November 26, 2007
Mr. Hugh West
Accounting Branch Chief
Securities and Exchange Commission
100 F Street, N.E.
Mail Stop 4561
Washington, D.C. 20549
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Re: |
| Citizens Bancshares Corporation |
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| Form 10-K for the Fiscal Year Ended December 31, 2006 |
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| Forms 10-Q for the Quarterly Period Ended March 31, 2007 |
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| Forms 10-Q for the Quarterly Period Ended June 30, 2007 |
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| Forms 10-Q for the Quarterly Period Ended September 30, 2007 |
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| File No.: 000-14913 |
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Dear Mr. West:
We are responding to the comments received from your office by letter dated November 16, 2007, with respect to the above-referenced periodic reports. We have responded to each of your comments below.
Form 10-Q for the Quarterly Period Ended September 30, 2007
Note 2 — Adoption of SFAS 159, page 8
Question:
“Confirm to us that you have adopted SFAS 157 for all assets and liabilities that require or permit fair value measurements (i.e. not merely the $10 million advances from the FHLB).”
Response:
Yes, the Company has adopted SFAS 157 for all assets and liabilities that require or permit fair value measurements, and not merely the $10 million advances from the FHLB. The Company will clarify its adoption of SFAS 157 in future filings of its Forms 10-K and 10-Q.
Question:
“It does not appear that you have provided the minimum required disclosures of SFAS 157 (see paragraph 32 — 35). Please advise and provide this information to us supplementally through the period ended September 30, 2007.”
Response:
The following table (unaudited — in thousands) provides the supplemental fair value information required by SFAS 157 that was not disclosed in our Form 10-Q for the quarterly period ended September 30, 2007. On a go forward basis, the Company will present the additional SFAS 157 fair value disclosure information in future filings of its Forms 10-K and 10-Q.
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Assets Measured at Fair Value on a Recurring Basis: | ||||||||||||
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Description |
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| Quoted Prices in Active Markets for Identical Assets |
| Significant Other Observable Inputs |
| Unobservable Inputs | ||||
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| 9/30/2007 |
| (Level 1) |
| (Level 2) |
| (Level 3) | ||||
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Investments securities available for sale |
| $ | 60,442 |
| $ | — |
| $ | 60,442 |
| $ | — |
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Total |
| $ | 60,442 |
| $ | — |
| $ | 60,442 |
| $ | — |
Assets Measured at Fair Value on a Nonrecurring Basis: | |||||||||||||||
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Description |
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| Quoted Prices in Active Markets for Identical Assets |
| Significant Other Observable Inputs |
| Unobservable Inputs |
| Total Gains | |||||
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| 9/30/2007 |
| (Level 1) |
| (Level 2) |
| (Level 3) |
| (Losses) | |||||
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Goodwill |
| $ | 362 |
| $ | — |
| $ | — |
| $ | 362 |
| $ | — |
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Total |
| $ | 362 |
| $ | — |
| $ | — |
| $ | 362 |
| $ | — |
Liabilities Measured at Fair Value on a Recurring Basis: | ||||||||
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Description |
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| Quoted Prices in Active Markets for Identical ssets |
| Significant Other Observable Inputs |
| Unobservable Inputs |
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| 9/30/2007 |
| (Level 1) |
| (Level 2) |
| (Level 3) |
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FHLB Advances |
| $ 18,184 |
| $ — |
| $ 18,184 |
| $ — |
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Total |
| $ 18,184 |
| $ — |
| $ 18,184 |
| $ — |
Question:
“Considering our comments in the points above, please revise your future filings accordingly”.
Response:
Based on the above comments the Company received regarding its regulatory filings with the SEC, future filings will be revised to provide the additional SFAS 157 fair value disclosure information.
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The Citizens Bancshares Corporation, hereby, acknowledges the following:
· the Company is responsible for the adequacy and accuracy of the disclosure in the filing;
· staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
· the Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Thank you for your consideration of our responses to your comments. If you have any questions, please call us at (404) 653-2800.
Sincerely,
/s/ James E. Young |
Chief Executive Officer |
Citizens Bancshares Corporation |
/s/ Samuel J. Cox |
Chief Financial Officer |
Citizens Bancshares Corporation |
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