Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 13, 2020 | |
Entity [Abstract] | ||
Entity Registrant Name | Security Federal Corporation | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2020 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Central Index Key | 0000818677 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 3,252,884 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Document Quarterly Report | true | |
Document Transition Report | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
ASSETS: | ||
Cash and Cash Equivalents | $ 15,340,792 | $ 12,536,311 |
Interest-bearing Deposits in Banks and Other Financial Institutions | 950,005 | 950,005 |
Investment and Mortgage-Backed Securities: | ||
Available For Sale ("AFS") | 471,931,623 | 414,644,840 |
Investment and Mortgage-Backed Securities, Held to Maturity | 16,858,861 | 19,246,935 |
Total Investments And Mortgage-Backed Securities | 488,790,484 | 433,891,775 |
Loans Receivable, Net: | ||
Held For Sale | 6,155,830 | 3,990,606 |
Loans and Leases Receivable, Net Amount | 528,290,665 | 448,868,129 |
Total Loans Receivable, Net | 534,446,495 | 452,859,000 |
Accrued Interest Receivable: | ||
Loans | 2,457,713 | 1,211,826 |
Mortgage-Backed Securities | 575,230 | 551,214 |
Investment Securities | 1,359,940 | 1,635,497 |
Total Accrued Interest Receivable | 4,392,883 | 3,398,537 |
Operating Lease, Right-of-Use Asset | 2,531,674 | 2,718,676 |
Premises and Equipment, Net | 27,051,354 | 27,219,883 |
Federal Home Loan Bank ("FHLB") Stock, at Cost | 2,672,800 | 2,536,500 |
Other Real Estate Owned ("OREO") | 184,300 | 677,740 |
Bank Owned Life Insurance ("BOLI") | 21,771,647 | 21,501,647 |
Goodwill | 1,199,754 | 1,199,754 |
Other Assets | 1,186,910 | 3,737,978 |
Total Assets | 1,100,519,098 | 963,227,541 |
Liabilities: | ||
Deposit Accounts | 875,185,557 | 771,407,482 |
Advance Payments By Borrowers For Taxes And Insurance | 501,493 | 207,582 |
Advances from FHLB | 42,500,000 | 38,138,000 |
Other Borrowings | 20,953,072 | 11,579,819 |
Junior Subordinated Debentures | 5,155,000 | |
Junior Subordinated Debentures | 5,155,000 | 5,155,000 |
Senior Convertible Debentures | 0 | |
Senior Convertible Debentures | 6,044,000 | |
Operating Lease, Liability | 2,553,516 | 2,733,531 |
Other Liabilities | 6,897,932 | 6,204,122 |
Total Liabilities | 993,446,570 | 871,469,536 |
Shareholders' Equity: | ||
Common Stock, $.01 Par Value; Authorized 5,000,000 Shares; Issued and Outstanding Shares, 3,453,817 and 3,252,884, Respectively, at June 30, 2020 and 3,157,787 and 2,956,854, Respectively, at December 31, 2019 | 34,538 | 31,578 |
Additional Paid-In Capital | 18,230,187 | 12,308,179 |
Treasury Stock, at Cost (200,933 Shares) | (4,330,712) | (4,330,712) |
Accumulated Other Comprehensive Income ("AOCI") | 11,427,261 | 4,467,527 |
Retained Earnings | 81,711,254 | 79,281,433 |
Total Shareholders' Equity | 107,072,528 | 91,758,005 |
Total Liabilities and Shareholders' Equity | $ 1,100,519,098 | $ 963,227,541 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | $ 456,753,017 | $ 408,695,280 |
Fair Value of Investment And Mortgage-Backed Securities Held To Maturity | 17,833,004 | 19,805,841 |
Allowance For Loan Losses | $ 10,676,271 | $ 9,225,574 |
Serial Preferred Stock Par Value Per Share | $ 0.01 | $ 0.01 |
Serial Preferred Stock Shares Authorized | 200,000 | 200,000 |
Serial Preferred Stock Shares Issued | 0 | 22,000 |
Serial Preferred Stock Shares Outstanding | 0 | 22,000 |
Common Stock Par Value Per Share | $ 0.01 | $ 0.01 |
Common Stock Shares Authorized | 5,000,000 | 5,000,000 |
Common Stock Shares Issued | 3,453,817 | 3,157,787 |
Common Stock, Shares, Outstanding | 3,252,884 | 2,956,854 |
Treasury Stock Shares Held | 200,933 | 200,933 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Net Income | $ 2,016,331 | $ 1,884,031 |
Interest Income: | ||
Loans | 6,437,349 | 6,046,834 |
Mortgage-Backed Securities | 1,602,695 | 1,621,616 |
Investment Securities | 1,052,300 | 1,434,119 |
Other | 6,303 | 25,832 |
Total Interest Income | 9,098,647 | 9,128,401 |
Interest Expense: | ||
NOW and Money Market Accounts | 277,774 | 570,965 |
Savings Accounts | 22,372 | 18,868 |
Certificate Accounts | 810,857 | 1,064,133 |
FHLB Advances and Other Borrowed Money | 220,665 | 167,050 |
Interest Expense, Other | 0 | 11,738 |
Senior Convertible Debentures | 0 | 120,880 |
Interest Expense, Medium-term Notes | 393,750 | |
Junior Subordinated Debentures | 30,822 | 55,771 |
Total Interest Expense | 1,756,240 | 2,009,405 |
Net Interest Income | 7,342,407 | 7,118,996 |
Provision For Loan Losses | 700,000 | 0 |
Net Interest Income After Provision For Loan Losses | 6,642,407 | 7,118,996 |
Non-Interest Income: | ||
Gain on Sale of Investments | 486,577 | 670,134 |
Gain on Sale of Loans | 806,415 | 372,048 |
Service Fees on Deposit Accounts | 188,401 | 254,610 |
Commissions From Insurance Agency | 163,745 | 175,693 |
Trust Income | 238,895 | 258,600 |
BOLI Income | 135,000 | 135,000 |
Grant Revenue | 87,164 | 17,414 |
Check card revenue | 446,931 | 355,321 |
Other | 252,859 | 253,741 |
Total Non-Interest Income | 2,805,987 | 2,492,561 |
Non-Interest Expense: | ||
Compensation and Employee Benefits | 4,236,956 | 4,137,872 |
Occupancy | 603,335 | 576,987 |
Advertising | 188,018 | 176,480 |
Depreciation and Maintenance of Equipment | 746,635 | 639,840 |
Federal Deposit Insurance Corporation ("FDIC") Insurance Premiums | 0 | 69,306 |
Net Recovery from Operation of OREO | (18,020) | (160,033) |
Other | 1,234,007 | 1,800,656 |
Total Non-Interest Expense | 6,990,931 | 7,241,108 |
Income Before Income Taxes | 2,457,463 | 2,370,449 |
Provision For Income Taxes | 441,132 | 486,418 |
Net Income | 2,016,331 | 1,884,031 |
Net Income | $ 2,016,331 | $ 1,884,031 |
Net Income Per Common Share (Basic) | $ 0.62 | $ 0.64 |
Net Income Per Common Share (Diluted) | 0.62 | 0.61 |
Cash Dividend Per Share on Common Stock | $ 0.10 | $ 0.09 |
Weighted Average Shares Outstanding (Basic) | 3,252,884 | 2,995,650 |
Weighted Average Shares Outstanding (Diluted) | 3,252,884 | 3,257,850 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Net Income | $ 2,016,331 | $ 1,884,031 |
Other Comprehensive Income: | ||
Other Comprehensive Income (Loss), Transfers from Held-to-maturity to Available-for-Sale Securities, Net of Tax | (5,792) | |
Reclassification Adjustment for Gains Included in Net Income, Net of Taxes of $121,644 and $167,534 at June 30, 2020 and 2019, Respectively | (364,933) | (502,600) |
Amortization of Unrealized Gains on AFS Securities Transferred to HTM | (6,225) | |
Unrealized Holding Gains on Securities AFS, Net of Taxes of $3,097,343 and $921,187 at June 30, 2020 and 2019, Respectively | (9,490,255) | (2,820,989) |
Other Comprehensive Income, Net of Tax | 9,119,097 | 2,312,597 |
Comprehensive Income | $ 11,135,428 | $ 4,196,628 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Other Comprehensive Income, Amortization on Unrealized Gain on AFS Transfer to HTM, Tax | $ (2,075) | $ (1,931) | $ (3,855) | $ (5,272) |
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, Tax | 3,097,343 | 921,187 | ||
Other Comprehensive Income (Loss), Securities, Available-for-sale, Tax | 2,556,079 | 1,920,184 | ||
Other Comprehensive Income (Loss), Available-for-sale Securities, before Reclassification Adjustments, Tax | $ 121,644 | $ 167,534 | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | $ 298,330 | $ 240,226 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Treasury Stock | Accumulated Other Comprehensive Income | Retained Earnings |
Balance at at Dec. 31, 2018 | $ 80,518,433 | $ 31,548 | $ 12,235,341 | $ (4,330,712) | $ (27,909) | $ 72,610,165 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 2,088,873 | 2,088,873 | ||||
Other Comprehensive Income, Net Of Tax: | 2,817,917 | 2,817,917 | ||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 12,009 | 5 | ||||
APIC, Share-based Payment Arrangement, ESPP, Increase for Cost Recognition | 12,004 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Stock Options, Requisite Service Period Recognition | 19,990 | |||||
Cash Dividends on Common Stock | (265,982) | (265,982) | ||||
Proceeds from Stock Options Exercised | 20,000 | |||||
Balance at at Mar. 31, 2019 | 85,191,250 | 31,563 | 12,267,335 | (4,330,712) | 2,790,008 | 74,433,056 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock Redeemed or Called During Period, Value | 10 | |||||
Balance at at Dec. 31, 2018 | 80,518,433 | 31,548 | 12,235,341 | (4,330,712) | (27,909) | 72,610,165 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 3,972,904 | |||||
Balance at at Jun. 30, 2019 | 89,136,630 | 31,569 | 12,282,115 | (4,330,712) | 5,102,605 | 76,051,053 |
Balance at at Mar. 31, 2019 | 85,191,250 | 31,563 | 12,267,335 | (4,330,712) | 2,790,008 | 74,433,056 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 1,884,031 | 1,884,031 | ||||
Other Comprehensive Income, Net Of Tax: | 2,312,597 | 2,312,597 | ||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 14,786 | 6 | ||||
APIC, Share-based Payment Arrangement, ESPP, Increase for Cost Recognition | 14,780 | |||||
Cash Dividends on Common Stock | (266,034) | (266,034) | ||||
Balance at at Jun. 30, 2019 | 89,136,630 | 31,569 | 12,282,115 | (4,330,712) | 5,102,605 | 76,051,053 |
Balance at at Dec. 31, 2019 | 91,758,005 | 31,578 | 12,308,179 | (4,330,712) | 4,467,527 | 79,281,433 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 1,064,187 | 1,064,187 | ||||
Other Comprehensive Income, Net Of Tax: | (2,159,363) | (2,159,363) | ||||
Stock Issued During Period, Value, Employee Stock Purchase Plan | 12,968 | 4 | ||||
APIC, Share-based Payment Arrangement, ESPP, Increase for Cost Recognition | 12,964 | |||||
Stock Issued During Period, Value, Stock Options Exercised | 2,956 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Stock Options, Requisite Service Period Recognition | 5,909,044 | |||||
Cash Dividends on Common Stock | (325,408) | (325,408) | ||||
Proceeds from Stock Options Exercised | 5,912,000 | |||||
Balance at at Mar. 31, 2020 | 96,262,389 | 34,538 | 18,230,187 | (4,330,712) | 2,308,164 | 80,020,212 |
Balance at at Dec. 31, 2019 | 91,758,005 | 31,578 | 12,308,179 | (4,330,712) | 4,467,527 | 79,281,433 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 3,080,518 | |||||
Balance at at Jun. 30, 2020 | 107,072,528 | 34,538 | 18,230,187 | (4,330,712) | 11,427,261 | 81,711,254 |
Balance at at Mar. 31, 2020 | 96,262,389 | 34,538 | 18,230,187 | (4,330,712) | 2,308,164 | 80,020,212 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 2,016,331 | 2,016,331 | ||||
Other Comprehensive Income, Net Of Tax: | 9,119,097 | 9,119,097 | ||||
Cash Dividends on Common Stock | (325,289) | (325,289) | ||||
Balance at at Jun. 30, 2020 | $ 107,072,528 | $ 34,538 | $ 18,230,187 | $ (4,330,712) | $ 11,427,261 | $ 81,711,254 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net Income | $ 3,080,518 | $ 3,972,904 |
Adjustments To Reconcile Net Income To Net Cash Provided By Operating Activities: | ||
Depreciation Expense | 936,139 | 781,982 |
Discount Accretion and Premium Amortization | 2,255,935 | 2,636,812 |
Provision for Loan Losses | 1,400,000 | 100,000 |
Earnings on BOLI | (270,000) | (270,000) |
Gain on Sales of Loans | (1,309,266) | (546,331) |
Gain on Sales of MBS | (486,577) | (2,459) |
Gain on Sales of Investment Securities | (706,743) | (958,443) |
Gain on Sales of OREO | (23,007) | (137,274) |
Write Down on OREO | 0 | 14,000 |
Amortization of Deferred Loan Costs | 371,886 | 89,585 |
Proceeds From Sale of Loans Held For Sale | 41,597,366 | 19,548,315 |
Origination of Loans Held For Sale | (42,453,324) | (20,970,814) |
(Increase) Decrease in Accrued Interest Receivable: | ||
Loans | (1,245,887) | 48,723 |
MBS | (24,016) | (16,278) |
Investment Securities | 275,557 | 109,588 |
Increase in Advance Payments By Borrowers | 293,911 | 271,370 |
Decrease (Increase) in Other, Net | 795,549 | (2,678) |
Net Cash Provided By Operating Activities | 4,675,043 | 4,857,761 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of MBS AFS | (50,610,348) | (71,340,833) |
Proceeds from Payments and Maturities of MBS AFS | 12,284,007 | 16,427,795 |
Proceeds from (Payments for) in Interest-bearing Deposits in Banks | 0 | 250,005 |
Proceeds from Maturities, Prepayments and Calls of Mortgage Backed Securities (MBS) | 2,271,470 | 1,020,431 |
Purchase of Investment Securities AFS | (46,571,411) | (67,023,891) |
Proceeds from Sale, Maturity and Collection of Investments | 15,483,066 | 17,308,244 |
Proceeds From Sale of Investment Securities Available For Sale | 11,148,752 | 35,174,873 |
Proceeds From Sale Of Mortgage-Backed Securities Available For Sale | 9,262,188 | 26,770,329 |
Purchase of FHLB Stock | (6,031,400) | (4,517,900) |
Redemption of FHLB Stock | 5,895,100 | 3,320,700 |
Increase (Decrease) In Loans Receivable | (81,214,022) | (10,545,706) |
Proceeds From Sale of OREO | 536,047 | 914,376 |
Purchase and Improvement of Premises and Equipment | (767,610) | (2,112,625) |
Net Cash Used By Investing Activities | (128,314,161) | (54,354,202) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Increase in Deposit Accounts | 103,778,075 | 18,952,122 |
Proceeds from FHLB Advances | 226,285,000 | 143,080,000 |
Repayment of FHLB Advances | (221,923,000) | (116,410,000) |
Proceeds from (Repayments of) Other Debt | 9,373,253 | 5,055,157 |
Repayments of Notes Payable | 0 | (2,362,500) |
Proceeds from Stock Plans | 12,968 | 26,795 |
Dividends to Common Stock Shareholders | (650,697) | (532,016) |
Net Cash Provided By Financing Activities | 126,443,599 | 47,809,558 |
Net Increase (Decrease) in Cash and Cash Equivalents | 2,804,481 | (1,686,883) |
Cash and Cash Equivalents at Beginning of Period | 12,536,311 | 12,705,910 |
Cash and Cash Equivalents at End of Period | 15,340,792 | 11,019,027 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash Paid for Interest | 4,184,818 | 3,531,407 |
Non-Cash Transactions: | ||
Transfers From Loans Receivable to OREO | $ 19,600 | $ 802,800 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying unaudited consolidated financial statements were prepared in accordance with instructions for Form 10-Q and accounting principles generally accepted in the United States of America ("GAAP"); therefore, they do not include all disclosures necessary for a complete presentation of financial condition, results of operations, and cash flows. Such statements are unaudited but, in the opinion of management, reflect all adjustments, which are of a normal recurring nature and necessary for a fair presentation of results for the selected interim periods. Users of financial information produced for interim periods are encouraged to refer to the footnotes contained in the audited consolidated financial statements appearing in Security Federal Corporation’s (the “Company”) 2019 Annual Report to Shareholders which was filed as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2019 (“2019 10-K”) when reviewing interim financial statements. |
Principles of Consolidation
Principles of Consolidation | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | Principles of Consolidation |
Critical Accounting Policies
Critical Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Critical Accounting Policies | Critical Accounting Policies The Company has adopted various accounting policies, which govern the application of accounting principles generally accepted in the United States in the preparation of our financial statements. Our significant accounting policies are described in the footnotes to the audited consolidated financial statements at December 31, 2019 included in our 2019 Annual Report to Shareholders. Certain accounting policies involve significant judgments and assumptions by management, which have a material impact on the carrying value of certain assets and liabilities, and, as such, have a greater possibility of producing results that could be materially different than originally reported. We consider these accounting policies to be critical accounting policies. The judgments and assumptions we use are based on historical experience and other factors, which we believe to be reasonable under the circumstances. Because of the nature of the judgments and assumptions we make, actual results could differ from these judgments and estimates which could have a material impact on our carrying values of assets and liabilities and our results of operations. The Company believes the allowance for loan losses is a critical accounting policy that requires the most significant judgments and estimates used in preparation of the consolidated financial statements. The impact of an unexpected and sudden large loss could deplete the allowance and potentially require increased provisions to replenish the allowance, which would negatively affect earnings. The Company provides for loan losses using the allowance method. Accordingly, all loan losses are charged to the related allowance and all recoveries are credited to the allowance for loan losses. Additions to the allowance for loan losses are provided by charges to operations based on various factors, which, in management’s judgment, deserve current recognition in estimating possible losses. Such factors considered by management include the fair value of the underlying collateral, stated guarantees by the borrower (if applicable), the borrower’s ability to repay from other economic resources, growth and composition of the loan portfolio, the relationship of the allowance for loan losses to the outstanding loans, loss experience, delinquency trends, and general economic conditions. Management evaluates the carrying value of the loans periodically and the allowance is adjusted accordingly. 3. Critical Accounting Policies, Continued While management uses the best information available to make evaluations, future adjustments may be necessary if economic conditions differ substantially from the assumptions used in making these evaluations. The allowance for loan losses is subject to periodic evaluations by our bank regulatory agencies, including the Board of Governors of the Federal Reserve System ("Federal Reserve"), the FDIC and the South Carolina Board of Financial Institutions, that may require adjustments to be made to the allowance based upon the information that is available at the time of their examination. The Company values impaired loans at the loan’s fair value if it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement at the present value of expected cash flows, the market price of the loan, if available, or the value of the underlying collateral. Expected cash flows are required to be discounted at the loan’s effective interest rate. When the ultimate collectibility of an impaired loan’s principal is in doubt, wholly or partially, all cash receipts are applied to principal. When this doubt does not exist, cash receipts are applied under the contractual terms of the loan agreement first to interest and then to principal. Once the recorded principal balance has been reduced to zero, future cash receipts are applied to interest income to the extent that any interest has been foregone. Further cash receipts are recorded as recoveries of any amounts previously charged off. The Company uses assumptions and estimates in determining income taxes payable or refundable for the current year, deferred income tax liabilities and assets for events recognized differently in its financial statements and income tax returns, and income tax expense. Determining these amounts requires analysis of certain transactions and interpretation of tax laws and regulations. The Company exercises considerable judgment in evaluating the amount and timing of recognition of the resulting tax liabilities and assets. These judgments and estimates are reevaluated on a continual basis as regulatory and business factors change. No assurance can be given that either the tax returns submitted by us or the income tax reported on the Consolidated Financial Statements will not be adjusted by either adverse rulings by the United States Tax Court, changes in the tax code, or assessments made by the Internal Revenue Service. |
Earnings Per Common Share
Earnings Per Common Share | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | Earnings Per Share Accounting guidance specifies the computation, presentation and disclosure requirements for earnings per share (“EPS”) for entities with publicly held common stock or potential common stock such as options, warrants, convertible securities or contingent stock agreements if those securities trade in a public market. Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding. Diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive common shares had been issued. The dilutive effect of options outstanding under the Company’s stock option plan is reflected in diluted EPS by application of the treasury stock method. There were no stock options outstanding at June 30, 2020 or June 30, 2019; and therefore, no dilutive options in the calculation of diluted EPS for those periods. Diluted EPS also assumes the Senior Convertible Debentures were converted into 302,200 shares of common stock at the beginning of the three and six months ended June 30, 2019. The related interest expense recorded during the period is added back to the EPS numerator while the underlying shares are added to the denominator. The following tables include a summary of the Company's basic and diluted EPS for the periods indicated. Three Months Ended June 30, 2020 2019 Income Shares Per Share Amounts Income Shares Per Share Amounts Basic EPS $ 2,016,331 3,252,884 $ 0.62 $ 1,884,031 2,995,650 $ 0.64 Effect of Dilutive Securities: Senior Convertible Debentures — — — 90,660 302,200 (0.03) Diluted EPS $ 2,016,331 3,252,884 $ 0.62 $ 1,974,691 3,257,850 $ 0.61 4. Earnings Per Share, Continued Six Months Ended June 30, 2020 2019 Income Shares Per Share Amounts Income Shares Per Share Amounts Basic EPS $ 3,080,518 3,172,669 $ 0.97 $ 3,972,904 2,955,086 $ 1.34 Effect of Dilutive Securities: Senior Convertible Debentures — — — 181,320 302,200 (0.06) Diluted EPS $ 3,080,518 3,172,669 $ 0.97 $ 4,154,224 3,257,286 $ 1.28 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | Stock-Based CompensationCertain officers and directors of the Company participate in incentive and non-qualified stock option plans. Options are granted at exercise prices not less than the fair value of the Company’s common stock on the date of the grant. At June 30, 2020 and 2019, the Company had no options outstanding and there was no activity during the six months ended June 30, 2020 and 2019. At those dates, there were 50,000 options available for grants. |
Investment and Mortgage-Backed
Investment and Mortgage-Backed Securities, Available for Sale | 6 Months Ended |
Jun. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment and Mortgage-Backed Securities, Available for Sale | Investment and Mortgage-Backed Securities, Available For Sale The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of investment and mortgage-backed securities available for sale at the dates indicated were as follows: June 30, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 52,946,093 $ 24,329 $ 1,785,755 $ 51,184,667 Small Business Administration (“SBA”) Bonds 110,532,402 647,863 693,082 110,487,183 Tax Exempt Municipal Bonds 38,913,210 5,180,069 — 44,093,279 Taxable Municipal Bonds 27,901,187 774,999 90,446 28,585,740 Mortgage-Backed Securities 226,394,056 11,425,761 305,132 237,514,685 State Tax Credit 66,069 — — 66,069 Total Available For Sale $ 456,753,017 $ 18,053,021 $ 2,874,415 $ 471,931,623 December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 41,088,231 $ — $ 856,401 $ 40,231,830 SBA Bonds 111,927,938 622,105 656,944 111,893,099 Tax Exempt Municipal Bonds 43,153,086 4,088,408 — 47,241,494 Taxable Municipal Bonds 15,169,737 35,359 364,686 14,840,410 Mortgage-Backed Securities 197,356,288 3,664,621 582,902 200,438,007 Total Available For Sale $ 408,695,280 $ 8,410,493 $ 2,460,933 $ 414,644,840 Student Loan Pools are typically 97% guaranteed by the United States government while SBA bonds are 100% backed by the full faith and credit of the United States government. Included in the tables above and below in mortgage-backed securities are Government National Mortgage Association ("GNMA") mortgage-backed securities, which are also backed by the full faith and credit of the United States government. 6. Investment and Mortgage-Backed Securities, Available For Sale, Continued At June 30, 2020, AFS GNMA mortgage-backed securities had an amortized cost and fair value of $68.0 million and $69.8 million, respectively, compared to an amortized cost and fair value of $63.2 million and $63.9 million, respectively, at December 31, 2019. Also included in mortgage-backed securities in the tables above and below are private label collateralized mortgage obligation ("CMO") securities, which are issued by non-governmental real estate mortgage investment conduits and are not backed by the full faith and credit of the United States government. At June 30, 2020 the Bank held AFS private label CMO mortgage-backed securities with an amortized cost and fair value of $32.0 million and $32.6 million, respectively, compared to an amortized cost and fair value of $15.8 million and $16.1 million, respectively, at December 31, 2019. The amortized cost and fair value of investment and mortgage-backed securities available for sale at June 30, 2020 are shown below by contractual maturity. Expected maturities will differ from contractual maturities because borrowers have the right to prepay obligations with or without call or prepayment penalties. Since mortgage-backed securities are not due at a single maturity date, they are disclosed separately, rather than allocated over the maturity groupings set forth in the table below. June 30, 2020 Investment Securities: Amortized Cost Fair Value One Year or Less $ 78,977 $ 78,893 After One – Five Years 5,183,070 5,225,881 After Five – Ten Years 67,925,056 67,955,648 More Than Ten Years 157,171,858 161,156,516 Mortgage-Backed Securities 226,394,056 237,514,685 Total Available For Sale $ 456,753,017 $ 471,931,623 At June 30, 2020 the amortized cost and fair value of investment and mortgage-backed securities available for sale pledged as collateral for certain deposit accounts, FHLB advances and other borrowings were $221.6 million and $231.6 million, respectively, compared to an amortized cost and fair value of $171.4 million and $173.1 million, respectively, at December 31, 2019. The Bank received $9.3 million and $55.4 million in gross proceeds from sales of available for sale securities during the three months ended June 30, 2020 and 2019, respectively. As a result, the Company recognized gross gains of $486,000 and $945,000 and gross losses of $0 and $275,000 during the three months ended June 30, 2020 and 2019, respectively. The Bank received $20.4 million and $61.9 million in gross proceeds from sales of available for sale securities during the six months ended June 30, 2020 and 2019, respectively. As a result, the Company recognized gross gains of $1.2 million and $1.2 million and gross losses of $0 and $283,000 for the same periods. The following tables show gross unrealized losses and fair value, aggregated by investment category, and length of time that the individual available for sale securities were in a continuous unrealized loss position at the dates indicated. June 30, 2020 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Student Loan Pools $ 19,529,136 $ 538,513 $ 29,869,847 $ 1,247,242 $ 49,398,983 $ 1,785,755 SBA Bonds 30,451,987 179,367 43,790,190 513,715 74,242,177 693,082 Taxable Municipal Bonds 3,508,658 90,446 — — 3,508,658 90,446 Mortgage-Backed Securities 24,160,716 205,894 29,139,252 99,238 53,299,968 305,132 $ 77,650,497 $ 1,014,220 $ 102,799,289 $ 1,860,195 $ 180,449,786 $ 2,874,415 6. Investment and Mortgage-Backed Securities, Available For Sale, Continued December 31, 2019 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Student Loan Pools $ 30,079,497 $ 534,048 $ 10,152,333 $ 322,353 $ 40,231,830 $ 856,401 SBA Bonds 13,844,666 106,110 47,395,036 550,834 61,239,702 656,944 Taxable Municipal Bond 13,810,279 364,686 — — 13,810,279 364,686 Mortgage-Backed Securities 55,326,064 480,958 7,975,863 101,944 63,301,927 582,902 $ 113,060,506 $ 1,485,802 $ 65,523,232 $ 975,131 $ 178,583,738 $ 2,460,933 Securities classified as available for sale are recorded at fair market value. At June 30, 2020 and December 31, 2019, 64.7% and 39.6% of the unrealized losses, representing 93 and 69 individual securities, respectively, consisted of securities in a continuous loss position for 12 months or more. The Company has the ability and intent to hold these securities until such time as the value recovers or the securities mature. The Company believes, based on industry analyst reports and credit ratings, that the deterioration in value is attributable to changes in market interest rates and is not in the credit quality of the issuer and therefore, these losses are not considered other-than-temporary. The Company reviews its investment securities portfolio at least quarterly and more frequently when economic conditions warrant, assessing whether there is any indication of other-than-temporary impairment (“OTTI”). Additional deterioration in market and economic conditions related to COVID-19 pandemic may, however, have an adverse impact on credit quality in the future and result in OTTI charges. Factors considered in the review include estimated future cash flows, length of time and extent to which market value has been less than cost, the financial condition and near term prospects of the issuer, and our intent and ability to retain the security to allow for an anticipated recovery in market value. If the review determines that there is OTTI, then an impairment loss is recognized in earnings equal to the entire difference between the investment’s cost and its fair value at the balance sheet date of the reporting period for which the assessment is made, or the Company may recognize a portion in other comprehensive income. The fair value of investments on which OTTI is recognized then becomes the new cost basis of the investment. There was no OTTI recognized |
Investment and Mortgage-Backe_2
Investment and Mortgage-Backed Securities, Held to Maturity | 6 Months Ended |
Jun. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment and Mortgage-Backed Securities, Held to Maturity | 7. Investment and Mortgage-Backed Securities, Held to Maturity At June 30, 2020 and December 31, 2019, the Company's entire held to maturity portfolio was comprised of mortgage-backed securities. The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of held to maturity securities at those dates were as follows: June 30, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Mortgage-Backed Securities (1) $ 16,858,861 $ 974,384 $ 241 $ 17,833,004 Total Held To Maturity $ 16,858,861 $ 974,384 $ 241 $ 17,833,004 December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Mortgage-Backed Securities (1) $ 19,246,935 $ 560,067 $ 1,161 $ 19,805,841 Total Held To Maturity $ 19,246,935 $ 560,067 $ 1,161 $ 19,805,841 (1) COMPRISED OF MORTGAGE-BACKED SECURITIES OF GSEs OR GNMA At June 30, 2020, the Bank held an amortized cost and fair value of $9.6 million and $10.2 million, respectively, in GNMA mortgage-backed securities classified as held to maturity, which are included in the table above, compared to an amortized cost and fair value of $11.3 million and $11.6 million, respectively, at December 31, 2019. The Company has not invested in any private label mortgage-backed securities classified as held to maturity. 7. Investment and Mortgage-Backed Securities, Held to Maturity, Continued At June 30, 2020, the amortized cost and fair value of mortgage-backed securities held to maturity that were pledged as collateral for certain deposit accounts, FHLB advances and other borrowings were $15.6 million and $16.5 million, respectively, compared to an amortized cost and fair value of $17.5 million and $18 million, respectively, at December 31, 2019. The following tables show gross unrealized losses, fair value, and length of time that individual held to maturity securities have been in a continuous unrealized loss position at the dates indicated below. June 30, 2020 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Mortgage-Backed Securities (1) $ — $ — $ 804,758 $ 241 $ 804,758 $ 241 $ — $ — $ 804,758 $ 241 $ 804,758 $ 241 (1) COMPRISED OF MORTGAGE-BACKED SECURITIES OF GSEs OR GNMA December 31, 2019 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Mortgage-Backed Securities (1) $ — $ — $ 820,313 $ 1,161 $ 820,313 $ 1,161 $ — $ — $ 820,313 $ 1,161 $ 820,313 $ 1,161 (1) COMPRISED OF MORTGAGE-BACKED SECURITIES OF GSEs OR GNMA The Company’s held to maturity portfolio is recorded at amortized cost. The Company has the ability and intent to hold these securities to maturity. |
Loans Receivable, Net
Loans Receivable, Net | 3 Months Ended |
Jun. 30, 2019 | |
Loans and Leases Receivable, Net Amount [Abstract] | |
Financing Receivables [Text Block] | Loans Receivable, Net Loans receivable, net, consisted of the following as of the dates indicated below: June 30, 2020 December 31, 2019 Residential Real Estate Loans $ 84,864,381 $ 86,404,304 Consumer Loans 58,235,306 56,331,013 Commercial Business Loans 24,003,787 22,234,189 Commercial Real Estate Loans 311,975,450 303,550,905 Paycheck Protection Program Loans 72,672,428 — Total Loans Held For Investment 551,751,352 468,520,411 Loans Held For Sale 6,155,830 3,990,606 Total Loans Receivable, Gross $ 557,907,182 $ 472,511,017 Less: Allowance For Loan Losses 10,676,271 9,225,574 Loans in Process 9,755,038 9,957,140 Deferred Loan Fees 3,029,378 469,568 23,460,687 19,652,282 Total Loans Receivable, Net $ 534,446,495 $ 452,858,735 8. Loans Receivable, Net, Continued The Company uses a risk based approach based on the following credit quality measures when analyzing the loan portfolio: pass, caution, special mention, and substandard. These indicators are used to rate the credit quality of loans for the purposes of determining the Company’s allowance for loan losses. Pass loans are loans that are performing and are deemed adequately protected by the net worth of the borrower or the underlying collateral value. These loans are considered to have the least amount of risk in terms of determining the allowance for loan losses. Loans that are graded as substandard are considered to have the most risk. These loans typically have an identified weakness or weaknesses and are inadequately protected by the net worth of the borrower or collateral value. All loans 90 days or more past due are automatically classified in this category. The caution and special mention categories fall in between the pass and substandard grades and consist of loans that do not currently expose the Company to sufficient risk to warrant adverse classification but possess weaknesses. The tables below summarize the balance within each risk category by loan type, excluding loans held for sale, at June 30, 2020 and December 31, 2019. June 30, 2020 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 74,090,846 $ 5,558,599 $ 1,073,323 $ 4,141,613 $ 84,864,381 Consumer 44,897,990 10,759,361 937,761 1,640,194 58,235,306 Commercial Business 17,787,879 4,935,589 468,875 811,444 24,003,787 Commercial Real Estate 236,153,488 56,777,380 15,486,771 3,557,811 311,975,450 PPP 72,672,428 — — — 72,672,428 Total $ 445,602,631 $ 78,030,929 $ 17,966,730 $ 10,151,062 $ 551,751,352 December 31, 2019 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 76,674,539 $ 4,612,182 $ 1,155,802 $ 3,961,781 $ 86,404,304 Consumer 44,294,400 9,617,301 624,248 1,795,064 56,331,013 Commercial Business 16,140,592 5,486,393 301,462 305,742 22,234,189 Commercial Real Estate 230,810,756 56,025,352 14,285,015 2,429,782 303,550,905 Total $ 367,920,287 $ 75,741,228 $ 16,366,527 $ 8,492,369 $ 468,520,411 The following tables present an age analysis of past due balances by loan category at June 30, 2020 and December 31, 2019: June 30, 2020 30-59 Days Past Due 60-89 Days Past Due 90 Days or Total Past Due Current Total Loans Receivable Residential Real Estate $ — $ 107,237 $ 1,233,577 $ 1,340,814 $ 83,523,567 $ 84,864,381 Consumer 312,743 8,504 95,369 416,616 57,818,690 58,235,306 Commercial Business 79,696 26,902 932 107,530 23,896,257 24,003,787 Commercial Real Estate 2,019,784 364,649 754,100 3,138,533 308,836,917 311,975,450 PPP — — — — 72,672,428 72,672,428 Total $ 2,412,223 $ 507,292 $ 2,083,978 $ 5,003,493 $ 546,747,859 $ 551,751,352 December 31, 2019 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Total Past Due Current Total Loans Receivable Residential Real Estate $ — $ 355,290 $ 144,209 $ 499,499 $ 85,904,805 $ 86,404,304 Consumer 422,443 217,542 81,736 721,721 55,609,292 56,331,013 Commercial Business 147,959 76,515 20,316 244,790 21,989,399 22,234,189 Commercial Real Estate 3,849,424 — 1,352,716 5,202,140 298,348,765 303,550,905 Total $ 4,419,826 $ 649,347 $ 1,598,977 $ 6,668,150 $ 461,852,261 $ 468,520,411 8. Loans Receivable, Net, Continued At June 30, 2020 and December 31, 2019, the Company did not have any loans that were 90 days or more past due and still accruing interest. The Company's strategy is to work with its borrowers to reach acceptable payment plans while protecting its interests in the existing collateral. In the event an acceptable arrangement cannot be reached, the Company may have to acquire these properties through foreclosure or other means and subsequently sell, develop, or liquidate them. The following table shows non-accrual loans by category at June 30, 2020 compared to December 31, 2019: June 30, 2020 December 31, 2019 Increase (Decrease) Amount Percent (1) Amount Percent (1) $ % Non-accrual Loans: Residential Real Estate $ 2,393,501 0.4 % $ 1,520,485 0.3 % $ 873,016 57.4% Consumer 402,084 0.1 319,280 0.1 82,804 25.9 Commercial Business 120,042 — 122,605 — (2,563) (2.1) Commercial Real Estate 864,409 0.2 1,474,036 0.3 (609,627) (41.4) Total Non-accrual Loans $ 3,780,036 0.7 % $ 3,436,406 0.7 % $ 343,630 10.0% (1) PERCENT OF TOTAL LOANS HELD FOR INVESTMENT, NET OF DEFERRED FEES AND LOANS IN PROCESS. The following tables show the activity in the allowance for loan losses by category for the three and six months ended June 30, 2020 and 2019: Three Months Ended June 30, 2020 Residential Consumer Commercial Commercial Total Beginning Balance $ 1,470,338 $ 1,328,285 $ 612,718 $ 6,460,497 $ 9,871,838 Provision for Loan Losses 61,866 26,726 27,013 584,395 700,000 Charge-Offs — (55,886) — — (55,886) Recoveries 600 18,609 — 141,110 160,319 Ending Balance $ 1,532,804 $ 1,317,734 $ 639,731 $ 7,186,002 $ 10,676,271 Six Months Ended June 30, 2020 Residential Consumer Commercial Commercial Total Beginning Balance $ 1,390,594 $ 1,210,849 $ 544,764 $ 6,079,367 $ 9,225,574 Provision for Loan Losses 141,010 168,670 130,015 960,305 1,400,000 Charge-Offs — (102,993) (35,048) — (138,041) Recoveries 1,200 41,208 — 146,330 188,738 Ending Balance $ 1,532,804 $ 1,317,734 $ 639,731 $ 7,186,002 $ 10,676,271 Three Months Ended June 30, 2019 Residential Commercial Commercial Beginning Balance $ 1,147,670 $ 1,121,205 $ 991,982 $ 5,537,698 $ 8,798,555 Provision for Loan Losses (23,308) 69,702 (95,635) 49,241 — Charge-Offs — (135,286) — (28,079) (163,365) Recoveries 1,450 36,706 496 79,697 118,349 Ending Balance $ 1,125,812 $ 1,092,327 $ 896,843 $ 5,638,557 $ 8,753,539 8. Loans Receivable, Net, Continued Six Months Ended June 30, 2019 Residential Commercial Commercial Beginning Balance $ 1,191,443 $ 1,203,593 $ 923,600 $ 5,853,081 $ 9,171,717 Provision for Loan Losses (35,958) 74,508 (40,189) 101,639 100,000 Charge-Offs (34,599) (265,480) (1,132) (428,164) (729,375) Recoveries 4,926 79,706 14,564 112,001 211,197 Ending Balance $ 1,125,812 $ 1,092,327 $ 896,843 $ 5,638,557 $ 8,753,539 The following tables present information related to impaired loans evaluated individually and collectively for impairment in the allowance for loan losses at the dates indicated: Allowance For Loan Losses June 30, 2020 Individually Evaluated For Collectively Evaluated For Total Residential Real Estate $ — $ 1,532,804 $ 1,532,804 Consumer — 1,317,734 1,317,734 Commercial Business — 639,731 639,731 Commercial Real Estate — 7,186,002 7,186,002 Total $ — $ 10,676,271 $ 10,676,271 Allowance For Loan Losses December 31, 2019 Individually Evaluated For Collectively Evaluated For Residential Real Estate $ — $ 1,390,594 $ 1,390,594 Consumer — 1,210,849 1,210,849 Commercial Business — 544,764 544,764 Commercial Real Estate — 6,079,367 6,079,367 Total $ — $ 9,225,574 $ 9,225,574 The following tables present information related to impaired loans evaluated individually and collectively for impairment in loans receivable at the dates indicated: Loans Receivable June 30, 2020 Individually Evaluated For Collectively Evaluated For Total Residential Real Estate $ 1,816,520 $ 83,047,861 $ 84,864,381 Consumer 176,522 58,058,784 58,235,306 Commercial Business 55,446 23,948,341 24,003,787 Commercial Real Estate 1,502,437 310,473,013 311,975,450 PPP — 72,672,428 72,672,428 Total $ 3,550,925 $ 548,200,427 $ 551,751,352 Because the SBA guarantees 100% of the PPP loans made to eligible borrowers, and the entire principal amount of these loans, including any accrued interest, is eligible to be forgiven and repaid by the SBA; PPP loans are excluded from our allowance for loan losses calculation. 8. Loans Receivable, Net, Continued Loans Receivable December 31, 2019 Individually Evaluated For Collectively Evaluated For Residential Real Estate $ 1,086,433 $ 85,317,871 $ 86,404,304 Consumer 184,402 56,146,611 56,331,013 Commercial Business 64,406 22,169,783 22,234,189 Commercial Real Estate 1,894,642 301,656,263 303,550,905 Total $ 3,229,883 $ 465,290,528 $ 468,520,411 Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired management measures the impairment and records the loan at fair value. Fair value is estimated using one of the following methods: fair value of the collateral less estimated costs to sell, discounted cash flows, or market value of the loan based on similar debt. The fair value of the collateral less estimated costs to sell is the most frequently used method. Typically, the Company reviews the most recent appraisal and, if it is over 24 months old, will request a new third party appraisal. Depending on the particular circumstances surrounding the loan, including the location of the collateral, the date of the most recent appraisal and the value of the collateral relative to the recorded investment in the loan, management may order an independent appraisal immediately or, in some instances, may elect to perform an internal analysis. The average balance of impaired loans was $3.9 million for the three months ended June 30, 2020 compared to $4.9 million for the three months ended June 30, 2019. The following tables present information related to impaired loans by loan category at June 30, 2020 and December 31, 2019 and for the six months ended June 30, 2020 and 2019. There was no allowance recorded related to any impaired loans at June 30, 2020 and December 31, 2019. June 30, 2020 December 31, 2019 Impaired Loans Recorded Unpaid Related Recorded Unpaid With No Related Allowance Recorded: Residential Real Estate $ 1,816,520 $ 1,816,520 $ — $ 1,086,433 $ 1,086,433 $ — Consumer 176,522 184,822 — 184,402 192,702 — Commercial Business 55,446 950,446 — 64,406 959,406 — Commercial Real Estate 1,502,437 1,674,657 — 1,894,642 2,066,862 — Total $ 3,550,925 $ 4,626,445 $ — $ 3,229,883 $ 4,305,403 $ — 8. Loans Receivable, Net, Continued Three Months Ended June 30, 2020 2019 Impaired Loans Average Interest Average Interest With No Related Allowance Recorded: Residential Real Estate $ 1,826,881 $ 11,835 $ 1,157,380 $ — Consumer 178,355 — 137,233 — Commercial Business 61,366 — 73,606 — Commercial Real Estate 1,836,782 18,232 2,481,028 14,085 With an Allowance Recorded: Consumer — — 71,554 — Commercial Real Estate — — 996,990 — Total Residential Real Estate 1,826,881 11,835 1,157,380 — Consumer 178,355 — 208,787 — Commercial Business 61,366 — 73,606 — Commercial Real Estate 1,836,782 18,232 3,478,018 14,085 Total $ 3,903,384 $ 30,067 $ 4,917,791 $ 14,085 Six Months Ended June 30, 2020 2019 Impaired Loans Average Interest Average Interest With No Related Allowance Recorded: Residential Real Estate $ 1,837,270 $ 13,030 $ 1,347,984 $ — Consumer 180,340 — 982,404 — Commercial Business 62,669 — 75,149 — Commercial Real Estate 1,856,463 33,792 2,866,245 28,332 With an Allowance Recorded: Consumer — — 72,072 — Commercial Real Estate — — 1,181,152 — Total Residential Real Estate 1,837,270 13,030 1,347,984 — Consumer 180,340 — 1,054,476 — Commercial Business 62,669 — 75,149 — Commercial Real Estate 1,856,463 33,792 4,047,397 28,332 Total $ 3,936,742 $ 46,822 $ 6,525,006 $ 28,332 8. Loans Receivable, Net, Continued In the course of resolving delinquent loans, the Company may choose to restructure the contractual terms of certain loans. A troubled debt restructuring ("TDR") is a restructuring in which the Company, for economic or legal reasons related to a borrower’s financial difficulties, grants a concession to a borrower that it would not otherwise consider (Financial Accounting Standards Board ("FASB") ASC Topic 310-40). The concessions granted on TDRs generally include terms to reduce the interest rate, extend the term of the debt obligation, or modify the payment structure on the debt obligation. The Company grants such concessions to reassess the borrower’s financial status and develop a plan for repayment. At the date of modification, TDRs are initially classified as nonaccrual TDRs. TDR loans are returned to accruing status when there is economic substance to the restructuring, there is documented credit evaluation of the borrower's financial condition, the remaining balance is reasonably assured of repayment in accordance with its modified terms, and the borrower has demonstrated sustained repayment performance in accordance with the modified terms for a reasonable period of time (generally a minimum of six months). TDRs included in impaired loans at June 30, 2020 and December 31, 2019 had a combined balance of $774,000 and $825,000, respectively, and the Company had no commitments at these dates to lend additional funds on these loans. There were no new TDRs modified during the six months ended June 30, 2020 or 2019 and there were no TDRs in default at those dates. The Bank considers any loan 30 days or more past due to be in default. The Company's policy with respect to accrual of interest on loans restructured as a TDR follows relevant supervisory guidance. That is, if a borrower has demonstrated performance under the previous loan terms and shows capacity to perform under the restructured loan terms, continued accrual of interest at the restructured interest rate is probable. If a borrower was materially delinquent on payments prior to the restructuring but shows capacity to meet the restructured loan terms, the loan will likely continue as nonaccrual going forward. Lastly, if the borrower does not perform under the restructured terms, the loan is placed on nonaccrual status. The Company closely monitors these loans and will cease accruing interest on them if management believes that the borrowers may not continue performing based on the restructured note terms. If, after previously being classified as a TDR, a loan is restructured a second time, then that loan is automatically placed on nonaccrual status. The Company's policy with respect to nonperforming loans requires the borrower to make a minimum of six consecutive payments in accordance with the modified loan terms before that loan can be placed back on accrual status. Further, the borrower must demonstrate the capacity to continue making payments on the loan prior to restoration of accrual status. The Coronavirus Aid, Relief, and Economic Security Act of 2020 ("CARES Act") signed into law on March 27, 2020, amended GAAP with respect to the modification of loans to borrowers affected by the COVID-19 pandemic. Among other criteria, this guidance provided that short-term loan modifications made on a good faith basis to borrowers who were current as defined under the CARES Act prior to any relief, are not TDRs. This includes short-term (e.g. six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. To qualify as an eligible loan under the CARES Act, a loan modification must be 1) related to COVID-19; 2) executed on a loan that was not more than 30 days past due as of December 31, 2019; and 3) executed between March 1, 2020, and the earlier of A) 60 days after the date of termination of the national emergency by the President or B) December 31, 2020. On March 22, 2020, federal banking regulators issued an interagency statement that included similar guidance on their approach for the accounting of loan modifications in light of the economic impact of the COVID-19 pandemic that provides that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not TDRs. See Footnote 11 – Accounting and Reporting Changes. As of June 30, 2020 the Bank had approved 324 loan modifications related to the COVID-19 pandemic with an outstanding loan balance, net of deferred fees, totaling $110.6 million, which consisted of deferral of regularly scheduled principal and interest payments for three to six months. The majority of these modifications ($104.0 million) have been for commercial real estate loans. Loan modifications in accordance with the CARES Act and related banking agency regulatory guidance are still subject to an evaluation in regards to determining whether or not a loan is deemed to be impaired. |
Regulatory Matters
Regulatory Matters | 6 Months Ended |
Jun. 30, 2020 | |
Banking and Thrift [Abstract] | |
Regulatory Matters | Regulatory Matters The Bank, as a state-chartered, federally insured savings bank, is subject to the capital requirements established by the FDIC. Under the FDIC's capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weighting and other factors. The Company is a bank holding company registered with the Federal Reserve. Bank holding companies are subject to capital adequacy requirements of the Federal Reserve under the Bank Holding Company Act of 1956, as amended, and the regulations of the Federal Reserve. For a bank holding company with less than $3.0 billion in assets, the capital guidelines apply on a bank only basis and the Federal Reserve expects the holding company's subsidiary banks to be well-capitalized under the prompt corrective action regulations. If Security Federal Corporation was subject to regulatory guidelines for bank holding companies with $3.0 billion or more in assets, it would have exceeded all regulatory capital requirements with Common Equity Tier 1 ("CET1") capital, Tier 1 leverage-based capital, Tier 1 risk-based capital and total risk-based capital ratios of 16.5%, 9.6%, 17.4% and 23.9%, respectively, at June 30, 2020. Based on its capital levels at June 30, 2020, the Bank exceeded all regulatory capital requirements as of that date. Consistent with the Bank's goals to operate a sound and profitable organization, it is the Bank's policy to maintain a "well-capitalized" status under the regulatory capital categories of the FDIC. Based on capital levels at June 30, 2020, the Bank was considered to be "well-capitalized" under applicable regulatory requirements. Management monitors the capital levels to provide for current and future business opportunities and to maintain the Bank's "well-capitalized" status. The tables below provide the Bank’s regulatory capital requirements and actual results at the dates indicated. Actual For Capital Adequacy To Be "Well-Capitalized" Amount Ratio Amount Ratio Amount Ratio June 30, 2020 Dollars in Thousands Tier 1 Risk-Based Core Capital $ 105,039 18.3% $ 34,406 6.0% $ 45,875 8.0% Total Risk-Based Capital 112,250 19.6% 45,875 8.0% 57,344 10.0% Common Equity Tier 1 Capital (To Risk Weighted Assets) 105,039 18.3% 25,805 4.5% 37,273 6.5% Tier 1 Leverage (Core) Capital 105,039 9.8% 43,017 4.0% 53,771 5.0% December 31, 2019 Tier 1 Risk-Based Core Capital $ 101,280 18.2% $ 33,418 6.0% $ 44,558 8.0% Total Risk-Based Capital 108,270 19.4% 44,558 8.0% 55,697 10.0% Common Equity Tier 1 Capital (To Risk Weighted Assets) 101,280 18.2% 25,064 4.5% 36,203 6.5% Tier 1 Leverage (Core) Capital 101,280 10.4% 39,134 4.0% 48,917 5.0% In addition to the minimum capital requirements, the Bank must maintain a capital conservation buffer, which consists of additional CET1 capital greater than 2.5% of risk weighted assets above the required minimum levels in order to avoid limitations on paying dividends, repurchasing shares, and paying discretionary bonuses. At June 30, 2020 the Bank’s conservation buffer was 11.6%. |
Carrying Amounts and Fair Value
Carrying Amounts and Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Carrying Amounts and Fair Value of Financial Instruments | Carrying Amounts and Fair Value of Financial Instruments GAAP requires the Company to disclose fair value of financial instruments measured at amortized cost on the balance sheet and to measure that fair value using an exit price notion, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. Accounting guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 - Quoted Market Price in Active Markets Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as U.S. Treasuries and money market funds. Level 2 - Significant Other Observable Inputs Valuation is based upon quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, mortgage-backed securities, municipal bonds, corporate debt securities and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes certain derivative contracts. Level 3 - Significant Unobservable Inputs Valuation is generated from model-based techniques that use at least one significant assumption based on unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The following is a description of the valuation methodologies used for assets and liabilities recorded at fair value. Investment Securities Available for Sale Investment securities available for sale are recorded at fair value on a recurring basis. At June 30, 2020, the Company’s investment portfolio was comprised of student loan pools, government and agency bonds, mortgage-backed securities issued by government agencies or GSEs, private label CMO mortgage-backed securities, municipal securities, and one state tax credit. Fair value measurement is based upon prices obtained from third party pricing services that use independent pricing models which rely on a variety of factors including reported trades, broker/dealer quotes, benchmark yields, economic and industry events and other relevant market information. As a result, these securities are classified as Level 2. Mortgage Loans Held for Sale The Company originates fixed rate residential loans on a servicing released basis in the secondary market. Loans closed but not yet settled with the FHLMC or other investors, are carried in the Company’s loans held for sale portfolio. These loans are fixed rate residential loans that have been originated in the Company’s name and have closed. Virtually all of these loans have commitments to be purchased by investors and the majority of these loans were locked in by price with the investors on the same day or shortly thereafter that the loan was locked in with the Company’s customers. Therefore, these loans present very little market risk for the Company. The Company usually delivers a commitment to, and receives funding from, the investor within 30 days. Commitments to sell these loans to the investor are considered derivative contracts and are sold to investors on a “best efforts" basis. The Company is not obligated to deliver a loan or pay a penalty if a loan is not delivered to the investor. As a result of the short-term nature of these derivative contracts, the fair value of the mortgage loans held for sale in most cases is the same as the value of the loan amount at its origination . These loans are classified as Level 2. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued Impaired Loans The Company does not record loans held for investment at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established as necessary. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as impaired, management measures the impairment by determining the fair value of the collateral for the loan. Fair value is estimated using one of the following methods: fair value of the collateral less estimated costs to sell, discounted cash flows, or market value of the loan based on similar debt. The fair value of the collateral less estimated costs to sell is the most frequently used method. Typically, the Company reviews the most recent appraisal and if it is over 24 months old will request a new third party appraisal. Depending on the particular circumstances surrounding the loan, including the location of the collateral, the date of the most recent appraisal and the value of the collateral relative to the recorded investment in the loan, management may order an independent appraisal immediately or, in some instances, may elect to perform an internal analysis. Specifically as an example, in situations where the collateral on a nonperforming commercial real estate loan is out of the Company’s primary market area, management would typically order an independent appraisal immediately, at the earlier of the date the loan becomes nonperforming or immediately following the determination that the loan is impaired. However, as a second example, on a nonperforming commercial real estate loan where management is familiar with the property and surrounding areas and where the original appraisal value far exceeds the recorded investment in the loan, management may perform an internal analysis whereby the previous appraisal value would be reviewed and adjusted for current conditions including recent sales of similar properties in the area and any other relevant economic trends. These valuations are reviewed at a minimum on a quarterly basis. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At June 30, 2020, our impaired loans were generally evaluated based on the fair value of the collateral. Impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. The Company records impaired loans as nonrecurring Level 3. At June 30, 2020 and December 31, 2019, the recorded investment in impaired loans was $3.6 million and $3.2 million Foreclosed Assets Foreclosed assets are adjusted to fair value upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. Foreclosed assets are recorded as nonrecurring Level 3. Assets measured at fair value on a recurring basis were as follows at June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Student Loan Pools $ — $ 51,184,667 $ — $ — $ 40,231,830 $ — SBA Bonds — 110,487,183 — — 111,893,099 — Tax Exempt Municipal Bonds — 44,093,279 — — 47,241,494 — Taxable Municipal Bonds — 28,585,740 — — 14,840,410 — Mortgage-Backed Securities — 237,514,685 — — 200,438,007 — State Tax Credit — 66,069 — — — — Total $ — $ 471,931,623 $ — $ — $ 414,644,840 $ — There were no liabilities measured at fair value on a recurring basis at June 30, 2020 or December 31, 2019. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis. These include assets that are measured at the lower of cost or market that were recognized at fair value below cost at the end of the period. The tables below present assets measured at fair value on a nonrecurring basis at June 30, 2020 and December 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall. June 30, 2020 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 6,155,830 $ — $ 6,155,830 Collateral Dependent Impaired Loans (1) — — 3,546,165 3,546,165 Foreclosed Assets — — 184,300 184,300 Total $ — $ 6,155,830 $ 3,730,465 $ 9,886,295 December 31, 2019 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 3,990,606 $ — $ 3,990,606 Collateral Dependent Impaired Loans (1) — — 3,222,746 3,222,746 Foreclosed Assets — — 677,740 677,740 Total $ — $ 3,990,606 $ 3,900,486 $ 7,891,092 (1) COLLATERAL IMPAIRED LOANS ARE REPORTED NET OF SPECIFIC RESERVES. THERE WERE NO SPECIFIC RESERVES AT JUNE 30, 2020 AND DECEMBER 31, 2019. There were no liabilities measured at fair value on a nonrecurring basis at June 30, 2020 or December 31, 2019. For Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis at June 30, 2020 and December 31, 2019, the significant unobservable inputs used in the fair value measurements were as follows: Valuation Significant June 30, 2020 December 31, 2019 Level 3 Assets Technique Unobservable Inputs Range Range Collateral Dependent Impaired Loans Appraised Value Discount Rates/ Discounts to Appraised Values 12% - 95% 8% - 92% Foreclosed Assets Appraised Value/Comparable Sales Discount Rates/ Discounts to Appraised Values For assets and liabilities not presented on the balance sheet at fair value, the following methods are used to determine fair value: Cash and Cash Equivalents —The carrying amount of these financial instruments approximates fair value. All mature within 90 days and do not present unanticipated credit concerns. Certificates of Deposit with Other Banks —Fair value is based on market prices for similar assets. Investment Securities Held to Maturity —Securities held to maturity are valued at quoted market prices or dealer quotes. Loans Receivable, Net —The fair value of loans is estimated using an exit price notion. The exit price notion uses a discounted cash flows technique to calculate the present value of expected future cash flows for a financial instrument and also incorporates other factors, such as enhanced credit risk, illiquidity risk and market factors that sometimes exist in exit prices in dislocated markets. The credit risk assumption is intended to approximate the fair value that a market participant would realize in a hypothetical orderly transaction. The Company’s loan portfolio is initially fair valued using a segmented approach. The Company divides its loan portfolio into the following categories: commercial real estate, other commercial, residential real estate, consumer and all other loans. The results are then adjusted to account for credit risk as described above. A further credit risk discount must be applied through the use of a discounted cash flow model to compensate for illiquidity risk, based on certain assumptions included within the discounted cash flow model, primarily the use of discount rates that better capture inherent credit risk over the lifetime of a loan. This consideration of enhanced credit risk provides an estimated exit price for the Company’s loan portfolio. For variable-rate loans that reprice frequently and have no significant change in credit risk, fair values approximate carrying values. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued FHLB Stock —The fair value approximates the carrying value. Deposits —The fair value of demand deposits, savings accounts, and money market accounts is the amount payable on demand at the reporting date. The fair value of fixed-maturity certificates of deposits is estimated by discounting the future cash flows using rates currently offered for deposits of similar remaining maturities. FHLB Advances and Borrowings from the FRB —Fair value is estimated using discounted cash flows with current market rates for borrowings with similar terms. Other Borrowed Money —The carrying value of these short term borrowings approximates fair value. Senior Convertible Debentures — The fair value is estimated by discounting the future cash flows using the current rates at which similar debenture offerings with similar terms and maturities would be issued by similar institutions. As discount rates are based on current debenture rates as well as management estimates, the fair values presented may not be indicative of the value negotiated in an actual sale. Subordinated Debentures —The fair value is estimated by discounting the future cash flows using the current rates at which similar debenture offerings with similar terms and maturities would be issued by similar institutions. As discount rates are based on current debenture rates as well as management estimates, the fair values presented may not be indicative of the value negotiated in an actual sale. Junior Subordinated Debentures —The carrying value of junior subordinated debentures approximates fair value. The following tables provide a summary of the carrying value and estimated fair value of the Company’s financial instruments at June 30, 2020 and December 31, 2019 presented in accordance with the applicable accounting guidance. June 30, 2020 Carrying Fair Value Amount Total Level 1 Level 2 Level 3 Financial Assets: Dollars in thousands Cash and Cash Equivalents $ 534,446 $ 534,446 $ 534,446 $ — $ — Certificates of Deposits with Other Banks 950,005 950 — 950 — Investment and Mortgage-Backed Securities 488,790 489,765 — 489,765 — Loans Receivable, Net 534,446 540,345 — — 540,345 FHLB Stock 2,673 2,673 2,673 — — Financial Liabilities: Deposits: Checking, Savings & Money Market Accounts $ 663,357 $ 663,357 $ 663,357 $ — $ — Certificate Accounts 211,828 213,407 — 213,407 — Advances from FHLB 42,500 43,104 — 43,104 — Borrowings from FRB 9,700 9,838 — 9,838 — Other Borrowed Money 20,953 20,953 20,953 — — Subordinated Debentures 30,000 30,000 — 30,000 — Junior Subordinated Debentures 5,155 5,155 — 5,155 — 10. Carrying Amounts and Fair Value of Financial Instruments, Continued December 31, 2019 Carrying Fair Value Amount Total Level 1 Level 2 Level 3 Financial Assets: Dollars in thousands Cash and Cash Equivalents $ 12,536 $ 12,536 $ 12,536 $ — $ — Certificates of Deposits with Other Banks 950,005 950 — 950 — Investment and Mortgage-Backed Securities 433,892 434,451 — 434,451 — Loans Receivable, Net 452,859 450,796 — — 450,796 FHLB Stock 2,537 2,537 2,537 — — Financial Liabilities: Deposits: Checking, Savings & Money Market Accounts $ 541,954 $ 541,954 $ 541,954 $ — $ — Certificate Accounts 229,453 229,363 — 229,363 — Advances from FHLB 38,138 38,233 — 38,233 — Other Borrowed Money 11,580 11,580 11,580 — — Senior Convertible Debentures 6,044 6,044 — 6,044 — Subordinated Debentures 30,000 30,000 — 30,000 — Junior Subordinated Debentures 5,155 5,155 — 5,155 — At June 30, 2020, the Bank had $113.8 million in off-balance sheet financial commitments. These commitments are to originate loans and unused consumer lines of credit and credit card lines. Because these obligations are based on current market rates, if funded, the original principal amount is considered to be a reasonable estimate of fair value. Fair value estimates are made on a specific date, based on relevant market data and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale the Bank’s entire holdings of a particular financial instrument. Because no active market exists for a significant portion of the Bank’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, current interest rates and prepayment trends, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in any of these assumptions used in calculating fair value would also significantly affect the estimates. Fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. For example, the Bank has significant assets and liabilities that are not considered financial assets or liabilities including deposit franchise values, loan servicing portfolios, deferred tax liabilities, and premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of these estimates. The Company has used management’s best estimate of fair value on the above assumptions. Thus, the fair values presented may not be the amounts, which could be realized, in an immediate sale or settlement of the instrument. In addition, any income taxes or other expenses that would be incurred in an actual sale or settlement are not taken into consideration in the fair value presented. |
Non-interest Income (Notes)
Non-interest Income (Notes) | 6 Months Ended |
Jun. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income and Other Expense Disclosure [Text Block] | 12. Non-Interest Income Revenue Recognition In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Deposit Fees The Bank earns fees from its deposit customers for account maintenance, transaction-based and overdraft services. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis. The performance obligation is satisfied and the fees are recognized on a monthly basis as the service period is completed. Transaction-based fees on deposits accounts are charged to deposit customers for specific services provided to the customer, such as non-sufficient funds fees, overdraft fees, and wire fees. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer. Check Card Fee Income Check card fee income represents fees earned when a debit card issued by the Bank is used. The Bank earns interchange fees from debit cardholder transactions through the Mastercard payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder. The performance obligation is satisfied and the fees are earned when the cost of the transaction is charged to the card. Certain expenses directly associated with the debit card are recorded on a net basis with the fee income. 12. Non-Interest Income, Continued Trust Income Trust income includes monthly advisory fees that are based on assets under management and certain transaction fees that are assessed and earned monthly, concurrently with the investment management services provided to the customer. The Bank does not charge performance based fees for its trust services and does not currently have any institutional clients, hedge funds or mutual funds. Although trust income is included within the scope of ASC 606, based on the fees charged by the Bank, there were no changes in the accounting for trust income at this time. Gains/Losses on OREO Sales Gains/losses on the sale of OREO are included in non-interest expense and are generally recognized when the performance obligation is complete. This is typically at delivery of control over the property to the buyer at the time of each real estate closing. The following table presents the Company's non-interest income for the three months ended June 30, 2020 and 2019. All of the Company’s revenue from contracts with customers within the scope of ASC 606 is recognized in non-interest income, with the exception of gains on the sale of OREO, which are included in non-interest expense when applicable. Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Non-interest income: Service fees on deposit accounts $ 188,401 $ 254,610 $ 473,476 $ 506,627 Check card fee income 446,931 355,321 801,030 697,655 Trust income 238,895 258,600 538,220 517,200 Insurance commissions (1) 163,745 175,693 311,776 326,993 Gain on sale of investment securities, net (1) 486,577 670,134 1,193,320 960,902 Gain on sale of loans, net (1) 806,415 372,048 1,309,266 546,331 BOLI income (1) 135,000 135,000 270,000 270,000 Grant income (1) 87,164 17,414 145,504 277,029 Other non-interest income (1) 252,859 253,741 559,285 585,656 Total non-interest income $ 2,805,987 $ 2,492,561 $ 5,601,877 $ 4,688,393 (1) Not within the scope of ASC 606 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsSubsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued. Recognized subsequent events are events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including estimates inherent in the process of preparing financial statements. Nonrecognized subsequent events are events that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. Management has reviewed all events occurring through the date the consolidated financial statements were available to be issued and determined that there were no subsequent events requiring disclosure. |
Critical Accounting Policies (P
Critical Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Allowance for Loan Losses | The Company believes the allowance for loan losses is a critical accounting policy that requires the most significant judgments and estimates used in preparation of the consolidated financial statements. The impact of an unexpected and sudden large loss could deplete the allowance and potentially require increased provisions to replenish the allowance, which would negatively affect earnings. The Company provides for loan losses using the allowance method. Accordingly, all loan losses are charged to the related allowance and all recoveries are credited to the allowance for loan losses. Additions to the allowance for loan losses are provided by charges to operations based on various factors, which, in management’s judgment, deserve current recognition in estimating possible losses. Such factors considered by management include the fair value of the underlying collateral, stated guarantees by the borrower (if applicable), the borrower’s ability to repay from other economic resources, growth and composition of the loan portfolio, the relationship of the allowance for loan losses to the outstanding loans, loss experience, delinquency trends, and general economic conditions. Management evaluates the carrying value of the loans periodically and the allowance is adjusted accordingly. 3. Critical Accounting Policies, Continued While management uses the best information available to make evaluations, future adjustments may be necessary if economic conditions differ substantially from the assumptions used in making these evaluations. The allowance for loan losses is subject to periodic evaluations by our bank regulatory agencies, including the Board of Governors of the Federal Reserve System ("Federal Reserve"), the FDIC and the South Carolina Board of Financial Institutions, that may require adjustments to be made to the allowance based upon the information that is available at the time of their examination. The Company values impaired loans at the loan’s fair value if it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement at the present value of expected cash flows, the market price of the loan, if available, or the value of the underlying collateral. Expected cash flows are required to be discounted at the loan’s effective interest rate. When the ultimate collectibility of an impaired loan’s principal is in doubt, wholly or partially, all cash receipts are applied to principal. When this doubt does not exist, cash receipts are applied under the contractual terms of the loan agreement first to interest and then to principal. Once the recorded principal balance has been reduced to zero, future cash receipts are applied to interest income to the extent that any interest has been foregone. Further cash receipts are recorded as recoveries of any amounts previously charged off. |
Income Taxes | The Company uses assumptions and estimates in determining income taxes payable or refundable for the current year, deferred income tax liabilities and assets for events recognized differently in its financial statements and income tax returns, and income tax expense. Determining these amounts requires analysis of certain transactions and interpretation of tax laws and regulations. The Company exercises considerable judgment in evaluating the amount and timing of recognition of the resulting tax liabilities and assets. These judgments and estimates are reevaluated on a continual basis as regulatory and business factors change. No assurance can be given that either the tax returns submitted by us or the income tax reported on the Consolidated Financial Statements will not be adjusted by either adverse rulings by the United States Tax Court, changes in the tax code, or assessments made by the Internal Revenue Service. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Activity under stock option plans | |
Options outstanding |
Investment and Mortgage-Backe_3
Investment and Mortgage-Backed Securities, Available for Sale (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available for Sale Securities | The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of investment and mortgage-backed securities available for sale at the dates indicated were as follows: June 30, 2020 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 52,946,093 $ 24,329 $ 1,785,755 $ 51,184,667 Small Business Administration (“SBA”) Bonds 110,532,402 647,863 693,082 110,487,183 Tax Exempt Municipal Bonds 38,913,210 5,180,069 — 44,093,279 Taxable Municipal Bonds 27,901,187 774,999 90,446 28,585,740 Mortgage-Backed Securities 226,394,056 11,425,761 305,132 237,514,685 State Tax Credit 66,069 — — 66,069 Total Available For Sale $ 456,753,017 $ 18,053,021 $ 2,874,415 $ 471,931,623 December 31, 2019 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Student Loan Pools $ 41,088,231 $ — $ 856,401 $ 40,231,830 SBA Bonds 111,927,938 622,105 656,944 111,893,099 Tax Exempt Municipal Bonds 43,153,086 4,088,408 — 47,241,494 Taxable Municipal Bonds 15,169,737 35,359 364,686 14,840,410 Mortgage-Backed Securities 197,356,288 3,664,621 582,902 200,438,007 Total Available For Sale $ 408,695,280 $ 8,410,493 $ 2,460,933 $ 414,644,840 |
Schedule of Available For Sale Securities, Contractual Maturities | June 30, 2020 Investment Securities: Amortized Cost Fair Value One Year or Less $ 78,977 $ 78,893 After One – Five Years 5,183,070 5,225,881 After Five – Ten Years 67,925,056 67,955,648 More Than Ten Years 157,171,858 161,156,516 Mortgage-Backed Securities 226,394,056 237,514,685 Total Available For Sale $ 456,753,017 $ 471,931,623 |
Schedule of Temporarily Impaired Securities, Fair Value and Unrealized Losses | The following tables show gross unrealized losses and fair value, aggregated by investment category, and length of time that the individual available for sale securities were in a continuous unrealized loss position at the dates indicated. June 30, 2020 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Student Loan Pools $ 19,529,136 $ 538,513 $ 29,869,847 $ 1,247,242 $ 49,398,983 $ 1,785,755 SBA Bonds 30,451,987 179,367 43,790,190 513,715 74,242,177 693,082 Taxable Municipal Bonds 3,508,658 90,446 — — 3,508,658 90,446 Mortgage-Backed Securities 24,160,716 205,894 29,139,252 99,238 53,299,968 305,132 $ 77,650,497 $ 1,014,220 $ 102,799,289 $ 1,860,195 $ 180,449,786 $ 2,874,415 6. Investment and Mortgage-Backed Securities, Available For Sale, Continued December 31, 2019 Less than 12 Months 12 Months or More Total Fair Unrealized Fair Unrealized Fair Unrealized Student Loan Pools $ 30,079,497 $ 534,048 $ 10,152,333 $ 322,353 $ 40,231,830 $ 856,401 SBA Bonds 13,844,666 106,110 47,395,036 550,834 61,239,702 656,944 Taxable Municipal Bond 13,810,279 364,686 — — 13,810,279 364,686 Mortgage-Backed Securities 55,326,064 480,958 7,975,863 101,944 63,301,927 582,902 $ 113,060,506 $ 1,485,802 $ 65,523,232 $ 975,131 $ 178,583,738 $ 2,460,933 |
Loans Receivable, Net (Tables)
Loans Receivable, Net (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Loans Receivable, Net [Abstract] (Deprecated 2019-01-31) | |
Financing Receivable, Nonaccrual [Table Text Block] | The following table shows non-accrual loans by category at June 30, 2020 compared to December 31, 2019: June 30, 2020 December 31, 2019 Increase (Decrease) Amount Percent (1) Amount Percent (1) $ % Non-accrual Loans: Residential Real Estate $ 2,393,501 0.4 % $ 1,520,485 0.3 % $ 873,016 57.4% Consumer 402,084 0.1 319,280 0.1 82,804 25.9 Commercial Business 120,042 — 122,605 — (2,563) (2.1) Commercial Real Estate 864,409 0.2 1,474,036 0.3 (609,627) (41.4) Total Non-accrual Loans $ 3,780,036 0.7 % $ 3,436,406 0.7 % $ 343,630 10.0% (1) PERCENT OF TOTAL LOANS HELD FOR INVESTMENT, NET OF DEFERRED FEES AND LOANS IN PROCESS. |
Impaired Financing Receivables [Table Text Block] | The following tables present information related to impaired loans by loan category at June 30, 2020 and December 31, 2019 and for the six months ended June 30, 2020 and 2019. There was no allowance recorded related to any impaired loans at June 30, 2020 and December 31, 2019. June 30, 2020 December 31, 2019 Impaired Loans Recorded Unpaid Related Recorded Unpaid With No Related Allowance Recorded: Residential Real Estate $ 1,816,520 $ 1,816,520 $ — $ 1,086,433 $ 1,086,433 $ — Consumer 176,522 184,822 — 184,402 192,702 — Commercial Business 55,446 950,446 — 64,406 959,406 — Commercial Real Estate 1,502,437 1,674,657 — 1,894,642 2,066,862 — Total $ 3,550,925 $ 4,626,445 $ — $ 3,229,883 $ 4,305,403 $ — 8. Loans Receivable, Net, Continued Three Months Ended June 30, 2020 2019 Impaired Loans Average Interest Average Interest With No Related Allowance Recorded: Residential Real Estate $ 1,826,881 $ 11,835 $ 1,157,380 $ — Consumer 178,355 — 137,233 — Commercial Business 61,366 — 73,606 — Commercial Real Estate 1,836,782 18,232 2,481,028 14,085 With an Allowance Recorded: Consumer — — 71,554 — Commercial Real Estate — — 996,990 — Total Residential Real Estate 1,826,881 11,835 1,157,380 — Consumer 178,355 — 208,787 — Commercial Business 61,366 — 73,606 — Commercial Real Estate 1,836,782 18,232 3,478,018 14,085 Total $ 3,903,384 $ 30,067 $ 4,917,791 $ 14,085 Six Months Ended June 30, 2020 2019 Impaired Loans Average Interest Average Interest With No Related Allowance Recorded: Residential Real Estate $ 1,837,270 $ 13,030 $ 1,347,984 $ — Consumer 180,340 — 982,404 — Commercial Business 62,669 — 75,149 — Commercial Real Estate 1,856,463 33,792 2,866,245 28,332 With an Allowance Recorded: Consumer — — 72,072 — Commercial Real Estate — — 1,181,152 — Total Residential Real Estate 1,837,270 13,030 1,347,984 — Consumer 180,340 — 1,054,476 — Commercial Business 62,669 — 75,149 — Commercial Real Estate 1,856,463 33,792 4,047,397 28,332 Total $ 3,936,742 $ 46,822 $ 6,525,006 $ 28,332 |
Financing Receivable, Troubled Debt Restructuring [Table Text Block] | no |
Schedule of Credit Losses Related to Financing Receivables, Current and Noncurrent [Table Text Block] (Deprecated 2019-01-31) | The following tables show the activity in the allowance for loan losses by category for the three and six months ended June 30, 2020 and 2019: Three Months Ended June 30, 2020 Residential Consumer Commercial Commercial Total Beginning Balance $ 1,470,338 $ 1,328,285 $ 612,718 $ 6,460,497 $ 9,871,838 Provision for Loan Losses 61,866 26,726 27,013 584,395 700,000 Charge-Offs — (55,886) — — (55,886) Recoveries 600 18,609 — 141,110 160,319 Ending Balance $ 1,532,804 $ 1,317,734 $ 639,731 $ 7,186,002 $ 10,676,271 Six Months Ended June 30, 2020 Residential Consumer Commercial Commercial Total Beginning Balance $ 1,390,594 $ 1,210,849 $ 544,764 $ 6,079,367 $ 9,225,574 Provision for Loan Losses 141,010 168,670 130,015 960,305 1,400,000 Charge-Offs — (102,993) (35,048) — (138,041) Recoveries 1,200 41,208 — 146,330 188,738 Ending Balance $ 1,532,804 $ 1,317,734 $ 639,731 $ 7,186,002 $ 10,676,271 Three Months Ended June 30, 2019 Residential Commercial Commercial Beginning Balance $ 1,147,670 $ 1,121,205 $ 991,982 $ 5,537,698 $ 8,798,555 Provision for Loan Losses (23,308) 69,702 (95,635) 49,241 — Charge-Offs — (135,286) — (28,079) (163,365) Recoveries 1,450 36,706 496 79,697 118,349 Ending Balance $ 1,125,812 $ 1,092,327 $ 896,843 $ 5,638,557 $ 8,753,539 8. Loans Receivable, Net, Continued Six Months Ended June 30, 2019 Residential Commercial Commercial Beginning Balance $ 1,191,443 $ 1,203,593 $ 923,600 $ 5,853,081 $ 9,171,717 Provision for Loan Losses (35,958) 74,508 (40,189) 101,639 100,000 Charge-Offs (34,599) (265,480) (1,132) (428,164) (729,375) Recoveries 4,926 79,706 14,564 112,001 211,197 Ending Balance $ 1,125,812 $ 1,092,327 $ 896,843 $ 5,638,557 $ 8,753,539 |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | Loans receivable, net, consisted of the following as of the dates indicated below: June 30, 2020 December 31, 2019 Residential Real Estate Loans $ 84,864,381 $ 86,404,304 Consumer Loans 58,235,306 56,331,013 Commercial Business Loans 24,003,787 22,234,189 Commercial Real Estate Loans 311,975,450 303,550,905 Paycheck Protection Program Loans 72,672,428 — Total Loans Held For Investment 551,751,352 468,520,411 Loans Held For Sale 6,155,830 3,990,606 Total Loans Receivable, Gross $ 557,907,182 $ 472,511,017 Less: Allowance For Loan Losses 10,676,271 9,225,574 Loans in Process 9,755,038 9,957,140 Deferred Loan Fees 3,029,378 469,568 23,460,687 19,652,282 Total Loans Receivable, Net $ 534,446,495 $ 452,858,735 |
Financing Receivable Credit Quality Indicators [Table Text Block] | The tables below summarize the balance within each risk category by loan type, excluding loans held for sale, at June 30, 2020 and December 31, 2019. June 30, 2020 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 74,090,846 $ 5,558,599 $ 1,073,323 $ 4,141,613 $ 84,864,381 Consumer 44,897,990 10,759,361 937,761 1,640,194 58,235,306 Commercial Business 17,787,879 4,935,589 468,875 811,444 24,003,787 Commercial Real Estate 236,153,488 56,777,380 15,486,771 3,557,811 311,975,450 PPP 72,672,428 — — — 72,672,428 Total $ 445,602,631 $ 78,030,929 $ 17,966,730 $ 10,151,062 $ 551,751,352 December 31, 2019 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 76,674,539 $ 4,612,182 $ 1,155,802 $ 3,961,781 $ 86,404,304 Consumer 44,294,400 9,617,301 624,248 1,795,064 56,331,013 Commercial Business 16,140,592 5,486,393 301,462 305,742 22,234,189 Commercial Real Estate 230,810,756 56,025,352 14,285,015 2,429,782 303,550,905 Total $ 367,920,287 $ 75,741,228 $ 16,366,527 $ 8,492,369 $ 468,520,411 |
Financing Receivable, Past Due [Table Text Block] | The following tables present an age analysis of past due balances by loan category at June 30, 2020 and December 31, 2019: June 30, 2020 30-59 Days Past Due 60-89 Days Past Due 90 Days or Total Past Due Current Total Loans Receivable Residential Real Estate $ — $ 107,237 $ 1,233,577 $ 1,340,814 $ 83,523,567 $ 84,864,381 Consumer 312,743 8,504 95,369 416,616 57,818,690 58,235,306 Commercial Business 79,696 26,902 932 107,530 23,896,257 24,003,787 Commercial Real Estate 2,019,784 364,649 754,100 3,138,533 308,836,917 311,975,450 PPP — — — — 72,672,428 72,672,428 Total $ 2,412,223 $ 507,292 $ 2,083,978 $ 5,003,493 $ 546,747,859 $ 551,751,352 December 31, 2019 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Total Past Due Current Total Loans Receivable Residential Real Estate $ — $ 355,290 $ 144,209 $ 499,499 $ 85,904,805 $ 86,404,304 Consumer 422,443 217,542 81,736 721,721 55,609,292 56,331,013 Commercial Business 147,959 76,515 20,316 244,790 21,989,399 22,234,189 Commercial Real Estate 3,849,424 — 1,352,716 5,202,140 298,348,765 303,550,905 Total $ 4,419,826 $ 649,347 $ 1,598,977 $ 6,668,150 $ 461,852,261 $ 468,520,411 |
Financing Receivable, Allowance for Credit Loss [Table Text Block] | The following tables present information related to impaired loans evaluated individually and collectively for impairment in the allowance for loan losses at the dates indicated: Allowance For Loan Losses June 30, 2020 Individually Evaluated For Collectively Evaluated For Total Residential Real Estate $ — $ 1,532,804 $ 1,532,804 Consumer — 1,317,734 1,317,734 Commercial Business — 639,731 639,731 Commercial Real Estate — 7,186,002 7,186,002 Total $ — $ 10,676,271 $ 10,676,271 Allowance For Loan Losses December 31, 2019 Individually Evaluated For Collectively Evaluated For Residential Real Estate $ — $ 1,390,594 $ 1,390,594 Consumer — 1,210,849 1,210,849 Commercial Business — 544,764 544,764 Commercial Real Estate — 6,079,367 6,079,367 Total $ — $ 9,225,574 $ 9,225,574 Loans Receivable June 30, 2020 Individually Evaluated For Collectively Evaluated For Total Residential Real Estate $ 1,816,520 $ 83,047,861 $ 84,864,381 Consumer 176,522 58,058,784 58,235,306 Commercial Business 55,446 23,948,341 24,003,787 Commercial Real Estate 1,502,437 310,473,013 311,975,450 PPP — 72,672,428 72,672,428 Total $ 3,550,925 $ 548,200,427 $ 551,751,352 Because the SBA guarantees 100% of the PPP loans made to eligible borrowers, and the entire principal amount of these loans, including any accrued interest, is eligible to be forgiven and repaid by the SBA; PPP loans are excluded from our allowance for loan losses calculation. 8. Loans Receivable, Net, Continued Loans Receivable December 31, 2019 Individually Evaluated For Collectively Evaluated For Residential Real Estate $ 1,086,433 $ 85,317,871 $ 86,404,304 Consumer 184,402 56,146,611 56,331,013 Commercial Business 64,406 22,169,783 22,234,189 Commercial Real Estate 1,894,642 301,656,263 303,550,905 Total $ 3,229,883 $ 465,290,528 $ 468,520,411 |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Banking and Thrift [Abstract] | |
Regulatory capital amounts and ratios | Actual For Capital Adequacy To Be "Well-Capitalized" Amount Ratio Amount Ratio Amount Ratio June 30, 2020 Dollars in Thousands Tier 1 Risk-Based Core Capital $ 105,039 18.3% $ 34,406 6.0% $ 45,875 8.0% Total Risk-Based Capital 112,250 19.6% 45,875 8.0% 57,344 10.0% Common Equity Tier 1 Capital (To Risk Weighted Assets) 105,039 18.3% 25,805 4.5% 37,273 6.5% Tier 1 Leverage (Core) Capital 105,039 9.8% 43,017 4.0% 53,771 5.0% December 31, 2019 Tier 1 Risk-Based Core Capital $ 101,280 18.2% $ 33,418 6.0% $ 44,558 8.0% Total Risk-Based Capital 108,270 19.4% 44,558 8.0% 55,697 10.0% Common Equity Tier 1 Capital (To Risk Weighted Assets) 101,280 18.2% 25,064 4.5% 36,203 6.5% Tier 1 Leverage (Core) Capital 101,280 10.4% 39,134 4.0% 48,917 5.0% |
Carrying Amounts and Fair Val_2
Carrying Amounts and Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements, recurring basis | Assets measured at fair value on a recurring basis were as follows at June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Student Loan Pools $ — $ 51,184,667 $ — $ — $ 40,231,830 $ — SBA Bonds — 110,487,183 — — 111,893,099 — Tax Exempt Municipal Bonds — 44,093,279 — — 47,241,494 — Taxable Municipal Bonds — 28,585,740 — — 14,840,410 — Mortgage-Backed Securities — 237,514,685 — — 200,438,007 — State Tax Credit — 66,069 — — — — Total $ — $ 471,931,623 $ — $ — $ 414,644,840 $ — |
Fair value measurements, nonrecurring basis | The tables below present assets measured at fair value on a nonrecurring basis at June 30, 2020 and December 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall. June 30, 2020 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 6,155,830 $ — $ 6,155,830 Collateral Dependent Impaired Loans (1) — — 3,546,165 3,546,165 Foreclosed Assets — — 184,300 184,300 Total $ — $ 6,155,830 $ 3,730,465 $ 9,886,295 December 31, 2019 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 3,990,606 $ — $ 3,990,606 Collateral Dependent Impaired Loans (1) — — 3,222,746 3,222,746 Foreclosed Assets — — 677,740 677,740 Total $ — $ 3,990,606 $ 3,900,486 $ 7,891,092 |
Significant unobservable inputs used in the fair value measurements | For Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis at June 30, 2020 and December 31, 2019, the significant unobservable inputs used in the fair value measurements were as follows: Valuation Significant June 30, 2020 December 31, 2019 Level 3 Assets Technique Unobservable Inputs Range Range Collateral Dependent Impaired Loans Appraised Value Discount Rates/ Discounts to Appraised Values 12% - 95% 8% - 92% Foreclosed Assets Appraised Value/Comparable Sales Discount Rates/ Discounts to Appraised Values |
Summary of the carrying value and estimated fair value of financial instruments | The following tables provide a summary of the carrying value and estimated fair value of the Company’s financial instruments at June 30, 2020 and December 31, 2019 presented in accordance with the applicable accounting guidance. June 30, 2020 Carrying Fair Value Amount Total Level 1 Level 2 Level 3 Financial Assets: Dollars in thousands Cash and Cash Equivalents $ 534,446 $ 534,446 $ 534,446 $ — $ — Certificates of Deposits with Other Banks 950,005 950 — 950 — Investment and Mortgage-Backed Securities 488,790 489,765 — 489,765 — Loans Receivable, Net 534,446 540,345 — — 540,345 FHLB Stock 2,673 2,673 2,673 — — Financial Liabilities: Deposits: Checking, Savings & Money Market Accounts $ 663,357 $ 663,357 $ 663,357 $ — $ — Certificate Accounts 211,828 213,407 — 213,407 — Advances from FHLB 42,500 43,104 — 43,104 — Borrowings from FRB 9,700 9,838 — 9,838 — Other Borrowed Money 20,953 20,953 20,953 — — Subordinated Debentures 30,000 30,000 — 30,000 — Junior Subordinated Debentures 5,155 5,155 — 5,155 — 10. Carrying Amounts and Fair Value of Financial Instruments, Continued December 31, 2019 Carrying Fair Value Amount Total Level 1 Level 2 Level 3 Financial Assets: Dollars in thousands Cash and Cash Equivalents $ 12,536 $ 12,536 $ 12,536 $ — $ — Certificates of Deposits with Other Banks 950,005 950 — 950 — Investment and Mortgage-Backed Securities 433,892 434,451 — 434,451 — Loans Receivable, Net 452,859 450,796 — — 450,796 FHLB Stock 2,537 2,537 2,537 — — Financial Liabilities: Deposits: Checking, Savings & Money Market Accounts $ 541,954 $ 541,954 $ 541,954 $ — $ — Certificate Accounts 229,453 229,363 — 229,363 — Advances from FHLB 38,138 38,233 — 38,233 — Other Borrowed Money 11,580 11,580 11,580 — — Senior Convertible Debentures 6,044 6,044 — 6,044 — Subordinated Debentures 30,000 30,000 — 30,000 — Junior Subordinated Debentures 5,155 5,155 — 5,155 — |
Non-interest Income (Tables)
Non-interest Income (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Nonoperating Income, by Component [Table Text Block] | Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Non-interest income: Service fees on deposit accounts $ 188,401 $ 254,610 $ 473,476 $ 506,627 Check card fee income 446,931 355,321 801,030 697,655 Trust income 238,895 258,600 538,220 517,200 Insurance commissions (1) 163,745 175,693 311,776 326,993 Gain on sale of investment securities, net (1) 486,577 670,134 1,193,320 960,902 Gain on sale of loans, net (1) 806,415 372,048 1,309,266 546,331 BOLI income (1) 135,000 135,000 270,000 270,000 Grant income (1) 87,164 17,414 145,504 277,029 Other non-interest income (1) 252,859 253,741 559,285 585,656 Total non-interest income $ 2,805,987 $ 2,492,561 $ 5,601,877 $ 4,688,393 (1) Not within the scope of ASC 606 |
Earnings Per Common Share (Reco
Earnings Per Common Share (Reconciliation of Net Income to Net Income Available to Common Shareholders) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Available To Common Shareholders | ||||||
Net Income | $ 2,016,331 | $ 1,064,187 | $ 1,884,031 | $ 2,088,873 | $ 3,080,518 | $ 3,972,904 |
Income | $ 2,016,331 | $ 1,884,031 |
Earnings Per Common Share (Narr
Earnings Per Common Share (Narrative) (Details) - shares | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||
Weighted Average Number Diluted Shares Outstanding Adjustment | 2,348 | 1,152 |
Earnings Per Common Share Dilut
Earnings Per Common Share Diluted EPS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||
Net Income (Loss) Available to Common Stockholders, Basic | $ 2,016,331 | $ 1,884,031 |
Weighted Average Shares Outstanding (Basic) | 3,252,884 | 2,995,650 |
Net Income Per Common Share (Basic) | $ 0.62 | $ 0.64 |
Dilutive Securities, Effect on Basic Earnings Per Share, Dilutive Convertible Securities | $ 0 | $ 90,660 |
Weighted Average Shares Outstanding, Senior Convertible Debentures | 0 | 302,200 |
Weighted Average Number Diluted Shares Outstanding Adjustment | 2,348 | 1,152 |
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities | 0 | (0.03) |
Net Income (Loss) Available to Common Stockholders, Diluted | $ 2,016,331 | $ 1,974,691 |
Weighted Average Shares Outstanding (Diluted) | 3,252,884 | 3,257,850 |
Net Income Per Common Share (Diluted) | $ 0.62 | $ 0.61 |
Investment and Mortgage-Backe_4
Investment and Mortgage-Backed Securities, Available for Sale (Schedule of Available for Sale Securities) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Gross Realized Losses | $ 0 | $ 283,000 | ||
Available For Sale Securities Pledged as Collateral, Amortized Cost Basis | 221,600,000 | $ 171,400,000 | ||
Pledged Assets Separately Reported, Other Debt Securities Available-for-sale or Held-for-investment | 231,600,000 | 173,100,000 | ||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 456,753,017 | 408,695,280 | ||
Available-for-sale Securities, Gross Unrealized Gains | $ 8,410,493 | 18,053,021 | ||
Available-for-sale Securities, Gross Unrealized Losses | 2,460,933 | 2,874,415 | ||
Available-for-sale Securities, Fair Value Disclosure | 471,931,623 | 414,644,840 | ||
Proceeds From Sale of Available For Sale Securities Including Mortgage Backed Securities | 20,400,000 | 61,900,000 | ||
US States and Political Subdivisions Debt Securities [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 38,913,210 | 43,153,086 | ||
Available-for-sale Securities, Gross Unrealized Gains | 4,088,408 | 5,180,069 | ||
Available-for-sale Securities, Gross Unrealized Losses | 0 | 0 | ||
Mortgage-backed Securities, Issued by Private Enterprises [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 32,000,000 | 15,800,000 | ||
Available-for-sale Securities, Fair Value Disclosure | 32,600,000 | |||
Investments [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Gross Realized Gains | 0 | 1,200,000 | $ 1,200,000 | |
Collateralized Loan Obligations [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 52,946,093 | 41,088,231 | ||
Available-for-sale Securities, Gross Unrealized Losses | 856,401 | 1,785,755 | ||
Available-for-sale Securities, Gross Realized Gains | 24,329 | |||
SBA Bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 110,532,402 | 111,927,938 | ||
Available-for-sale Securities, Gross Unrealized Gains | 622,105 | 647,863 | ||
Available-for-sale Securities, Gross Unrealized Losses | 656,944 | 693,082 | ||
Mortgage-Backed Securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 226,394,056 | 197,356,288 | ||
Available-for-sale Securities, Gross Unrealized Gains | 3,664,621 | 11,425,761 | ||
Available-for-sale Securities, Gross Unrealized Losses | 582,902 | 305,132 | ||
Taxable Municipal Bonds [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 27,901,187 | 15,169,737 | ||
Available-for-sale Securities, Gross Unrealized Gains | 35,359 | 774,999 | ||
Available-for-sale Securities, Gross Unrealized Losses | $ 364,686 | 90,446 | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | US States and Political Subdivisions Debt Securities [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Fair Value Disclosure | 44,093,279 | 47,241,494 | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Collateralized Loan Obligations [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Fair Value Disclosure | 51,184,667 | 40,231,830 | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | SBA Bonds | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Fair Value Disclosure | 110,487,183 | 111,893,099 | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Mortgage-Backed Securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Fair Value Disclosure | 237,514,685 | 200,438,007 | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Taxable Municipal Bonds [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Fair Value Disclosure | $ 28,585,740 | $ 14,840,410 |
Investment and Mortgage-Backe_5
Investment and Mortgage-Backed Securities, Available for Sale (Schedule of Held to Maturity Securities, Contractual Maturities) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Available-for-sale Securities, Gross Realized Losses | $ 0 | $ 283,000 |
Debt Securities, Available-for-sale, Amortized Cost, Fiscal Year Maturity [Abstract] | ||
Less Than One Year, Amortized Cost | 78,977 | |
One – Five Years, Amortized Cost | 5,183,070 | |
Five – Ten Years, Amortized Cost | 67,925,056 | |
After Ten Years, Amortized Cost | 157,171,858 | |
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis | 456,753,017 | |
Debt Securities, Available-for-sale, Fair Value, Fiscal Year Maturity [Abstract] | ||
Less Than One Year, Fair Value | 78,893 | |
One – Five Years, Fair Value | 5,225,881 | |
Five – Ten Years, Fair Value | 67,955,648 | |
After Ten Years, Fair Value | 161,156,516 | |
Debt Securities, Available-for-sale, Maturity, without Single Maturity Date, Fair Value | $ 471,931,623 |
Investment and Mortgage-Backe_6
Investment and Mortgage-Backed Securities, Available for Sale (Schedule of Temporarily Impaired Securities, Fair Value and Unrealized losses) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Available For Sale, Percent of Unrealized Losses for Securities in a Continuous Loss Position, 12 Months or Longer | 64.70% | 39.60% |
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | $ 77,650,497 | $ 113,060,506 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 102,799,289 | 65,523,232 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 180,449,786 | 178,583,738 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Unrealized Losses | 1,014,220 | 1,485,802 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Unrealized Losses | 1,860,195 | 975,131 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses | 2,874,415 | 2,460,933 |
Collateralized Loan Obligations [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 19,529,136 | 30,079,497 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 29,869,847 | 10,152,333 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 49,398,983 | 40,231,830 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Unrealized Losses | 538,513 | 534,048 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Unrealized Losses | 1,247,242 | 322,353 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses | 1,785,755 | 856,401 |
SBA Bonds | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 30,451,987 | 13,844,666 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 43,790,190 | 47,395,036 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 74,242,177 | 61,239,702 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Unrealized Losses | 179,367 | 106,110 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Unrealized Losses | 513,715 | 550,834 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses | 693,082 | 656,944 |
Taxable Municipal Bonds [Member] | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 3,508,658 | 13,810,279 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 3,508,658 | 13,810,279 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Unrealized Losses | 90,446 | 364,686 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Unrealized Losses | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses | 90,446 | 364,686 |
Mortgage-Backed Securities | ||
Debt Securities, Available-for-sale, Unrealized Loss Position [Line Items] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | 24,160,716 | 55,326,064 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | 29,139,252 | 7,975,863 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | 53,299,968 | 63,301,927 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Unrealized Losses | 205,894 | 480,958 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Unrealized Losses | 99,238 | 101,944 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses | $ 305,132 | $ 582,902 |
Investment and Mortgage-Backe_7
Investment and Mortgage-Backed Securities, Available for Sale (Narrative) (Details) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020USD ($) | Jun. 30, 2020USD ($)security | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($)security | |
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | $ 456,753,017 | $ 408,695,280 | ||
Available-for-sale Securities, Fair Value Disclosure | 471,931,623 | 414,644,840 | ||
Available For Sale Securities Pledged as Collateral, Amortized Cost Basis | 221,600,000 | $ 171,400,000 | ||
Proceeds From Sale of Available For Sale Securities Including Mortgage Backed Securities | $ 20,400,000 | $ 61,900,000 | ||
Percent of unrealized losses for securities in a continuous loss position for 12 months or more | 64.70% | 39.60% | ||
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions | security | 93 | 69 | ||
Available-for-sale Securities, Gross Realized Losses | $ 0 | 283,000 | ||
GNMA Mortgage-Backed Securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 68,000,000 | $ 63,200,000 | ||
Available-for-sale Securities, Fair Value Disclosure | 69,800,000 | 63,900,000 | ||
Mortgage-backed Securities, Issued by Private Enterprises [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Amortized Cost of Investment And Mortgage-Backed Securities Available For Sale | 32,000,000 | $ 15,800,000 | ||
Available-for-sale Securities, Fair Value Disclosure | 32,600,000 | |||
Investments [Member] | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Available-for-sale Securities, Gross Realized Gains | $ 0 | $ 1,200,000 | $ 1,200,000 |
Investment and Mortgage-Backe_8
Investment and Mortgage-Backed Securities, Held to Maturity (Schedule of investment and mortgage-backed securities held to maturity) (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Schedule of Held-to-maturity Securities [Line Items] | |||
Held to maturity, gross unrealized gains | $ 974,384 | ||
Debt Securities, Held-to-maturity, Amortized Cost, before Other-than-temporary Impairment | 16,858,861 | ||
Held to maturity, gross unrealized losses | 241 | ||
Debt Securities, Held-to-maturity, Fair Value | 17,833,004 | $ 19,805,841 | |
Available-for-sale Securities, Gross Realized Losses | 0 | $ 283,000 | |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | |||
Schedule of Held-to-maturity Securities [Line Items] | |||
Debt Securities, Held-to-maturity | 16,858,861 | ||
Held to maturity, gross unrealized gains | 974,384 | ||
Held to maturity, gross unrealized losses | 241 | ||
Debt Securities, Held-to-maturity, Fair Value | $ 17,833,004 |
Investment and Mortgage-Backe_9
Investment and Mortgage-Backed Securities, Held to Maturity (Schedule of Held-to-maturity Securities) (Details) | Jun. 30, 2020USD ($) |
Schedule of Held-to-maturity Securities [Line Items] | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Fair Value | $ 0 |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | 241 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Fair Value [Abstract] | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 804,758 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 241 |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | 804,758 |
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | |
Schedule of Held-to-maturity Securities [Line Items] | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Fair Value | 0 |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Accumulated Loss | 241 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Fair Value [Abstract] | |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Fair Value | 804,758 |
Debt Securities, Held-to-maturity, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 241 |
Debt Securities, Held-to-maturity, Unrealized Loss Position, Fair Value | $ 804,758 |
Investment and Mortgage-Back_10
Investment and Mortgage-Backed Securities, Held to Maturity (Narrative) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Proceeds from Sale of Held-to-maturity Securities | $ 0 | |
Debt Securities, Held-to-maturity, Fair Value | 17,833,004 | $ 19,805,841 |
Pledged Financial Instruments, Not Separately Reported, Other Debt Securities Held-to-maturity | 15,600,000 | 17,500,000 |
Held to maturity pledged as collateral, fair value | 16,500,000 | |
US Government Agencies Debt Securities [Member] | ||
Debt Securities, Held-to-maturity, Fair Value | 10,200,000 | 11,600,000 |
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment | $ 9,600,000 | $ 11,300,000 |
Loans Receivable, Net (Schedule
Loans Receivable, Net (Schedule of Accounts, Notes, Loans and Financing Receivable) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | $ 551,751,352 | $ 468,520,411 |
Loans Held For Sale | 6,155,830 | 3,990,606 |
Total Loans Receivable, Gross | 557,907,182 | 472,511,017 |
Allowance For Loan Losses | 10,676,271 | 9,225,574 |
Loans and Leases Receivable, Loans in Process | 9,755,038 | 9,957,140 |
Loans and Leases Receivable, Deferred Income | 3,029,378 | 469,568 |
Loans Receivable, Allowance, Loans in Process, and Deferred Loan Fees | 23,460,687 | 19,652,282 |
Total Loans Receivable, Net | 534,446,495 | 452,859,000 |
Residential Mortgage [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 84,864,381 | 86,404,304 |
Consumer Loan [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 58,235,306 | 56,331,013 |
Commercial Loan [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 24,003,787 | 22,234,189 |
Commercial Real Estate [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | $ 311,975,450 | $ 303,550,905 |
Loans Receivable, Net (Schedu_2
Loans Receivable, Net (Schedule of Allowance for Loan Losses) (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for Loan Losses | $ 700,000 | $ 0 |
Charge Offs | (55,886) | (163,365) |
Recoveries | 160,319 | 118,349 |
Balance At End of Period | 10,676,271 | 8,753,539 |
Residential Real Estate 1 [Member] | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for Loan Losses | 61,866 | (23,308) |
Charge Offs | 0 | 0 |
Recoveries | 600 | 1,450 |
Balance At End of Period | 1,532,804 | 1,125,812 |
Consumer [Member] | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for Loan Losses | 26,726 | 69,702 |
Charge Offs | (55,886) | (135,286) |
Recoveries | 18,609 | 36,706 |
Balance At End of Period | 1,317,734 | 1,092,327 |
Commercial Business [Member] | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for Loan Losses | 27,013 | (95,635) |
Charge Offs | 0 | 0 |
Recoveries | 0 | 496 |
Balance At End of Period | 639,731 | 896,843 |
Commercial Real Estate 1 [Member] | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for Loan Losses | 584,395 | 49,241 |
Charge Offs | 0 | (28,079) |
Recoveries | 141,110 | 79,697 |
Balance At End of Period | $ 7,186,002 | $ 5,638,557 |
Loans Receivable, Net (Financin
Loans Receivable, Net (Financing Receivable Credit Quality Indicators) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable Credit Quality Indicators [Table Text Block] | The tables below summarize the balance within each risk category by loan type, excluding loans held for sale, at June 30, 2020 and December 31, 2019. June 30, 2020 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 74,090,846 $ 5,558,599 $ 1,073,323 $ 4,141,613 $ 84,864,381 Consumer 44,897,990 10,759,361 937,761 1,640,194 58,235,306 Commercial Business 17,787,879 4,935,589 468,875 811,444 24,003,787 Commercial Real Estate 236,153,488 56,777,380 15,486,771 3,557,811 311,975,450 PPP 72,672,428 — — — 72,672,428 Total $ 445,602,631 $ 78,030,929 $ 17,966,730 $ 10,151,062 $ 551,751,352 December 31, 2019 Pass Caution Special Mention Substandard Total Loans Residential Real Estate $ 76,674,539 $ 4,612,182 $ 1,155,802 $ 3,961,781 $ 86,404,304 Consumer 44,294,400 9,617,301 624,248 1,795,064 56,331,013 Commercial Business 16,140,592 5,486,393 301,462 305,742 22,234,189 Commercial Real Estate 230,810,756 56,025,352 14,285,015 2,429,782 303,550,905 Total $ 367,920,287 $ 75,741,228 $ 16,366,527 $ 8,492,369 $ 468,520,411 | |
Financing Receivable, before Allowance for Credit Loss | $ 551,751,352 | $ 468,520,411 |
Residential Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 84,864,381 | 86,404,304 |
Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 58,235,306 | 56,331,013 |
Commercial Business [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 24,003,787 | 22,234,189 |
Commercial Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 311,975,450 | 303,550,905 |
Substandard [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 10,151,062 | 8,492,369 |
Substandard [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 4,141,613 | 3,961,781 |
Substandard [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 1,640,194 | 1,795,064 |
Substandard [Member] | Commercial Business [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 811,444 | 305,742 |
Substandard [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 3,557,811 | 2,429,782 |
Special Mention [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 17,966,730 | 16,366,527 |
Special Mention [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 1,073,323 | 1,155,802 |
Special Mention [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 937,761 | 624,248 |
Special Mention [Member] | Commercial Business [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 468,875 | 301,462 |
Special Mention [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 15,486,771 | 14,285,015 |
Caution [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 78,030,929 | 75,741,228 |
Caution [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 5,558,599 | 4,612,182 |
Caution [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 10,759,361 | 9,617,301 |
Caution [Member] | Commercial Business [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 4,935,589 | 5,486,393 |
Caution [Member] | Commercial Real Estate [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 56,777,380 | 56,025,352 |
Pass [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 445,602,631 | 367,920,287 |
Pass [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 74,090,846 | 76,674,539 |
Pass [Member] | Consumer [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 44,897,990 | 44,294,400 |
Pass [Member] | Commercial Business [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | 17,787,879 | 16,140,592 |
Pass [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Financing Receivable, before Allowance for Credit Loss | $ 236,153,488 | $ 230,810,756 |
Loans Receivable, Net (Past Due
Loans Receivable, Net (Past Due Financing Receivables) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | $ 5,003,493 | $ 6,668,150 |
Financing Receivable, Not Past Due | 546,747,859 | 461,852,261 |
Financing Receivable, before Allowance for Credit Loss | 551,751,352 | 468,520,411 |
Residential Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 1,340,814 | 499,499 |
Financing Receivable, Not Past Due | 83,523,567 | 85,904,805 |
Financing Receivable, before Allowance for Credit Loss | 84,864,381 | 86,404,304 |
Consumer [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 416,616 | 721,721 |
Financing Receivable, Not Past Due | 57,818,690 | 55,609,292 |
Financing Receivable, before Allowance for Credit Loss | 58,235,306 | 56,331,013 |
Commercial Business [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 107,530 | 244,790 |
Financing Receivable, Not Past Due | 23,896,257 | 21,989,399 |
Financing Receivable, before Allowance for Credit Loss | 24,003,787 | 22,234,189 |
Commercial Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 3,138,533 | 5,202,140 |
Financing Receivable, Not Past Due | 308,836,917 | 298,348,765 |
Financing Receivable, before Allowance for Credit Loss | 311,975,450 | 303,550,905 |
Financial Asset, 30 to 59 Days Past Due [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 2,412,223 | 4,419,826 |
Financial Asset, 30 to 59 Days Past Due [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 0 | 0 |
Financial Asset, 30 to 59 Days Past Due [Member] | Consumer [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 312,743 | 422,443 |
Financial Asset, 30 to 59 Days Past Due [Member] | Commercial Business [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 79,696 | 147,959 |
Financial Asset, 30 to 59 Days Past Due [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 2,019,784 | 3,849,424 |
Financial Asset, 60 to 89 Days Past Due [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 507,292 | 649,347 |
Financial Asset, 60 to 89 Days Past Due [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 107,237 | 355,290 |
Financial Asset, 60 to 89 Days Past Due [Member] | Consumer [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 8,504 | 217,542 |
Financial Asset, 60 to 89 Days Past Due [Member] | Commercial Business [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 26,902 | 76,515 |
Financial Asset, 60 to 89 Days Past Due [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 364,649 | 0 |
Financial Asset, Equal to or Greater than 90 Days Past Due [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 2,083,978 | 1,598,977 |
Financial Asset, Equal to or Greater than 90 Days Past Due [Member] | Residential Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 1,233,577 | 144,209 |
Financial Asset, Equal to or Greater than 90 Days Past Due [Member] | Consumer [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 95,369 | 81,736 |
Financial Asset, Equal to or Greater than 90 Days Past Due [Member] | Commercial Business [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | 932 | 20,316 |
Financial Asset, Equal to or Greater than 90 Days Past Due [Member] | Commercial Real Estate 1 [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Financing Receivable, Past Due | $ 754,100 | $ 1,352,716 |
Loans Receivable, Net (Schedu_3
Loans Receivable, Net (Schedule of non-accrual loans by category) (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Dec. 31, 2019 | ||
Financing Receivable, Past Due [Line Items] | |||
Financing Receivable, Nonaccrual | $ 3,780,036 | $ 3,436,406 | |
FInancing Receivable, Recorded Investment, Nonaccrual Status, Percentage | [1] | 0.70% | 0.70% |
Financing Receivable Recorded Investment in Non-accrual Status, Increase (Decrease) | $ 343,630 | ||
Financing Receivable Recorded Investment in Non-accrual Status, Percent, Increase (Decrease) | 10.00% | ||
Residential Real Estate 1 [Member] | |||
Financing Receivable, Past Due [Line Items] | |||
Financing Receivable, Nonaccrual | $ 2,393,501 | $ 1,520,485 | |
FInancing Receivable, Recorded Investment, Nonaccrual Status, Percentage | [1] | 0.40% | 0.30% |
Financing Receivable Recorded Investment in Non-accrual Status, Increase (Decrease) | $ 873,016 | ||
Financing Receivable Recorded Investment in Non-accrual Status, Percent, Increase (Decrease) | 57.40% | ||
Commercial Business [Member] | |||
Financing Receivable, Past Due [Line Items] | |||
Financing Receivable, Nonaccrual | $ 120,042 | $ 122,605 | |
FInancing Receivable, Recorded Investment, Nonaccrual Status, Percentage | [1] | 0.00% | 0.00% |
Financing Receivable Recorded Investment in Non-accrual Status, Increase (Decrease) | $ (2,563) | ||
Financing Receivable Recorded Investment in Non-accrual Status, Percent, Increase (Decrease) | (2.10%) | ||
Commercial Real Estate 1 [Member] | |||
Financing Receivable, Past Due [Line Items] | |||
Financing Receivable, Nonaccrual | $ 864,409 | $ 1,474,036 | |
FInancing Receivable, Recorded Investment, Nonaccrual Status, Percentage | [1] | 0.20% | 0.30% |
Financing Receivable Recorded Investment in Non-accrual Status, Increase (Decrease) | $ (609,627) | ||
Financing Receivable Recorded Investment in Non-accrual Status, Percent, Increase (Decrease) | (41.40%) | ||
Consumer [Member] | |||
Financing Receivable, Past Due [Line Items] | |||
Financing Receivable, Nonaccrual | $ 402,084 | $ 319,280 | |
FInancing Receivable, Recorded Investment, Nonaccrual Status, Percentage | [1] | 0.10% | 0.10% |
Financing Receivable Recorded Investment in Non-accrual Status, Increase (Decrease) | $ 82,804 | ||
Financing Receivable Recorded Investment in Non-accrual Status, Percent, Increase (Decrease) | 25.90% | ||
[1] | PERCENT OF TOTAL LOANS HELD FOR INVESTMENT, NET OF DEFERRED FEES AND LOANS IN PROCESS. |
Loans Receivable, Net (Schedu_4
Loans Receivable, Net (Schedule of loans evaluated individually for impairment and collectively evaluated for impairment in the allowance for loan losses) (Details) - USD ($) | 3 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | $ 0 | $ 0 | |
Provision for Loan Losses | 700,000 | $ 0 | |
Charge Offs | 55,886 | 163,365 | |
Recoveries | 160,319 | 118,349 | |
Balance At End of Period | 10,676,271 | 8,753,539 | |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 10,676,271 | 9,225,574 | |
Financing Receivable, Allowance for Credit Loss | 10,676,271 | 9,225,574 | |
Commercial Real Estate 1 [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 7,186,002 | 6,079,367 | |
Financing Receivable, Allowance for Credit Loss | 7,186,002 | 6,079,367 | |
Commercial Business [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 639,731 | 544,764 | |
Financing Receivable, Allowance for Credit Loss | 639,731 | 544,764 | |
Consumer [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,317,734 | 1,210,849 | |
Financing Receivable, Allowance for Credit Loss | 1,317,734 | 1,210,849 | |
Residential Real Estate 1 [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 | |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,532,804 | 1,390,594 | |
Financing Receivable, Allowance for Credit Loss | 1,532,804 | $ 1,390,594 | |
Residential Real Estate 1 [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Provision for Loan Losses | 61,866 | (23,308) | |
Charge Offs | 0 | 0 | |
Recoveries | 600 | 1,450 | |
Balance At End of Period | 1,532,804 | 1,125,812 | |
Consumer [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Provision for Loan Losses | 26,726 | 69,702 | |
Charge Offs | 55,886 | 135,286 | |
Recoveries | 18,609 | 36,706 | |
Balance At End of Period | 1,317,734 | 1,092,327 | |
Commercial Business [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Provision for Loan Losses | 27,013 | (95,635) | |
Charge Offs | 0 | 0 | |
Recoveries | 0 | 496 | |
Balance At End of Period | 639,731 | 896,843 | |
Commercial Real Estate 1 [Member] | |||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||
Provision for Loan Losses | 584,395 | 49,241 | |
Charge Offs | 0 | 28,079 | |
Recoveries | 141,110 | 79,697 | |
Balance At End of Period | $ 7,186,002 | $ 5,638,557 |
Loans Receivable, Net (Schedu_5
Loans Receivable, Net (Schedule of loans evaluated individually for impairment and collectively evaluated for impairment in loans receivable) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | $ 0 | $ 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 10,676,271 | 9,225,574 |
Financing Receivable, Allowance for Credit Loss | 10,676,271 | 9,225,574 |
Financing Receivable, Individually Evaluated for Impairment | 3,550,925 | 3,229,883 |
Financing Receivable, Collectively Evaluated for Impairment | 548,200,427 | 465,290,528 |
Financing Receivable, before Allowance for Credit Loss | $ 551,751,352 | 468,520,411 |
Loans and Leases Receivable, Valuation Period for New Appraisal | 24 months | |
Residential Real Estate 1 [Member] | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | $ 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,532,804 | 1,390,594 |
Financing Receivable, Allowance for Credit Loss | 1,532,804 | 1,390,594 |
Financing Receivable, Individually Evaluated for Impairment | 1,816,520 | 1,086,433 |
Financing Receivable, Collectively Evaluated for Impairment | 83,047,861 | 85,317,871 |
Financing Receivable, before Allowance for Credit Loss | 84,864,381 | 86,404,304 |
Consumer [Member] | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 1,317,734 | 1,210,849 |
Financing Receivable, Allowance for Credit Loss | 1,317,734 | 1,210,849 |
Financing Receivable, Individually Evaluated for Impairment | 176,522 | 184,402 |
Financing Receivable, Collectively Evaluated for Impairment | 58,058,784 | 56,146,611 |
Financing Receivable, before Allowance for Credit Loss | 58,235,306 | 56,331,013 |
Commercial Business [Member] | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 639,731 | 544,764 |
Financing Receivable, Allowance for Credit Loss | 639,731 | 544,764 |
Financing Receivable, Individually Evaluated for Impairment | 55,446 | 64,406 |
Financing Receivable, Collectively Evaluated for Impairment | 23,948,341 | 22,169,783 |
Financing Receivable, before Allowance for Credit Loss | 24,003,787 | 22,234,189 |
Commercial Real Estate 1 [Member] | ||
Financing Receivable, Allowance for Credit Loss [Line Items] | ||
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment | 0 | 0 |
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment | 7,186,002 | 6,079,367 |
Financing Receivable, Allowance for Credit Loss | 7,186,002 | 6,079,367 |
Financing Receivable, Individually Evaluated for Impairment | 1,502,437 | 1,894,642 |
Financing Receivable, Collectively Evaluated for Impairment | 310,473,013 | 301,656,263 |
Financing Receivable, before Allowance for Credit Loss | $ 311,975,450 | $ 303,550,905 |
Loans Receivable, Net (Impaired
Loans Receivable, Net (Impaired Financing Receivables) (Details) - USD ($) | 3 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Financing Receivable, Impaired [Line Items] | |||
Impaired financing receivable, recorded investment | $ 3,550,925 | $ 3,229,883 | |
Impaired Financing Receivable, Unpaid Principal Balance | 4,626,445 | 4,305,403 | |
Impaired Financing Receivable, Average Recorded Investment | 3,903,384 | $ 4,917,791 | |
Impaired Financing Receivable, Interest Income, Accrual Method | 30,067 | 14,085 | |
Residential Real Estate 1 [Member] | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 1,816,520 | 1,086,433 | |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 1,816,520 | 1,086,433 | |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 1,826,881 | 1,157,380 | |
Impaired Financing Receivable, with No Related Allowance, Interest Income, Accrual Method | 11,835 | 0 | |
Impaired Financing Receivable, Average Recorded Investment | 1,826,881 | 1,157,380 | |
Impaired Financing Receivable, Interest Income, Accrual Method | 11,835 | 0 | |
Consumer [Member] | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 176,522 | 184,402 | |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 184,822 | 192,702 | |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 178,355 | 137,233 | |
Impaired Financing Receivable, with No Related Allowance, Interest Income, Accrual Method | 0 | 0 | |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 0 | 71,554 | |
Impaired Financing Receivable, with Related Allowance, Interest Income, Accrual Method | 0 | 0 | |
Impaired Financing Receivable, Average Recorded Investment | 178,355 | 208,787 | |
Impaired Financing Receivable, Interest Income, Accrual Method | 0 | 0 | |
Commercial Business [Member] | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 55,446 | 64,406 | |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 950,446 | 959,406 | |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 61,366 | 73,606 | |
Impaired Financing Receivable, with No Related Allowance, Interest Income, Accrual Method | 0 | 0 | |
Impaired Financing Receivable, Average Recorded Investment | 61,366 | 73,606 | |
Impaired Financing Receivable, Interest Income, Accrual Method | 0 | 0 | |
Commercial Real Estate 1 [Member] | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired Financing Receivable, with No Related Allowance, Recorded Investment | 1,502,437 | 1,894,642 | |
Impaired Financing Receivable, with No Related Allowance, Unpaid Principal Balance | 1,674,657 | 2,066,862 | |
Impaired Financing Receivable, with No Related Allowance, Average Recorded Investment | 1,836,782 | 2,481,028 | |
Impaired Financing Receivable, with No Related Allowance, Interest Income, Accrual Method | 18,232 | 14,085 | |
Impaired Financing Receivable, with Related Allowance, Average Recorded Investment | 0 | 996,990 | |
Impaired Financing Receivable, with Related Allowance, Interest Income, Accrual Method | 0 | 0 | |
Impaired Financing Receivable, Average Recorded Investment | 1,836,782 | 3,478,018 | |
Impaired Financing Receivable, Interest Income, Accrual Method | 18,232 | $ 14,085 | |
Fair Value, Measurements, Nonrecurring | Impaired Loans [Member] | |||
Financing Receivable, Impaired [Line Items] | |||
Impaired financing receivable, related allowance | $ 0 | $ 0 |
Loans Receivable, Net (Narrativ
Loans Receivable, Net (Narrative) (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020USD ($)paymentsloan | Jun. 30, 2020USD ($)loan | Dec. 31, 2019USD ($) | Jun. 30, 2019loan | |
Financing Receivable, Past Due [Line Items] | ||||
Nonperforming Loans, Accrual Status, Minimum Consecutive Payments | 6 | 90 | ||
TDRs included in impaired loans | $ 774,000 | $ 774,000 | $ 825,000 | |
Financing Receivable, Modifications, Subsequent Default, Aggregate Number of Contracts | loan | 0 | 0 | 0 | |
Days Past Due to Be Considered In Default | 30 | |||
Review period to request a new third party appraisal | 24 months | |||
Impaired Financing Receivable, Recorded Investment | $ 3,550,925 | $ 3,550,925 | $ 3,229,883 |
Regulatory Matters (Regulatory
Regulatory Matters (Regulatory capital amounts and ratios) (Details) - Security Federal Bank [Member] - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Tier 1 Risk-Based Core Capital (To Risk Weighted Assets) | ||
Actual, Amount | $ 105,039,000 | $ 101,280,000 |
Actual, Ratio | 18.30% | 18.20% |
For Capital Adequacy, Amount | $ 34,406,000 | $ 33,418,000 |
For Capital Adequacy, Ratio | 6.00% | 6.00% |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 45,875,000 | $ 44,558,000 |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 8.00% | 8.00% |
Total Risk-Based Capital (To Risk Weighted Assets) | ||
Actual, Amount | $ 112,250,000 | $ 108,270,000 |
Actual, Ratio | 19.60% | 19.40% |
For Capital Adequacy, Amount | $ 45,875,000 | $ 44,558,000 |
For Capital Adequacy, Ratio | 8.00% | 8.00% |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 57,344,000 | $ 55,697,000 |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 10.00% | 10.00% |
Common Equity Tier One Capital | $ 105,039,000 | $ 101,280,000 |
Common Equity Tier One Capital Ratio | 18.30% | 18.20% |
Common Equity Tier One Capital Required for Capital Adequacy | $ 25,805,000 | $ 25,064,000 |
Common Equity Tier One Capital Required to be Well-Capitalized | 37,273,000 | 36,203,000 |
Tier 1 Leverage (Core) Capital (To Adjusted Tangible Assets) | ||
Actual, Amount | $ 105,039,000 | $ 101,280,000 |
Actual, Ratio | 9.80% | 10.40% |
For Capital Adequacy, Amount | $ 43,017,000 | $ 39,134,000 |
For Capital Adequacy, Ratio | 4.00% | 4.00% |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount | $ 53,771,000 | $ 48,917,000 |
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio | 5.00% | 5.00% |
Carrying Amounts and Fair Val_3
Carrying Amounts and Fair Value of Financial Instruments (Fair value measurements, recurring basis) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Disclosures [Abstract] | ||
Liabilities, Fair Value Disclosure, Recurring (Deprecated 2018-01-31) | $ 0 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 471,931,623 | $ 414,644,840 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets, Fair Value Disclosure | 471,931,623 | 414,644,840 |
Taxable Municipal Bonds [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 28,585,740 | 14,840,410 |
US Government Agencies Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 69,800,000 | 63,900,000 |
Collateralized Mortgage Backed Securities [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 237,514,685 | 200,438,007 |
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 44,093,279 | 47,241,494 |
SBA Bonds | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 110,487,183 | 111,893,099 |
Collateralized Loan Obligations [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | $ 51,184,667 | $ 40,231,830 |
Carrying Amounts and Fair Val_4
Carrying Amounts and Fair Value of Financial Instruments (Fair value measurements, nonrecurring basis) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Other Real Estate, Foreclosed Assets, and Repossessed Assets | $ 184,300 | $ 677,740 | |||
Fair Value, Measurements, Nonrecurring | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 9,886,295 | 7,891,092 | |||
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 1 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | |||
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 2 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 6,155,830 | 3,990,606 | |||
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 3,730,465 | 3,900,486 | |||
Mortgage Loans Held For Sale | Fair Value, Measurements, Nonrecurring | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 6,155,830 | 3,990,606 | |||
Mortgage Loans Held For Sale | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 1 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | |||
Mortgage Loans Held For Sale | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 2 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 6,155,830 | ||||
Mortgage Loans Held For Sale | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | |||
Collateral Dependent Impaired Loans (1) | Fair Value, Measurements, Nonrecurring | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | [1] | 3,222,746 | |||
Impaired financing receivable, related allowance | 0 | 0 | |||
Collateral Dependent Impaired Loans (1) | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 1 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | [2] | 0 | [1] | |
Collateral Dependent Impaired Loans (1) | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 2 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | [2] | 0 | [1] | |
Collateral Dependent Impaired Loans (1) | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | [2] | 3,546,165 | |||
Foreclosed Assets | Fair Value, Measurements, Nonrecurring | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 184,300 | 677,740 | |||
Foreclosed Assets | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 1 | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | |||
Foreclosed Assets | Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 2 [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | $ 0 | $ 0 | |||
[1] | IMPAIRED LOANS ARE REPORTED NET OF SPECIFIC RESERVES. THERE WERE NO SPECIFIC RESERVES AT JUNE 30, 2020 AND DECEMBER 31, 2019. | ||||
[2] | 10. Carrying Amounts and Fair Value of Financial Instruments GAAP requires the Company to disclose fair value of financial instruments measured at amortized cost on the balance sheet and to measure that fair value using an exit price notion, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. Accounting guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 - Quoted Market Price in Active Markets Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as U.S. Treasuries and money market funds. Level 2 - Significant Other Observable Inputs Valuation is based upon quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, mortgage-backed securities, municipal bonds, corporate debt securities and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes certain derivative contracts. Level 3 - Significant Unobservable Inputs Valuation is generated from model-based techniques that use at least one significant assumption based on unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The following is a description of the valuation methodologies used for assets and liabilities recorded at fair value. Investment Securities Available for Sale Investment securities available for sale are recorded at fair value on a recurring basis. At June 30, 2020, the Company’s investment portfolio was comprised of student loan pools, government and agency bonds, mortgage-backed securities issued by government agencies or GSEs, private label CMO mortgage-backed securities, municipal securities, and one state tax credit. Fair value measurement is based upon prices obtained from third party pricing services that use independent pricing models which rely on a variety of factors including reported trades, broker/dealer quotes, benchmark yields, economic and industry events and other relevant market information. As a result, these securities are classified as Level 2. Mortgage Loans Held for Sale The Company originates fixed rate residential loans on a servicing released basis in the secondary market. Loans closed but not yet settled with the FHLMC or other investors, are carried in the Company’s loans held for sale portfolio. These loans are fixed rate residential loans that have been originated in the Company’s name and have closed. Virtually all of these loans have commitments to be purchased by investors and the majority of these loans were locked in by price with the investors on the same day or shortly thereafter that the loan was locked in with the Company’s customers. Therefore, these loans present very little market risk for the Company. The Company usually delivers a commitment to, and receives funding from, the investor within 30 days. Commitments to sell these loans to the investor are considered derivative contracts and are sold to investors on a “best efforts" basis. The Company is not obligated to deliver a loan or pay a penalty if a loan is not delivered to the investor. As a result of the short-term nature of these derivative contracts, the fair value of the mortgage loans held for sale in most cases is the same as the value of the loan amount at its origination . These loans are classified as Level 2. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued Impaired Loans The Company does not record loans held for investment at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established as necessary. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as impaired, management measures the impairment by determining the fair value of the collateral for the loan. Fair value is estimated using one of the following methods: fair value of the collateral less estimated costs to sell, discounted cash flows, or market value of the loan based on similar debt. The fair value of the collateral less estimated costs to sell is the most frequently used method. Typically, the Company reviews the most recent appraisal and if it is over 24 months old will request a new third party appraisal. Depending on the particular circumstances surrounding the loan, including the location of the collateral, the date of the most recent appraisal and the value of the collateral relative to the recorded investment in the loan, management may order an independent appraisal immediately or, in some instances, may elect to perform an internal analysis. Specifically as an example, in situations where the collateral on a nonperforming commercial real estate loan is out of the Company’s primary market area, management would typically order an independent appraisal immediately, at the earlier of the date the loan becomes nonperforming or immediately following the determination that the loan is impaired. However, as a second example, on a nonperforming commercial real estate loan where management is familiar with the property and surrounding areas and where the original appraisal value far exceeds the recorded investment in the loan, management may perform an internal analysis whereby the previous appraisal value would be reviewed and adjusted for current conditions including recent sales of similar properties in the area and any other relevant economic trends. These valuations are reviewed at a minimum on a quarterly basis. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At June 30, 2020, our impaired loans were generally evaluated based on the fair value of the collateral. Impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. The Company records impaired loans as nonrecurring Level 3. At June 30, 2020 and December 31, 2019, the recorded investment in impaired loans was $3.6 million and $3.2 million Foreclosed Assets Foreclosed assets are adjusted to fair value upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. Foreclosed assets are recorded as nonrecurring Level 3. Assets measured at fair value on a recurring basis were as follows at June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Student Loan Pools $ — $ 51,184,667 $ — $ — $ 40,231,830 $ — SBA Bonds — 110,487,183 — — 111,893,099 — Tax Exempt Municipal Bonds — 44,093,279 — — 47,241,494 — Taxable Municipal Bonds — 28,585,740 — — 14,840,410 — Mortgage-Backed Securities — 237,514,685 — — 200,438,007 — State Tax Credit — 66,069 — — — — Total $ — $ 471,931,623 $ — $ — $ 414,644,840 $ — There were no liabilities measured at fair value on a recurring basis at June 30, 2020 or December 31, 2019. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis. These include assets that are measured at the lower of cost or market that were recognized at fair value below cost at the end of the period. The tables below present assets measured at fair value on a nonrecurring basis at June 30, 2020 and December 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall. June 30, 2020 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 6,155,830 $ — $ 6,155,830 Collateral Dependent Impaired Loans (1) — — 3,546,165 3,546,165 Foreclosed Assets — — 184,300 184,300 Total $ — $ 6,155,830 $ 3,730,465 $ 9,886,295 |
Carrying Amounts and Fair Val_5
Carrying Amounts and Fair Value of Financial Instruments (Significant unobservable inputs used in the fair value measurements) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Other Real Estate Owned ("OREO") | $ 184,300 | $ 184,300 | $ 677,740 | |
Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Assets, Fair Value Disclosure, Nonrecurring (Deprecated 2018-01-31) | $ 9,886,295 | 9,886,295 | 7,891,092 | |
Impaired Loans [Member] | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Assets, Fair Value Disclosure, Nonrecurring (Deprecated 2018-01-31) | [1] | 3,222,746 | ||
Significant Unobservable Inputs | Discount Rates/ Discounts to Appraised Values | |||
Foreclosed Assets | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Assets, Fair Value Disclosure, Nonrecurring (Deprecated 2018-01-31) | $ 184,300 | $ 184,300 | 677,740 | |
Significant Unobservable Inputs | Discount Rates/ Discounts to Appraised Values | |||
Minimum | Impaired Loans [Member] | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Significant Unobservable Inputs, Percentage Range | 12.00% | |||
Minimum | Foreclosed Assets | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Significant Unobservable Inputs, Percentage Range | 11.00% | |||
Maximum | Impaired Loans [Member] | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Significant Unobservable Inputs, Percentage Range | 95.00% | |||
Maximum | Foreclosed Assets | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Significant Unobservable Inputs, Percentage Range | 40.00% | |||
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Assets, Fair Value Disclosure, Nonrecurring (Deprecated 2018-01-31) | $ 3,730,465 | $ 3,730,465 | $ 3,900,486 | |
Fair Value, Inputs, Level 3 | Impaired Loans [Member] | Fair Value, Measurements, Nonrecurring | ||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||||
Assets, Fair Value Disclosure, Nonrecurring (Deprecated 2018-01-31) | [2] | $ 3,546,165 | $ 3,546,165 | |
[1] | IMPAIRED LOANS ARE REPORTED NET OF SPECIFIC RESERVES. THERE WERE NO SPECIFIC RESERVES AT JUNE 30, 2020 AND DECEMBER 31, 2019. | |||
[2] | 10. Carrying Amounts and Fair Value of Financial Instruments GAAP requires the Company to disclose fair value of financial instruments measured at amortized cost on the balance sheet and to measure that fair value using an exit price notion, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. Accounting guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 - Quoted Market Price in Active Markets Valuation is based upon quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as U.S. Treasuries and money market funds. Level 2 - Significant Other Observable Inputs Valuation is based upon quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, mortgage-backed securities, municipal bonds, corporate debt securities and derivative contracts whose value is determined using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. This category generally includes certain derivative contracts. Level 3 - Significant Unobservable Inputs Valuation is generated from model-based techniques that use at least one significant assumption based on unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The following is a description of the valuation methodologies used for assets and liabilities recorded at fair value. Investment Securities Available for Sale Investment securities available for sale are recorded at fair value on a recurring basis. At June 30, 2020, the Company’s investment portfolio was comprised of student loan pools, government and agency bonds, mortgage-backed securities issued by government agencies or GSEs, private label CMO mortgage-backed securities, municipal securities, and one state tax credit. Fair value measurement is based upon prices obtained from third party pricing services that use independent pricing models which rely on a variety of factors including reported trades, broker/dealer quotes, benchmark yields, economic and industry events and other relevant market information. As a result, these securities are classified as Level 2. Mortgage Loans Held for Sale The Company originates fixed rate residential loans on a servicing released basis in the secondary market. Loans closed but not yet settled with the FHLMC or other investors, are carried in the Company’s loans held for sale portfolio. These loans are fixed rate residential loans that have been originated in the Company’s name and have closed. Virtually all of these loans have commitments to be purchased by investors and the majority of these loans were locked in by price with the investors on the same day or shortly thereafter that the loan was locked in with the Company’s customers. Therefore, these loans present very little market risk for the Company. The Company usually delivers a commitment to, and receives funding from, the investor within 30 days. Commitments to sell these loans to the investor are considered derivative contracts and are sold to investors on a “best efforts" basis. The Company is not obligated to deliver a loan or pay a penalty if a loan is not delivered to the investor. As a result of the short-term nature of these derivative contracts, the fair value of the mortgage loans held for sale in most cases is the same as the value of the loan amount at its origination . These loans are classified as Level 2. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued Impaired Loans The Company does not record loans held for investment at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established as necessary. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as impaired, management measures the impairment by determining the fair value of the collateral for the loan. Fair value is estimated using one of the following methods: fair value of the collateral less estimated costs to sell, discounted cash flows, or market value of the loan based on similar debt. The fair value of the collateral less estimated costs to sell is the most frequently used method. Typically, the Company reviews the most recent appraisal and if it is over 24 months old will request a new third party appraisal. Depending on the particular circumstances surrounding the loan, including the location of the collateral, the date of the most recent appraisal and the value of the collateral relative to the recorded investment in the loan, management may order an independent appraisal immediately or, in some instances, may elect to perform an internal analysis. Specifically as an example, in situations where the collateral on a nonperforming commercial real estate loan is out of the Company’s primary market area, management would typically order an independent appraisal immediately, at the earlier of the date the loan becomes nonperforming or immediately following the determination that the loan is impaired. However, as a second example, on a nonperforming commercial real estate loan where management is familiar with the property and surrounding areas and where the original appraisal value far exceeds the recorded investment in the loan, management may perform an internal analysis whereby the previous appraisal value would be reviewed and adjusted for current conditions including recent sales of similar properties in the area and any other relevant economic trends. These valuations are reviewed at a minimum on a quarterly basis. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At June 30, 2020, our impaired loans were generally evaluated based on the fair value of the collateral. Impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. The Company records impaired loans as nonrecurring Level 3. At June 30, 2020 and December 31, 2019, the recorded investment in impaired loans was $3.6 million and $3.2 million Foreclosed Assets Foreclosed assets are adjusted to fair value upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. Foreclosed assets are recorded as nonrecurring Level 3. Assets measured at fair value on a recurring basis were as follows at June 30, 2020 and December 31, 2019: June 30, 2020 December 31, 2019 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Student Loan Pools $ — $ 51,184,667 $ — $ — $ 40,231,830 $ — SBA Bonds — 110,487,183 — — 111,893,099 — Tax Exempt Municipal Bonds — 44,093,279 — — 47,241,494 — Taxable Municipal Bonds — 28,585,740 — — 14,840,410 — Mortgage-Backed Securities — 237,514,685 — — 200,438,007 — State Tax Credit — 66,069 — — — — Total $ — $ 471,931,623 $ — $ — $ 414,644,840 $ — There were no liabilities measured at fair value on a recurring basis at June 30, 2020 or December 31, 2019. 10. Carrying Amounts and Fair Value of Financial Instruments, Continued The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis. These include assets that are measured at the lower of cost or market that were recognized at fair value below cost at the end of the period. The tables below present assets measured at fair value on a nonrecurring basis at June 30, 2020 and December 31, 2019, aggregated by the level in the fair value hierarchy within which those measurements fall. June 30, 2020 Assets: Level 1 Level 2 Level 3 Total Mortgage Loans Held For Sale $ — $ 6,155,830 $ — $ 6,155,830 Collateral Dependent Impaired Loans (1) — — 3,546,165 3,546,165 Foreclosed Assets — — 184,300 184,300 Total $ — $ 6,155,830 $ 3,730,465 $ 9,886,295 |
Carrying Amounts and Fair Val_6
Carrying Amounts and Fair Value of Financial Instruments (Summary of the carrying value and estimated fair value of financial instruments) (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Financial Assets: | ||||
Cash And Cash Equivalents | $ 534,446,000 | $ 12,536,000 | ||
Cash and Cash Equivalents | 15,340,792 | 12,536,311 | $ 11,019,027 | $ 12,705,910 |
Certificates of Deposits With Other Banks | 950,000 | 950,000 | ||
Investments | 488,790,484 | 433,891,775 | ||
Investment And Mortgage-Backed Securities | 489,765,000 | 434,451,000 | ||
Financing Receivable, after Allowance for Credit Loss | 534,446,495 | 452,859,000 | ||
Loans Receivable, Net | 540,345,000 | 450,796,000 | ||
FHLB Stock | 2,673,000 | 2,537,000 | ||
Federal Home Loan Bank ("FHLB") Stock, at Cost | 2,672,800 | 2,536,500 | ||
Financial Liabilities: | ||||
Checking, Savings, And Money Market Accounts | 663,357,000 | 541,954,000 | ||
Certificate Accounts, Carrying Value | 211,828,000 | 229,453,000 | ||
Certificate Accounts | 213,407,000 | 229,363,000 | ||
Advances from FHLB | 42,500,000 | 38,138,000 | ||
Advances From FHLB | 43,104,000 | 38,233,000 | ||
Other Borrowed Money | 20,953,000 | 11,580,000 | ||
Other Borrowings | 20,953,072 | 11,579,819 | ||
Senior Convertible Debentures | 6,044,000 | |||
Junior Subordinated Debentures | 5,155,000 | 5,155,000 | ||
Interest-bearing Deposits in Banks and Other Financial Institutions | 950,005 | 950,005 | ||
Fair Value, Inputs, Level 1 | ||||
Financial Assets: | ||||
Cash And Cash Equivalents | 12,536,000 | |||
Cash and Cash Equivalents | 534,446,000 | |||
Certificates of Deposits With Other Banks | 0 | 0 | ||
Investment And Mortgage-Backed Securities | 0 | 0 | ||
Loans Receivable, Net | 0 | 0 | ||
FHLB Stock | 2,537,000 | |||
Federal Home Loan Bank ("FHLB") Stock, at Cost | 2,673,000 | |||
Financial Liabilities: | ||||
Checking, Savings, And Money Market Accounts | 663,357,000 | 541,954,000 | ||
Certificate Accounts | 0 | 0 | ||
Advances From FHLB | 0 | 0 | ||
Other Borrowed Money | 11,580,000 | |||
Other Borrowings | 20,953,000 | |||
Senior Convertible Debentures | 0 | |||
Junior Subordinated Debentures | 0 | 0 | ||
Fair Value, Inputs, Level 2 [Member] | ||||
Financial Assets: | ||||
Cash And Cash Equivalents | 0 | 0 | ||
Certificates of Deposits With Other Banks | 950,000 | |||
Certificates of Deposit with Other Banks | 950,000 | |||
Investment And Mortgage-Backed Securities | 489,765,000 | 434,451,000 | ||
Loans Receivable, Net | 0 | 0 | ||
FHLB Stock | 0 | 0 | ||
Financial Liabilities: | ||||
Checking, Savings, And Money Market Accounts | 0 | 0 | ||
Certificate Accounts | 213,407,000 | 229,363,000 | ||
Advances From FHLB | 43,104,000 | 38,233,000 | ||
Other Borrowed Money | 0 | 0 | ||
Senior Convertible Debentures | 6,044,000 | |||
Junior Subordinated Debentures | 5,155,000 | 5,155,000 | ||
Fair Value, Inputs, Level 3 | ||||
Financial Assets: | ||||
Cash And Cash Equivalents | 0 | 0 | ||
Certificates of Deposits With Other Banks | 0 | 0 | ||
Investment And Mortgage-Backed Securities | 0 | 0 | ||
Loans Receivable, Net | 540,345,000 | 450,796,000 | ||
FHLB Stock | 0 | 0 | ||
Financial Liabilities: | ||||
Checking, Savings, And Money Market Accounts | 0 | 0 | ||
Certificate Accounts | 0 | 0 | ||
Advances From FHLB | 0 | 0 | ||
Other Borrowed Money | 0 | 0 | ||
Senior Convertible Debentures | 0 | |||
Junior Subordinated Debentures | $ 0 | $ 0 |
Carrying Amounts and Fair Val_7
Carrying Amounts and Fair Value of Financial Instruments (Narrative) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | ||
Investor funding period | 30 days | |
Review period to request a new third party appraisal | 24 months | |
Impaired financing receivable, recorded investment | $ 3,550,925 | $ 3,229,883 |
Non-interest Income (Details)
Non-interest Income (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Other Income and Expenses [Abstract] | ||
Service Fees on Deposit Accounts | $ 188,401 | $ 254,610 |
Check card revenue | 446,931 | 355,321 |
Trust Income | 238,895 | 258,600 |
Commissions From Insurance Agency | 163,745 | 175,693 |
Gain on Sale of Investments | 486,577 | 670,134 |
Gain on Sale of Loans | 806,415 | 372,048 |
BOLI Income | 135,000 | 135,000 |
Other | 252,859 | 253,741 |
Noninterest Income | $ 2,805,987 | $ 2,492,561 |
Uncategorized Items - sfdl-2020
Label | Element | Value |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | $ 9,871,838 |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 8,798,555 |
Commercial Business [Member] | ||
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 612,718 |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 991,982 |
Consumer [Member] | ||
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 1,328,285 |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 1,121,205 |
Residential Real Estate 1 [Member] | ||
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 1,470,338 |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 1,147,670 |
Commercial Real Estate 1 [Member] | ||
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | 6,460,497 |
Accounts Receivable, Allowance for Credit Loss | us-gaap_AllowanceForDoubtfulAccountsReceivable | $ 5,537,698 |