ 0 | $ 0 |
[1] | As of December 31, 2018 and 2017, the fair value of securities pledged in connection with repurchase agreements was $16,970,000 and $26,023,000, respectively. |
SHORT-TERM BORROWINGS (Detail_2
SHORT-TERM BORROWINGS (Details 2) $ in Thousands | Dec. 31, 2018USD ($) |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | $ 12,957 |
U.S. Treasury and/or agency securities [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 12,957 |
Overnight and Continuous [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 12,957 |
Overnight and Continuous [Member] | U.S. Treasury and/or agency securities [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 12,957 |
Up to 30 days [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 0 |
Up to 30 days [Member] | U.S. Treasury and/or agency securities [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 0 |
30 - 90 Days [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 0 |
30 - 90 Days [Member] | U.S. Treasury and/or agency securities [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 0 |
Greater than 90 Days [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | 0 |
Greater than 90 Days [Member] | U.S. Treasury and/or agency securities [Member] | |
Repurchase agreements and repurchase-to-maturity transactions: | |
Remaining Contractual Maturity of the Agreements | $ 0 |
SHORT-TERM BORROWINGS (Detail_3
SHORT-TERM BORROWINGS (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Short-term Debt [Line Items] | ||
Fair value of securities pledged | $ 16,970,000 | $ 26,023,000 |
Federal Funds Purchased [Member] | ||
Short-term Debt [Line Items] | ||
Short-term Debt, Maximum Amount Outstanding During Period | 15,000,000 | |
Federal Discount Window [Member] | ||
Short-term Debt [Line Items] | ||
Short-term Debt, Maximum Amount Outstanding During Period | $ 4,741,000 | |
Maximum [Member] | ||
Short-term Debt [Line Items] | ||
Federal funds purchased, securities sold under agreements to repurchase and Federal Home Loan Bank advances, maturity | 30 days |
LONG-TERM BORROWINGS (Details)
LONG-TERM BORROWINGS (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Due 2018, 1.27% to 4.86% | $ 0 | $ 23,000 |
Due 2019, 1.79% to 2.11% | 20,000 | 20,000 |
Due 2020, 1.62% to 1.95% | 10,000 | 10,000 |
Due 2021, 1.42% to 1.58% | 10,000 | 10,000 |
Due 2023, 2.96% | 3,000 | 0 |
Due 2028, 5.14% | 2,000 | 2,000 |
Long-term Debt and Capital Lease Obligations | $ 45,000 | $ 65,000 |
LONG-TERM BORROWINGS (Details)
LONG-TERM BORROWINGS (Details) (Parenthetical) | Dec. 31, 2018 | Dec. 31, 2017 |
Due 2018, 1.27% to 4.86% [Member] | Minimum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.27% | 1.27% |
Due 2018, 1.27% to 4.86% [Member] | Maximum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.86% | 4.86% |
Due 2019, 1.79% to 2.11% [Member] | Minimum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.79% | 1.79% |
Due 2019, 1.79% to 2.11% [Member] | Maximum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 2.11% | 2.11% |
Due 2020, 1.62% to 1.95% [Member] | Minimum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.62% | 1.62% |
Due 2020, 1.62% to 1.95% [Member] | Maximum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.95% | 1.95% |
Due 2021, 1.42% to 1.58% [Member] | Minimum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.42% | 1.42% |
Due 2021, 1.42% to 1.58% [Member] | Maximum [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 1.58% | 1.58% |
Due 2028, 5.14% [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 5.14% | 5.14% |
Due 2023, 2.96%[Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 2.96% | 2.96% |
LONG-TERM BORROWINGS (Details T
LONG-TERM BORROWINGS (Details Textual) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | |
Federal Home Loan Bank, Advances, General Debt Obligations, Maximum Amount Available | $ 313,923,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Federal | ||
Current | $ (107) | $ 1,309 |
Deferred | 566 | 146 |
Income tax expense | $ 459 | $ 1,455 |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Amount | ||
Federal income tax at statutory rate | $ 2,031 | $ 3,435 |
Tax-exempt income | (1,043) | (1,897) |
Low-income housing credits | (405) | (323) |
Bank owned life insurance income | (128) | (216) |
Effect of tax rate change | 0 | 379 |
Other | 4 | 77 |
Income tax expense and rate | $ 459 | $ 1,455 |
Rate | ||
Federal income tax at statutory rate | 21.00% | 34.00% |
Tax-exempt income | (10.80%) | (18.80%) |
Low-income housing credits | (4.20%) | (3.20%) |
Bank owned life insurance income | (1.30%) | (2.10%) |
Effect of tax rate change | 0.00% | 3.80% |
Other | 0.00% | 0.70% |
Income tax expense and rate | 4.70% | 14.40% |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred Tax Assets: | ||
Allowance for loan losses | $ 1,417 | $ 1,572 |
Provision for unfunded commitments | 25 | 24 |
Deferred compensation | 241 | 316 |
Contributions | 1 | 8 |
Leases | 53 | 66 |
Limited partnership investments | 66 | 57 |
Alternative minimum tax credits | 7 | 379 |
Net unrealized investment securities losses | 449 | 0 |
Impairment loss on investment securities | 4 | 4 |
Writedowns on OREO properties | 34 | 5 |
Capital and net operating loss carry forwards | 0 | 25 |
Total | 2,297 | 2,456 |
Deferred Tax Liabilities: | ||
Net unrealized investment securities gains | 0 | 670 |
Loan fees and costs | 183 | 162 |
Accumulated depreciation | 311 | 332 |
Accretion | 35 | 77 |
Mortgage servicing rights | 42 | 38 |
Intangibles | 257 | 241 |
Total | 828 | 1,520 |
Net Deferred Tax Asset | $ 1,469 | $ 936 |
INCOME TAXES (Details Textual)
INCOME TAXES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Tax Assets, Valuation Allowance | $ 70,000 | $ 16,000 |
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | $ 0 | $ 320,000 |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 34.00% |
State Net Operating Loss Carryforwards Offset Future State Taxable Income Expiration Term | 2038 | |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount | $ 379,000 | |
Scenario, Plan [Member] | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 34.00% |
EMPLOYEE BENEFIT PLANS AND DE_2
EMPLOYEE BENEFIT PLANS AND DEFERRED COMPENSATION AGREEMENTS (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Description of Defined Contribution Pension and Other Postretirement Plans | Under the savings feature, the Corporation makes safe harbor matching contributions of 100% of the first 3% of compensation an employee contributes to the Plan and 50% of the next 2% of compensation an employee contributes to the Plan. | |
Safe Harbor Matching Contributions Plan [Member] | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 296,000 | $ 274,000 |
Profit Sharing Feature Contributions [Member] | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Defined Contribution Plan, Employer Discretionary Contribution Amount | 304,000 | 215,000 |
Officers [Member] | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Deferred Compensation Arrangement with Individual, Recorded Liability | 1,109,000 | 1,464,000 |
Deferred Compensation Arrangement with Individual, Compensation Expense | (229,000) | $ 117,000 |
Resigned Officer [Member] | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Deferred Compensation Arrangement with Individual, Compensation Expense | $ (305,000) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Line Items] | ||
Operating Leases, Rent Expense, Net | $ 170,000 | $ 155,000 |
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 123,000 | |
Operating Leases, Future Minimum Payments, Due in Two Years | 72,000 | |
Operating Leases, Future Minimum Payments, Due in Three Years | 65,000 | |
Operating Leases, Future Minimum Payments, Due in Four Years | 68,000 | |
Operating Leases, Future Minimum Payments, Due in Five Years | 68,000 | |
Operating Leases, Future Minimum Payments, Due Thereafter | $ 2,394,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Balance at January 1 | $ 10,997 | $ 2,159 |
Additions | 13,642 | 15,574 |
Deductions | (4,691) | (6,736) |
Balance at December 31 | $ 19,948 | $ 10,997 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Related Party Transaction [Line Items] | ||
Related Party Deposit Liabilities | $ 18,696,000 | $ 15,180,000 |
Management [Member] | ||
Related Party Transaction [Line Items] | ||
Fair Value Disclosure, Off-balance Sheet Risks, Face Amount, Liability | $ 4,958,000 | $ 6,214,000 |
REGULATORY MATTERS (Details)
REGULATORY MATTERS (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Total Capital (to Risk-Weighted Assets) | ||
Actual | $ 96,065 | $ 93,566 |
For capital adequacy purposes | 55,395 | 52,676 |
To be well capitalized under prompt corrective action provisions | 69,243 | 65,845 |
Minimum capital adequacy with capital buffer | $ 68,378 | $ 60,907 |
Total - Actual | 13.87% | 14.21% |
For capital adequacy purposes | 8.00% | 8.00% |
Total - To be well capitalized under prompt corrective action provisions | 10.00% | 10.00% |
Total - Minimum capital adequacy with capital buffer | 9.88% | 9.25% |
Tier 1 Capital (to Risk-Weighted Assets) | ||
Actual | $ 89,203 | $ 85,963 |
For capital adequacy purposes | 41,546 | 39,507 |
To be well capitalized under prompt corrective action provisions | 55,395 | 52,676 |
Minimum capital adequacy with capital buffer | $ 54,529 | $ 47,738 |
Tier 1 - Actual | 12.88% | 13.06% |
Tier 1 - For capital adequacy purposes | 6.00% | 6.00% |
Tier 1 - To be well capitalized under prompt corrective action provisions | 8.00% | 8.00% |
Tier 1 - Minimum capital adequacy with capital buffer | 7.88% | 7.25% |
Common Equity Tier 1 Capital (to Risk-Weighted Assets) | ||
Actual | $ 89,203 | $ 85,963 |
For capital adequacy purposes | 31,160 | 29,630 |
To be well capitalized under prompt corrective action provisions | 45,008 | 42,800 |
Minimum Capital Adequacy With Capital Buffer | $ 44,143 | $ 37,861 |
Common Equity Tier 1 - Actual | 12.88% | 13.06% |
Common Equity Tier 1 - For Capital Adequacy Purposes | 4.50% | 4.50% |
Common Equity Tier 1 - To be well capitalized under prompt corrective action provisions | 6.50% | 6.50% |
Common Equity Tier 1 - Minimum Capital Adequacy With Capital Buffer | 6.38% | 5.75% |
Tier 1 Capital (to Average Assets) | ||
Actual | $ 89,203 | $ 85,963 |
For capital adequacy purposes | 39,616 | 38,901 |
Minimum capital adequacy with capital buffer | 39,616 | 38,901 |
To be well capitalized under prompt corrective action provisions | $ 49,521 | $ 48,626 |
Actual | 9.01% | 8.84% |
Tier 1 - For capital adequacy purposes | 4.00% | 4.00% |
Tier 1 - Minimum capital adequacy with capital buffer | 4.00% | 4.00% |
To be well capitalized under prompt corrective action provisions | 5.00% | 5.00% |
REGULATORY MATTERS (Details Tex
REGULATORY MATTERS (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Jul. 02, 2013 | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Amount Available for Dividend Distribution without Affecting Capital Adequacy Requirements | $ 8,776,000 | ||
Tier One Risk Based Capital to Risk Weighted Assets | 12.88% | 13.06% | |
Tier One Leverage Capital to Average Assets | 9.01% | 8.84% | |
Common Equity Tier 1 Conservation Buffer Percentage | 2.50% | ||
Loans And Advances From Bank To Corporation Percentage Limit Of Consolidated Net Assets | 10.00% | ||
Capital Conservation Buffer Rate | 1.875% | 1.25% | |
Minimum [Member] | |||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Tier One Risk Based Capital to Risk Weighted Assets | 4.50% | ||
Excess Tier One Risk Based Capital to Risk Weighted Assets | 6.00% | ||
Tier One Leverage Capital to Average Assets | 4.00% |
FINANCIAL INSTRUMENTS WITH OF_3
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Commitments to extend credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Concentration Risk, Credit Risk, Financial Instrument, Off-Balance Sheet Risk | $ 107,126 | $ 90,373 |
Financial standby letters of credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Concentration Risk, Credit Risk, Financial Instrument, Off-Balance Sheet Risk | 331 | 450 |
Performance standby letters of credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Concentration Risk, Credit Risk, Financial Instrument, Off-Balance Sheet Risk | $ 3,107 | $ 2,901 |
FINANCIAL INSTRUMENTS WITH OF_4
FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND CONCENTRATIONS OF CREDIT RISK (Details Textual) - Credit Concentration Risk [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Loans Receivable, Secure by Commercial and Residential Real Estate | $ 508,217,000 | |
Loans Receivable, Percentage of Loans Secure by Commercial and Residential Real Estate | 83.80% | |
Concentration Risk, Percentage | 10.00% | 10.00% |
STOCKHOLDERS' EQUITY (Details T
STOCKHOLDERS' EQUITY (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share Purchase And Dividend Reinvestment Plan Shares Transferred And Held | 45,371 | 46,388 |
Share Purchase And Dividend Reinvestment Plan Number Of Shares Authorized | 577,048 | |
Share Based Compensation Arrangement By Share Based Payment Award Minimum Number Of Qualifying Shares | 25 | |
Minimum [Member] | ||
Share Purchase And Dividend Reinvestment Plan Quarterly Voluntary Investment | $ 100 | |
Maximum [Member] | ||
Share Purchase And Dividend Reinvestment Plan Quarterly Voluntary Investment | $ 2,500 |
STOCK COMPENSATION PLAN (Detail
STOCK COMPENSATION PLAN (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Options | ||
Balance at January 1 | 0 | 1,500 |
Exercised | 0 | (1,500) |
Forfeited/Expired | 0 | 0 |
Balance at December 31 | 0 | 0 |
Exercisable at December 31 | 0 | 0 |
Weighted Average Exercise Price | ||
Balance at January 1 | $ 0 | $ 16.75 |
Exercised | 0 | 16.75 |
Forfeited/Expired | 0 | 0 |
Balance at December 31 | 0 | 0 |
Exercisable at December 31 | $ 0 | $ 0 |
STOCK COMPENSATION PLAN (Deta_2
STOCK COMPENSATION PLAN (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 100,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 0 | $ 18,000 |
Proceeds from Stock Options Exercised | $ 0 | $ 25,000 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | $ 316,054 | $ 348,586 |
Corporate Debt Securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 26,243 | 28,971 |
Marketable equity securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 1,560 | 1,632 |
Asset-backed Securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 14,370 | 0 |
Fair Value, Measurements, Recurring [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 317,614 | 350,218 |
Available-for-Sale Debt Securities | 316,054 | 348,586 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 1,560 | 1,632 |
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 316,054 | 348,586 |
Available-for-Sale Debt Securities | 316,054 | 348,586 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 0 | 0 |
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 5,295 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 5,295 | 0 |
Fair Value, Measurements, Recurring [Member] | U.S. Treasury securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Obligations of US Government Corporations and Agencies [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 64,876 | 81,860 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Obligations of US Government Corporations and Agencies [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Obligations of US Government Corporations and Agencies [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 64,876 | 81,860 |
Fair Value, Measurements, Recurring [Member] | Mortgage Backed Obligations of US Government Corporations and Agencies [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Other Obligations Of Us Government Corporations And Agencies [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 18,243 | 22,233 |
Fair Value, Measurements, Recurring [Member] | Other Obligations Of Us Government Corporations And Agencies [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Other Obligations Of Us Government Corporations And Agencies [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 18,243 | 22,233 |
Fair Value, Measurements, Recurring [Member] | Other Obligations Of Us Government Corporations And Agencies [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Obligations of state and political subdivisions [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 182,278 | 215,522 |
Fair Value, Measurements, Recurring [Member] | Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 182,278 | 215,522 |
Fair Value, Measurements, Recurring [Member] | Obligations of state and political subdivisions [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 26,243 | 28,971 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 26,243 | 28,971 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Marketable equity securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 1,560 | 1,632 |
Fair Value, Measurements, Recurring [Member] | Marketable equity securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 1,560 | 1,632 |
Fair Value, Measurements, Recurring [Member] | Marketable equity securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Marketable equity securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Other mortgage backed debt securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 4,749 | 0 |
Fair Value, Measurements, Recurring [Member] | Other mortgage backed debt securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Other mortgage backed debt securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 4,749 | 0 |
Fair Value, Measurements, Recurring [Member] | Other mortgage backed debt securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 14,370 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | 14,370 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Available-for-Sale Debt Securities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details 1) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 6,481 | $ 5,752 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 6,481 | 5,752 |
Commercial Real Estate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 6,400 | 5,498 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 6,400 | 5,498 |
Residential Real Estate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 81 | 254 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 0 | 0 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | $ 81 | $ 254 |
FAIR VALUE MEASUREMENTS (Deta_3
FAIR VALUE MEASUREMENTS (Details 2) - Fair Value Measurements, Non-Financial Assets, Nonrecurring [Member] - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | $ 856 | $ 94 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 856 | 94 |
Commercial Real Estate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 856 | 81 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Commercial Real Estate [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 856 | 81 |
Residential Real Estate [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 13 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Residential Real Estate [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | $ 0 | $ 13 |
FAIR VALUE MEASUREMENTS (Deta_4
FAIR VALUE MEASUREMENTS (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Impaired Loans Receivable, Appraisal of collateral [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Value Estimate | $ 3,346 | $ 2,495 | |
Valuation Technique | [1],[2] | Appraisal of collateral | Appraisal of collateral |
Unobservable Input | [3] | Appraisal adjustments | Appraisal adjustments |
Impaired Loans Receivable, Appraisal of collateral [Member] | Minimum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (15.00%) | (7.00%) | |
Impaired Loans Receivable, Appraisal of collateral [Member] | Maximum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (82.00%) | (65.00%) | |
Impaired Loans Receivable, Appraisal of collateral [Member] | Weighted Average [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (18.00%) | (15.00%) | |
Foreclosed assets held for resale [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Value Estimate | $ 856 | $ 94 | |
Valuation Technique | [1],[2] | Appraisal of collateral | Appraisal of collateral |
Unobservable Input | [3] | Appraisal adjustments | Appraisal adjustments |
Foreclosed assets held for resale [Member] | Minimum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (16.00%) | (35.00%) | |
Foreclosed assets held for resale [Member] | Maximum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (35.00%) | (37.00%) | |
Foreclosed assets held for resale [Member] | Weighted Average [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (18.00%) | (36.00%) | |
Impaired Loans Receivable, Discounted Cash Flow [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Value Estimate | $ 3,135 | $ 3,257 | |
Valuation Technique | Discounted cash flow | Discounted cash flow | |
Unobservable Input | Discount rate | Discount rate | |
Impaired Loans Receivable, Discounted Cash Flow [Member] | Minimum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (6.00%) | (7.00%) | |
Impaired Loans Receivable, Discounted Cash Flow [Member] | Maximum [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (7.00%) | (8.00%) | |
Impaired Loans Receivable, Discounted Cash Flow [Member] | Weighted Average [Member] | |||
Fair Values Inputs Assets Quantitative Information [Line Items] | |||
Fair Values Inputs Comparability Adjustments | (7.00%) | (7.00%) | |
[1] | Fair value is generally determined through independent appraisals of the underlying collateral, as defined by Bank regulators. | ||
[2] | Includes qualitative adjustments by management and estimated liquidation expenses. | ||
[3] | Appraisals may be adjusted downward by management for qualitative factors such as economic conditions and estimated liquidation expenses. The typical range of appraisal adjustments are presented as a percent of the appraisal value. |
FAIR VALUE MEASUREMENTS (Deta_5
FAIR VALUE MEASUREMENTS (Details 4) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
FINANCIAL ASSETS: (Carrying Amount) | ||
Cash and due from banks | $ 9,822 | $ 7,913 |
Interest-bearing deposits in other banks | 1,128 | 826 |
Time deposits with other banks | 1,482 | 1,482 |
Restricted investment in bank stocks | 8,681 | 4,058 |
Net loans | 599,647 | 551,910 |
Mortgage servicing rights | 316 | 379 |
Accrued interest receivable | 4,041 | 4,237 |
FINANCIAL LIABILITIES: (Carrying Amount) | ||
Demand, savings and other deposits | 474,261 | 570,518 |
Time deposits | 197,292 | 207,628 |
Short-term borrowings | 174,445 | 26,296 |
Long-term borrowings | 45,000 | 65,000 |
Accrued interest payable | 785 | 490 |
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Carrying Amount) | 0 | 0 |
FINANCIAL ASSETS: (Fair Value) | ||
Cash and due from banks | 9,822 | 7,913 |
Interest-bearing deposits in other banks | 1,128 | 826 |
Time deposits with other banks | 1,469 | 1,482 |
Restricted investment in bank stocks | 8,681 | 4,058 |
Net loans | 597,548 | 550,696 |
Mortgage servicing rights | 316 | 379 |
Accrued interest receivable | 4,041 | 4,237 |
FINANCIAL LIABILITIES: (Fair Value) | ||
Demand, savings and other deposits | 474,261 | 570,518 |
Time deposits | 195,136 | 206,299 |
Short-term borrowings | 174,491 | 26,296 |
Long-term borrowings | 45,077 | 65,336 |
Accrued interest payable | 785 | 490 |
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Fair Value) | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | ||
FINANCIAL ASSETS: (Fair Value) | ||
Cash and due from banks | 9,822 | 7,913 |
Interest-bearing deposits in other banks | 0 | 0 |
Time deposits with other banks | 0 | 0 |
Restricted investment in bank stocks | 0 | 0 |
Net loans | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Accrued interest receivable | 0 | 0 |
FINANCIAL LIABILITIES: (Fair Value) | ||
Demand, savings and other deposits | 0 | 0 |
Time deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Fair Value) | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
FINANCIAL ASSETS: (Fair Value) | ||
Cash and due from banks | 0 | 0 |
Interest-bearing deposits in other banks | 1,128 | 826 |
Time deposits with other banks | 1,469 | 1,482 |
Restricted investment in bank stocks | 8,681 | 4,058 |
Net loans | 0 | 0 |
Mortgage servicing rights | 0 | 0 |
Accrued interest receivable | 4,041 | 4,237 |
FINANCIAL LIABILITIES: (Fair Value) | ||
Demand, savings and other deposits | 474,261 | 570,518 |
Time deposits | 195,136 | 206,299 |
Short-term borrowings | 174,491 | 26,296 |
Long-term borrowings | 45,077 | 65,336 |
Accrued interest payable | 785 | 490 |
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Fair Value) | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
FINANCIAL ASSETS: (Fair Value) | ||
Cash and due from banks | 0 | 0 |
Interest-bearing deposits in other banks | 0 | 0 |
Time deposits with other banks | 0 | 0 |
Restricted investment in bank stocks | 0 | 0 |
Net loans | 597,548 | 550,696 |
Mortgage servicing rights | 316 | 379 |
Accrued interest receivable | 0 | 0 |
FINANCIAL LIABILITIES: (Fair Value) | ||
Demand, savings and other deposits | 0 | 0 |
Time deposits | 0 | 0 |
Short-term borrowings | 0 | 0 |
Long-term borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS (Fair Value) | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS (Deta_6
FAIR VALUE MEASUREMENTS (Details Textual) | Dec. 31, 2018USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Minimum impaired loan balance that requires an appraisal to be obtained and reviewed annually for impaired loan valuation procedure | $ 250,000 |
Maximum impaired loan balance for which the bank completes a Certificate of Inspection | $ 250,000 |
REVENUE RECOGNITION (Details Te
REVENUE RECOGNITION (Details Textual) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Revenue from Contract with Customer [Abstract] | ||
Trust Assets, Fair Value Disclosure | $ 105,917,000 | $ 111,130,000 |
PARENT COMPANY FINANCIAL INFO_3
PARENT COMPANY FINANCIAL INFORMATION (BALANCE SHEETS) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
ASSETS | |||
Investment in banking subsidiary | $ 2,096 | $ 2,626 | |
Marketable equity securities | 1,560 | 1,632 | |
TOTAL ASSETS | 1,012,000 | 990,121 | |
LIABILITIES | |||
TOTAL LIABILITIES | 895,244 | 873,402 | |
STOCKHOLDERS' EQUITY | |||
Common stock | 11,993 | 11,902 | |
Surplus | 37,255 | 36,193 | |
Retained earnings | 75,798 | 72,507 | |
Accumulated other comprehensive (loss) income | (2,581) | 1,826 | |
Treasury stock, at cost | (5,709) | (5,709) | |
TOTAL STOCKHOLDERS' EQUITY | 116,756 | 116,719 | $ 109,685 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 1,012,000 | 990,121 | |
Parent Company [Member] | |||
ASSETS | |||
Cash | 9,988 | 8,984 | |
Investment in banking subsidiary | 105,755 | 106,647 | |
Marketable equity securities | 1,560 | 1,632 | |
Prepaid expenses and other assets | 232 | 30 | |
TOTAL ASSETS | 117,535 | 117,293 | |
LIABILITIES | |||
Advances from banking subsidiary | 536 | 325 | |
Accrued expenses and other liabilities | 243 | 249 | |
TOTAL LIABILITIES | 779 | 574 | |
STOCKHOLDERS' EQUITY | |||
Common stock | 11,993 | 11,902 | |
Surplus | 37,255 | 36,193 | |
Retained earnings | 75,798 | 72,507 | |
Accumulated other comprehensive (loss) income | (2,581) | 1,826 | |
Treasury stock, at cost | (5,709) | (5,709) | |
TOTAL STOCKHOLDERS' EQUITY | 116,756 | 116,719 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 117,535 | $ 117,293 |
PARENT COMPANY FINANCIAL INFO_4
PARENT COMPANY FINANCIAL INFORMATION (STATEMENTS OF INCOME) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
INCOME | ||
Income before income tax expense | $ 9,670 | $ 10,103 |
INCOME TAX BENEFIT | 459 | 1,455 |
NET INCOME | 9,211 | 8,648 |
Parent Company [Member] | ||
INCOME | ||
Dividends from subsidiary bank | 6,102 | 6,102 |
Net securities (losses) gains | (72) | 74 |
Other income | 76 | 73 |
TOTAL INCOME | 6,106 | 6,249 |
OPERATING EXPENSES | 176 | 117 |
Income before income tax expense | 5,930 | 6,132 |
INCOME TAX BENEFIT | (41) | (110) |
Income Before Equity in Undistributed Net Income of Subsidiary | 5,971 | 6,242 |
EQUITY IN UNDISTRIBUTED EARNINGS OF BANKING SUBSIDIARY | 3,240 | 2,406 |
NET INCOME | $ 9,211 | $ 8,648 |
PARENT COMPANY FINANCIAL INFO_5
PARENT COMPANY FINANCIAL INFORMATION (STATEMENTS OF COMPREHENSIVE INCOME) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Condensed Financial Statements, Captions [Line Items] | |||
Net Income | $ 9,211 | $ 8,648 | |
Other comprehensive (loss) income: | |||
Unrealized net holding gains on available-for-sale investment securities arising during the period, net of income taxes of $0 and $55, respectively | (4,127) | 3,859 | |
Less reclassification adjustment for net gains included in net income, net of income taxes of $0 and $(30), respectively | [1],[2] | (6) | (614) |
Total other comprehensive (loss) income | (4,133) | 3,245 | |
Total Comprehensive Income | 5,078 | 11,893 | |
Parent Company [Member] | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net Income | 9,211 | 8,648 | |
Other comprehensive (loss) income: | |||
Unrealized net holding gains on available-for-sale investment securities arising during the period, net of income taxes of $0 and $55, respectively | 0 | 81 | |
Less reclassification adjustment for net gains included in net income, net of income taxes of $0 and $(30), respectively | 0 | (44) | |
Equity in other comprehensive (loss) income of banking subsidiary | (4,133) | 3,208 | |
Total other comprehensive (loss) income | (4,133) | 3,245 | |
Total Comprehensive Income | $ 5,078 | $ 11,893 | |
[1] | Gross amounts are included in net securities (losses) gains on the Consolidated Statements of Income in non-interest income. | ||
[2] | Income tax amounts are included in income tax expense on the Consolidated Statements of Income. |
PARENT COMPANY FINANCIAL INFO_6
PARENT COMPANY FINANCIAL INFORMATION (STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 9,211 | $ 8,648 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Losses (gains) on securities | 65 | (938) |
Deferred income tax expense (benefit) | 566 | 146 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 14,741 | 12,204 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
NET CASH PROVIDED BY INVESTING ACTIVITIES | (29,045) | (6,788) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 1,153 | 1,261 |
Proceeds from exercise of stock options | 0 | 25 |
Dividends paid | (6,194) | (6,145) |
NET CASH USED IN FINANCING ACTIVITIES | 16,515 | (5,805) |
INCREASE IN CASH AND CASH EQUIVALENTS | 2,211 | (389) |
CASH AND CASH EQUIVALENTS, BEGINNING | 8,739 | 9,128 |
CASH AND CASH EQUIVALENTS, ENDING | 10,950 | 8,739 |
Parent Company [Member] | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | 9,211 | 8,648 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Losses (gains) on securities | 72 | (74) |
Deferred income tax expense (benefit) | 5 | (110) |
Equity in undistributed earnings of banking subsidiary | (3,240) | (2,406) |
Increase in prepaid/accrued expenses and other assets/liabilities | (214) | (235) |
Increase in advances from banking subsidiary | 211 | 216 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 6,045 | 6,039 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from sales of investment securities available-for-sale | 0 | 144 |
NET CASH PROVIDED BY INVESTING ACTIVITIES | 0 | 144 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 1,153 | 1,261 |
Proceeds from exercise of stock options | 0 | 25 |
Dividends paid | (6,194) | (6,145) |
NET CASH USED IN FINANCING ACTIVITIES | (5,041) | (4,859) |
INCREASE IN CASH AND CASH EQUIVALENTS | 1,004 | 1,324 |
CASH AND CASH EQUIVALENTS, BEGINNING | 8,984 | 7,660 |
CASH AND CASH EQUIVALENTS, ENDING | $ 9,988 | $ 8,984 |
PARENT COMPANY FINANCIAL INFO_7
PARENT COMPANY FINANCIAL INFORMATION (STATEMENTS OF COMPREHENSIVE INCOME (LOSS)) (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Condensed Financial Statements, Captions [Line Items] | ||
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, Tax | $ (1,097) | $ 2,002 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | (1) | (324) |
Parent Company [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, Tax | 0 | 55 |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | $ 0 | $ (30) |