Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 31, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | CHOICEONE FINANCIAL SERVICES INC | |
Entity Central Index Key | 803,164 | |
Document Type | 10-Q | |
Trading Symbol | COFS | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 3,613,916 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,018 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and due from banks | $ 11,877 | $ 36,837 |
Equity securities at fair value (Note 2) | 3,338 | |
Securities available for sale (Note 2) | 161,687 | 155,591 |
Federal Home Loan Bank stock | 1,994 | 1,994 |
Federal Reserve Bank stock | 1,573 | 1,573 |
Loans held for sale | 617 | 1,721 |
Loans to other financial institutions | 9,006 | 6,802 |
Loans (Note 3) | 395,898 | 398,785 |
Allowance for loan losses (Note 3) | (4,659) | (4,577) |
Loans, net | 391,239 | 394,208 |
Premises and equipment, net | 13,571 | 12,855 |
Cash surrender value of life insurance policies | 14,706 | 14,514 |
Goodwill | 13,728 | 13,728 |
Other assets | 7,501 | 6,721 |
Total assets | 630,837 | 646,544 |
Liabilities | ||
Deposits - noninterest-bearing | 147,040 | 151,462 |
Deposits - interest-bearing | 380,881 | 388,391 |
Total deposits | 527,921 | 539,853 |
Repurchase agreements | 7,148 | |
Federal funds purchased | 4,000 | |
Advances from Federal Home Loan Bank | 20,251 | 20,268 |
Other liabilities | 2,397 | 2,725 |
Total liabilities | 554,569 | 569,994 |
Shareholders' Equity | ||
Common stock and paid in capital, no par value; shares authorized: 7,000,000; shares outstanding: 3,613,080 at June 30, 2018 and 3,448,569 at December 31, 2017 | 54,289 | 50,290 |
Retained earnings | 24,146 | 26,023 |
Accumulated other comprehensive income (loss), net | (2,167) | 237 |
Total shareholders' equity | 76,268 | 76,550 |
Total liabilities and shareholders' equity | $ 630,837 | $ 646,544 |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - shares | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, authorized shares | 7,000,000 | 7,000,000 |
Common stock, outstanding shares | 3,613,080 | 3,448,569 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Interest income | ||||
Loans, including fees | $ 5,028 | $ 4,401 | $ 9,624 | $ 8,565 |
Securities: | ||||
Taxable | 713 | 663 | 1,398 | 1,284 |
Tax exempt | 362 | 352 | 723 | 713 |
Other | 12 | 9 | 69 | 24 |
Total interest income | 6,115 | 5,425 | 11,814 | 10,586 |
Interest expense | ||||
Deposits | 463 | 292 | 809 | 540 |
Advances from Federal Home Loan Bank | 57 | 52 | 102 | 107 |
Other | 25 | 4 | 26 | 7 |
Total interest expense | 545 | 348 | 937 | 654 |
Net interest income | 5,570 | 5,077 | 10,877 | 9,932 |
Provision for loan losses (Note 3) | 25 | 35 | 25 | |
Net interest income after provision for loan losses | 5,570 | 5,052 | 10,842 | 9,907 |
Noninterest income | ||||
Customer service charges | 1,120 | 1,049 | 2,175 | 2,023 |
Insurance and investment commissions | 72 | 262 | 134 | 500 |
Gains on sales of loans | 288 | 341 | 549 | 565 |
Gains on sales of securities | 16 | 60 | 25 | 126 |
Net gain on sales of other assets | 4 | 8 | 4 | |
Earnings on life insurance policies | 98 | 99 | 192 | 198 |
Other | 127 | 127 | 286 | 258 |
Total noninterest income | 1,721 | 1,942 | 3,369 | 3,674 |
Noninterest expense | ||||
Salaries and benefits | 2,779 | 2,591 | 5,528 | 5,106 |
Occupancy and equipment | 664 | 689 | 1,344 | 1,397 |
Data processing | 555 | 554 | 1,089 | 1,130 |
Professional fees | 311 | 262 | 528 | 491 |
Supplies and postage | 97 | 90 | 213 | 191 |
Advertising and promotional | 85 | 73 | 177 | 127 |
Other | 623 | 520 | 1,199 | 1,006 |
Total noninterest expense | 5,114 | 4,779 | 10,078 | 9,448 |
Income before income tax | 2,177 | 2,215 | 4,132 | 4,133 |
Income tax expense | 344 | 580 | 642 | 1,052 |
Net income | $ 1,833 | $ 1,635 | $ 3,491 | $ 3,081 |
Basic earnings per share (Note 4) (in dollars per share) | $ 0.51 | $ 0.45 | $ 0.97 | $ 0.85 |
Diluted earnings per share (Note 4) (in dollars per share) | 0.5 | 0.45 | 0.96 | 0.85 |
Dividends declared per share (in dollars per share) | $ 0.18 | $ 0.16 | $ 0.35 | $ 0.31 |
CONSOLIDATED STATEMENTS OF INC5
CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||
Stock dividend paid (percent) | 5.00% | 5.00% |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 1,833 | $ 1,635 | $ 3,491 | $ 3,081 |
Other comprehensive income: | ||||
Changes in net unrealized gains and losses on investment securities available for sale, net of tax benefit (expense) of $86 and $(557) for the three months ended June 30, 2018 and June 30, 2017 respectively. Changes in net unrealized gains on investment securities available for sale, net of tax benefit (expense) of $569 and $(910) for the six months ended June 30, 2018 and June 30, 2017 respectively. | (324) | 1,081 | (2,140) | 1,766 |
Less: Reclassification adjustment for realized gain on sale of investment securities available for sale included in net income, net of tax expense of $3 and $21 for the three months ended June 30, 2018 and June 30, 2017 respectively. Reclassification adjustment for realized gain on sale of investment securities available for sale included in net income, net of tax expense of $5 and $43 for the six months ended June 30, 2018 and June 30, 2017 respectively. | (12) | (39) | (20) | (83) |
Other comprehensive income (loss), net of tax | (336) | 1,042 | (2,160) | 1,683 |
Comprehensive income | $ 1,497 | $ 2,677 | $ 1,331 | $ 4,764 |
CONSOLIDATED STATEMENTS OF COM7
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Unrealized gains (losses) on investment securities available for sale, net of tax expense (benefit) | $ 86 | $ (557) | $ 569 | $ (910) |
Reclassification adjustment for realized gain on sale of investment securities available for sale included in net income, net of tax expense | $ 3 | $ 21 | $ 5 | $ 43 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss), Net [Member] | Total | |
Balance, beginning at Dec. 31, 2016 | $ 46,299 | $ 25,997 | $ (598) | $ 71,698 | |
Balance, beginning (in shares) at Dec. 31, 2016 | 3,277,944 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 3,081 | 3,081 | |||
Other comprehensive income (loss) | 1,683 | 1,683 | |||
Shares issued | $ 82 | 82 | |||
Shares issued (in shares) | 5,318 | ||||
Effect of employee stock purchases | $ 6 | 6 | |||
Stock options exercised | $ 13 | 13 | |||
Stock options exercised (in shares) | 1,000 | ||||
Stock-based compensation expense | $ 116 | 116 | |||
Restricted stock units vested (in shares) | 4,104 | ||||
Stock dividend declared (5%) | $ 3,779 | (3,786) | (7) | ||
Stock dividend declared (5%) (in shares) | 163,989 | ||||
Cash dividends declared | (1,144) | (1,144) | |||
Balance, ending at Jun. 30, 2017 | $ 50,295 | 24,148 | 1,085 | 75,528 | |
Balance, ending (in shares) at Jun. 30, 2017 | 3,452,355 | ||||
Balance, beginning at Dec. 31, 2017 | $ 50,290 | 26,023 | 237 | $ 76,550 | |
Balance, beginning (in shares) at Dec. 31, 2017 | 3,448,569 | 3,448,569 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 3,491 | $ 3,491 | |||
Other comprehensive income (loss) | (2,160) | $ (2,160) | |||
Shares issued | $ 50 | ||||
Shares issued (in shares) | 4,532 | 50 | |||
Shares repurchased | $ (523) | $ (523) | |||
Shares repurchased (in shares) | (20,228) | ||||
Effect of employee stock purchases | $ 6 | 6 | |||
Stock options exercised (in shares) | 809 | ||||
Stock-based compensation expense | $ 131 | 131 | |||
Restricted stock units vested (in shares) | 7,304 | ||||
Stock dividend declared (5%) | $ 4,335 | (4,342) | (7) | ||
Stock dividend declared (5%) (in shares) | 172,094 | ||||
Adoption effect of ASU 2016-01 | 244 | (244) | |||
Cash dividends declared | [1] | (1,270) | (1,270) | ||
Balance, ending at Jun. 30, 2018 | $ 54,289 | $ 24,146 | $ (2,167) | $ 76,268 | |
Balance, ending (in shares) at Jun. 30, 2018 | 3,613,080 | 3,613,080 | |||
[1] | The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental tax rate of 21% |
CONSOLIDATED STATEMENTS OF CHA9
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividend declared, per share | $ 0.18 | $ 0.16 | $ 0.35 | $ 0.31 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 3,491 | $ 3,081 |
Adjustments to reconcile net income to net cash from operating activities: | ||
Provision for loan losses | 35 | 25 |
Depreciation | 579 | 643 |
Amortization | 460 | 549 |
Compensation expense on stock purchases and restricted stock units | 148 | 163 |
Gains on sales of securities | (25) | (126) |
Gains on sales of loans | (549) | (565) |
Loans originated for sale | (17,835) | (14,456) |
Proceeds from loan sales | 19,120 | 14,180 |
Earnings on bank-owned life insurance | (192) | (198) |
Gains on sales of other real estate owned | (8) | |
Proceeds from sales of other real estate owned | 114 | 172 |
Deferred federal income tax benefit | 40 | 138 |
Net changes in other assets | (853) | 309 |
Net changes in other liabilities | 219 | (468) |
Net cash from operating activities | 4,744 | 3,447 |
Securities available for sale: | ||
Sales | 2,716 | 12,520 |
Maturities, prepayments and calls | 6,072 | 8,011 |
Purchases | (21,177) | (24,301) |
Loan originations and payments, net | 686 | (14,378) |
Additions to premises and equipment | (1,143) | (291) |
Net cash used in investing activities | (12,846) | (18,439) |
Cash flows from financing activities: | ||
Net change in deposits | (11,932) | 11,958 |
Net change in repurchase agreements | (7,148) | (5,612) |
Net change in federal funds purchased | 4,000 | |
Proceeds from Federal Home Loan Bank advances | 30,000 | 117,500 |
Payments on Federal Home Loan Bank advances | (30,017) | (105,517) |
Issuance of common stock | 40 | 55 |
Repurchase of common stock | (523) | |
Cash dividends and fractional shares from stock dividend | (1,278) | (1,151) |
Net cash provided by (used in) financing activities | (16,858) | 17,233 |
Net change in cash and cash equivalents | (24,960) | 2,241 |
Beginning cash and cash equivalents | 36,837 | 14,809 |
Ending cash and cash equivalents | 11,877 | 17,050 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 889 | 596 |
Cash paid for taxes | 700 | 800 |
Loans transferred to other real estate owned | $ 179 | $ 207 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include ChoiceOne Financial Services, Inc. (“ChoiceOne”) and its wholly-owned subsidiary, ChoiceOne Bank (the “Bank”), and the Bank’s wholly-owned subsidiary, ChoiceOne Insurance Agencies, Inc. Intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information, prevailing practices within the banking industry and the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying consolidated financial statements reflect all adjustments ordinary in nature which are, in the opinion of management, necessary for a fair presentation of the Consolidated Balance Sheets as of June 30, 2018 and December 31, 2017, the Consolidated Statements of Income for the three- and six-month periods ended June 30, 2018 and June 30, 2017, the Consolidated Statements of Comprehensive Income for the three- and six-month periods ended June 30, 2018 and June 30, 2017, the Consolidated Statements of Changes in Shareholders' Equity for the six-month periods ended June 30, 2018 and June 30, 2017, and the Consolidated Statements of Cash Flows for the six-month periods ended June 30, 2018 and June 30, 2017. Operating results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in ChoiceOne’s Annual Report on Form 10-K for the year ended December 31, 2017. Loans to Other Financial Institutions 44% of the total at June 30, 2018 Credit risk associated with the participating interest is measured as an allowance for loan losses when necessary. Losses are charged off against the allowance when incurred and recoveries of loan charge-offs are recorded when received. At least quarterly, the Bank reviews the portfolio of participating interests for potential losses including any participating interest that is outstanding over 90 days (even if the advance and participating interest is current). At June 30, 2018, there was one participating in loans to other financial institutions interest totaling $254,000 that was over 30 days. Since the inception of the program, there were no losses or charge-offs of participating interests. Allowance for Loan Losses The allowance for loan losses is maintained at a level believed adequate by management to absorb probable incurred losses inherent in the consolidated loan portfolio. Management’s evaluation of the adequacy of the allowance is an estimate based on reviews of individual loans, assessments of the impact of current economic conditions on the portfolio and historical loss experience of seasoned loan portfolios. See Note 3 to the interim consolidated financial statements for additional information. Management believes the accounting estimate related to the allowance for loan losses is a “critical accounting estimate” because (1) the estimate is highly susceptible to change from period to period because of assumptions concerning the changes in the types and volumes of the portfolios and economic conditions and (2) the impact of recognizing an impairment or loan loss could have a material effect on ChoiceOne’s assets reported on the balance sheets as well as its net income. Stock Transactions A total of 2,709 shares of common stock were issued to ChoiceOne’s Board of Directors for a cash price of $68,000 under the terms of the Directors’ Stock Purchase Plan in the first six months of 2018. A total of 1,824 shares for a cash price of $40,000 were issued under the Employee Stock Purchase Plan in the first half of 2018. A total of 809 shares were issued upon the exercise of stock options in the first six months of 2018. A total of 7,304 shares were issued to employees for Restricted Stock Units that vested during the first half of 2018. Stock-Based Compensation Effective July 1, 2013, ChoiceOne began granting Restricted Stock Units to a select group of employees under the Stock Incentive Plan of 2012. All of the Restricted Stock Units are initially unvested and vest in three annual installments on each of the next three anniversaries of the grant date. Certain additional vesting provisions apply. Each unit, once vested, is settled by delivery of one share of ChoiceOne common stock. Reclassifications Certain amounts presented in prior periods have been reclassified to conform to the current presentation. Recent Accounting Pronouncements The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) The FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities the fair value of loans has been estimated using an exit price notion in Note 5. The FASB issued ASU 2016-02, Leases The FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
SECURITIES
SECURITIES | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
SECURITIES | NOTE 2 - SECURITIES The fair value of equity securities at fair value and the related gross unrealized gains recognized in other noninterest income were as follows: June 30, 2018 (Dollars in thousands) Amortized Gross Gross Fair Equity securities $ 3,002 $ 336 $ — $ 3,338 The fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows: June 30, 2018 Gross Gross (Dollars in thousands) Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. Government and federal agency $ 34,099 $ — $ (971 ) $ 33,128 U.S. Treasury 1,991 — (72 ) 1,919 State and municipal 104,958 378 (1,731 ) 103,605 Mortgage-backed 18,310 11 (409 ) 17,912 Corporate 5,146 — (79 ) 5,067 Asset-backed securities 56 — — 56 Total $ 164,560 $ 389 $ (3,262 ) $ 161,687 December 31, 2017 Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Value U.S. Government and federal agency $ 35,518 $ — $ (392 ) $ 35,126 U.S. Treasury 1,991 — (31 ) 1,960 State and municipal 99,609 910 (471 ) 100,048 Mortgage-backed 9,943 8 (131 ) 9,820 Corporate 5,184 2 (35 ) 5,151 Equity securities 3,083 309 — 3,392 Asset-backed securities 95 — (1 ) 94 Total $ 155,423 $ 1,229 $ (1,061 ) $ 155,591 ChoiceOne reviews its securities portfolio on a quarterly basis to determine whether unrealized losses are considered to be temporary or other-than-temporary. No other-than-temporary impairment charges were recorded in the three and six months ended June 30, 2018. ChoiceOne believed that unrealized losses on securities were temporary in nature and were due to changes in interest rates and reduced market liquidity and not as a result of credit quality issues. Presented below is a schedule of maturities of securities as of June 30, 2018, the fair value of securities as of June 30, 2018 and December 31, 2017, and the weighted average yields of securities as of June 30, 2018: Securities maturing within: Fair Value Fair Value Less than 1 Year - 5 Years - More than at June 30, at Dec. 31, (Dollars in thousands) 1 Year 5 Years 10 Years 10 Years 2018 2017 U.S. Government and federal agency $ 16,460 $ 9,888 $ 6,780 $ — $ 33,128 $ 35,126 U.S. Treasury notes and bonds — 1,919 — — 1,919 1,960 State and municipal 10,694 50,580 40,314 2,017 103,605 100,048 Corporate 1,992 2,587 488 — 5,067 5,151 Asset-backed securities 56 — — — 56 94 Total debt securities 29,202 64,974 47,582 2,017 143,775 142,379 Mortgage-backed securities — 11,656 6,256 — 17,912 9,820 Equity securities (1) — — 1,000 2,338 3,338 3,392 Total $ 29,202 $ 76,630 $ 54,838 $ 4,355 $ 165,025 $ 155,591 Weighted average yields: Less than 1 Year - 5 Years - More than 1 Year 5 Years 10 Years 10 Years Total U.S. Government and federal agency 2.19 % 1.78 % 2.67 % — % 2.17 % U.S. Treasury notes and bonds — 1.85 — — 1.85 State and municipal (2) 3.10 3.05 3.58 1.22 3.23 Corporate — 2.48 3.21 — 1.58 Asset-backed securities 2.59 — — — 2.59 Mortgage-backed securities — 2.92 3.01 — 2.95 Equity securities (1) — — 4.78 1.07 2.18 (1) Equity securities are preferred and common stock that may or may not have stated maturity. (2) The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental rate of 21%. Following is information regarding unrealized gains and losses on equity securities for the three- and six-month periods ending June 30, 2018: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Net gains and losses recognized during the period $ 26 $ 58 Less: Net gains and losses recognized during the period on securities sold — 9 Unrealized gains and losses recognized during the reporting period on securities still held at the reporting date $ 26 $ 49 |
LOANS AND ALLOWANCE FOR LOAN LO
LOANS AND ALLOWANCE FOR LOAN LOSSES | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
LOANS AND ALLOWANCE FOR LOAN LOSSES | NOTE 3 – LOANS AND ALLOWANCE FOR LOAN LOSSES Activity in the allowance for loan losses and balances in the loan portfolio were as follows: Commercial (Dollars in thousands) and Commercial Construction Residential Agricultural Industrial Consumer Real Estate Real Estate Real Estate Unallocated Total Allowance for Loan Losses Three Months Ended June 30, 2018 Beginning balance $ 350 $ 1,005 $ 245 $ 1,786 $ 18 $ 625 $ 680 $ 4,709 Charge-offs — (57 ) (50 ) — — (9 ) — (116 ) Recoveries — — 15 3 — 48 — 66 Provision 9 22 (5 ) 122 (2 ) (44 ) (102 ) — Ending balance $ 359 $ 970 $ 205 $ 1,911 $ 16 $ 620 $ 578 $ 4,659 Six Months Ended June 30, 2018 Beginning balance $ 506 $ 1,001 $ 262 $ 1,761 $ 35 $ 726 $ 286 $ 4,577 Charge-offs — (58 ) (118 ) — — (13 ) — (188 ) Recoveries — 53 51 59 — 73 — 236 Provision (147 ) (26 ) 10 91 (19 ) (166 ) 292 35 Ending balance $ 359 $ 970 $ 205 $ 1,911 $ 16 $ 620 $ 578 $ 4,659 Individually evaluated for impairment $ — $ 76 $ 1 $ 28 $ — $ 221 $ — $ 326 Collectively evaluated for impairment $ 359 $ 894 $ 204 $ 1,883 $ 16 $ 399 $ 577 $ 4,333 Three Months Ended June 30, 2017 Beginning balance $ 406 $ 745 $ 286 $ 1,414 $ 23 $ 727 $ 724 $ 4,325 Charge-offs — (352 ) (57 ) — — — — (409 ) Recoveries — — 39 49 40 29 — 157 Provision (11 ) 511 26 88 (39 ) (7 ) (543 ) 25 Ending balance $ 395 $ 904 $ 294 $ 1,551 $ 24 $ 749 $ 181 $ 4,098 Six Months Ended Beginning balance $ 433 $ 688 $ 305 $ 1,438 $ 62 $ 1,014 $ 337 $ 4,277 Charge-offs — (362 ) (137 ) — — (34 ) — (533 ) Recoveries — — 91 161 40 37 — 329 Provision (38 ) 578 35 (48 ) (78 ) (268 ) (156 ) 25 Ending balance $ 395 $ 904 $ 294 $ 1,551 $ 24 $ 749 $ 181 $ 4,098 Individually evaluated for impairment $ — $ 27 $ 4 $ 65 $ — $ 271 $ — $ 367 Collectively evaluated for impairment $ 395 $ 877 $ 290 $ 1,486 $ 24 $ 478 $ 181 $ 3,731 Loans Individually evaluated for impairment $ 421 $ 292 $ 58 $ 815 $ — $ 2,692 $ 4,278 Collectively evaluated for impairment 38,951 96,746 24,122 135,394 3,682 92,725 391,620 Ending balance $ 39,372 $ 97,038 $ 24,180 $ 136,209 $ 3,682 $ 95,417 $ 395,898 December 31, 2017 Individually evaluated for impairment $ 423 $ 124 $ 36 $ 778 $ — $ 2,779 $ 4,140 Collectively evaluated for impairment 48,041 104,262 24,477 122,709 6,613 88,543 394,645 Ending balance $ 48,464 $ 104,386 $ 24,513 $ 123,487 $ 6,613 $ 91,322 $ 398,785 The process to monitor the credit quality of ChoiceOne’s loan portfolio includes tracking (1) the risk ratings of business loans, (2) the level of classified business loans, and (3) delinquent and nonperforming consumer loans. Business loans are risk rated on a scale of 1 to 8. A description of the characteristics of the ratings follows: Risk ratings 1 and 2: These loans are considered pass credits. They exhibit good to exceptional credit risk and demonstrate the ability to repay the loan from normal business operations. Risk rating 3: These loans are considered pass credits. They exhibit acceptable credit risk and demonstrate the ability to repay the loan from normal business operations. Risk rating 4: These loans are considered pass credits. However, they have potential developing weaknesses that, if not corrected, may cause deterioration in the ability of the borrower to repay the loan. While a loss is possible for a loan with this rating, it is not anticipated. Risk rating 5: These loans are considered special mention credits. Loans in this risk rating are considered to be inadequately protected by the net worth and debt service coverage of the borrower or of any pledged collateral. These loans have well defined weaknesses that may jeopardize the borrower’s ability to repay the loan. If the weaknesses are not corrected, loss of principal and interest could be probable. Risk rating 6: These loans are considered substandard credits. These loans have well defined weaknesses, the severity of which makes collection of principal and interest in full questionable. Loans in this category may be placed on nonaccrual status. Risk rating 7: These loans are considered doubtful credits. Some loss of principal and interest has been determined to be probable. The estimate of the amount of loss could be affected by factors such as the borrower’s ability to provide additional capital or collateral. Loans in this category are on nonaccrual status. Risk rating 8: These loans are considered loss credits. They are considered uncollectible and will be charged off against the allowance for loan losses. Information regarding the Bank’s credit exposure is as follows: Corporate Credit Exposure - Credit Risk Profile By Creditworthiness Category Agricultural Commercial and Industrial Commercial Real Estate (Dollars in thousands) June 30, December 31, June 30, December 31, June 30, December 31, 2018 2017 2018 2017 2018 2017 Risk ratings 1 and 2 $ 11,449 $ 14,813 $ 12,253 $ 13,491 $ 8,392 $ 8,227 Risk rating 3 17,983 22,721 60,172 63,366 91,126 78,868 Risk rating 4 9,108 10,199 23,292 26,943 33,074 33,429 Risk rating 5 411 308 1,188 491 2,269 1,533 Risk rating 6 421 423 133 95 1,348 1,430 $ 39,372 $ 48,464 $ 97,038 $ 104,386 $ 136,209 $ 123,487 Corporate Credit Exposure - Credit Risk Profile Based On Payment Activity Consumer Construction Real Estate Residential Real Estate (Dollars in thousands) June 30, December 31, June 30, December 31, June 30, December 31, 2018 2017 2018 2017 2018 2017 Performing $ 24,180 $ 24,497 $ 3,682 $ 6,613 $ 94,875 $ 90,629 Nonperforming — 1 — — — 257 Nonaccrual — 15 — — 542 436 $ 24,180 $ 24,513 $ 3,682 $ 6,613 $ 95,417 $ 91,322 The following schedule provides information on loans that were considered troubled debt restructurings (“TDRs”) that were modified during the three and six months periods ended June 30, 2018. There were no loans that were considered TDRs that were modified during the three and six months periods ended June 30, 2017: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Pre- Post- Pre- Post- Modification Modification Modification Modification Outstanding Outstanding Outstanding Outstanding (Dollars in thousands) Number of Recorded Recorded Number of Recorded Recorded Loans Investment Investment Loans Investment Investment Commercial and industrial — $ — $ — 1 $ 39 $ 39 The pre-modification and post-modification outstanding recorded investment represents amounts as of the date of loan modification. If a difference exists between the pre-modification and post-modification outstanding recorded investment, it represents impairment recognized through the provision for loan losses computed based on a loan’s post-modification present value of expected future cash flows discounted at the loan’s original effective interest rate. If no difference exists, a loss is not expected to be incurred based on an assessment of the borrower’s expected cash flows. The following schedule provides information on TDRs as of June 30, 2018 where the borrower was past due with respect to principal and/or interest for 30 days or more during the three month and six months ended June 30, 2018 that had been modified during the year prior to the default: Three Months Ended Six Months Ended (Dollars in thousands) Number Recorded Number Recorded of Loans Investment of Loans Investment Commercial and industrial 1 $ 39 1 $ 39 The following schedule provides information on TDRs as of June 30, 2017 where the borrower was past due with respect to principal and/or interest for 30 days or more during the three month and six months ended June 30, 2017 that had been modified during the year prior to the default: Three Months Ended Six Months Ended (Dollars in thousands) Number Recorded Number Recorded of Loans Investment of Loans Investment Commercial real estate — $ — 1 $ 128 Impaired loans by loan category follow: Unpaid (Dollars in thousands) Recorded Principal Related Investment Balance Allowance June 30, 2018 With no related allowance recorded Agricultural $ 421 $ 455 $ — Commercial and industrial 61 61 — Consumer — — — Commercial real estate 53 55 — Residential real estate 110 122 — Subtotal 645 693 — With an allowance recorded Agricultural — — — Commercial and industrial 231 266 76 Consumer 58 59 1 Commercial real estate 762 849 28 Residential real estate 2,582 2,616 221 Subtotal 3,633 3,790 326 Total Agricultural 421 455 — Commercial and industrial 292 327 76 Consumer 58 59 1 Commercial real estate 815 904 28 Residential real estate 2,692 2,738 221 Total $ 4,278 $ 4,483 $ 326 December 31, 2017 With no related allowance recorded Agricultural $ 423 $ 455 $ — Commercial and industrial — — — Consumer — — — Commercial real estate 127 258 — Residential real estate 115 126 — Subtotal 665 839 — With an allowance recorded Agricultural — — — Commercial and industrial 124 124 26 Consumer 36 36 3 Commercial real estate 651 734 49 Residential real estate 2,664 2,690 224 Subtotal 3,475 3,584 302 Total Agricultural 423 455 — Commercial and industrial 124 124 26 Consumer 36 36 3 Commercial real estate 778 992 49 Residential real estate 2,779 2,816 224 Total $ 4,140 $ 4,423 $ 302 The following schedule provides information regarding average balances of impaired loans and interest recognized on impaired loans for the six months ended June 30, 2018 and 2017: Average Interest (Dollars in thousands) Recorded Income Investment Recognized June 30, 2018 With no related allowance recorded Agricultural $ 423 $ — Commercial and industrial 20 2 Consumer 3 — Commercial real estate 79 — Residential real estate 137 1 Subtotal 662 3 With an allowance recorded Agricultural — — Commercial and industrial 215 8 Consumer 43 1 Commercial real estate 733 22 Residential real estate 2,633 63 Subtotal 3,624 94 Agricultural 423 — Commercial and industrial 235 10 Consumer 46 1 Commercial real estate 812 22 Residential real estate 2,770 64 Total $ 4,286 $ 97 June 30, 2017 With no related allowance recorded Agricultural $ 308 $ — Commercial and industrial 186 — Consumer — — Commercial real estate 181 — Residential real estate 158 2 Subtotal 833 2 With an allowance recorded Agricultural 175 — Commercial and industrial 182 1 Consumer 31 1 Commercial real estate 853 17 Residential real estate 2,590 56 Subtotal 3,831 75 Agricultural 483 — Commercial and industrial 368 1 Consumer 31 1 Commercial real estate 1,034 17 Residential real estate 2,748 58 Total $ 4,664 $ 77 An aging analysis of loans by loan category follows: Greater 90 Days Past (Dollars in thousands) 30 to 59 60 to 89 Than 90 Loans Not Due and Days Days Days (1) Total Past Due Total Loans Accruing June 30, 2018 Agricultural $ — $ — $ 421 $ 421 $ 38,951 $ 39,372 $ — Commercial and industrial — — 39 39 96,999 97,038 — Consumer 93 — — 93 24,087 24,180 — Commercial real estate 84 79 — 163 136,046 136,209 — Construction real estate 268 — — 268 3,414 3,682 — Residential real estate 694 475 66 1,235 94,182 95,417 — $ 1,139 $ 554 $ 526 $ 2,219 $ 393,679 $ 395,898 $ — December 31, 2017 Agricultural $ — $ — $ 83 $ 83 $ 48,381 $ 48,464 $ — Commercial and industrial 20 — — 20 104,366 104,386 — Consumer 142 38 1 181 24,332 24,513 — Commercial real estate 95 58 69 222 123,265 123,487 — Construction real estate — — — — 6,613 6,613 — Residential real estate 585 272 296 1,153 90,169 91,322 258 $ 842 $ 368 $ 449 $ 1,659 $ 397,126 $ 398,785 $ 258 (1) Includes nonaccrual loans. Nonaccrual loans by loan category follow: (Dollars in thousands) June 30, December 31, 2018 2017 Agricultural $ 421 $ 423 Commercial and industrial 39 — Consumer — 15 Commercial real estate 138 222 Construction real estate — — Residential real estate 542 436 $ 1,140 $ 1,096 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | NOTE 4 - EARNINGS PER SHARE Earnings per share are based on the weighted average number of shares outstanding during the period. A computation of basic earnings per share and diluted earnings per share follows: Three Months Ended Six Months Ended (Dollars in thousands, except per share data) June 30, June 30, 2018 2017 2018 2017 Basic Earnings Per Share Net income available to common shareholders $ 1,833 $ 1,635 $ 3,491 $ 3,081 Weighted average common shares outstanding 3,613,398 3,622,290 3,614,197 3,618,729 Basic earnings per share $ 0.51 $ 0.45 $ 0.97 $ 0.85 Diluted Earnings Per Share Net income available to common shareholders $ 1,833 $ 1,635 $ 3,491 $ 3,081 Weighted average common shares outstanding 3,613,398 3,622,290 3,614,197 3,618,729 Plus dilutive stock options and restricted stock units 12,550 4,049 10,463 3,482 Weighted average common shares outstanding and potentially dilutive shares 3,625,948 3,626,339 3,624,660 3,622,211 Diluted earnings per share $ 0.50 $ 0.45 $ 0.96 $ 0.85 There were no stock options that were considered to be anti-dilutive to earnings per share for the three months ended June 30, 2018. There were 15,000 options that were considered to be anti-dilutive to earnings per share for the six months ended June 30, 2018 and were excluded from the calculation above. There were 31,500 stock options that were considered to be anti-dilutive for the three months ended June 30, 2017 and there were 47,250 stock options that were considered to be anti-dilutive for the six months ended June 30, 2017. These stock options have been excluded from the calculation of diluted earnings above. All per share amounts have been adjusted for the 5% stock dividend issued on May 31, 2018 and the 5% stock dividend issued on May 31, 2017, where applicable. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2018 | |
Investments, All Other Investments [Abstract] | |
FINANCIAL INSTRUMENTS | NOTE 5 – FINANCIAL INSTRUMENTS Financial instruments as of the dates indicated were as follows: Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable (Dollars in thousands) Carrying Estimated Assets Inputs Inputs Amount Fair Value (Level 1) (Level 2) (Level 3) June 30, 2018 Assets: Cash and due from banks $ 11,877 $ 11,877 $ 11,877 $ — $ — Equity securities at fair value 3,338 3,338 1,838 — 1,500 Securities available for sale 161,687 161,687 — 150,348 11,339 Federal Home Loan Bank and Federal Reserve Bank stock 3,567 3,567 — 3,567 — Loans held for sale 617 647 — 647 — Loans to other financial institutions 9,006 9,006 — 9,006 — Loans, net 391,239 390,988 — — 390,988 Accrued interest receivable 2,220 2,220 — 2,220 — Liabilities: Noninterest-bearing deposits 147,040 147,040 — 147,040 — Interest-bearing deposits 380,881 379,501 — 379,501 — Federal funds purchased 4,000 4,000 — 4,000 — Federal Home Loan Bank advances 20,251 20,259 — 20,259 — Accrued interest payable 98 98 — 98 — December 31, 2017 Assets: Cash and due from banks $ 36,837 $ 36,837 $ 36,837 $ — $ — Securities available for sale 155,591 155,591 1,892 140,301 13,398 Federal Home Loan Bank and Federal Reserve Bank stock 3,567 3,567 — 3,567 — Loans held for sale 1,721 1,773 — 1,773 — Loans to other financial institutions 6,802 6,802 6,802 Loans, net 394,208 394,819 — — 394,819 Accrued interest receivable 2,146 2,146 — 2,146 — Liabilities: Noninterest-bearing deposits 151,462 151,462 — 151,462 — Interest-bearing deposits 388,391 387,343 — 387,343 — Repurchase agreements 7,148 7,148 — 7,148 — Federal Home Loan Bank advances 20,268 20,271 — 20,271 — Accrued interest payable 49 49 — 49 — |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 6 – FAIR VALUE MEASUREMENTS The following tables present information about assets and liabilities measured at fair value on a recurring basis and the valuation techniques used to determine those fair values. In general, fair values determined by Level 1 inputs use quoted prices in active markets for identical assets or liabilities that the Bank has the ability to access. Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset or liability. In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Bank’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each asset or liability. There were no liabilities measured at fair value as of June 30, 2018 or December 31, 2017. Disclosures concerning assets measured at fair value are as follows: Assets Measured at Fair Value on a Recurring Basis Quoted Prices Significant in Active Other Significant Markets for Identical Observable Unobservable (Dollars in thousands) Assets Inputs Inputs Balance at (Level 1) (Level 2) (Level 3) Date Indicated Equity Securities Held at Fair Value - June 30, 2018 Equity securities $ 1,838 $ — $ 1,500 $ 3,338 Investment Securities, Available for Sale – June 30, 2018 U.S. Treasury notes and bonds $ — $ 1,919 $ — $ 1,919 U.S. Government and federal agency — 33,128 — 33,128 State and municipal — 92,266 11,339 103,605 Mortgage-backed — 17,912 — 17,912 Corporate — 5,067 — 5,067 Asset backed securities — 56 — 56 Total $ — $ 150,348 $ 11,339 $ 161,687 Investment Securities, Available for Sale - December 31, 2017 U.S. Treasury notes and bonds $ — $ 1,960 $ — $ 1,960 U.S. Government and federal agency — 35,126 — 35,126 State and municipal — 88,150 11,898 100,048 Mortgage-backed — 9,820 — 9,820 Corporate — 5,151 — 5,151 Equity securities 1,892 — 1,500 3,392 Asset backed securities — 94 — 94 Total $ 1,892 $ 140,301 $ 13,398 $ 155,591 Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis (Dollars in thousands) 2018 2017 Investment Securities Balance, January 1 $ 13,398 $ 15,103 Total realized and unrealized gains included in income — — Total unrealized gains (losses) included in other comprehensive income (246 ) 162 Net purchases, sales, calls, and maturities (313 ) (407 ) Net transfers into Level 3 — — Balance, June 30 $ 12,839 $ 14,858 Of the Level 3 assets that were held by the company as available for sale at June 30, 2018, the net unrealized gain as of June 30, 2018 was $84,000, which is recognized in accumulated other comprehensive income in the consolidated balance sheet. A total of $231,000 of Level 3 securities were purchased in the six months ended June 30, 2018. Both observable and unobservable inputs may be used to determine the fair value of positions classified as Level 3 investment securities and liabilities. As a result, the unrealized gains and losses for these assets and liabilities presented in the tables above may include changes in fair value that were attributable to both observable and unobservable inputs. Securities categorized as Level 3 assets primarily consist of bonds issued by local municipalities and equity securities of community banks. The company estimates the fair value of these bonds based on the present value of expected future cash flows using management’s best estimate of key assumptions, including forecasted interest yield and payment rates, credit quality and a discount rate commensurate with the current market and other risks involved. The company also has assets that under certain conditions are subject to measurement at fair value on a non-recurring basis. These assets are not normally measured at fair value, but can be subject to fair value adjustments in certain circumstances, such as impairment. Disclosures concerning assets measured at fair value on a non-recurring basis are as follows: Assets Measured at Fair Value on a Non-recurring Basis Quoted Prices Significant in Active Other Significant Markets for Identical Observable Unobservable (Dollars in thousands) Balance at Assets Inputs Inputs Dates Indicated (Level 1) (Level 2) (Level 3) Impaired Loans June 30, 2018 $ 4,278 $ — $ — $ 4,278 December 31, 2017 $ 4,140 $ — $ — $ 4,140 Other Real Estate June 30, 2018 $ 179 $ — $ — $ 179 December 31, 2017 $ 106 $ — $ — $ 106 Impaired loans categorized as Level 3 assets consist of non-homogeneous loans that are considered impaired. The company estimates the fair value of the loans based on the present value of expected future cash flows using management’s estimate of key assumptions. These assumptions include future payment ability, timing of payment streams, and estimated realizable values of available collateral (typically based on outside appraisals). The changes in fair value consisted of charge-downs of impaired loans that were posted to the allowance for loan losses and write-downs of other real estate that were posted to a valuation account. |
SUMMARY OF SIGNIFICANT ACCOUN17
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include ChoiceOne Financial Services, Inc. (“ChoiceOne”) and its wholly-owned subsidiary, ChoiceOne Bank (the “Bank”), and the Bank’s wholly-owned subsidiary, ChoiceOne Insurance Agencies, Inc. Intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information, prevailing practices within the banking industry and the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying consolidated financial statements reflect all adjustments ordinary in nature which are, in the opinion of management, necessary for a fair presentation of the Consolidated Balance Sheets as of June 30, 2018 and December 31, 2017, the Consolidated Statements of Income for the three- and six-month periods ended June 30, 2018 and June 30, 2017, the Consolidated Statements of Comprehensive Income for the three- and six-month periods ended June 30, 2018 and June 30, 2017, the Consolidated Statements of Changes in Shareholders' Equity for the six-month periods ended June 30, 2018 and June 30, 2017, and the Consolidated Statements of Cash Flows for the six-month periods ended June 30, 2018 and June 30, 2017. Operating results for the six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in ChoiceOne’s Annual Report on Form 10-K for the year ended December 31, 2017. |
Loans to Other Financial Institutions | Loans to Other Financial Institutions 44% of the total at June 30, 2018 Credit risk associated with the participating interest is measured as an allowance for loan losses when necessary. Losses are charged off against the allowance when incurred and recoveries of loan charge-offs are recorded when received. At least quarterly, the Bank reviews the portfolio of participating interests for potential losses including any participating interest that is outstanding over 90 days (even if the advance and participating interest is current). At June 30, 2018, there was one participating in loans to other financial institutions interest totaling $254,000 that was over 30 days. Since the inception of the program, there were no losses or charge-offs of participating interests. |
Allowance for Loan Losses | Allowance for Loan Losses The allowance for loan losses is maintained at a level believed adequate by management to absorb probable incurred losses inherent in the consolidated loan portfolio. Management’s evaluation of the adequacy of the allowance is an estimate based on reviews of individual loans, assessments of the impact of current economic conditions on the portfolio and historical loss experience of seasoned loan portfolios. See Note 3 to the interim consolidated financial statements for additional information. Management believes the accounting estimate related to the allowance for loan losses is a “critical accounting estimate” because (1) the estimate is highly susceptible to change from period to period because of assumptions concerning the changes in the types and volumes of the portfolios and economic conditions and (2) the impact of recognizing an impairment or loan loss could have a material effect on ChoiceOne’s assets reported on the balance sheets as well as its net income. |
Stock Transactions | Stock Transactions A total of 2,709 shares of common stock were issued to ChoiceOne’s Board of Directors for a cash price of $68,000 under the terms of the Directors’ Stock Purchase Plan in the first six months of 2018. A total of 1,824 shares for a cash price of $40,000 were issued under the Employee Stock Purchase Plan in the first half of 2018. A total of 809 shares were issued upon the exercise of stock options in the first six months of 2018. A total of 7,304 shares were issued to employees for Restricted Stock Units that vested during the first half of 2018. |
Stock-Based Compensation | Stock-Based Compensation Effective July 1, 2013, ChoiceOne began granting Restricted Stock Units to a select group of employees under the Stock Incentive Plan of 2012. All of the Restricted Stock Units are initially unvested and vest in three annual installments on each of the next three anniversaries of the grant date. Certain additional vesting provisions apply. Each unit, once vested, is settled by delivery of one share of ChoiceOne common stock. |
Reclassifications | Reclassifications Certain amounts presented in prior periods have been reclassified to conform to the current presentation. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) The FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities the fair value of loans has been estimated using an exit price notion in Note 5. The FASB issued ASU 2016-02, Leases The FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
SECURITIES (Tables)
SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of fair value of securities available for sale | The fair value of equity securities at fair value and the related gross unrealized gains recognized in other noninterest income were as follows: June 30, 2018 (Dollars in thousands) Amortized Gross Gross Fair Equity securities $ 3,002 $ 336 $ — $ 3,338 The fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows: June 30, 2018 Gross Gross (Dollars in thousands) Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. Government and federal agency $ 34,099 $ — $ (971 ) $ 33,128 U.S. Treasury 1,991 — (72 ) 1,919 State and municipal 104,958 378 (1,731 ) 103,605 Mortgage-backed 18,310 11 (409 ) 17,912 Corporate 5,146 — (79 ) 5,067 Asset-backed securities 56 — — 56 Total $ 164,560 $ 389 $ (3,262 ) $ 161,687 December 31, 2017 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value U.S. Government and federal agency $ 35,518 $ — $ (392 ) $ 35,126 U.S. Treasury 1,991 — (31 ) 1,960 State and municipal 99,609 910 (471 ) 100,048 Mortgage-backed 9,943 8 (131 ) 9,820 Corporate 5,184 2 (35 ) 5,151 Equity securities 3,083 309 — 3,392 Asset-backed securities 95 — (1 ) 94 Total $ 155,423 $ 1,229 $ (1,061 ) $ 155,591 |
Schedule of contractual maturities of available for sale securities | Presented below is a schedule of maturities of securities as of June 30, 2018, the fair value of securities as of June 30, 2018 and December 31, 2017, and the weighted average yields of securities as of June 30, 2018: Securities maturing within: Fair Value Fair Value Less than 1 Year - 5 Years - More than at June 30, at Dec. 31, (Dollars in thousands) 1 Year 5 Years 10 Years 10 Years 2018 2017 U.S. Government and federal agency $ 16,460 $ 9,888 $ 6,780 $ — $ 33,128 $ 35,126 U.S. Treasury notes and bonds — 1,919 — — 1,919 1,960 State and municipal 10,694 50,580 40,314 2,017 103,605 100,048 Corporate 1,992 2,587 488 — 5,067 5,151 Asset-backed securities 56 — — — 56 94 Total debt securities 29,202 64,974 47,582 2,017 143,775 142,379 Mortgage-backed securities — 11,656 6,256 — 17,912 9,820 Equity securities (1) — — 1,000 2,338 3,338 3,392 Total $ 29,202 $ 76,630 $ 54,838 $ 4,355 $ 165,025 $ 155,591 Weighted average yields: Less than 1 Year - 5 Years - More than 1 Year 5 Years 10 Years 10 Years Total U.S. Government and federal agency 2.19 % 1.78 % 2.67 % — % 2.17 % U.S. Treasury notes and bonds — 1.85 — — 1.85 State and municipal (2) 3.10 3.05 3.58 1.22 3.23 Corporate — 2.48 3.21 — 1.58 Asset-backed securities 2.59 — — — 2.59 Mortgage-backed securities — 2.92 3.01 — 2.95 Equity securities (1) — — 4.78 1.07 2.18 (1) Equity securities are preferred and common stock that may or may not have stated maturity. (2) The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental rate of 21%. |
Schedule of unrealized gains and losses on equity securities | Following is information regarding unrealized gains and losses on equity securities for the three- and six-month periods ending June 30, 2018: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Net gains and losses recognized during the period $ 26 $ 58 Less: Net gains and losses recognized during the period on securities sold — 9 Unrealized gains and losses recognized during the reporting period on securities still held at the reporting date $ 26 $ 49 |
LOANS AND ALLOWANCE FOR LOAN 19
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Receivables [Abstract] | |
Schedule of activity in the allowance for loan losses and balances in the loan portfolio | Activity in the allowance for loan losses and balances in the loan portfolio were as follows: Commercial (Dollars in thousands) and Commercial Construction Residential Agricultural Industrial Consumer Real Estate Real Estate Real Estate Unallocated Total Allowance for Loan Losses Three Months Ended June 30, 2018 Beginning balance $ 350 $ 1,005 $ 245 $ 1,786 $ 18 $ 625 $ 680 $ 4,709 Charge-offs — (57 ) (50 ) — — (9 ) — (116 ) Recoveries — — 15 3 — 48 — 66 Provision 9 22 (5 ) 122 (2 ) (44 ) (102 ) — Ending balance $ 359 $ 970 $ 205 $ 1,911 $ 16 $ 620 $ 578 $ 4,659 Six Months Ended June 30, 2018 Beginning balance $ 506 $ 1,001 $ 262 $ 1,761 $ 35 $ 726 $ 286 $ 4,577 Charge-offs — (58 ) (118 ) — — (13 ) — (188 ) Recoveries — 53 51 59 — 73 — 236 Provision (147 ) (26 ) 10 91 (19 ) (166 ) 292 35 Ending balance $ 359 $ 970 $ 205 $ 1,911 $ 16 $ 620 $ 578 $ 4,659 Individually evaluated for impairment $ — $ 76 $ 1 $ 28 $ — $ 221 $ — $ 326 Collectively evaluated for impairment $ 359 $ 894 $ 204 $ 1,883 $ 16 $ 399 $ 577 $ 4,333 Three Months Ended June 30, 2017 Beginning balance $ 406 $ 745 $ 286 $ 1,414 $ 23 $ 727 $ 724 $ 4,325 Charge-offs — (352 ) (57 ) — — — — (409 ) Recoveries — — 39 49 40 29 — 157 Provision (11 ) 511 26 88 (39 ) (7 ) (543 ) 25 Ending balance $ 395 $ 904 $ 294 $ 1,551 $ 24 $ 749 $ 181 $ 4,098 Six Months Ended Beginning balance $ 433 $ 688 $ 305 $ 1,438 $ 62 $ 1,014 $ 337 $ 4,277 Charge-offs — (362 ) (137 ) — — (34 ) — (533 ) Recoveries — — 91 161 40 37 — 329 Provision (38 ) 578 35 (48 ) (78 ) (268 ) (156 ) 25 Ending balance $ 395 $ 904 $ 294 $ 1,551 $ 24 $ 749 $ 181 $ 4,098 Individually evaluated for impairment $ — $ 27 $ 4 $ 65 $ — $ 271 $ — $ 367 Collectively evaluated for impairment $ 395 $ 877 $ 290 $ 1,486 $ 24 $ 478 $ 181 $ 3,731 Loans Individually evaluated for impairment $ 421 $ 292 $ 58 $ 815 $ — $ 2,692 $ 4,278 Collectively evaluated for impairment 38,951 96,746 24,122 135,394 3,682 92,725 391,620 Ending balance $ 39,372 $ 97,038 $ 24,180 $ 136,209 $ 3,682 $ 95,417 $ 395,898 December 31, 2017 Individually evaluated for impairment $ 423 $ 124 $ 36 $ 778 $ — $ 2,779 $ 4,140 Collectively evaluated for impairment 48,041 104,262 24,477 122,709 6,613 88,543 394,645 Ending balance $ 48,464 $ 104,386 $ 24,513 $ 123,487 $ 6,613 $ 91,322 $ 398,785 |
Schedule of the bank's credit exposure | Information regarding the Bank’s credit exposure is as follows: Corporate Credit Exposure - Credit Risk Profile By Creditworthiness Category Agricultural Commercial and Industrial Commercial Real Estate (Dollars in thousands) June 30, December 31, June 30, December 31, June 30, December 31, 2018 2017 2018 2017 2018 2017 Risk ratings 1 and 2 $ 11,449 $ 14,813 $ 12,253 $ 13,491 $ 8,392 $ 8,227 Risk rating 3 17,983 22,721 60,172 63,366 91,126 78,868 Risk rating 4 9,108 10,199 23,292 26,943 33,074 33,429 Risk rating 5 411 308 1,188 491 2,269 1,533 Risk rating 6 421 423 133 95 1,348 1,430 $ 39,372 $ 48,464 $ 97,038 $ 104,386 $ 136,209 $ 123,487 Corporate Credit Exposure - Credit Risk Profile Based On Payment Activity Consumer Construction Real Estate Residential Real Estate (Dollars in thousands) June 30, December 31, June 30, December 31, June 30, December 31, 2018 2017 2018 2017 2018 2017 Performing $ 24,180 $ 24,497 $ 3,682 $ 6,613 $ 94,875 $ 90,629 Nonperforming — 1 — — — 257 Nonaccrual — 15 — — 542 436 $ 24,180 $ 24,513 $ 3,682 $ 6,613 $ 95,417 $ 91,322 |
Schedule of information on TDRs | The following schedule provides information on loans that were considered troubled debt restructurings (“TDRs”) that were modified during the three and six months periods ended June 30, 2018. There were no loans that were considered TDRs that were modified during the three and six months periods ended June 30, 2017: Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Pre- Post- Pre- Post- Modification Modification Modification Modification Outstanding Outstanding Outstanding Outstanding (Dollars in thousands) Number of Recorded Recorded Number of Recorded Recorded Loans Investment Investment Loans Investment Investment Commercial and industrial — $ — $ — 1 $ 39 $ 39 The following schedule provides information on TDRs as of June 30, 2018 where the borrower was past due with respect to principal and/or interest for 30 days or more during the three month and six months ended June 30, 2018 that had been modified during the year prior to the default: Three Months Ended Six Months Ended (Dollars in thousands) Number Recorded Number Recorded of Loans Investment of Loans Investment Commercial and industrial 1 $ 39 1 $ 39 The following schedule provides information on TDRs as of June 30, 2017 where the borrower was past due with respect to principal and/or interest for 30 days or more during the three month and six months ended June 30, 2017 that had been modified during the year prior to the default: Three Months Ended Six Months Ended (Dollars in thousands) Number Recorded Number Recorded of Loans Investment of Loans Investment Commercial real estate — $ — 1 $ 128 |
Schedule of impaired loans | Impaired loans by loan category follow: Unpaid (Dollars in thousands) Recorded Principal Related Investment Balance Allowance June 30, 2018 With no related allowance recorded Agricultural $ 421 $ 455 $ — Commercial and industrial 61 61 — Consumer — — — Commercial real estate 53 55 — Residential real estate 110 122 — Subtotal 645 693 — With an allowance recorded Agricultural — — — Commercial and industrial 231 266 76 Consumer 58 59 1 Commercial real estate 762 849 28 Residential real estate 2,582 2,616 221 Subtotal 3,633 3,790 326 Total Agricultural 421 455 — Commercial and industrial 292 327 76 Consumer 58 59 1 Commercial real estate 815 904 28 Residential real estate 2,692 2,738 221 Total $ 4,278 $ 4,483 $ 326 December 31, 2017 With no related allowance recorded Agricultural $ 423 $ 455 $ — Commercial and industrial — — — Consumer — — — Commercial real estate 127 258 — Residential real estate 115 126 — Subtotal 665 839 — With an allowance recorded Agricultural — — — Commercial and industrial 124 124 26 Consumer 36 36 3 Commercial real estate 651 734 49 Residential real estate 2,664 2,690 224 Subtotal 3,475 3,584 302 Total Agricultural 423 455 — Commercial and industrial 124 124 26 Consumer 36 36 3 Commercial real estate 778 992 49 Residential real estate 2,779 2,816 224 Total $ 4,140 $ 4,423 $ 302 |
Schedule of average balances of impaired loans and interest recognized on impaired loans | The following schedule provides information regarding average balances of impaired loans and interest recognized on impaired loans for the six months ended June 30, 2018 and 2017: Average Interest (Dollars in thousands) Recorded Income Investment Recognized June 30, 2018 With no related allowance recorded Agricultural $ 423 $ — Commercial and industrial 20 2 Consumer 3 — Commercial real estate 79 — Residential real estate 137 1 Subtotal 662 3 With an allowance recorded Agricultural — — Commercial and industrial 215 8 Consumer 43 1 Commercial real estate 733 22 Residential real estate 2,633 63 Subtotal 3,624 94 Agricultural 423 — Commercial and industrial 235 10 Consumer 46 1 Commercial real estate 812 22 Residential real estate 2,770 64 Total $ 4,286 $ 97 June 30, 2017 With no related allowance recorded Agricultural $ 308 $ — Commercial and industrial 186 — Consumer — — Commercial real estate 181 — Residential real estate 158 2 Subtotal 833 2 With an allowance recorded Agricultural 175 — Commercial and industrial 182 1 Consumer 31 1 Commercial real estate 853 17 Residential real estate 2,590 56 Subtotal 3,831 75 Agricultural 483 — Commercial and industrial 368 1 Consumer 31 1 Commercial real estate 1,034 17 Residential real estate 2,748 58 Total $ 4,664 $ 77 |
Schedule of aging analysis of loans by loan category | An aging analysis of loans by loan category follows: Greater 90 Days Past (Dollars in thousands) 30 to 59 60 to 89 Than 90 Loans Not Due and Days Days Days (1) Total Past Due Total Loans Accruing June 30, 2018 Agricultural $ — $ — $ 421 $ 421 $ 38,951 $ 39,372 $ — Commercial and industrial — — 39 39 96,999 97,038 — Consumer 93 — — 93 24,087 24,180 — Commercial real estate 84 79 — 163 136,046 136,209 — Construction real estate 268 — — 268 3,414 3,682 — Residential real estate 694 475 66 1,235 94,182 95,417 — $ 1,139 $ 554 $ 526 $ 2,219 $ 393,679 $ 395,898 $ — December 31, 2017 Agricultural $ — $ — $ 83 $ 83 $ 48,381 $ 48,464 $ — Commercial and industrial 20 — — 20 104,366 104,386 — Consumer 142 38 1 181 24,332 24,513 — Commercial real estate 95 58 69 222 123,265 123,487 — Construction real estate — — — — 6,613 6,613 — Residential real estate 585 272 296 1,153 90,169 91,322 258 $ 842 $ 368 $ 449 $ 1,659 $ 397,126 $ 398,785 $ 258 (1) Includes nonaccrual loans. |
Schedule of nonaccrual loans by loan category | Nonaccrual loans by loan category follow: (Dollars in thousands) June 30, December 31, 2018 2017 Agricultural $ 421 $ 423 Commercial and industrial 39 — Consumer — 15 Commercial real estate 138 222 Construction real estate — — Residential real estate 542 436 $ 1,140 $ 1,096 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted earnings per share | NOTE 4 - EARNINGS PER SHARE Earnings per share are based on the weighted average number of shares outstanding during the period. A computation of basic earnings per share and diluted earnings per share follows: Three Months Ended Six Months Ended (Dollars in thousands, except per share data) June 30, June 30, 2018 2017 2018 2017 Basic Earnings Per Share Net income available to common shareholders $ 1,833 $ 1,635 $ 3,491 $ 3,081 Weighted average common shares outstanding 3,613,398 3,622,290 3,614,197 3,618,729 Basic earnings per share $ 0.51 $ 0.45 $ 0.97 $ 0.85 Diluted Earnings Per Share Net income available to common shareholders $ 1,833 $ 1,635 $ 3,491 $ 3,081 Weighted average common shares outstanding 3,613,398 3,622,290 3,614,197 3,618,729 Plus dilutive stock options and restricted stock units 12,550 4,049 10,463 3,482 Weighted average common shares outstanding and potentially dilutive shares 3,625,948 3,626,339 3,624,660 3,622,211 Diluted earnings per share $ 0.50 $ 0.45 $ 0.96 $ 0.85 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investments, All Other Investments [Abstract] | |
Schedule of carrying value and fair value of financial assets and liabilities | Financial instruments as of the dates indicated were as follows: Quoted Prices in Active Significant Markets for Other Significant Identical Observable Unobservable (Dollars in thousands) Carrying Estimated Assets Inputs Inputs Amount Fair Value (Level 1) (Level 2) (Level 3) June 30, 2018 Assets: Cash and due from banks $ 11,877 $ 11,877 $ 11,877 $ — $ — Equity securities at fair value 3,338 3,338 1,838 — 1,500 Securities available for sale 161,687 161,687 — 150,348 11,339 Federal Home Loan Bank and Federal Reserve Bank stock 3,567 3,567 — 3,567 — Loans held for sale 617 647 — 647 — Loans to other financial institutions 9,006 9,006 — 9,006 — Loans, net 391,239 390,988 — — 390,988 Accrued interest receivable 2,220 2,220 — 2,220 — Liabilities: Noninterest-bearing deposits 147,040 147,040 — 147,040 — Interest-bearing deposits 380,881 379,501 — 379,501 — Federal funds purchased 4,000 4,000 — 4,000 — Federal Home Loan Bank advances 20,251 20,259 — 20,259 — Accrued interest payable 98 98 — 98 — December 31, 2017 Assets: Cash and due from banks $ 36,837 $ 36,837 $ 36,837 $ — $ — Securities available for sale 155,591 155,591 1,892 140,301 13,398 Federal Home Loan Bank and Federal Reserve Bank stock 3,567 3,567 — 3,567 — Loans held for sale 1,721 1,773 — 1,773 — Loans to other financial institutions 6,802 6,802 6,802 Loans, net 394,208 394,819 — — 394,819 Accrued interest receivable 2,146 2,146 — 2,146 — Liabilities: Noninterest-bearing deposits 151,462 151,462 — 151,462 — Interest-bearing deposits 388,391 387,343 — 387,343 — Repurchase agreements 7,148 7,148 — 7,148 — Federal Home Loan Bank advances 20,268 20,271 — 20,271 — Accrued interest payable 49 49 — 49 — |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets measured at fair value on a recurring basis | There were no liabilities measured at fair value as of June 30, 2018 or December 31, 2017. Disclosures concerning assets measured at fair value are as follows: Assets Measured at Fair Value on a Recurring Basis Quoted Prices Significant in Active Other Significant Markets for Identical Observable Unobservable (Dollars in thousands) Assets Inputs Inputs Balance at (Level 1) (Level 2) (Level 3) Date Indicated Equity Securities Held at Fair Value - June 30, 2018 Equity securities $ 1,838 $ — $ 1,500 $ 3,338 Investment Securities, Available for Sale – June 30, 2018 U.S. Treasury notes and bonds $ — $ 1,919 $ — $ 1,919 U.S. Government and federal agency — 33,128 — 33,128 State and municipal — 92,266 11,339 103,605 Mortgage-backed — 17,912 — 17,912 Corporate — 5,067 — 5,067 Asset backed securities — 56 — 56 Total $ — $ 150,348 $ 11,339 $ 161,687 Investment Securities, Available for Sale - December 31, 2017 U.S. Treasury notes and bonds $ — $ 1,960 $ — $ 1,960 U.S. Government and federal agency — 35,126 — 35,126 State and municipal — 88,150 11,898 100,048 Mortgage-backed — 9,820 — 9,820 Corporate — 5,151 — 5,151 Equity securities 1,892 — 1,500 3,392 Asset backed securities — 94 — 94 Total $ 1,892 $ 140,301 $ 13,398 $ 155,591 |
Schedule of changes in Level 3 assets measured at fair value on a recurring basis | Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis (Dollars in thousands) 2018 2017 Investment Securities Balance, January 1 $ 13,398 $ 15,103 Total realized and unrealized gains included in income — — Total unrealized gains (losses) included in other comprehensive income (246 ) 162 Net purchases, sales, calls, and maturities (313 ) (407 ) Net transfers into Level 3 — — Balance, June 30 $ 12,839 $ 14,858 |
Schedule of assets measured at fair value on a nonrecurring basis | Disclosures concerning assets measured at fair value on a non-recurring basis are as follows: Assets Measured at Fair Value on a Non-recurring Basis Quoted Prices Significant in Active Other Significant Markets for Identical Observable Unobservable (Dollars in thousands) Balance at Assets Inputs Inputs Dates Indicated (Level 1) (Level 2) (Level 3) Impaired Loans June 30, 2018 $ 4,278 $ — $ — $ 4,278 December 31, 2017 $ 4,140 $ — $ — $ 4,140 Other Real Estate June 30, 2018 $ 179 $ — $ — $ 179 December 31, 2017 $ 106 $ — $ — $ 106 |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($)shares | |
Directors' Stock Purchase Plan [Member] | |
Property, Plant and Equipment [Line Items] | |
Shares issued during the period, shares | 2,709 |
Shares issued during the period, value | $ | $ 68,000 |
EmployeeStockOptionMember | |
Property, Plant and Equipment [Line Items] | |
Shares issued upon exercise of options | 1,824 |
Shares issued during period under Employee Stock Purchase Plan, value | $ | $ 40,000 |
Restricted Stock [Member] | |
Property, Plant and Equipment [Line Items] | |
Shares issued during the period upon vesting | 7,304 |
Vesting period | 3 years |
SECURITIES (Details)
SECURITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | |
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | $ 164,560 | $ 155,423 | |
Gross Unrealized Gains | 389 | 1,229 | |
Gross Unrealized Losses | (2,876) | (1,061) | |
Fair Value | 161,687 | 155,591 | |
U.S. Government and Federal Agency [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 34,099 | 35,518 | |
Gross Unrealized Losses | (971) | (392) | |
Fair Value | 33,128 | 35,126 | |
U.S. Treasury Notes and Bonds [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 1,991 | 1,991 | |
Gross Unrealized Losses | (72) | (31) | |
Fair Value | 1,919 | 1,960 | |
State and Municipal [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 104,958 | 99,609 | |
Gross Unrealized Gains | 378 | 910 | |
Gross Unrealized Losses | (1,731) | (471) | |
Fair Value | 103,605 | 100,048 | |
Mortgage-backed [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 18,310 | 9,943 | |
Gross Unrealized Gains | 11 | 8 | |
Gross Unrealized Losses | (409) | (131) | |
Fair Value | 17,912 | 9,820 | |
Corporate [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 5,146 | 5,184 | |
Gross Unrealized Gains | 2 | ||
Gross Unrealized Losses | (79) | (35) | |
Fair Value | 5,067 | 5,151 | |
Equity Securities [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 3,002 | 3,083 | |
Gross Unrealized Gains | 336 | 309 | |
Fair Value | [1] | 3,338 | 3,392 |
Asset-backed Securities [Member] | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 56 | 95 | |
Gross Unrealized Losses | (1) | ||
Fair Value | $ 56 | $ 94 | |
[1] | The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental tax rate of 21% |
SECURITIES (Details 1)
SECURITIES (Details 1) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | |
Available for Sale Securities, Fair Values | |||
Less than 1 Year | $ 29,202 | ||
1 Year - 5 Years | 76,630 | ||
5 Years - 10 Years | 54,838 | ||
More than 10 Years | 4,355 | ||
Securities available for sale | 161,687 | $ 155,591 | |
U.S. Government and Federal Agency [Member] | |||
Available for Sale Securities, Fair Values | |||
Less than 1 Year | 16,460 | ||
1 Year - 5 Years | 9,888 | ||
5 Years - 10 Years | 6,780 | ||
Securities available for sale | $ 33,128 | 35,126 | |
Weighted average yields | |||
Less than 1 year | 2.19% | ||
1 year to 5 years | 1.78% | ||
5 years to 10 years | 2.67% | ||
Total | 2.17% | ||
U.S. Treasury Notes and Bonds [Member] | |||
Available for Sale Securities, Fair Values | |||
1 Year - 5 Years | $ 1,919 | ||
Securities available for sale | $ 1,919 | 1,960 | |
Weighted average yields | |||
1 year to 5 years | 1.85% | ||
Total | 1.85% | ||
State and Municipal [Member] | |||
Available for Sale Securities, Fair Values | |||
Less than 1 Year | $ 10,694 | ||
1 Year - 5 Years | 50,580 | ||
5 Years - 10 Years | 40,314 | ||
More than 10 Years | 2,017 | ||
Securities available for sale | $ 103,605 | 100,048 | |
Weighted average yields | |||
Less than 1 year | [1],[2] | 3.10% | |
1 year to 5 years | [1],[2] | 3.05% | |
5 years to 10 years | [1],[2] | 3.58% | |
More than 10 years | [1],[2] | 1.22% | |
Total | [1],[2] | 3.23% | |
Corporate [Member] | |||
Available for Sale Securities, Fair Values | |||
Less than 1 Year | $ 1,992 | ||
1 Year - 5 Years | 2,587 | ||
5 Years - 10 Years | 488 | ||
Securities available for sale | $ 5,067 | 5,151 | |
Weighted average yields | |||
1 year to 5 years | 2.48% | ||
5 years to 10 years | 3.21% | ||
Total | 1.58% | ||
Asset-backed Securities [Member] | |||
Available for Sale Securities, Fair Values | |||
Less than 1 Year | $ 56 | ||
Securities available for sale | $ 56 | 94 | |
Weighted average yields | |||
Less than 1 year | 2.59% | ||
Total | 2.59% | ||
Total Debt Securities [Member] | |||
Available for Sale Securities, Fair Values | |||
Less than 1 Year | $ 29,202 | ||
1 Year - 5 Years | 64,974 | ||
5 Years - 10 Years | 47,582 | ||
More than 10 Years | 2,017 | ||
Securities available for sale | 143,775 | 142,379 | |
Mortgage-backed [Member] | |||
Available for Sale Securities, Fair Values | |||
1 Year - 5 Years | 11,656 | ||
5 Years - 10 Years | 6,256 | ||
Securities available for sale | $ 17,912 | 9,820 | |
Weighted average yields | |||
1 year to 5 years | 2.92% | ||
5 years to 10 years | 3.01% | ||
Total | 2.95% | ||
Equity Securities [Member] | |||
Available for Sale Securities, Fair Values | |||
5 Years - 10 Years | [2] | $ 1,000 | |
More than 10 Years | [2] | 2,338 | |
Securities available for sale | [2] | $ 3,338 | $ 3,392 |
Weighted average yields | |||
5 years to 10 years | [1] | 4.78% | |
More than 10 years | [1] | 1.07% | |
Total | [1] | 2.18% | |
[1] | Equity securities are preferred and common stock that may or may not have a stated maturity. | ||
[2] | The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental tax rate of 21% |
SECURITIES (Details 2)
SECURITIES (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018 | Jun. 30, 2018 | |
Securities | ||
Net gains and losses recognized during the period | $ 26 | $ 58 |
Less: Net gains and losses recognized during the period on securities sold | 9 | |
Unrealized gains and losses recognized during the reporting period on securities still held at the reporting date | $ 26 | $ 49 |
LOANS AND ALLOWANCE FOR LOAN 27
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Allowance for Loan Losses | |||||
Beginning balance | $ 4,709 | $ 4,577 | $ 4,277 | ||
Charge-offs | (116) | (188) | (533) | ||
Recoveries | 66 | 236 | 329 | ||
Provision | 35 | 25 | |||
Ending balance | 4,659 | $ 4,098 | 4,659 | 4,098 | |
Individually evaluated for impairment | 326 | 367 | 326 | 367 | |
Collectively evaluated for impairment | 4,333 | 3,731 | 4,333 | 3,731 | |
Loans | |||||
Individually evaluated for impairment | 4,278 | 4,278 | $ 4,140 | ||
Collectively evaluated for impairment | 391,620 | 391,620 | 394,645 | ||
Loans | 395,898 | 395,898 | 398,785 | ||
Agricultural [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 350 | 406 | 506 | 433 | |
Charge-offs | |||||
Recoveries | |||||
Provision | 9 | (11) | (147) | (38) | |
Ending balance | 359 | 395 | 359 | 395 | |
Individually evaluated for impairment | |||||
Collectively evaluated for impairment | 359 | 395 | 359 | 395 | |
Loans | |||||
Individually evaluated for impairment | 421 | 421 | 423 | ||
Collectively evaluated for impairment | 38,951 | 38,951 | 48,041 | ||
Loans | 39,372 | 39,372 | 48,464 | ||
Commercial and Industrial [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 1,005 | 745 | 1,001 | 688 | |
Charge-offs | (57) | (352) | (58) | (362) | |
Recoveries | 53 | ||||
Provision | 22 | 511 | (26) | 578 | |
Ending balance | 970 | 904 | 970 | 904 | |
Individually evaluated for impairment | 76 | 27 | 76 | 27 | |
Collectively evaluated for impairment | 894 | 877 | 894 | 877 | |
Loans | |||||
Individually evaluated for impairment | 292 | 292 | 124 | ||
Collectively evaluated for impairment | 96,746 | 96,746 | 104,262 | ||
Loans | 97,038 | 97,038 | 104,386 | ||
Consumer [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 245 | 286 | 262 | 305 | |
Charge-offs | (50) | (57) | (118) | (137) | |
Recoveries | 15 | 39 | 51 | 91 | |
Provision | (5) | 26 | 10 | 35 | |
Ending balance | 205 | 294 | 205 | 294 | |
Individually evaluated for impairment | 1 | 4 | 1 | 4 | |
Collectively evaluated for impairment | 204 | 290 | 204 | 290 | |
Loans | |||||
Individually evaluated for impairment | 58 | 58 | 36 | ||
Collectively evaluated for impairment | 24,122 | 24,122 | 24,477 | ||
Loans | 24,180 | 24,180 | 24,513 | ||
Commercial Real Estate [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 1,786 | 1,414 | 1,761 | 1,438 | |
Charge-offs | |||||
Recoveries | 3 | 49 | 59 | 161 | |
Provision | 122 | 88 | 91 | (48) | |
Ending balance | 1,911 | 1,551 | 1,911 | 1,551 | |
Individually evaluated for impairment | 28 | 65 | 28 | 65 | |
Collectively evaluated for impairment | 1,883 | 1,486 | 1,883 | 1,486 | |
Loans | |||||
Individually evaluated for impairment | 815 | 815 | 778 | ||
Collectively evaluated for impairment | 135,394 | 135,394 | 122,709 | ||
Loans | 136,209 | 136,209 | 123,487 | ||
Construction Real Estate [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 18 | 23 | 35 | 62 | |
Charge-offs | |||||
Recoveries | 40 | ||||
Provision | (2) | (39) | (19) | 40 | |
Ending balance | 16 | (78) | 16 | (78) | |
Individually evaluated for impairment | |||||
Collectively evaluated for impairment | 16 | 24 | 16 | 24 | |
Loans | |||||
Collectively evaluated for impairment | 3,682 | 3,682 | 6,613 | ||
Loans | 3,682 | 3,682 | 6,613 | ||
Residential Real Estate [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 625 | 727 | 726 | 1,014 | |
Charge-offs | (9) | (13) | (34) | ||
Recoveries | 48 | 29 | 73 | 37 | |
Provision | (44) | (7) | (166) | (268) | |
Ending balance | 620 | 749 | 620 | 749 | |
Individually evaluated for impairment | 221 | 271 | 221 | 271 | |
Collectively evaluated for impairment | 399 | 478 | 399 | 478 | |
Loans | |||||
Individually evaluated for impairment | 2,692 | 2,692 | 2,779 | ||
Collectively evaluated for impairment | 92,725 | 92,725 | 88,543 | ||
Loans | 95,417 | 95,417 | $ 91,322 | ||
Unallocated [Member] | |||||
Allowance for Loan Losses | |||||
Beginning balance | 680 | 724 | 286 | 337 | |
Charge-offs | |||||
Recoveries | |||||
Provision | (102) | (543) | 292 | (156) | |
Ending balance | 578 | 181 | 578 | 181 | |
Individually evaluated for impairment | |||||
Collectively evaluated for impairment | $ 577 | $ 181 | $ 577 | $ 181 |
LOANS AND ALLOWANCE FOR LOAN 28
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 1) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | $ 395,898 | $ 398,785 |
Agricultural [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 39,372 | 48,464 |
Agricultural [Member] | Risk ratings 1 and 2 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 11,449 | 14,813 |
Agricultural [Member] | Risk rating 3 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 17,983 | 22,721 |
Agricultural [Member] | Risk rating 4 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 9,108 | 10,199 |
Agricultural [Member] | Risk rating 5 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 411 | 308 |
Agricultural [Member] | Risk rating 6 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 421 | 423 |
Commercial and Industrial [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 97,038 | 104,386 |
Commercial and Industrial [Member] | Risk ratings 1 and 2 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 12,253 | 13,491 |
Commercial and Industrial [Member] | Risk rating 3 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 60,172 | 63,366 |
Commercial and Industrial [Member] | Risk rating 4 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 23,292 | 26,943 |
Commercial and Industrial [Member] | Risk rating 5 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 1,188 | 491 |
Commercial and Industrial [Member] | Risk rating 6 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 133 | 95 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 136,209 | 123,487 |
Commercial Real Estate [Member] | Risk ratings 1 and 2 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 8,392 | 8,227 |
Commercial Real Estate [Member] | Risk rating 3 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 91,126 | 78,868 |
Commercial Real Estate [Member] | Risk rating 4 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 33,074 | 33,429 |
Commercial Real Estate [Member] | Risk rating 5 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 2,269 | 1,533 |
Commercial Real Estate [Member] | Risk rating 6 [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | $ 1,348 | $ 1,430 |
LOANS AND ALLOWANCE FOR LOAN 29
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | $ 395,898 | $ 398,785 |
Nonaccrual past due loans | 1,140 | 1,096 |
Consumer [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 24,180 | 24,513 |
Nonaccrual past due loans | 15 | |
Consumer [Member] | Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 24,180 | 24,497 |
Consumer [Member] | Nonperforming [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 1 | |
Construction Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 3,682 | 6,613 |
Construction Real Estate [Member] | Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 3,682 | 6,613 |
Residential Real Estate [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | 95,417 | 91,322 |
Nonaccrual past due loans | 542 | 436 |
Residential Real Estate [Member] | Performing [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | $ 94,875 | 90,629 |
Residential Real Estate [Member] | Nonperforming [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Risk rated loans | $ 257 |
LOANS AND ALLOWANCE FOR LOAN 30
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)N | |
Commercial and Industrial [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Number of Loans | N | 1 | ||
Pre-Modification Outstanding Recorded Investment | $ 39 | ||
Post Modification Oustanding Recorded Investment | 39 | ||
Recorded Investment with payment defaults during period | $ 39 | $ 39 | |
Commercial Real Estate [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Number of Loans | N | 1 | ||
Recorded Investment with payment defaults during period | $ 128 |
LOANS AND ALLOWANCE FOR LOAN 31
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Impaired and Restructured Loans with or without related allowance recorded | |||
Recorded Investment with no related allowance recorded | $ 645 | $ 665 | |
Unpaid Principal Balance with no related allowance recorded | 693 | 839 | |
Average Recorded Investment with no related allowance recorded | 662 | $ 833 | |
Interest Income Recognized with no related allowance recorded | 1 | 2 | |
Recorded Investment with an allowance recorded | 3,633 | 3,475 | |
Unpaid Principal Balance with an allowance recorded | 3,790 | 3,584 | |
Related Allowance | 326 | 302 | |
Average Recorded Investment with an allowance recorded | 3,624 | 3,831 | |
Interest Income Recognized with an allowance recorded | 94 | 75 | |
Recorded Investment | 4,278 | 4,140 | |
Unpaid Principal Balance | 4,483 | 4,423 | |
Related Allowance | 326 | 302 | |
Average Recorded Investment | 4,286 | 4,664 | |
Interest Income Recognized | 97 | 77 | |
Agricultural [Member] | |||
Impaired and Restructured Loans with or without related allowance recorded | |||
Recorded Investment with no related allowance recorded | 421 | 423 | |
Unpaid Principal Balance with no related allowance recorded | 455 | 455 | |
Average Recorded Investment with no related allowance recorded | 423 | 308 | |
Interest Income Recognized with no related allowance recorded | 3 | ||
Average Recorded Investment with an allowance recorded | 175 | ||
Recorded Investment | 421 | 423 | |
Unpaid Principal Balance | 455 | 455 | |
Average Recorded Investment | 423 | 483 | |
Commercial and Industrial [Member] | |||
Impaired and Restructured Loans with or without related allowance recorded | |||
Recorded Investment with no related allowance recorded | 61 | ||
Unpaid Principal Balance with no related allowance recorded | 61 | ||
Average Recorded Investment with no related allowance recorded | 20 | 186 | |
Interest Income Recognized with no related allowance recorded | 1 | ||
Recorded Investment with an allowance recorded | 231 | 124 | |
Unpaid Principal Balance with an allowance recorded | 266 | 124 | |
Related Allowance | 76 | 26 | |
Average Recorded Investment with an allowance recorded | 215 | 182 | |
Interest Income Recognized with an allowance recorded | 8 | 1 | |
Recorded Investment | 294 | 124 | |
Unpaid Principal Balance | 327 | 124 | |
Related Allowance | 76 | 26 | |
Average Recorded Investment | 235 | 368 | |
Interest Income Recognized | 10 | 1 | |
Consumer [Member] | |||
Impaired and Restructured Loans with or without related allowance recorded | |||
Average Recorded Investment with no related allowance recorded | 3 | ||
Interest Income Recognized with no related allowance recorded | 2 | ||
Recorded Investment with an allowance recorded | 58 | 36 | |
Unpaid Principal Balance with an allowance recorded | 59 | 36 | |
Related Allowance | 1 | 3 | |
Average Recorded Investment with an allowance recorded | 43 | 31 | |
Interest Income Recognized with an allowance recorded | 1 | 1 | |
Recorded Investment | 58 | 36 | |
Unpaid Principal Balance | 59 | 36 | |
Related Allowance | 1 | 3 | |
Average Recorded Investment | 46 | 31 | |
Interest Income Recognized | 1 | 1 | |
Commercial Real Estate [Member] | |||
Impaired and Restructured Loans with or without related allowance recorded | |||
Recorded Investment with no related allowance recorded | 53 | 127 | |
Unpaid Principal Balance with no related allowance recorded | 55 | 258 | |
Average Recorded Investment with no related allowance recorded | 79 | 181 | |
Recorded Investment with an allowance recorded | 762 | 651 | |
Unpaid Principal Balance with an allowance recorded | 849 | 734 | |
Related Allowance | 28 | 49 | |
Average Recorded Investment with an allowance recorded | 733 | 853 | |
Interest Income Recognized with an allowance recorded | 22 | 17 | |
Recorded Investment | 815 | 778 | |
Unpaid Principal Balance | 904 | 992 | |
Related Allowance | 28 | 49 | |
Average Recorded Investment | 812 | 1,034 | |
Interest Income Recognized | 22 | 17 | |
Residential Real Estate [Member] | |||
Impaired and Restructured Loans with or without related allowance recorded | |||
Recorded Investment with no related allowance recorded | 110 | 115 | |
Unpaid Principal Balance with no related allowance recorded | 122 | 126 | |
Average Recorded Investment with no related allowance recorded | 137 | 158 | |
Interest Income Recognized with no related allowance recorded | 2 | ||
Recorded Investment with an allowance recorded | 2,582 | 2,664 | |
Unpaid Principal Balance with an allowance recorded | 2,616 | 2,690 | |
Related Allowance | 221 | 224 | |
Average Recorded Investment with an allowance recorded | 2,633 | 2,590 | |
Interest Income Recognized with an allowance recorded | 63 | 56 | |
Recorded Investment | 2,692 | 2,779 | |
Unpaid Principal Balance | 2,738 | 2,816 | |
Related Allowance | 221 | $ 224 | |
Average Recorded Investment | 2,770 | 2,748 | |
Interest Income Recognized | $ 64 | $ 58 |
LOANS AND ALLOWANCE FOR LOAN 32
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | $ 2,219 | $ 1,659 | ||
Loans Not Past Due | 393,679 | 397,126 | ||
Loans | 395,898 | 398,785 | ||
Loans 90 Days Past Due and Accruing | 258 | |||
30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 1,139 | 842 | ||
60 to 89 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 554 | 368 | ||
Greater Than 90 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | [1] | 526 | 449 | |
Commercial and Industrial [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 39 | 20 | ||
Loans Not Past Due | 96,999 | 104,366 | ||
Loans | 97,038 | 104,386 | ||
Commercial and Industrial [Member] | 30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 20 | |||
Agricultural [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 421 | 83 | ||
Loans Not Past Due | 38,951 | 48,381 | ||
Loans | 39,372 | 48,464 | ||
Agricultural [Member] | Greater Than 90 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 421 | [1] | 83 | |
Loans Not Past Due | [1] | 39 | ||
Consumer [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 93 | 181 | ||
Loans Not Past Due | 24,087 | 24,332 | ||
Loans | 24,180 | 24,513 | ||
Consumer [Member] | 30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 93 | 142 | ||
Consumer [Member] | 60 to 89 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 38 | |||
Consumer [Member] | Greater Than 90 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | [1] | 1 | ||
Commercial Real Estate [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 163 | 222 | ||
Loans Not Past Due | 136,046 | 123,265 | ||
Loans | 136,209 | 123,487 | ||
Commercial Real Estate [Member] | 30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 84 | 95 | ||
Commercial Real Estate [Member] | 60 to 89 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 79 | 58 | ||
Commercial Real Estate [Member] | Greater Than 90 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | [1] | 69 | ||
Construction Real Estate [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 268 | |||
Loans Not Past Due | 3,414 | 6,613 | ||
Loans | 3,682 | 6,613 | ||
Construction Real Estate [Member] | 30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 268 | |||
Residential Real Estate [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 1,235 | 1,153 | ||
Loans Not Past Due | 94,182 | 90,169 | ||
Loans | 95,417 | 91,322 | ||
Loans 90 Days Past Due and Accruing | 258 | |||
Residential Real Estate [Member] | 30 to 59 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 694 | 585 | ||
Residential Real Estate [Member] | 60 to 89 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | 475 | 272 | ||
Residential Real Estate [Member] | Greater Than 90 Days [Member] | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||
Past Due Total | [1] | $ 66 | $ 296 | |
[1] | Includes nonaccrual loans. |
LOANS AND ALLOWANCE FOR LOAN 33
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | $ 1,140 | $ 1,096 |
Agricultural [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 421 | 423 |
Commercial and Industrial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 39 | |
Consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 15 | |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | 138 | 222 |
Residential Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Nonaccrual loans | $ 542 | $ 436 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Basic Earnings Per Share | ||||
Net income available to common shareholders | $ 1,833 | $ 1,635 | $ 3,491 | $ 3,081 |
Weighted average common shares outstanding | 3,613,398 | 3,622,290 | 3,614,197 | 3,618,729 |
Basic earnings per common shares | $ 0.51 | $ 0.45 | $ 0.97 | $ 0.85 |
Diluted Earnings Per Share | ||||
Net income available to common shareholders | $ 1,833 | $ 1,635 | $ 3,491 | $ 3,081 |
Weighted average common shares outstanding | 3,613,398 | 3,622,290 | 3,614,197 | 3,618,729 |
Plus dilutive stock options and restricted stock units | 12,550 | 4,049 | 10,463 | 3,482 |
Weighted average common shares outstanding and potentially dilutive shares | 3,625,948 | 3,626,339 | 3,624,660 | 3,622,211 |
Diluted earnings per common share | $ 0.5 | $ 0.45 | $ 0.96 | $ 0.85 |
EARNINGS PER SHARE (Details Nar
EARNINGS PER SHARE (Details Narrative) - shares | May 31, 2018 | May 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 |
Earnings Per Share [Abstract] | ||||||
Dilutive stock options excluded in calculation of earnings per share | 0 | 31,500 | 15,000 | 47,250 | ||
Stock dividend percent | 5.00% | 5.00% |
FINANCIAL INSTRUMENTS (Details)
FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets: | ||
Securities available for sale | $ 161,687 | $ 155,591 |
Loans to other financial institutions | 9,006 | 6,802 |
Liabilities: | ||
Noninterest-bearing deposits | 147,040 | 151,462 |
Interest-bearing deposits | 380,881 | 388,391 |
Federal funds purchased | 4,000 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets: | ||
Cash and due from banks | 11,877 | 36,837 |
Equity securities at fair value | 1,838 | |
Securities available for sale | 1,892 | |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: | ||
Securities available for sale | 150,348 | 140,301 |
Federal Home Loan Bank and Federal Reserve Bank stock | 3,567 | 3,567 |
Loans held for sale | 647 | 1,773 |
Loans to other financial institutions | 9,006 | 6,802 |
Accrued interest receivable | 2,220 | 2,146 |
Liabilities: | ||
Noninterest-bearing deposits | 147,040 | 151,462 |
Interest-bearing deposits | 379,501 | 387,343 |
Repurchase agreements | 7,148 | |
Federal Home Loan Bank advances | 20,259 | 20,271 |
Accrued interest payable | 98 | 49 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets: | ||
Equity securities at fair value | 1,500 | |
Securities available for sale | 11,339 | 13,398 |
Loans, net | 390,988 | 394,819 |
Carrying Amount [Member] | ||
Assets: | ||
Cash and due from banks | 11,877 | 36,837 |
Equity securities at fair value | 3,338 | |
Securities available for sale | 161,687 | 155,591 |
Federal Home Loan Bank and Federal Reserve Bank stock | 3,567 | 3,567 |
Loans held for sale | 617 | 1,721 |
Loans to other financial institutions | 9,006 | 6,802 |
Loans, net | 391,239 | 394,208 |
Accrued interest receivable | 2,220 | 2,146 |
Liabilities: | ||
Noninterest-bearing deposits | 147,040 | 151,462 |
Interest-bearing deposits | 380,881 | 388,391 |
Federal funds purchased | 4,000 | |
Repurchase agreements | 7,148 | |
Federal Home Loan Bank advances | 20,251 | 20,268 |
Accrued interest payable | 98 | 49 |
Estimated Fair Value [Member] | ||
Assets: | ||
Cash and due from banks | 11,877 | 36,837 |
Equity securities at fair value | 3,338 | |
Securities available for sale | 161,687 | 155,591 |
Federal Home Loan Bank and Federal Reserve Bank stock | 3,567 | 3,567 |
Loans held for sale | 647 | 1,773 |
Loans to other financial institutions | 9,006 | 6,802 |
Loans, net | 390,988 | 394,819 |
Accrued interest receivable | 2,220 | 2,146 |
Liabilities: | ||
Noninterest-bearing deposits | 147,040 | 151,462 |
Interest-bearing deposits | 379,501 | 387,343 |
Repurchase agreements | 7,148 | |
Federal Home Loan Bank advances | 20,259 | 20,271 |
Accrued interest payable | $ 98 | $ 49 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | $ 161,687 | $ 155,591 | |
Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | [1] | 3,338 | 3,392 |
U.S. Treasury Notes and Bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,919 | 1,960 | |
U.S. Government and Federal Agency [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 33,128 | 35,126 | |
State and Municipal [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 103,605 | 100,048 | |
Mortgage-backed [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 17,912 | 9,820 | |
Corporate [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 5,067 | 5,151 | |
Asset-backed Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 56 | 94 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,892 | ||
Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 150,348 | 140,301 | |
Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 11,339 | 13,398 | |
Fair Value Measured on a Recurring Basis [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 161,687 | 155,591 | |
Fair Value Measured on a Recurring Basis [Member] | Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 3,392 | ||
Securities Held at Fair Value | 3,338 | ||
Fair Value Measured on a Recurring Basis [Member] | U.S. Treasury Notes and Bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,919 | 1,960 | |
Fair Value Measured on a Recurring Basis [Member] | U.S. Government and Federal Agency [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 33,128 | 35,126 | |
Fair Value Measured on a Recurring Basis [Member] | State and Municipal [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 103,605 | 100,048 | |
Fair Value Measured on a Recurring Basis [Member] | Mortgage-backed [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 17,912 | 9,820 | |
Fair Value Measured on a Recurring Basis [Member] | Corporate [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 5,067 | 5,151 | |
Fair Value Measured on a Recurring Basis [Member] | Asset-backed Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 56 | 94 | |
Fair Value Measured on a Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,892 | ||
Fair Value Measured on a Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,892 | ||
Securities Held at Fair Value | 1,838 | ||
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 150,348 | 140,301 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Treasury Notes and Bonds [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,919 | 1,960 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Government and Federal Agency [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 33,128 | 35,126 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | State and Municipal [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 92,266 | 88,150 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 17,912 | 9,820 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Corporate [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 5,067 | 5,151 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Asset-backed Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 56 | 94 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 11,339 | 13,398 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Equity Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | 1,500 | ||
Securities Held at Fair Value | 1,500 | ||
Fair Value Measured on a Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | State and Municipal [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Securities available for sale | $ 11,339 | $ 11,898 | |
[1] | The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental tax rate of 21% |
FAIR VALUE MEASUREMENTS (Deta38
FAIR VALUE MEASUREMENTS (Details 1) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Changes in Level 3 Investment Securities, Available for Sale Measured at Fair Value on a Recurring Basis | ||
Total unrealized gains (losses) included in other comprehensive income | $ 84 | |
Fair Value Measured on a Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Changes in Level 3 Investment Securities, Available for Sale Measured at Fair Value on a Recurring Basis | ||
Balance at the beginning of year | 13,398 | $ 15,103 |
Total unrealized gains (losses) included in other comprehensive income | (246) | 162 |
Net purchases, sales, calls, and maturities | (313) | (407) |
Balance at the end of year | $ 12,839 | $ 14,858 |
FAIR VALUE MEASUREMENTS (Deta39
FAIR VALUE MEASUREMENTS (Details 2) - Fair Value measured on a Non-Recurring Basis [Member] - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired Loans | $ 4,278 | $ 4,140 |
Other real estate owned, net | 179 | 106 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired Loans | 4,278 | 4,140 |
Other real estate owned, net | $ 179 | $ 106 |
FAIR VALUE MEASUREMENTS (Deta40
FAIR VALUE MEASUREMENTS (Details Narrative) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Fair Value Disclosures [Abstract] | |
Total unrealized gains (losses) included in other comprehensive income | $ 84 |
Purchased during period | $ 231,000 |