Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 14, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | BANK OF SOUTH CAROLINA CORP | ||
Entity Central Index Key | 1,007,273 | ||
Document Type | 10-K | ||
Trading Symbol | BKSC | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth | false | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 5,514,305 | ||
Entity Public Float | $ 74,908,192 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and due from banks | $ 6,325,457 | $ 8,486,025 |
Interest-bearing deposits at the Federal Reserve | 25,506,784 | 24,034,194 |
Investment securities available for sale (amortized cost of $121,918,501 and $140,606,807 in 2018 and 2017, respectively) | 119,668,874 | 139,250,250 |
Mortgage loans to be sold | 1,199,438 | 2,093,723 |
Loans | 274,664,267 | 270,180,640 |
Less: Allowance for loan losses | (4,214,331) | (3,875,398) |
Net loans | 270,449,936 | 266,305,242 |
Premises, equipment and leasehold improvements, net | 2,335,207 | 2,244,525 |
Other real estate owned | 435,479 | |
Accrued interest receivable | 1,561,915 | 1,720,920 |
Other assets | 2,087,587 | 1,996,140 |
Total assets | 429,135,198 | 446,566,498 |
Deposits: | ||
Non-interest-bearing demand | 130,940,138 | 139,256,748 |
Interest-bearing demand | 94,207,731 | 108,967,196 |
Money market accounts | 87,300,433 | 77,833,728 |
Time deposits over $250,000 | 15,909,991 | 18,624,924 |
Other time deposits | 18,558,734 | 23,295,492 |
Other savings deposits | 35,461,361 | 34,910,212 |
Total deposits | 382,378,388 | 402,888,300 |
Accrued interest payable and other liabilities | 1,294,249 | 913,563 |
Total liabilities | 383,672,637 | 403,801,863 |
Commitments and contingencies Notes 6 and 11 | ||
Shareholders' equity | ||
Common stock - no par 12,000,000 shares authorized; Issued 5,777,474 shares at December 31, 2018 and 5,753,743 shares at December 31, 2017. Shares outstanding 5,510,917 and 5,488,207 at December 31, 2018 and December 31, 2017, respectively | 0 | 0 |
Additional paid in capital | 46,857,734 | 37,236,566 |
Retained earnings | 2,650,296 | 8,847,164 |
Treasury stock: 266,557 shares as of December 31, 2018 and 265,536 shares as of December 31, 2017 | (2,268,264) | (2,247,415) |
Accumulated other comprehensive loss, net of income taxes | (1,777,205) | (1,071,680) |
Total shareholders' equity | 45,462,561 | 42,764,635 |
Total liabilities and shareholders' equity | $ 429,135,198 | $ 446,566,498 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Amortized cost for investment securities available for sale | $ 121,918,501 | $ 140,606,807 |
Common stock, authorized | 12,000,000 | 12,000,000 |
Common stock, issued | 5,777,474 | 5,753,743 |
Common stock, outstanding | 5,510,917 | 5,488,207 |
Treasury stock, shares | 266,557 | 265,536 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Interest and fee income | |||
Loans, including fees | $ 15,126,316 | $ 13,287,318 | $ 12,851,900 |
Taxable securities | 1,872,285 | 1,585,505 | 1,297,636 |
Tax-exempt securities | 744,713 | 1,026,513 | 1,007,438 |
Other | 393,597 | 269,811 | 138,623 |
Total interest and fee income | 18,136,911 | 16,169,147 | 15,295,597 |
Interest expense | |||
Deposits | 694,386 | 423,863 | 378,740 |
Total interest expense | 694,386 | 423,863 | 378,740 |
Net interest income | 17,442,525 | 15,745,284 | 14,916,857 |
Provision for loan losses | 325,000 | 55,000 | 570,000 |
Net interest income after provision for loan losses | 17,117,525 | 15,690,284 | 14,346,857 |
Other income | |||
Service charges and fees | 1,168,808 | 1,135,037 | 1,061,349 |
Mortgage banking income | 786,893 | 1,057,457 | 1,387,740 |
Gain on sales of securities | 4,735 | 45,820 | 380,904 |
Other non-interest income | 34,189 | 30,157 | 31,090 |
Total other income | 1,994,625 | 2,268,471 | 2,861,083 |
Other expense | |||
Salaries and employee benefits | 6,488,229 | 6,060,831 | 6,087,929 |
Net occupancy expense | 1,580,929 | 1,571,076 | 1,528,048 |
Net other real estate owned expenses | 57,613 | 92,652 | 16,691 |
Other operating expenses | 2,953,463 | 2,517,737 | 2,639,776 |
Total other expense | 11,080,234 | 10,242,296 | 10,272,444 |
Income before income tax expense | 8,031,916 | 7,716,459 | 6,935,496 |
Income tax expense | 1,108,982 | 2,814,634 | 1,688,433 |
Net Income | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Weighted average shares outstanding | |||
Basic (in shares) | 5,500,027 | 5,471,001 | 5,428,884 |
Diluted (in shares) | 5,589,012 | 5,568,493 | 5,561,739 |
Basic income per common share (in dollars per share) | $ 1.26 | $ 0.90 | $ 0.97 |
Diluted income per common share (in dollars per share) | $ 1.24 | $ 0.88 | $ 0.94 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net Income | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Other comprehensive loss | |||
Unrealized loss on securities arising during the period | (893,070) | (347,066) | (2,158,236) |
Reclassification adjustment for securities gains realized in net income | (4,735) | (45,820) | (380,904) |
Other comprehensive loss before tax | (897,805) | (392,886) | (2,539,140) |
Income tax effect related to items of other comprehensive loss before tax | 192,280 | 116,007 | 939,482 |
Other comprehensive loss after tax | (705,525) | (276,879) | (1,599,658) |
Total comprehensive income | $ 6,217,409 | $ 4,624,946 | $ 3,647,405 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) | Additional Paid in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total |
Beginning Balance at Dec. 31, 2015 | $ 36,341,744 | $ 4,064,834 | $ (2,247,415) | $ 992,549 | $ 39,151,712 |
Net income | 5,247,063 | 5,247,063 | |||
Other comprehensive loss | (1,599,658) | (1,599,658) | |||
Stock option exercises | 405,749 | 405,749 | |||
Stock-based compensation expense | 76,529 | 76,529 | |||
Cash dividends | (2,668,421) | (2,668,421) | |||
Ending balance at Dec. 31, 2016 | 36,824,022 | 6,643,476 | (2,247,415) | (607,109) | 40,612,974 |
Net income | 4,901,825 | 4,901,825 | |||
Other comprehensive loss | (276,879) | (276,879) | |||
Stock option exercises | 340,843 | 340,843 | |||
Stock-based compensation expense | 71,701 | 71,701 | |||
Reclassification of tax effects stranded in accumulated other comprehensive income by tax reform | 187,692 | (187,692) | |||
Cash dividends | (2,885,829) | (2,885,829) | |||
Ending balance at Dec. 31, 2017 | 37,236,566 | 8,847,164 | (2,247,415) | (1,071,680) | 42,764,635 |
Net income | 6,922,934 | 6,922,934 | |||
Other comprehensive loss | (705,525) | (705,525) | |||
Stock option exercises | 214,418 | (20,849) | 193,569 | ||
Stock-based compensation expense | 72,408 | 72,408 | |||
Cash dividends | (3,785,460) | (3,785,460) | |||
Common stock dividend, 10% | 9,334,342 | (9,334,342) | |||
Ending balance at Dec. 31, 2018 | $ 46,857,734 | $ 2,650,296 | $ (2,268,264) | $ (1,777,205) | $ 45,462,561 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Stockholders' Equity [Abstract] | |||
Dividends (per share) | $ 0.70 | $ 0.58 | $ 0.54 |
Common stock dividend (percent) | 10.00% |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Adjustments to reconcile net income net cash provided by operating activities: | |||
Depreciation | 195,921 | 193,298 | 189,188 |
Gain on sale of investment securities | (4,735) | (45,820) | (380,904) |
Loss on sale of other real estate owned | 33,476 | 1,477 | 13,450 |
Loss on disposal of premises, equipment, and leasehold improvements, net | 428 | ||
Valuation and other adjustments to other real estate owned | 23,637 | 86,464 | |
Provision for loan losses | 325,000 | 55,000 | 570,000 |
Stock-based compensation expense | 72,408 | 71,701 | 76,529 |
Deferred income taxes | (217,637) | 276,362 | (750,254) |
Net amortization of unearned discounts on investment securities available for sale | 303,530 | 381,079 | 250,755 |
Origination of mortgage loans held for sale | (55,504,124) | (55,791,625) | (76,032,671) |
Proceeds from sale of mortgage loans held for sale | 56,398,409 | 58,084,112 | 77,466,700 |
Decrease (increase) in accrued interest receivable and other assets | 472,740 | (78,328) | (63,949) |
Increase (decrease) in accrued interest payable and other liabilities | 295,071 | 46,412 | (543,083) |
Net cash provided by operating activities | 9,317,058 | 8,181,957 | 6,042,824 |
Cash flows from investing activities: | |||
Proceeds from calls and maturities of investment securities available for sale | 6,932,927 | 4,713,870 | 9,630,804 |
Proceeds from sale of investment securities available for sale | 21,434,634 | 20,231,265 | 36,218,087 |
Purchase of investment securities available for sale | (9,978,050) | (44,944,586) | (48,239,241) |
Proceeds from sale of other real estate owned | 378,366 | 89,355 | 85,001 |
Net decrease in loans | (4,469,694) | (9,726,576) | (18,089,620) |
Purchase of premises, equipment, and leasehold improvements, net | (287,031) | (141,199) | (196,584) |
Net cash provided by (used in) investing activities | 14,011,152 | (29,777,871) | (20,591,553) |
Cash flows from financing activities: | |||
Net (decrease) increase in deposit accounts | (20,509,912) | 30,365,449 | 13,804,239 |
Dividends paid | (3,699,845) | (2,832,489) | (2,613,715) |
Stock options exercised | 193,569 | 340,843 | 405,749 |
Net cash (used in) provided by financing activities | (24,016,188) | 27,873,803 | 11,596,273 |
Net (decrease) increase in cash and cash equivalents | (687,978) | 6,277,889 | (2,952,456) |
Cash and cash equivalents at the beginning of the period | 32,520,219 | 26,242,330 | 29,194,786 |
Cash and cash equivalents at the end of the period | 31,832,241 | 32,520,219 | 26,242,330 |
Cash paid during the period for: | |||
Interest | 626,700 | 379,302 | 400,531 |
Income taxes | 1,169,085 | 2,496,047 | 2,320,830 |
Supplemental disclosures for non-cash investing and financing activity: | |||
Change in unrealized gain on securities available for sale, net of income taxes | (705,525) | (276,879) | (1,599,658) |
Change in dividends payable | $ 85,615 | 53,340 | $ 54,706 |
Transfer of loans to other real estate owned | $ 90,832 |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | 1. ORGANIZATION The Bank of South Carolina (the “Bank”) was organized on October 22, 1986 and opened for business as a state-chartered financial institution on February 26, 1987, in Charleston, South Carolina. The Bank was reorganized into a wholly-owned subsidiary of Bank of South Carolina Corporation (the “Company”), effective April 17, 1995. At the time of the reorganization, each outstanding share of the Bank was exchanged for two shares of Bank of South Carolina Corporation Stock. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Our accounting and reporting policies conform, in all material respects, to U.S. generally accepted accounting principles (“GAAP”), and to general practices within the banking industry. The following summarizes the more significant of these policies and practices. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, the Bank. In consolidation, all significant intercompany balances and transactions have been eliminated. References to “we,” “us,” “our,” “the Bank,” or “the Company” refer to the parent and its subsidiary that are consolidated for financial purposes. Accounting Estimates and Assumptions The financial statements are prepared in conformity with GAAP, which require management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ significantly from these estimates and assumptions. Material estimates generally susceptible to significant change are related to the determination of the allowance for loan losses, impaired loans, other real estate owned, deferred tax assets, the fair value of financial instruments and other-than-temporary impairment of investment securities. Reclassification: Certain amounts in the prior years’ financial statements have been reclassified to conform to the current year’s presentation. Such reclassifications have no effect on shareholders’ equity or the net income as previously reported. Subsequent Events: Subsequent 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 as of the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Non-recognized subsequent events are events that provide evidence about conditions that did not exist as of the date of the balance sheet but arose after that date. We have reviewed events occurring through the date the financial statements were available to be issued and no subsequent events occurred requiring accrual or disclosure. Cash and Cash Equivalents Cash and cash equivalents include working cash funds, due from banks, interest-bearing deposits at the Federal Reserve, items in process of collection and federal funds sold. All cash equivalents are readily convertible to cash and have maturities of less than 90 days. Depository institutions are required to maintain reserve and clearing balances at the Federal Reserve Bank. Vault cash satisfied our daily reserve requirement for the years ended December 31, 2018 and 2017, respectively. Interest-bearing Deposits at the Federal Reserve Interest-bearing deposits at the Federal Reserve mature within one year and are carried at cost. Investment Securities We classify investments into three categories: (1) Held to Maturity - debt securities that we have the positive intent and ability to hold to maturity, which are reported at amortized cost, adjusted for the amortization of any related premiums or the accretion of any related discounts into interest income using a methodology which approximates a level yield of interest over the estimated remaining period until maturity; (2) Trading - debt and equity securities that are bought and held principally for the purpose of selling them in the near term, which are reported at fair value, with unrealized gains and losses included in earnings; and (3) Available for Sale - debt and equity securities that may be sold under certain conditions, which are reported at fair value, with unrealized gains and losses excluded from earnings and reported as a separate component of shareholders’ equity, net of income taxes. Unrealized losses on securities due to fluctuations in fair value are recognized when it is determined that an other than temporary decline in value has occurred. Realized gains or losses on the sale of investments are recognized on a specific identification, trade date basis. All securities were classified as available for sale for 2018 and 2017. Mortgage Loans to be Sold We originate fixed and variable rate residential mortgage loans on a service release basis in the secondary market. Loans closed but not yet settled with an investor are carried in our loans held for sale portfolio. 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 our customers. Therefore, these loans present very little market risk. We usually deliver to, and receive funding from, the investor within 30 to 60 days. Commitments to sell these loans to the investor are considered derivative contracts and are sold to investors on a “best efforts” basis. We are not obligated to deliver a loan or pay a penalty if a loan is not delivered to the investor. Because of the short-term nature of these derivative contracts, the fair value of the mortgage loans held for sale in most cases is materially the same as the value of the loan amount at its origination . Mortgage loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated market value in the aggregate. Net unrealized losses are provided for in a valuation allowance by charges to operations as a component of mortgage banking income. Gains or losses on sales of loans are recognized when control over these assets are surrendered and are included in mortgage banking income in the consolidated statements of income. Loans and Allowance for Loan Losses Loans are carried at principal amounts outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized over the weighted average life of the loan as an adjustment to yield. Interest income on all loans is recorded on an accrual basis. The accrual of interest and the amortization of net loan fees are generally discontinued on loans that 1) are maintained on a cash basis because of deterioration in the financial condition of the borrower; 2) the payment of full principal is not expected; or 3) the principal or interest has been in default for a period of 90 days or more. We define past due loans based on contractual payment and maturity dates. The accrual of interest is generally discontinued on loans that become 90 days past due as to principal or interest. The accrual of interest on some loans may continue even though they are 90 days past due if the loans are well secured or in the process of collection and management deems it appropriate. If non-accrual loans decrease their past due status to less than 30 days for a period of six to nine months, they are reviewed individually by management to determine if they should be returned to accrual status. When the ultimate collectability of an impaired loan’s principal is in doubt, wholly or partially, all cash receipts are applied 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. When this doubt does not exist, cash receipts are applied under the contractual terms of the loan agreement first to interest income and then to principal. We account for impaired loans by requiring that all loans (greater than $50,000) where it is estimated that we will be unable to collect all amounts due according to the terms of the loan agreement be recorded at the loan’s fair value. Fair value may be determined based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral less cost to sell, if the loan is collateral dependent. Additional accounting guidance allows us to use existing methods for recognizing interest income on an impaired loan. The guidance also requires additional disclosures about how we estimate interest income related to our impaired loans. A loan is also considered impaired if its terms are modified in a troubled debt restructuring (“TDR”). For this type of impaired loan, cash receipts are typically applied to principal and interest receivable in accordance with the terms of the restructured loan agreement. Interest income is recognized on these loans using the accrual method of accounting, provided they are performing in accordance with their restructured terms. The allowance for loan losses (the “allowance”) is our estimate of credit losses inherent in the loan portfolio. The allowance is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when we believe the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance is evaluated on a regular basis and is based upon our periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. We believe that the allowance is adequate to absorb inherent losses in the loan portfolio; however, there can be no assurance that loan losses in future periods will not exceed the current allowance amount or that future increases in the allowance will not be required. No assurance can be given that our ongoing evaluation of the loan portfolio, in light of changing economic conditions and other relevant circumstances, will not require significant future additions to the allowance, thus adversely affecting our operating results. The allowance is also subject to examination by regulatory agencies, which may consider factors such as the methodology used to determine adequacy and the size of the allowance relative to that of peer institutions and other adequacy tests. In addition, such regulatory agencies could require us to adjust our allowance based on information available at the time of the examination. The methodology used to determine the reserve for unfunded lending commitments, which is included in other liabilities, is inherently similar to the methodology used to determine the allowance adjusted for factors specific to binding commitments, including the probability of funding and historical loss ratio. Concentration of Credit Risk Our primary market consists of the counties of Berkeley, Charleston and Dorchester, South Carolina. As of December 31, 2018, the majority of the total loan portfolio, as well as a substantial portion of the commercial and real estate loan portfolios, were to borrowers within this region. No other areas of significant concentration of credit risk have been identified. Premises, Equipment and Leasehold Improvements and Depreciation Land is carried at cost. Buildings and equipment are stated at cost less accumulated depreciation. Depreciation is recorded using the straight-line method for financial reporting purposes and accelerated methods for income tax purposes over the estimated useful lives of the assets ranging from 40 years for buildings and 3 to 15 years for equipment. Leasehold improvements are amortized over the shorter of the asset’s useful life or the remaining lease term, including renewal periods when reasonably assured. The cost of maintenance and repairs is charged to operating expense as incurred. Other Real Estate Owned Fair value is based upon independent market prices, appraised values of the collateral, or our estimation of the value of the collateral. Losses arising from an initial foreclosure are charged against the allowance for loan losses. Subsequent to foreclosure, other real estate owned (“OREO”) is recorded at the lower of cost or fair value, adjusted for net selling costs. Gains and losses on the sale of OREO and subsequent write-downs from periodic re-evaluation are charged to net other real estate owned expenses. Income Taxes We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Net deferred tax assets are included in other assets in the consolidated balance sheet. Accounting standards require the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. These standards also prescribe a recognition threshold and measurement of a tax position taken or expected to be taken in an enterprise’s tax return. We believe that we had no uncertain tax positions for the years ended December 31, 2018 and 2017. Stock-Based Compensation Compensation cost is recognized for stock options issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options. Compensation cost is recognized over the required service period, generally defined as the vesting period (10 years). Income Per Common Share Basic income per share is computed by dividing net income by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the weighted-average number of common shares and potential common shares outstanding. Potential common shares consist of dilutive stock options determined using the treasury stock method and the average market price of common stock. Earnings per share are restated for all stock splits and stock dividends through the date of issuance of the financial statements. Segment Information The Company operates and manages itself within one retail banking segment and therefore has not provided segment disclosures. Interest Rate Lock Commitments and Forward Sale Contracts Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free-standing derivatives. The fair value of the interest rate lock is recorded at the time the commitment to fund the mortgage loan is executed and is adjusted for the expected exercise of the commitments before the loan is funded. In order to hedge the change in interest rates resulting from commitments to fund the loans, we enter into forward commitments for the future delivery of mortgage loans when the interest rate is locked. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest on the loan is locked. Changes in the fair values of these derivatives are included in income when they occur. As a result of the short-term nature of mortgage loans held for sale (derivative contract), our derivative instruments were considered to be immaterial as of December 31, 2018 and 2017. We had no embedded derivative instruments requiring hedge accounting treatment at December 31, 2018. We do not currently engage in hedging activities. Recent Accounting Pronouncements The following is a summary of recent authoritative pronouncements that could impact the accounting, reporting and/or disclosure of financial information by the Company. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, Topic 606. In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10); Recognition and Measurement of Financial Instruments and Financial Liabilities. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net), In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share – Based Payment Accounting, In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow- Scope Improvements and Practical Expedients In June 2016, the FASB issued ASU 2016-13, Financial instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business In February 2017, the FASB issued ASU 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets Revenue from Contracts with Customers In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization of Purchased Callable Debt Securities, In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, In March 2018, the FASB issued ASU 2018-04 , Investments—Debt Securities (Topic 320) and Regulated Operations (Topic 980): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273, In March 2018, the FASB issued ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 In May 2018, the FASB amended the Financial Services – Depository and Lending Topic of the ASC to remove outdated guidance related to Circular 202. The amendments were effective upon issuance and did not have a material effect on the financial statements. In July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842 – Leases In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. In August 2018, the FASB issued ASU 2018-15, Intangibles and Goodwill and Other-Internal Use Software (Subtopic 350-40):Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract), In October 2018, the FASB issued ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes, In October 2018, the FASB issued ASU 2018-07, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities, In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors, Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on our financial position, results of operations or cash flows. |
INVESTMENT SECURITIES AVAILABLE
INVESTMENT SECURITIES AVAILABLE FOR SALE | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT SECURITIES AVAILABLE FOR SALE | 3. INVESTMENT SECURITIES AVAILABLE FOR SALE The amortized cost and fair value of investment securities available for sale are summarized as follows. December 31, 2018 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated U.S. Treasury Notes $ 32,965,693 $ — $ (609,059 ) $ 32,356,634 Government-Sponsored Enterprises 60,684,878 — (1,315,598 ) 59,369,280 Municipal Securities 28,267,930 112,971 (437,941 ) 27,942,960 Total $ 121,918,501 $ 112,971 $ (2,362,598 ) $ 119,668,874 December 31, 2017 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated U.S. Treasury Notes $ 35,970,990 $ — $ (411,145 ) $ 35,559,845 Government-Sponsored Enterprises 64,444,315 — (887,811 ) 63,556,504 Municipal Securities 40,191,502 487,545 (545,146 ) 40,133,901 Total $ 140,606,807 $ 487,545 $ (1,844,102 ) $ 139,250,250 The amortized cost and estimated fair value of investment securities available for sale at December 31, 2018 and December 31, 2017, by contractual maturity are in the following table. December 31, 2018 December 31, 2017 Amortized Estimated Amortized Estimated Due in one year or less $ 4,246,325 $ 4,249,570 $ 11,554,040 $ 11,546,968 Due in one year to five years 99,753,174 97,915,185 72,622,056 72,124,395 Due in five years to ten years 17,504,456 17,128,425 53,290,088 52,576,036 Due in ten years and over 414,546 375,694 3,140,623 3,002,851 Total $ 121,918,501 $ 119,668,874 $ 140,606,807 $ 139,250,250 Securities pledged to secure deposits and repurchase agreements at December 31, 2018 and 2017, had a carrying amount of $41,547,205 and $49,424,692, respectively. The tables below summarize gross unrealized losses on investment securities and the fair market value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 and 2017. We believe that all unrealized losses have resulted from temporary changes in the interest rate market and not as a result of credit deterioration. We do not intend to sell and it is not likely that we will be required to sell any of the securities referenced in the table below before recovery of their amortized cost. Less Than 12 Months 12 Months or Longer Total # Fair Value Gross Unrealized Loss # Fair Value Gross Unrealized Loss # Fair Value Gross Unrealized Loss December 31, 2018 Available for sale U.S. Treasury Notes $ — $ — 7 $ 32,356,634 $ (609,059 ) 7 $ 32,356,634 $ (609,059 ) Government-Sponsored Enterprises 2 9,967,000 (14,302 ) 11 49,402,280 (1,301,296 ) 13 59,369,280 (1,315,598 ) Municipal Securities 2 1,362,286 (7,547 ) 31 11,840,912 (430,394 ) 33 13,203,198 (437,941 ) Total 4 $ 11,329,286 $ (21,849 ) 49 $ 93,599,826 $ (2,340,749 ) 53 $ 104,929,112 $ (2,362,598 ) December 31, 2017 Available for sale U.S. Treasury Notes 8 $ 35,559,845 $ (411,145 ) — $ — $ — 8 $ 35,559,845 $ (411,145 ) Government-Sponsored Enterprises 12 53,275,064 (462,174 ) 3 10,281,440 (425,637 ) 15 63,556,504 (887,811 ) Municipal Securities 20 7,815,221 (134,998 ) 29 11,056,185 (410,148 ) 49 18,871,406 (545,146 ) Total 40 $ 96,650,130 $ (1,008,317 ) 32 $ 21,337,625 $ (835,785 ) 72 $ 117,987,755 $ (1,844,102 ) The table below shows the proceeds received from sales of securities available for sale and gross realized gains and losses. For the Year Ended December 31, 2018 2017 2016 Gross proceeds $ 21,434,634 $ 20,231,265 $ 36,218,087 Gross realized gains 104,634 154,692 384,963 Gross realized losses (99,899 ) (108,872 ) (4,059 ) The tax provision related to these gains was $994 and $15,578 for the year ended December 31, 2018 and 2017, respectively. |
LOANS AND ALLOWANCE FOR LOAN LO
LOANS AND ALLOWANCE FOR LOAN LOSSES | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
LOANS AND ALLOWANCE FOR LOAN LOSSES | 4. LOANS AND ALLOWANCE FOR LOAN LOSSES Major classifications of loans (net of deferred loan fees of $156,309 at December 31, 2018, and $152,047 at December 31, 2017) are shown in the table below. December 31, December 31, Commercial $ 54,829,078 $ 51,723,237 Commercial real estate: Construction 7,304,300 2,317,857 Other 143,703,401 140,186,324 Consumer: Real estate 63,787,411 70,797,973 Other 5,040,077 5,155,249 Total loans 274,664,267 270,180,640 Allowance for loan losses (4,214,331 ) (3,875,398 ) Total loans, net $ 270,449,936 $ 266,305,242 We had $101.9 million and $113.4 million of loans pledged as collateral to secure funding with the Federal Reserve Bank (“FRB”) Discount Window at December 31, 2018 and 2017, respectively. Our portfolio grading analysis estimates the capability of the borrower to repay the contractual obligations of the loan agreements as scheduled. Our internal credit risk grading system is based on experience with similarly graded loans, industry best practices, and regulatory guidance. Our portfolio is graded in its entirety. Our internally assigned grades pursuant to the Board-approved lending policy are as follows: ● Excellent ● Good ● Satisfactory ● Watch ● OAEM ● Substandard ● Doubtful ● Loss The following tables illustrate credit risks by category and internally assigned grades at December 31, 2018 and December 31, 2017. “Pass” includes loans internally graded as excellent, good and satisfactory. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Pass $ 50,663,356 $ 7,304,300 $ 136,804,420 $ 60,480,317 $ 4,726,494 $ 259,978,887 Watch 1,973,675 — 4,938,711 2,077,341 226,117 9,215,844 OAEM 157,300 — 590,294 350,000 — 1,097,594 Sub-Standard 2,034,747 — 1,369,976 879,753 87,466 4,371,942 Doubtful — — — — — — Loss — — — — — — Total $ 54,829,078 $ 7,304,300 $ 143,703,401 $ 63,787,411 $ 5,040,077 $ 274,664,267 December 31, 2017 Commercial Commercial Commercial Consumer Consumer Total Pass $ 47,456,205 $ 1,936,335 $ 134,401,977 $ 68,570,298 $ 4,933,696 $ 257,298,511 Watch 2,403,978 381,522 3,605,621 1,934,802 185,746 8,511,669 OAEM — — 610,806 — — 610,806 Sub-Standard 1,863,054 — 1,567,920 292,873 35,807 3,759,654 Doubtful — — — — — — Loss — — — — — — Total $ 51,723,237 $ 2,317,857 $ 140,186,324 $ 70,797,973 $ 5,155,249 $ 270,180,640 The following tables include an aging analysis of the recorded investment in loans segregated by class. December 31, 2018 30-59 Days 60-89 Days Greater Than Total Current Total Recorded Commercial $ 266,567 $ 17,492 $ 229,395 $ 513,454 $ 54,315,624 $ 54,829,078 $ — Commercial Real Estate Construction — — — — 7,304,300 7,304,300 — Commercial Real Estate Other 35,000 215,049 571,292 821,341 142,882,060 143,703,401 — Consumer Real Estate — — — — 63,787,411 63,787,411 — Consumer Other 24,621 — — 24,621 5,015,456 5,040,077 — Total $ 326,188 $ 232,541 $ 800,687 $ 1,359,416 $ 273,304,851 $ 274,664,267 $ — December 31, 2017 30-59 Days 60-89 Days Greater Than Total Current Total Recorded Commercial $ 3,531 $ 192,846 $ — $ 196,377 $ 51,526,860 $ 51,723,237 $ — Commercial Real Estate — — — — 2,317,857 2,317,857 — Commercial Real Estate — — 651,578 651,578 139,534,746 140,186,324 — Consumer Real Estate — — — — 70,797,973 70,797,973 — Consumer Other 10,302 — 34,107 44,409 5,110,840 5,155,249 34,107 Total $ 13,833 $ 192,846 $ 685,685 $ 892,364 $ 269,288,276 $ 270,180,640 $ 34,107 There were no loans 90 days or more past due and still accruing interest at December 31, 2018. There were two loans 90 days or more past due and still accruing interest at December 31, 2017. The following table summarizes the balances of non-accrual loans. Loans Receivable on Non-Accrual December 31, 2018 December 31, 2017 Commercial $ 251,219 $ 41,651 Commercial Real Estate Construction — — Commercial Real Estate Other 571,292 790,208 Consumer Real Estate — — Consumer Other 1,023 — Total $ 823,534 $ 831,859 The following tables set forth the changes in the allowance and an allocation of the allowance by class at December 31, 2018, 2017, and 2016. The allowance consists of specific and general components. The specific component relates to loans that are individually classified as impaired. The general component covers non-impaired loans and is based on historical loss experience adjusted for current economic factors. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Allowance for Loan Losses: Beginning Balance $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 Charge-offs (31,250 ) — — — (84,637 ) (115,887 ) Recoveries 14,000 — 56,827 45,412 13,581 129,820 Provisions 279,075 40,238 (314,236 ) (455,745 ) 775,668 325,000 Ending Balance $ 1,665,413 $ 63,876 $ 1,292,346 $ 386,585 $ 806,111 $ 4,214,331 December 31, 2017 Commercial Commercial Real Estate Commercial Consumer Consumer Other Total Allowance for Loan Losses Beginning Balance $ 1,545,188 $ 51,469 $ 1,374,706 $ 726,391 $ 153,863 $ 3,851,617 Charge-offs — — (180,587 ) — (4,862 ) (185,449 ) Recoveries 6,000 — 87,030 60,000 1,200 154,230 Provisions (147,600 ) (27,831 ) 268,606 10,527 (48,702 ) 55,000 Ending Balance $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 December 31, 2016 Commercial Commercial Real Estate Commercial Consumer Real Estate Consumer Other Total Allowance for Loan Losses Beginning Balance $ 896,854 $ 59,861 $ 1,345,094 $ 941,470 $ 174,548 $ 3,417,827 Charge-offs (33,046 ) — (78,300 ) (82,015 ) (14,934 ) (208,295 ) Recoveries — — 65,000 — 7,085 72,085 Provisions 681,380 (8,392 ) 42,912 (133,064 ) (12,836 ) 570,000 Ending Balance $ 1,545,188 $ 51,469 $ 1,374,706 $ 726,391 $ 153,863 $ 3,851,617 The following tables present, by class and reserving methodology, the allocation of the allowance for loan losses and the gross investment in loans. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Allowance for Loan Losses Individually evaluated for impairment $ 1,132,805 $ — $ 37,416 $ — $ 21,324 $ 1,191,545 Collectively evaluated for impairment 532,608 63,876 1,254,930 386,585 784,787 3,022,786 Total Allowance for Loan Losses $ 1,665,413 $ 63,876 $ 1,292,346 $ 386,585 $ 806,111 $ 4,214,331 Loans Receivable Individually evaluated for impairment $ 1,996,579 $ — $ 1,280,890 $ 879,753 $ 21,324 $ 4,178,546 Collectively evaluated for impairment 52,832,499 7,304,300 142,422,511 62,907,658 5,018,753 270,485,721 Total Loans Receivable $ 54,829,078 $ 7,304,300 $ 143,703,401 $ 63,787,411 $ 5,040,077 $ 274,664,267 December 31, 2017 Commercial Commercial Commercial Real Estate Consumer Consumer Other Total Allowance for Loan Losses Individually evaluated for impairment $ 832,571 $ — $ 99,523 $ 43,042 $ 34,107 $ 1,009,243 Collectively evaluated for impairment 571,017 23,638 1,450,232 753,876 67,392 2,866,155 Total Allowance for Losses $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 Loans Receivable Individually evaluated for impairment $ 1,812,461 $ — $ 1,584,821 $ 292,873 $ 34,107 $ 3,724,262 Collectively evaluated for impairment 49,910,776 2,317,857 138,601,503 70,505,100 5,121,142 266,456,378 Total Loans Receivable $ 51,723,237 $ 2,317,857 $ 140,186,324 $ 70,797,973 $ 5,155,249 $ 270,180,640 As of December 31, 2018 and 2017, loans individually evaluated for impairment and the corresponding allowance for loan losses are presented in the following table. Impaired and Restructured Loans as of the year ended December 31, 2018 2017 Unpaid Principal Balance Recorded Investment Related Allowance Unpaid Principal Balance Recorded Investment Related Allowance With no related allowance recorded: Commercial $ 115,983 $ 115,983 $ — $ 152,490 $ 152,490 $ — Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 974,249 974,249 — 1,058,601 1,058,601 — Consumer Real Estate 879,753 879,753 — 249,754 249,754 — Consumer Other — — — — — — Total $ 1,969,985 $ 1,969,985 $ — $ 1,460,845 $ 1,460,845 $ — With an allowance recorded: Commercial $ 1,880,596 $ 1,880,596 $ 1,132,805 $ 1,659,971 $ 1,659,971 $ 832,571 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 406,442 306,641 37,416 626,021 526,220 99,523 Consumer Real Estate — — — 43,119 43,119 43,042 Consumer Other 21,324 21,324 21,324 34,107 34,107 34,107 Total $ 2,308,362 $ 2,208,561 $ 1,191,545 $ 2,363,218 $ 2,263,417 $ 1,009,243 Total Commercial $ 1,996,579 $ 1,996,579 $ 1,132,805 $ 1,812,461 $ 1,812,461 $ 832,571 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 1,380,691 1,280,890 37,416 1,684,622 1,584,821 99,523 Consumer Real Estate 879,753 879,753 — 292,873 292,873 43,042 Consumer Other 21,324 21,324 21,324 34,107 34,107 34,107 Total $ 4,278,347 $ 4,178,546 $ 1,191,545 $ 3,824,063 $ 3,724,262 $ 1,009,243 The following table presents average impaired loans and interest income recognized on those impaired loans, by class segment, for the periods indicated. For the year ended December 31, 2018 2017 2016 Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial $ 133,413 $ 8,637 $ 173,964 $ 7,416 $ 267,747 $ 12,282 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 982,078 40,174 1,275,402 23,084 2,267,288 81,582 Consumer Real Estate 879,753 51,520 451,025 16,938 1,242,515 22,111 Consumer Other — — — — — — Total $ 1,995,244 $ 100,331 $ 1,900,391 $ 47,438 $ 3,777,550 $ 115,975 With an allowance recorded: Commercial $ 1,915,139 $ 100,395 $ 1,711,259 $ 76,544 $ 1,087,559 $ 49,985 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 416,569 10,999 930,420 5,367 1,047,685 16,138 Consumer Real Estate — — 43,119 1,296 43,155 1,514 Consumer Other 26,314 1,382 36,056 1,419 94,945 5,533 Total $ 2,358,022 $ 112,776 $ 2,720,854 $ 84,626 $ 2,273,344 $ 73,170 Total Commercial $ 2,048,552 $ 109,032 $ 1,885,223 $ 83,960 $ 1,355,306 $ 62,267 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 1,398,647 51,173 2,205,822 28,451 3,314,973 97,720 Consumer Real Estate 879,753 51,520 494,144 18,234 1,285,670 23,625 Consumer Other 26,314 1,382 36,056 1,419 94,945 5,533 Total $ 4,353,266 $ 213,107 $ 4,621,245 $ 132,064 $ 6,050,894 $ 189,145 In general, the modification or restructuring of a debt is considered a troubled debt restructuring (“TDR”) if we, for economic or legal reasons related to a borrower’s financial difficulties, grant a concession to the borrower that we would not otherwise consider. As of December 31, 2018, there were no TDRs compared to one TDR with a balance of $33,300 as of December 31, 2017 and two TDRs with a total balance of $378,392 as of December 31, 2016. These TDRs were granted extended payment terms with no principal reduction. All TDRs were performing as agreed as of December 31, 2017. No TDRs that were modified within the previous twelve months defaulted during the following year for years ended December 31, 2018, 2017, and 2016. |
CONCENTRATIONS OF CREDIT RISK
CONCENTRATIONS OF CREDIT RISK | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS OF CREDIT RISK | 5. CONCENTRATIONS OF CREDIT RISK We grant short to intermediate term commercial and consumer loans to customers throughout our primary market area of Charleston, Berkeley and Dorchester counties of South Carolina. Our primary market area is heavily dependent on tourism and medical and legal services. Although we have a diversified loan portfolio, a substantial portion of our debtors’ ability to honor their contracts is dependent upon the stability of the economic environment in their primary market. The majority of the loan portfolio is located in our immediate market area with a concentration in real estate related activities and offices, medical offices, and attorneys’ offices. Our loans were concentrated in the following categories. December 31, 2018 December 31, 2017 Commercial 19.96 % 19.14 % Commercial Real Estate Construction 2.67 % 0.86 % Commercial Real Estate Other 52.32 % 51.89 % Consumer Real Estate 23.22 % 26.20 % Consumer Other 1.83 % 1.91 % Total Loans 100.00 % 100.00 % |
PREMISES, EQUIPMENT AND LEASEHO
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS | 6. Premises, Equipment and Leasehold Improvements Premises, equipment and leasehold improvements are summarized in the table below. December 31, December 31, Bank buildings $ 1,861,237 $ 1,824,613 Land 838,075 838,075 Leasehold purchases 30,000 30,000 Leasehold improvements 709,520 690,212 Construction in progress 120,849 11,754 Equipment 3,526,404 3,405,686 7,086,085 6,800,340 Accumulated depreciation (4,750,878 ) (4,555,815 ) Total $ 2,335,207 $ 2,244,525 Depreciation and amortization on our bank premises and equipment charged to operating expense totaled $195,063 in 2018, $193,298 in 2017, and $189,188 in 2016. We entered into agreements to lease parking and office facilities under non-cancellable operating lease agreements expiring on various dates through 2039. We may, at our option, extend the lease of our Summerville office at 100 North Main Street for two additional ten-year periods; as well as extend the land lease where our Mt. Pleasant office is located for five additional five-year periods. We rent office space at 1071 Morrison Drive, Charleston, South Carolina, from a related party, to house our Mortgage Department. Rent expense for this lease was $60,840, $54,720, and $51,690 for the years ended December 31, 2018, 2017, and 2016, respectively. This lease expires June 30, 2019. We own the land and improvements at our West Ashley office located at 2027 Sam Rittenberg Boulevard, Charleston, South Carolina. Management intends to exercise its option on all lease agreements. Lease payments below include the lease renewals. Minimum rental commitments for these leases as of December 31, 2018 are presented in the table below. 2019 $ 619,492 2020 589,492 2021 589,492 2022 589,492 2023 and thereafter 8,603,721 Total $ 10,991,689 Total rental expense was $622,396, $612,717, and $594,567 in 2018, 2017 and 2016, respectively. On January 28, 2014, we signed a lease to open a banking office located on Highway 78, North Charleston, South Carolina (copy of the lease incorporated as Exhibit 10.8 in the 2013 10-K and copy of the Assignment and Assumption of Lease incorporated as Exhibit 10.9, First Amendment to the Lease incorporated as Exhibit 10.10 and Second Amendment to the Lease incorporated as Exhibit 10.11 in the 2015 10-K). The original lease agreement was terminated but a new lease agreement was executed on July 31, 2017 for the same location (copy of lease incorporated as Exhibit 10.13 in the June 30, 2017 10Q). The building is expected to be completed in the second half of 2019. Rental payments do not commence until we take control of our space. As of December 31, 2018, we have spent $120,849 towards the construction of this office. |
OTHER REAL ESTATE OWNED
OTHER REAL ESTATE OWNED | 12 Months Ended |
Dec. 31, 2018 | |
Real Estate Owned, Disclosure of Detailed Components [Abstract] | |
OTHER REAL ESTATE OWNED | 7. OTHER REAL ESTATE OWNED The following table summarizes the activity in other real estate owned at December 31, 2018 and December 31, 2017. December 31, 2018 December 31, 2017 Balance, beginning of the year $ 435,479 $ 521,943 Additions - foreclosure — 90,832 Sales (411,842 ) (90,832 ) Write-downs (23,637 ) (86,464 ) Balance, end of the year $ — $ 435,479 As of December 31, 2018, there were no properties classified as OREO. One property valued at $411,842 was sold at a loss of $33,476 during 2018. As of December 31, 2017, we had one property with a balance of $435,479 classified as OREO. Another property valued at $90,832 and classified as OREO during 2017 was sold at a loss of $1,477. |
DEPOSITS
DEPOSITS | 12 Months Ended |
Dec. 31, 2018 | |
Deposits: | |
DEPOSITS | 8. DEPOSITS As of December 31, 2018 and 2017, certificates of deposit of $250,000 or more totaled approximately $15,909,991 and $18,624,924, respectively. The scheduled maturities of certificates of deposit as of December 31, 2018 are presented in the table below: 2019 $ 32,319,817 2020 675,338 2021 579,684 2022 402,255 2023 and thereafter 491,631 $ 34,468,725 As of December 31, 2018, deposits with a deficit balance of $43,118 were re-classified as other loans. |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 12 Months Ended |
Dec. 31, 2018 | |
Short-term Debt [Abstract] | |
SHORT-TERM BORROWINGS | 9. Short-Term Borrowings Securities sold under agreements to repurchase with customers mature on demand. At December 31, 2018 and 2017, there were no securities sold under agreements to repurchase. There was no amount outstanding at any month-end during 2018 and 2017. At December 31, 2018 and 2017, we had no outstanding federal funds purchased. We have a Borrower-In-Custody arrangement with the Federal Reserve. This arrangement permits the Company to retain possession of loans pledged as collateral to secure advances from the Federal Reserve Discount Window. Under this agreement, we may borrow up to $79.3 million. We established this arrangement as an additional source of liquidity. There have been no borrowings under this arrangement. At December 31, 2018 and 2017, the Bank had unused short-term lines of credit totaling approximately $23.0 million (which are withdrawable at the lender’s option). |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 10. Income Taxes On December 22, 2017, the President of the United States signed into law the 2017 Tax Act. The 2017 Tax Act includes a number of changes to the existing U.S. tax laws that impact the Company, most notably a reduction in the U.S. corporate income tax rate from 34 percent to 21 percent for tax years beginning after December 31, 2017. The Company recognized the income tax effects of the 2017 Tax Act in its 2017 consolidated financial statements in accordance with Staff Accounting Bulletin No. 118, which provides SEC staff guidance for the application of ASC Topic 740, Income Taxes, Total income taxes for the years ended December 31, 2018, 2017 and 2016 are presented in the table below. For the year ended December 31, 2018 2017 2016 Income tax expense $ 1,108,982 $ 2,814,634 $ 1,688,433 Unrealized gains (losses) on securities available for sale presented in accumulated other comprehensive income (loss) (192, 280) (116,007 ) (939,482 ) Total $ 916,702 $ 2,698,627 $ 748,951 Income tax expense was as follows: For the year ended December 31, 2018 2017 2016 Current income taxes Federal $ 1,326,619 $ 2,538,272 $ 2,438,687 State — — — Total current tax expense 1,326,619 2,538,272 2,438,687 Deferred income tax (benefit) expense (217,637 ) 276,362 (750,254 ) Total income tax expense $ 1,108,982 $ 2,814,634 $ 1,688,433 The differences between actual income tax expense and the amounts computed by applying the U.S. federal income tax rate of 21% to pretax income from continuing operations for the periods indicated are reconciled in the table below. For the year ended December 31, 2018 2017 2016 Computed “expected” tax expense $ 1,686,702 $ 2,623,595 $ 2,358,069 Increase (reduction) in income taxes resulting from: Tax rate change impact — 666,674 — Amortization of credit and gain 196,477 163,411 163,411 Stock based compensation 15,205 24,378 26,012 Valuation Allowance 7,538 16,952 4,314 Other 38,938 (4,768 ) (203,854 ) State income tax, net of federal benefit (226,578 ) (329,412 ) (319,525 ) Federal Credits (454,985 ) — — Tax exempt interest income (154,315 ) (346,196 ) (339,994 ) $ 1,108,982 $ 2,814,634 $ 1,688,433 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2018 and 2017 are presented below. December 31, December 31, Deferred tax assets: Allowance for loan losses $ 850,964 $ 782,714 State credit carryforward 647,190 488,052 Unrealized gain (loss) on securities available for sale 472,421 284,877 Passthrough income 68,438 70,603 State net operating loss carryforward 74,791 67,253 Nonaccrual interest 27,956 19,209 Other real estate owned — 18,157 Other 6,155 5,214 Total gross deferred tax assets 2,147,915 1,736,079 Valuation allowance (74,791 ) (67,253 ) Total gross deferred tax assets, net of valuation allowance 2,073,124 1,668,826 Deferred tax liabilities: Fixed assets, principally due to differences in depreciation (39,294 ) (36,424 ) Deferred loan fees (32,825 ) (31,930 ) Other (56,481 ) (53,591 ) Prepaid expenses (210 ) (210 ) (128,810 ) (122,155 ) Net deferred tax assets $ 1,944,314 $ 1,546,671 In 2018, the Company invested in a Federal Rehabilitation Credit. The tax credit was used during the year ended December 31, 2018. Amortization expense recognized for the year ended December 31, 2018 was $354,888. In 2016, the Company invested in a South Carolina Rehabilitation Credit. The tax credit is included in deferred tax assets and is being amortized. Amortization expense recognized for the years ended December 31, 2018 and 2017 was $306,105, and is included in other operating expense on the statement of operations. There was a $74,791 valuation allowance for deferred tax assets at December 31, 2018 associated with the Company’s state net operating loss. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and prior to their expiration governed by the income tax code. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods during which the deferred income tax assets are expected to be deductible, management believes it is more likely than not the Company will realize the benefits of these deductible differences, net of the existing valuation allowance at December 31, 2018. The amount of the deferred income tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carry forward period are reduced. The Company measures deferred tax assets and liabilities using enacted tax rates that will apply in the years in which the temporary differences are expected to be recovered or paid. Accordingly, the Company’s deferred tax assets and liabilities were remeasured to reflect the reduction in the U.S. corporate income tax rate from 34 percent to 21 percent, resulting in a $666,674 increase in income tax expense for the year ended December 31, 2017 and a corresponding $666,674 decrease in net deferred tax assets as of December 31, 2017. The Company has analyzed the tax positions taken or expected to be taken in its tax returns and concluded it has no liability related to uncertain tax positions in accordance with applicable regulations. Tax returns for 2015 and subsequent years are subject to examination by taxing authorities. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 11. Commitments and Contingencies We are a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit, interest rate, and liquidity risk. Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is essentially the same as that involved in extending loan facilities to customers. We use the same credit policies in making commitments and conditional obligations as we do for on-balance sheet instruments. Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. If deemed necessary, the amount of collateral obtained upon extension of credit is based on our credit evaluation of the borrower. Collateral held varies, but may include accounts receivable, negotiable instruments, inventory, property, plant and equipment, and real estate. Commitments to extend credit, including unused lines of credit, amounted to $96,115,504 and $92,869,285 at December 31, 2018 and 2017, respectively. Standby letters of credit represent our obligation to a third party contingent upon the failure by our customer to perform under the terms of an underlying contract with the third party or obligates us to guarantee or stand as surety for the benefit of the third party. The underlying contract may entail either financial or nonfinancial obligations and may involve such things as the shipment of goods, performance of a contract, or repayment of an obligation. Under the terms of a standby letter, generally drafts will be drawn only when the underlying event fails to occur as intended. We can seek recovery of the amounts paid from the borrower. The majority of these standby letters of credit are unsecured. Commitments under standby letters of credit are usually for one year or less. At December 31, 2018 and 2017, we have recorded no liability for the current carrying amount of the obligation to perform as a guarantor; as such amounts are not considered material. The maximum potential amount of undiscounted future payments related to standby letters of credit at December 31, 2018 and 2017 was $1,169,644 and $1,219,644, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 12. RELATED PARTY TRANSACTIONS In the opinion of management, loans to our executive officers and directors are made on substantially the same terms, including interest rates and collateral, as those terms prevailing at the time for comparable loans with persons not related to the lender that do not involve more than the normal risk of collectability. There were no past due loans to our executive officers as of December 31, 2018 and 2017. The table below summarizes related party loans. December 31, December 31, Balance at beginning of the year $ 4,569,780 $ 3,944,140 New loans or advances 1,428,098 2,879,435 Repayments (1,596,169 ) (2,253,795 ) Balance at the end of the year $ 4,401,710 $ 4,569,780 At December 31, 2018 and 2017, total deposits held by related parties were $8,914,967 and $7,180,958, respectively. The Company also leased office space from a related party as discussed in the Premises, Equipment and Leasehold Improvements footnote. |
OTHER EXPENSE
OTHER EXPENSE | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
OTHER EXPENSE | 13. Other Expense The table below summarizes of the components of other operating expense. For the year ended December 31, 2018 2017 2016 Advertising and business development $ 12,217 $ 10,844 $ 16,159 Supplies 85,984 75,965 94,006 Telephone and postage 175,520 207,526 194,853 Insurance 43,866 44,613 42,192 Professional fees 459,348 451,882 431,424 Data processing services 579,666 585,497 594,550 State and FDIC insurance and fees 183,867 165,280 242,926 Courier service 54,044 82,907 96,823 Amortization of state tax credit 306,106 306,105 325,000 Amortization of federal tax credit 354,888 — — Other 697,957 587,118 601,843 Total other operating expenses $ 2,953,463 $ 2,517,737 $ 2,639,776 |
STOCK INCENTIVE PLAN
STOCK INCENTIVE PLAN | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK INCENTIVE PLAN | 14. Stock Incentive Plan We have a Stock Incentive Plan which was approved in 1998 with 180,000 (329,422 adjusted for five 10% stock dividends and a 25% stock dividend) shares reserved and a Stock Incentive Plan which was approved in 2010 with 300,000 (363,000 adjusted for two 10% stock dividends) shares reserved. Under both plans, options are periodically granted to employees at a price not less than the fair market value of the shares at the date of grant. Employees become 20% vested after five years and then vest 20% each year until fully vested. The right to exercise each such 20% of the options is cumulative and will not expire until the tenth anniversary of the date of the grant. All employees are eligible to participate in this plan if the Executive/Long-Range Committee, in its sole discretion, determines that such person has contributed or can be expected to contribute to our profits or growth. Option awards are generally granted with an exercise price equal to the market price of the Company’s common stock at the date of grant. The fair value of each option award is estimated on the date of grant using a closed form option valuation (Black-Scholes) model that uses the assumptions noted in the table below. Expected volatilities are based on historical volatilities of our common stock. The expected term of the options granted shall not exceed ten years from the date of grant (the amount of time options granted are expected to be outstanding). The risk-free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The fair value of options granted was determined using the following weighted-average assumptions as of grant date: 2018 2017 2016 Risk free interest rate 2.88 % 2.43 % 2.33 % Expected life (in years) 7.5 7.5 10 Expected stock price volatility 33.69 % 34.20 % 27.95 % Dividend yield 3.61 % 4.00 % 3.47 % There are currently no options to purchase or shares exercisable under the 1998 Omnibus Stock Incentive Plan as of December 31, 2018. The following table presents a summary of the activity under the 1998 and 2010 Omnibus Stock Incentive Plans for the years ended December 31. 2018 2017 2016 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Outstanding, January 1 117,191 $ 10.79 154,085 $ 10.19 201,151 $ 9.97 Granted 11,275 18.23 10,175 20.72 11,000 14.54 Expired — — — — — — Exercised (24,056 ) 8.96 (36,454 ) 9.57 (43,100 ) 9.51 Forfeited (1,650 ) 20.02 (10,615 ) 15.83 (14,966 ) 12.28 Outstanding, December 31 102,760 $ 11.89 117,191 $ 10.79 154,085 $ 10.19 Exercisable at year end 32,219 $ 8.81 31,694 $ 8.77 13,882 $ 10.35 Information has been retroactively adjusted for the 2018 10% stock dividends as applicable. The following table presents information pertaining to options outstanding at December 31, 2018. December 31, 2018 Exercise Price Number of Options Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Intrinsic Value of Options Outstanding Number of Options Exercisable Weighted Average Exercise Price Intrinsic Value of Options Exercisable $ 8.61 41,075 6.33 $ 8.61 $ 353,656 24,645 $ 8.61 $ 277,504 $ 8.90 2,541 1.75 $ 8.90 $ 22,615 2,033 $ 8.90 $ 22,300 $ 9.18 7,199 3.50 $ 9.18 $ 66,087 2,880 $ 9.18 $ 30,783 $ 9.65 2,420 2.25 $ 9.65 $ 23,353 1,452 $ 9.65 $ 14,840 $ 9.92 1,815 3.75 $ 9.92 $ 18,005 726 $ 9.92 $ 7,224 $ 12.26 5,444 5.59 $ 12.26 $ 66,743 — $ 12.26 $ — $ 12.40 2,419 5.00 $ 12.40 $ 29,996 484 $ 12.40 $ 3,614 $ 13.05 14,217 6.33 $ 13.05 $ 185,532 — $ 13.05 $ — $ 13.62 3,630 6.50 $ 13.62 $ 49,441 — $ 13.62 $ — $ 14.54 5,500 7.25 $ 14.54 $ 79,970 — $ 14.54 $ — $ 18.23 10,450 9.25 $ 18.23 $ 190,504 — $ 18.23 $ — $ 19.00 2,750 8.17 $ 19.00 $ 52,250 — $ 19.00 $ — $ 19.82 3,300 8.09 $ 19.82 $ 65,406 — $ 19.82 $ — 102,760 6.26 $ 11.71 $ 1,203,558 32,220 $ 11.7 1 $ 356,265 All relevant information has been retroactively adjusted for the 2018 10% stock dividends as applicable. The total intrinsic value of options exercised during the years ended December 31, 2018, 2017, and 2016, were $262,415, $311,836, and $273,979, respectively. We recognized compensation cost for the years ended December 31, 2018, 2017 and 2016 in the amount of $72,408, $71,701, and $76,529, respectively, related to the granted options. As of December 31, 2018, there was a total of $248,027 in unrecognized compensation cost related to nonvested share-based compensation arrangements granted under the Plan. The cost is expected to be recognized over a weighted average period of 4.19 years. |
EMPLOYEE STOCK OWNERSHIP PLAN A
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST | 12 Months Ended |
Dec. 31, 2018 | |
Employee Stock Ownership Plan And Trust | |
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST | 15. EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST We established an Employee Stock Ownership Plan (“ESOP”) effective January 1, 1989. Any employee of the Bank is eligible to become a participant in the ESOP upon reaching 21 years of age and credited with one-year of service (1,000 hours of service). The employee may enter the Plan on the January 1 st The Company recognizes expense when the contribution is approved by the Board of Directors. The total expenses amounted to $420,000, $375,000, and $345,000 during the years ended December 31, 2018, 2017, and 2016, respectively. The plan currently owns 308,613 shares of common stock of Bank of South Carolina Corporation. A participant vests in the ESOP based upon the participant’s credited years of service. The vesting schedule is as follows: ● 1 Year of Service 0% Vested ● 2 Years of Service 25% Vested ● 3 Years of Service 50% Vested ● 4 Years of Service 75% Vested ● 5 Years of Service 100% Vested Periodically, the Internal Revenue Service “IRS” requires a restatement of a qualified retirement plan to ensure that the plan document includes provisions required by legislative and regulatory changes made since the last restatement. There have been no substantive changes to the plan. The Board of Directors approved a restated plan, on January 26, 2012 (incorporated as Exhibit 10.5 in the 2011 10-K). The Plan was submitted to the IRS for approval and a determination letter was issued September 26, 2013, stating that the plan satisfies the requirements of Code Section 4975(e)(7). On January 26, 2017, the Board of Directors approved a restated plan (incorporated as Exhibit 10.6 in the 2016 10-K). The Plan was submitted to the IRS for approval and a determination letter was issued November 17, 2017, stating that the plan satisfies the requirements of Code Section 4975(e)(7). |
DIVIDENDS
DIVIDENDS | 12 Months Ended |
Dec. 31, 2018 | |
Dividends [Abstract] | |
DIVIDENDS | 16. DIVIDENDS The Bank’s ability to pay dividends to the Company is restricted by the laws and regulations of the State of South Carolina. Generally, these restrictions allow the Bank to pay dividends from current earnings without the prior written consent of the South Carolina Commissioner of Banking, if it received a satisfactory rating at its most recent examination. Cash dividends when declared, are paid by the Bank to the Company for distribution to shareholders of the Company. The Bank paid dividends of $3.8 million, $2.7 million, and $2.3 million to the Company during the years ended December 31, 2018, 2017 and 2016, respectively. On April 10, 2018, the Company’s Board of Directors declared a ten percent stock dividend to our shareholders. The record date was April 30, 2018 and the distribution date was May 31, 2018. Earnings per share and average shares outstanding have been adjusted for all periods presented to retroactively reflect the stock dividend in our consolidated financial statements. Total shares outstanding increased by 499,095 shares. |
INCOME PER COMMON SHARE
INCOME PER COMMON SHARE | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
INCOME PER COMMON SHARE | 17. Income Per Common Share Basic income per share is computed by dividing net income by the weighted-average number of common shares outstanding. Diluted income per share is computed by dividing net income by the weighted-average number of common shares and potential common shares outstanding. Potential common shares consist of dilutive stock options determined using the treasury stock method and the average market price of common stock. Earnings per share and average shares outstanding have been adjusted for all periods presented to retroactively reflect the ten percent stock dividend declared on April 10, 2018. The following table is a summary of the reconciliation of average shares outstanding for the years ended December 31. 2018 2017 2017 Numerator: Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Denominator: Weighted average shares outstanding 5,500,027 5,471,001 5,428,884 Effect of dilutive shares 88,985 97,492 132,855 Weighted average shares outstanding - diluted 5,589,012 5,568,493 5,561,739 Earnings per share - basic $ 1.26 $ 0.90 $ 0.97 Earnings per share - diluted $ 1.24 $ 0.88 $ 0.94 |
REGULATORY CAPITAL REQUIREMENTS
REGULATORY CAPITAL REQUIREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory Capital Requirements [Abstract] | |
REGULATORY CAPITAL REQUIREMENTS | 18. Regulatory Capital Requirements The Company and the Bank are subject to various capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the 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 judgements by the regulators about components, risk weightings, and other factors. Current quantitative measures established by regulation to ensure capital adequacy require that we maintain minimum amounts and ratios (set forth in the table below) of total and Tier 1 capital (as defined in the regulation) to risk-weighted assets (as defined) and to average assets. We believe that the Company and the Bank meet all capital adequacy requirements to which they were subject at December 31, 2018 and 2017. On July 2, 2013, the Federal Reserve Board approved the final rules implementing the Basel Committee on Banking Supervision’s (“BCBS”) capital guidelines for U.S. banks (“Basel III”). Following the actions by the Federal Reserve, the FDIC also approved regulatory capital requirements on July 9, 2013. The FDIC’s rule is identical in substance to the final rules issued by the Federal Reserve Bank. Basel III became effective on January 1, 2015. The purpose is to improve the quality and increase the quantity of capital for all banking organizations. The minimum requirements for the quantity and quality of capital were increased. The rule includes a new common equity Tier 1 capital to risk-weighted assets ratio of 4.50% and a common equity Tier 1 capital conservation buffer of 2.50% of risk-weighted assets. The rule also raises the minimum ratio of Tier 1 capital to risk-weighted assets from 4.00% to 6.00% and requires a minimum leverage ratio of 4.00%. In addition, the rule also implements strict eligibility criteria for regulatory capital instruments and improves the methodology for calculating risk-weighted assets to enhance risk sensitivity. All final rule requirements will be phased in over a multi-year schedule. The capital conservation buffer in effect for the year ended December 31, 2018 was 8.39%. At December 31, 2018, the Bank was categorized as “well capitalized” under Basel III. To be categorized as “well capitalized” the Bank must maintain minimum total risk based, Tier 1 risk based, common equity Tier 1 risk based capital and Tier 1 leverage ratios of 10.00%, 8.00%, 6.50%, and 5.00%, respectively, and to be categorized as “adequately capitalized,” the Bank must maintain minimum total risk based, Tier 1 risk based, common equity Tier 1 risk based capital, and Tier 1 leverage ratios of 8.00%, 6.00%, 4.50%, and 4.00%, respectively. The following tables present the actual and required capital amounts and ratios for the Company and Bank at December 31, 2018 and 2017: December 31, 2018 Actual For Capital Adequacy Purposes To Be Well Capitalized Under Prompt Corrective Action Provisions ( in thousands Amount Ratio Amount Ratio Amount Ratio Total capital to risk-weighted assets: Company $ 50,657 16.69 % $ 24,280 8.00 % N/A N/A Bank $ 49,695 16.39 % $ 24,262 8.00 % $ 30,328 10.00 % Tier 1 capital to risk-weighted assets: Company $ 46,864 15.44 % $ 18,210 6.00 % N/A N/A Bank $ 45,898 15.13 % $ 18,197 6.00 % $ 24,262 8.00 % Tier 1 capital to average assets: Company $ 46,864 10.76 % $ 17,428 4.00 % N/A N/A Bank $ 45,898 10.54 % $ 17,419 4.00 % $ 21,773 5.00 % Common equity Tier 1 capital: Company $ 46,864 15.44 % $ 13,658 4.50 % N/A N/A Bank $ 45,898 15.13 % $ 13,647 4.50 % $ 13,647 4.50 % December 31, 2017 Actual For Capital Adequacy Purposes To Be Well Capitalized Under Prompt Corrective Action Provisions ( in thousands Amount Ratio Amount Ratio Amount Ratio Total capital to risk-weighted assets: Company $ 47,986 15.97 % $ 23,213 8.00 % N/A N/A Bank $ 47,100 15.69 % $ 24,020 8.00 % $ 30,025 10.00 % Tier 1 capital to risk-weighted assets: Company $ 44,253 14.73 % $ 17,410 6.00 % N/A N/A Bank $ 43,344 14.44 % $ 18,015 6.00 % $ 24,020 8.00 % Tier 1 capital to average assets: Company $ 44,253 10.01 % $ 16,738 4.00 % N/A N/A Bank $ 43,344 9.82 % $ 17,661 4.00 % $ 22,077 5.00 % Common equity Tier 1 capital: Company $ 44,253 14.73 % $ 13,058 4.50 % N/A N/A Bank $ 43,344 14.44 % $ 13,511 4.50 % $ 19,516 6.50 % |
DISCLOSURES REGARDING FAIR VALU
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS | 19. Disclosures Regarding Fair Value of Financial Instruments Fair value measurements apply whenever GAAP requires or permits assets or liabilities to be measured at fair value either on a recurring or nonrecurring basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants at the measurement date. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities; it is not a forced transaction. GAAP establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs. Observable inputs, which are developed based on market data we have obtained from independent sources, are ones that market participants would use in pricing an asset or liability. Unobservable inputs, which are developed based on the best information available in the circumstances, reflect our estimate of assumptions that market participants would use in pricing an asset or liability. The fair value hierarchy gives the highest priority to unadjusted quoted market prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The fair value hierarchy is broken down into three levels based on the reliability of inputs as follows: ● Level 1: valuation is based upon unadjusted quoted market prices for identical instruments traded in active markets. ● Level 2: valuation is based upon quoted market prices for similar instruments traded in active markets, quoted market prices for identical or similar instruments traded in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by market data. ● Level 3: valuation is derived from other valuation methodologies, including discounted cash flow models and similar techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in determining fair value. Fair value estimates are made at a specific point of time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale our entire holdings of a particular financial instrument. Because no active market exists for a significant portion of our financial instruments, fair value estimates are based on judgements 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 judgement and therefore cannot be determined with precision. Changes in any of these assumptions used in calculating fair value also would affect significantly the estimates. 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 following paragraphs describe the valuation methodologies used for assets and liabilities recorded at fair value on a recurring basis: Investment Securities Available for Sale Investment securities are recorded at fair value on a recurring basis and are based upon quoted prices if available. If quoted prices are not available, fair value is measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange such as the New York Stock Exchange, or by dealers or brokers in active over-the counter markets. Level 2 securities include mortgage backed securities issued by government sponsored entities, municipal bonds and corporate debt securities. Securities classified as Level 3 include asset-backed securities in less liquid markets. Derivative Instruments Derivative instruments include interest rate lock commitments and forward sale commitments. These instruments are valued based on the change in the value of the underlying loan between the commitment date and the end of the period. We classify these instruments as Level 3. We had no embedded derivative instruments requiring separate accounting treatment. We had freestanding derivative instruments consisting of fixed rate conforming loan commitments with interest rate locks and commitments to sell fixed rate conforming loans on a best efforts basis. We do not currently engage in hedging activities. Based on the short-term fair value of mortgage loans held for sale (derivative contract), our derivative instruments were immaterial to our consolidated financial statements as of December 31, 2018 and 2017. Assets and liabilities measured at fair value on a recurring basis at December 31, 2018 and 2017 are in the following table. Balance as of December 31, 2018 Quoted Market Price in Active Markets Significant Other Observable Inputs Significant Unobservable Inputs Total U.S. Treasury Notes $ 32,356,634 $ — $ — $ 32,356,634 Government-Sponsored Enterprises — 59,369,280 — 59,369,280 Municipal Securities — 21,701,005 6,241,955 27,942,960 Total $ 32,356,634 $ 81,070,285 $ 6,241,955 $ 119,668,874 Balance as of December 31, 2017 Quoted Market Price in Active Markets Significant Other Observable Inputs Significant Unobservable Inputs Total U.S. Treasury Notes $ 35,559,845 $ — $ — $ 35,559,845 Government-Sponsored Enterprises — 63,556,504 — 63,556,504 Municipal Securities — 28,675,012 11,458,889 40,133,901 Total $ 35,559,845 $ 92,231,516 $ 11,458,889 $ 139,250,250 There were no liabilities recorded at fair value on a recurring basis as of December 31, 2018 or 2017. The following table reconciles the changes in assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2018 and 2017. December 31, December 31, Beginning balance $ 11,458,889 $ 13,977,857 Total realized/unrealized gains (losses) Included in earnings — — Included in other comprehensive income 150,993 137,751 Purchases, issuances, and settlements, net of maturities (5,367,927 ) (2,656,719 ) Transfers in and/or out of Level 3 — — Ending balance $ 6,241,955 $ 11,458,889 There were no transfers between fair value levels in 2018 or 2017. The following paragraphs describe the valuation methodologies used for assets and liabilities recorded at fair value on a nonrecurring basis: OREO Loans, secured by real estate, are adjusted to the lower of the recorded investment in the loan or the fair value of the real estate upon transfer to OREO. Subsequently, OREO is carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or our estimation of the value of the collateral. When the fair value of the collateral is based on an observable market price or a current appraisal, we record the asset as nonrecurring Level 2. When an appraised value is not available or we determine the fair value of the collateral is further impaired below the appraised value and there is no observable market price, we record the asset as nonrecurring Level 3. Impaired Loans Impaired loans are carried at the lower of recorded investment or fair value. The fair value of the collateral less estimated costs to sell is the most frequently used method. Typically, we review the most recent appraisal and if it is over 12 to 18 months old we may 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, we 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 our primary market area, we 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 we are familiar with the property and surrounding areas and where the original appraisal value far exceeds the recorded investment in the loan, we may perform an internal analysis whereby the previous appraisal value would be reviewed considering recent current conditions, and known recent sales or listings of similar properties in the area, and any other relevant economic trends. This analysis may result in the call for a new appraisal. These valuations are reviewed and updated on a quarterly basis. In accordance with ASC 820, Fair Value Measurement, Mortgage Loans to be Sold Mortgage loans to be sold carried at the lower of cost or market value. The fair values of mortgage loans to be sold are based on current market rates from investors within the secondary market for loans with similar characteristics. Carrying value approximates fair value. These loans are classified as Level 2. Certain assets and liabilities are measured at fair value on a ongoing basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). The following tables present information about certain assets and liabilities measured at fair value on a nonrecurring basis at December 31, 2018 and 2017. December 31, 2018 Quoted Market Price in Active Markets Significant Other Observable Inputs Significant Unobservable Inputs Total Impaired loans $ — $ — $ 2,223,028 $ 2,223,028 Other real estate owned — — — — Loans held for sale — 1,199,438 — 1,199,438 Total $ — $ 1,199,438 $ 2,223,028 $ 3,422,466 December 31, 2017 Quoted Market Price in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Impaired loans $ — $ — $ 1,735,051 $ 1,735,051 Other real estate owned — — 435,479 435,479 Mortgage loans to be sold — 2,093,723 — 2,093,723 Total $ — $ 2,093,723 $ 2,170,530 $ 4,264,253 There were no liabilities measured at fair value on a nonrecurring basis as of December 31, 2018 or 2017. The following table provides information describing the unobservable inputs used in Level 3 fair value measurements at December 31, 2018: Inputs Valuation Technique Unobservable Input General Range of Inputs Impaired Loans Appraisal Value/Comparison Sales/Other Estimates Appraisals and/or Sales of Comparable Properties Appraisals Discounted 10% to 20% for Sales Commissions and Other Holding Costs Other Real Estate Owned Appraisal Value/Comparison Sales/Other Estimates Appraisals and/or Sales of Comparable Properties Appraisals Discounted 10% to 20% for Sales Commissions and Other Holding Costs Accounting standards require disclosure of fair value information for all of our assets and liabilities that are considered financial instruments, whether or not recognized on the balance sheet, for which it is practicable to estimate fair value. Under the accounting standard, fair value estimates are based on existing financial instruments without attempting to estimate the value of anticipated future business and the value of the assets and liabilities that are not financial instruments. Accordingly, the aggregate fair value amounts of existing financial instruments do not represent the underlying value of those instruments on our books. The following paragraphs describe the methods and assumptions we use in estimating the fair values of financial instruments: a. Cash and due from banks, interest-bearing deposits at the Federal Reserve Bank The carrying value approximates fair value. All mature within 90 days and do not present unanticipated credit concerns. b. Investment securities available for sale Investment securities available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. c. Loans During the first quarter of 2018, the Company adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Liabilities. As of December 31, 2018, the technique used by the Company to estimate the exit price of the loan portfolio consists of similar procedures to those used as of December 31, 2017, but with added emphasis on both illiquidity risk and credit risk not captured by the previously applied entry price notion. The fair value of the Company’s loan portfolio has always included a credit risk assumption in the determination of the fair value of its loans. This 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: variable rate loans, impaired loans and all other loans. The results are then adjusted to account for credit risk as described above. However, under the new guidance, the Company believes 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. Fair values for impaired loans are estimated using discounted cash flow models or based on the fair value of the underlying collateral. As of December 31, 2017, the fair value of the Company’s loan portfolio included a credit risk assumption in the determination of the fair value of its loans. This credit risk assumption was 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: variable rate loans, impaired loans and all other loans. The results are then adjusted to account for credit risk. For variable-rate loans that reprice frequently and have no significant change in credit risk, fair values approximate carrying values. Fair values for impaired loans are estimated using discounted cash flow models or based on the fair value of the underlying collateral. For other loans, fair values are estimated using discounted cash flow models, using current market interest rates offered for loans with similar terms to borrowers of similar credit quality. The values derived from the discounted cash flow approach for each of the above portfolios are then further discounted to incorporate credit risk. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price as of December 31, 2017. d. Deposits The estimated fair value of deposits with no stated maturity is equal to the carrying amount. The fair value of time deposits is estimated by discounting contractual cash flows, using interest rates currently being offered on the deposit products. The fair value estimates for deposits do not include the benefit that results from the low cost funding provided by the deposit liabilities as compared to the cost of alternative forms of funding (deposit base intangibles). e. Accrued interest receivable and payable Since these financial instruments will typically be received or paid within three months, the carrying amounts of such instruments are deemed a reasonable estimate of fair value. f. Loan commitments Estimates of the fair value of these off-balance sheet items are not made because of the short-term nature of these arrangements and the credit standing on the counterparties. The following tables present the carrying amount, fair value, and placement in the fair value hierarchy of our financial instruments as of December 31, 2018 and 2017, respectively. Fair Value Measurements at December 31, 2018 Carrying Estimated Level 1 Level 2 Level 3 Financial Assets: Cash and due from banks $ 6,325,457 $ 6,325,457 $ 6,325,457 $ — $ — Interest-bearing deposits at the Federal Reserve 25,506,784 25,506,784 25,506,784 — — Investment securities available for sale 119,668,874 119,668,874 32,356,634 81,070,285 6,241,955 Mortgage loans to be sold 1,199,438 1,199,438 — 1,199,438 — Loans, net 270,449,936 263,780,751 — 263,780,751 Accrued interest receivable 1,561,915 1,561,915 — 1,561,915 — Financial Liabilities: Demand deposits 347,909,663 347,909,663 — 347,909,663 — Time deposits 34,468,725 38,747,898 38,747,898 — Accrued interest payable 163,876 163,876 — 163,876 — Fair Value Measurements at December 31, 2017 Carrying Amount Estimated Fair Value Level 1 Level 2 Level 3 Financial Assets: Cash and due from banks $ 8,486,025 $ 8,486,025 $ 8,486,025 $ — $ — Interest-bearing deposits at the Federal Reserve 24,034,194 24,034,194 24,034,194 — — Investment securities available for sale 139,250,250 139,250,250 35,559,845 92,231,516 11,458,889 Mortgage loans to be sold 2,093,723 2,093,723 — 2,093,723 — Net loans 266,305,242 265,277,204 — — 265,277,204 Accrued interest receivable 1,720,920 1,720,920 — 1,720,920 — Financial Liabilities: Demand deposits 360,967,884 360,967,884 — 360,967,884 — Time deposits 41,920,416 40,722,870 — 40,722,870 — Accrued interest payable 96,190 96,190 — 96,190 — |
BANK OF SOUTH CAROLINA CORPORAT
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY | 20. Bank of South Carolina Corporation - Parent Company The Company’s principal source of income is dividends from the Bank. Certain regulatory requirements restrict the amount of dividends which the Bank can pay to the Company. The Company’s principal asset is its investment in its Bank subsidiary. The Company’s condensed statements of financial condition as of December 31, 2018 and 2017, and the related condensed statements of income and cash flows for the years ended December 31, 2018, 2017 and 2016, are as follows: Condensed Statements of Financial Condition 2018 2017 Assets Cash $ 1,007,501 $ 947,216 Investment in wholly-owned bank subsidiary 45,103,068 42,437,503 Other assets 178,629 127,274 Total assets $ 46,289,198 $ 43,511,993 Liabilities and shareholders’ equity Other liabilities $ 826,637 $ 747,358 Shareholders’ equity 45,462,561 42,764,635 Total liabilities and shareholders’ equity $ 46,289,198 $ 43,511,993 Condensed Statements of Income For the years ended December 31, 2018 2017 2016 Interest income $ 1,157 $ 484 $ 571 Net operating expenses (224,316 ) (189,872 ) (177,612 ) Dividends received from bank 3,775,000 2,685,000 2,340,000 Equity in undistributed earnings of subsidiary 3,371,093 2,406,213 3,084,104 Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Condensed Statements of Cash Flows For the years ended December 31, 2018 2017 2016 Cash flows from operating activities: Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Stock-based compensation expense 72,408 71,701 76,529 Equity in undistributed earnings of subsidiary (3,371,093 ) (2,406,213 ) (3,084,104 ) Decrease in other assets (51,355 ) (51,197 ) (55,923 ) (Decrease) Increase in other liabilities (6,333 ) 151 — Net cash provided by operating activities 3,566,561 2,516,267 2,183,565 Cash flows from financing activities: Dividends paid (3,699,845 ) (2,832,489 ) (2,613,715 ) Stock options exercised 193,569 340,843 405,749 Net cash used in financing activities (3,506,276 ) (2,491,646 ) (2,207,966 ) Net increase (decrease) in cash 60,285 24,621 (24,401 ) Cash at the beginning of the year 947,216 922,595 946,996 Cash at the end of the year $ 1,007 ,501 $ 947,216 $ 922,595 Supplemental disclosure for non-cash investing and financing activity $ 85,615 $ 53,340 $ 74,706 |
QUARTERLY RESULTS OF OPERATIONS
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) | 21. Quarterly Results of Operations (unaudited) The tables below represent the quarterly results of operations for the years ended December 31, 2018 and 2017, respectively: 2018 Fourth Third Second First Total interest and fee income $ 4,727,449 $ 4,665,586 $ 4,423,867 $ 4,320,009 Total interest expense 249,425 195,434 139,697 109,830 Net interest income 4,478,024 4,470,152 4,284,170 4,210,179 Provision for loan losses 95,000 100,000 75,000 55,000 Net interest income after provision for loan losses 4,383,024 4,370,152 4,209,170 4,155,179 Total other income 532,891 458,693 555,096 447,945 Total other expense 2,970,411 2,816,474 2,651,515 2,641,834 Income before income tax expense 1,945,504 2,012,371 2,112,751 1,961,290 Income tax expense 139,310 234,218 386,394 349,060 Net income $ 1,806,194 $ 1,778,153 $ 1,726,357 $ 1,612,230 Basic income per common share $ 0.33 $ 0.32 $ 0.31 $ 0.29 Diluted income per common share $ 0.32 $ 0.32 $ 0.31 $ 0.29 2017 Fourth Third Second First Total interest and fee income $ 4,327,409 $ 4,117,032 $ 3,933,285 $ 3,791,421 Total interest expense 109,934 110,625 106,522 96,782 Net interest income 4,217,475 4,006,407 3,826,763 3,694,639 Provision for loan losses 2,500 20,000 30,000 2,500 Net interest income after provision for loan losses 4,214,975 3,986,407 3,796,763 3,692,139 Other income 538,236 481,882 696,479 551,874 Other expense 2,696,005 2,484,538 2,590,123 2,471,630 Income before income tax expense 2,057,206 1,983,751 1,903,119 1,772,383 Income tax expense 1,208,507 543,098 516,734 546,295 Net income $ 848,699 $ 1,440,653 $ 1,386,385 $ 1,226,088 Basic income per common share $ 0.15 $ 0.26 $ 0.25 $ 0.22 Diluted income per common share $ 0.15 $ 0.26 $ 0.25 $ 0.22 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, the Bank. In consolidation, all significant intercompany balances and transactions have been eliminated. References to “we,” “us,” “our,” “the Bank,” or “the Company” refer to the parent and its subsidiary that are consolidated for financial purposes. |
Accounting Estimates and Assumptions | Accounting Estimates and Assumptions The financial statements are prepared in conformity with GAAP, which require management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ significantly from these estimates and assumptions. Material estimates generally susceptible to significant change are related to the determination of the allowance for loan losses, impaired loans, other real estate owned, deferred tax assets, the fair value of financial instruments and other-than-temporary impairment of investment securities. |
Reclassification | Reclassification: Certain amounts in the prior years’ financial statements have been reclassified to conform to the current year’s presentation. Such reclassifications have no effect on shareholders’ equity or the net income as previously reported. |
Subsequent Events | Subsequent Events: Subsequent 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 as of the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Non-recognized subsequent events are events that provide evidence about conditions that did not exist as of the date of the balance sheet but arose after that date. We have reviewed events occurring through the date the financial statements were available to be issued and no subsequent events occurred requiring accrual or disclosure. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include working cash funds, due from banks, interest-bearing deposits at the Federal Reserve, items in process of collection and federal funds sold. All cash equivalents are readily convertible to cash and have maturities of less than 90 days. Depository institutions are required to maintain reserve and clearing balances at the Federal Reserve Bank. Vault cash satisfied our daily reserve requirement for the years ended December 31, 2018 and 2017, respectively. |
Interest-bearing Deposits at the Federal Reserve | Interest-bearing Deposits at the Federal Reserve Interest-bearing deposits at the Federal Reserve mature within one year and are carried at cost. |
Investment Securities | Investment Securities We classify investments into three categories: (1) Held to Maturity - debt securities that we have the positive intent and ability to hold to maturity, which are reported at amortized cost, adjusted for the amortization of any related premiums or the accretion of any related discounts into interest income using a methodology which approximates a level yield of interest over the estimated remaining period until maturity; (2) Trading - debt and equity securities that are bought and held principally for the purpose of selling them in the near term, which are reported at fair value, with unrealized gains and losses included in earnings; and (3) Available for Sale - debt and equity securities that may be sold under certain conditions, which are reported at fair value, with unrealized gains and losses excluded from earnings and reported as a separate component of shareholders’ equity, net of income taxes. Unrealized losses on securities due to fluctuations in fair value are recognized when it is determined that an other than temporary decline in value has occurred. Realized gains or losses on the sale of investments are recognized on a specific identification, trade date basis. All securities were classified as available for sale for 2018 and 2017. |
Mortgage Loans to be Sold | Mortgage Loans to be Sold We originate fixed and variable rate residential mortgage loans on a service release basis in the secondary market. Loans closed but not yet settled with an investor are carried in our loans held for sale portfolio. 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 our customers. Therefore, these loans present very little market risk. We usually deliver to, and receive funding from, the investor within 30 to 60 days. Commitments to sell these loans to the investor are considered derivative contracts and are sold to investors on a “best efforts” basis. We are not obligated to deliver a loan or pay a penalty if a loan is not delivered to the investor. Because of the short-term nature of these derivative contracts, the fair value of the mortgage loans held for sale in most cases is materially the same as the value of the loan amount at its origination . Mortgage loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated market value in the aggregate. Net unrealized losses are provided for in a valuation allowance by charges to operations as a component of mortgage banking income. Gains or losses on sales of loans are recognized when control over these assets are surrendered and are included in mortgage banking income in the consolidated statements of income. |
Loans and Allowance for Loan Losses | Loans and Allowance for Loan Losses Loans are carried at principal amounts outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized over the weighted average life of the loan as an adjustment to yield. Interest income on all loans is recorded on an accrual basis. The accrual of interest and the amortization of net loan fees are generally discontinued on loans that 1) are maintained on a cash basis because of deterioration in the financial condition of the borrower; 2) the payment of full principal is not expected; or 3) the principal or interest has been in default for a period of 90 days or more. We define past due loans based on contractual payment and maturity dates. The accrual of interest is generally discontinued on loans that become 90 days past due as to principal or interest. The accrual of interest on some loans may continue even though they are 90 days past due if the loans are well secured or in the process of collection and management deems it appropriate. If non-accrual loans decrease their past due status to less than 30 days for a period of six to nine months, they are reviewed individually by management to determine if they should be returned to accrual status. When the ultimate collectability of an impaired loan’s principal is in doubt, wholly or partially, all cash receipts are applied 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. When this doubt does not exist, cash receipts are applied under the contractual terms of the loan agreement first to interest income and then to principal. We account for impaired loans by requiring that all loans (greater than $50,000) where it is estimated that we will be unable to collect all amounts due according to the terms of the loan agreement be recorded at the loan’s fair value. Fair value may be determined based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, or the fair value of the collateral less cost to sell, if the loan is collateral dependent. Additional accounting guidance allows us to use existing methods for recognizing interest income on an impaired loan. The guidance also requires additional disclosures about how we estimate interest income related to our impaired loans. A loan is also considered impaired if its terms are modified in a troubled debt restructuring (“TDR”). For this type of impaired loan, cash receipts are typically applied to principal and interest receivable in accordance with the terms of the restructured loan agreement. Interest income is recognized on these loans using the accrual method of accounting, provided they are performing in accordance with their restructured terms. The allowance for loan losses (the “allowance”) is our estimate of credit losses inherent in the loan portfolio. The allowance is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when we believe the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance is evaluated on a regular basis and is based upon our periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. We believe that the allowance is adequate to absorb inherent losses in the loan portfolio; however, there can be no assurance that loan losses in future periods will not exceed the current allowance amount or that future increases in the allowance will not be required. No assurance can be given that our ongoing evaluation of the loan portfolio, in light of changing economic conditions and other relevant circumstances, will not require significant future additions to the allowance, thus adversely affecting our operating results. The allowance is also subject to examination by regulatory agencies, which may consider factors such as the methodology used to determine adequacy and the size of the allowance relative to that of peer institutions and other adequacy tests. In addition, such regulatory agencies could require us to adjust our allowance based on information available at the time of the examination. The methodology used to determine the reserve for unfunded lending commitments, which is included in other liabilities, is inherently similar to the methodology used to determine the allowance adjusted for factors specific to binding commitments, including the probability of funding and historical loss ratio. |
Concentration of Credit Risk | Concentration of Credit Risk Our primary market consists of the counties of Berkeley, Charleston and Dorchester, South Carolina. As of December 31, 2018, the majority of the total loan portfolio, as well as a substantial portion of the commercial and real estate loan portfolios, were to borrowers within this region. No other areas of significant concentration of credit risk have been identified. |
Premises, Equipment and Leasehold Improvements and Depreciation | Premises, Equipment and Leasehold Improvements and Depreciation Land is carried at cost. Buildings and equipment are stated at cost less accumulated depreciation. Depreciation is recorded using the straight-line method for financial reporting purposes and accelerated methods for income tax purposes over the estimated useful lives of the assets ranging from 40 years for buildings and 3 to 15 years for equipment. Leasehold improvements are amortized over the shorter of the asset’s useful life or the remaining lease term, including renewal periods when reasonably assured. The cost of maintenance and repairs is charged to operating expense as incurred. |
Other Real Estate Owned | Other Real Estate Owned Fair value is based upon independent market prices, appraised values of the collateral, or our estimation of the value of the collateral. Losses arising from an initial foreclosure are charged against the allowance for loan losses. Subsequent to foreclosure, other real estate owned (“OREO”) is recorded at the lower of cost or fair value, adjusted for net selling costs. Gains and losses on the sale of OREO and subsequent write-downs from periodic re-evaluation are charged to net other real estate owned expenses. |
Income Taxes | Income Taxes We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Net deferred tax assets are included in other assets in the consolidated balance sheet. Accounting standards require the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. These standards also prescribe a recognition threshold and measurement of a tax position taken or expected to be taken in an enterprise’s tax return. We believe that we had no uncertain tax positions for the years ended December 31, 2018 and 2017. |
Stock-Based Compensation | Stock-Based Compensation Compensation cost is recognized for stock options issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options. Compensation cost is recognized over the required service period, generally defined as the vesting period (10 years). |
Income Per Common Share | Income Per Common Share Basic income per share is computed by dividing net income by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the weighted-average number of common shares and potential common shares outstanding. Potential common shares consist of dilutive stock options determined using the treasury stock method and the average market price of common stock. Earnings per share are restated for all stock splits and stock dividends through the date of issuance of the financial statements. |
Segment Information | Segment Information The Company operates and manages itself within one retail banking segment and therefore has not provided segment disclosures. |
Interest Rate Lock Commitments and Forward Sale Contracts | Interest Rate Lock Commitments and Forward Sale Contracts Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free-standing derivatives. The fair value of the interest rate lock is recorded at the time the commitment to fund the mortgage loan is executed and is adjusted for the expected exercise of the commitments before the loan is funded. In order to hedge the change in interest rates resulting from commitments to fund the loans, we enter into forward commitments for the future delivery of mortgage loans when the interest rate is locked. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest on the loan is locked. Changes in the fair values of these derivatives are included in income when they occur. As a result of the short-term nature of mortgage loans held for sale (derivative contract), our derivative instruments were considered to be immaterial as of December 31, 2018 and 2017. We had no embedded derivative instruments requiring hedge accounting treatment at December 31, 2018. We do not currently engage in hedging activities. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The following is a summary of recent authoritative pronouncements that could impact the accounting, reporting and/or disclosure of financial information by the Company. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, Topic 606. In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10); Recognition and Measurement of Financial Instruments and Financial Liabilities. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net), In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share – Based Payment Accounting, In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow- Scope Improvements and Practical Expedients In June 2016, the FASB issued ASU 2016-13, Financial instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business In February 2017, the FASB issued ASU 2017-05, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets Revenue from Contracts with Customers In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization of Purchased Callable Debt Securities, In February 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, In March 2018, the FASB issued ASU 2018-04 , Investments—Debt Securities (Topic 320) and Regulated Operations (Topic 980): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273, In March 2018, the FASB issued ASU 2018-05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 In May 2018, the FASB amended the Financial Services – Depository and Lending Topic of the ASC to remove outdated guidance related to Circular 202. The amendments were effective upon issuance and did not have a material effect on the financial statements. In July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842 – Leases In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. In August 2018, the FASB issued ASU 2018-15, Intangibles and Goodwill and Other-Internal Use Software (Subtopic 350-40):Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract), In October 2018, the FASB issued ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes, In October 2018, the FASB issued ASU 2018-07, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities, In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors, Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on our financial position, results of operations or cash flows. |
INVESTMENT SECURITIES AVAILAB_2
INVESTMENT SECURITIES AVAILABLE FOR SALE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost fair value of investment securities available for sale | The amortized cost and fair value of investment securities available for sale are summarized as follows. December 31, 2018 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated U.S. Treasury Notes $ 32,965,693 $ — $ (609,059 ) $ 32,356,634 Government-Sponsored Enterprises 60,684,878 — (1,315,598 ) 59,369,280 Municipal Securities 28,267,930 112,971 (437,941 ) 27,942,960 Total $ 121,918,501 $ 112,971 $ (2,362,598 ) $ 119,668,874 December 31, 2017 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated U.S. Treasury Notes $ 35,970,990 $ — $ (411,145 ) $ 35,559,845 Government-Sponsored Enterprises 64,444,315 — (887,811 ) 63,556,504 Municipal Securities 40,191,502 487,545 (545,146 ) 40,133,901 Total $ 140,606,807 $ 487,545 $ (1,844,102 ) $ 139,250,250 |
Schedule of amortized cost and estimated fair value of investment securities available for sale by contractual maturity | The amortized cost and estimated fair value of investment securities available for sale at December 31, 2018 and December 31, 2017, by contractual maturity are in the following table. December 31, 2018 December 31, 2017 Amortized Cost Estimated Fair Value Amortized Cost Estimated Fair Value Due in one year or less $ 4,246,325 $ 4,249,570 $ 11,554,040 $ 11,546,968 Due in one year to five years 99,753,174 97,915,185 72,622,056 72,124,395 Due in five years to ten years 17,504,456 17,128,425 53,290,088 52,576,036 Due in ten years and over 414,546 375,694 3,140,623 3,002,851 Total $ 121,918,501 $ 119,668,874 $ 140,606,807 $ 139,250,250 |
Schedule of investment securities gross unrealized losses on investment securities and the fair market value of the related securities | The tables below summarize gross unrealized losses on investment securities and the fair market value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 and 2017. Less Than 12 Months 12 Months or Longer Total # Fair Value Gross Unrealized Loss # Fair Value Gross Unrealized Loss # Fair Value Gross Unrealized Loss December 31, 2018 Available for sale U.S. Treasury Notes $ — $ — 7 $ 32,356,634 $ (609,059 ) 7 $ 32,356,634 $ (609,059 ) Government-Sponsored Enterprises 2 9,967,000 (14,302 ) 11 49,402,280 (1,301,296 ) 13 59,369,280 (1,315,598 ) Municipal Securities 2 1,362,286 (7,547 ) 31 11,840,912 (430,394 ) 33 13,203,198 (437,941 ) Total 4 $ 11,329,286 $ (21,849 ) 49 $ 93,599,826 $ (2,340,749 ) 53 $ 104,929,112 $ (2,362,598 ) December 31, 2017 Available for sale U.S. Treasury Notes 8 $ 35,559,845 $ (411,145 ) — $ — $ — 8 $ 35,559,845 $ (411,145 ) Government-Sponsored Enterprises 12 53,275,064 (462,174 ) 3 10,281,440 (425,637 ) 15 63,556,504 (887,811 ) Municipal Securities 20 7,815,221 (134,998 ) 29 11,056,185 (410,148 ) 49 18,871,406 (545,146 ) Total 40 $ 96,650,130 $ (1,008,317 ) 32 $ 21,337,625 $ (835,785 ) 72 $ 117,987,755 $ (1,844,102 ) |
Schedule of proceeds from sales of securities available for sale and gross realized gains and losses | The table below shows the proceeds received from sales of securities available for sale and gross realized gains and losses. For the Year Ended December 31, 2018 2017 2016 Gross proceeds $ 21,434,634 $ 20,231,265 $ 36,218,087 Gross realized gains 104,634 154,692 384,963 Gross realized losses (99,899 ) (108,872 ) (4,059 ) |
LOANS AND ALLOWANCE FOR LOAN _2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Receivables [Abstract] | |
Schedule of major classifications of loans | Major classifications of loans (net of deferred loan fees of $156,309 at December 31, 2018, and $152,047 at December 31, 2017) are shown in the table below. December 31, December 31, Commercial $ 54,829,078 $ 51,723,237 Commercial real estate: Construction 7,304,300 2,317,857 Other 143,703,401 140,186,324 Consumer: Real estate 63,787,411 70,797,973 Other 5,040,077 5,155,249 Total loans 274,664,267 270,180,640 Allowance for loan losses (4,214,331 ) (3,875,398 ) Total loans, net $ 270,449,936 $ 266,305,242 |
Schedule of credit risks by category and internally assigned grades | The following tables illustrate credit risks by category and internally assigned grades at December 31, 2018 and December 31, 2017. “Pass” includes loans internally graded as excellent, good and satisfactory. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Pass $ 50,663,356 $ 7,304,300 $ 136,804,420 $ 60,480,317 $ 4,726,494 $ 259,978,887 Watch 1,973,675 — 4,938,711 2,077,341 226,117 9,215,844 OAEM 157,300 — 590,294 350,000 — 1,097,594 Sub-Standard 2,034,747 — 1,369,976 879,753 87,466 4,371,942 Doubtful — — — — — — Loss — — — — — — Total $ 54,829,078 $ 7,304,300 $ 143,703,401 $ 63,787,411 $ 5,040,077 $ 274,664,267 December 31, 2017 Commercial Commercial Commercial Consumer Consumer Total Pass $ 47,456,205 $ 1,936,335 $ 134,401,977 $ 68,570,298 $ 4,933,696 $ 257,298,511 Watch 2,403,978 381,522 3,605,621 1,934,802 185,746 8,511,669 OAEM — — 610,806 — — 610,806 Sub-Standard 1,863,054 — 1,567,920 292,873 35,807 3,759,654 Doubtful — — — — — — Loss — — — — — — Total $ 51,723,237 $ 2,317,857 $ 140,186,324 $ 70,797,973 $ 5,155,249 $ 270,180,640 |
Schedule of aging analysis of the recorded investment in loans segregated by class | The following tables include an aging analysis of the recorded investment in loans segregated by class. December 31, 2018 30-59 Days 60-89 Days Greater Than Total Current Total Recorded Commercial $ 266,567 $ 17,492 $ 229,395 $ 513,454 $ 54,315,624 $ 54,829,078 $ — Commercial Real Estate Construction — — — — 7,304,300 7,304,300 — Commercial Real Estate Other 35,000 215,049 571,292 821,341 142,882,060 143,703,401 — Consumer Real Estate — — — — 63,787,411 63,787,411 — Consumer Other 24,621 — — 24,621 5,015,456 5,040,077 — Total $ 326,188 $ 232,541 $ 800,687 $ 1,359,416 $ 273,304,851 $ 274,664,267 $ — December 31, 2017 30-59 Days 60-89 Days Greater Than Total Current Total Recorded Commercial $ 3,531 $ 192,846 $ — $ 196,377 $ 51,526,860 $ 51,723,237 $ — Commercial Real Estate — — — — 2,317,857 2,317,857 — Commercial Real Estate — — 651,578 651,578 139,534,746 140,186,324 — Consumer Real Estate — — — — 70,797,973 70,797,973 — Consumer Other 10,302 — 34,107 44,409 5,110,840 5,155,249 34,107 Total $ 13,833 $ 192,846 $ 685,685 $ 892,364 $ 269,288,276 $ 270,180,640 $ 34,107 |
Schedule of non-accrual loans | The following table summarizes the balances of non-accrual loans. Loans Receivable on Non-Accrual December 31, 2018 December 31, 2017 Commercial $ 251,219 $ 41,651 Commercial Real Estate Construction — — Commercial Real Estate Other 571,292 790,208 Consumer Real Estate — — Consumer Other 1,023 — Total $ 823,534 $ 831,859 |
Schedule of change in allowance and an allocation of the allowance by loan categery | The following tables set forth the changes in the allowance and an allocation of the allowance by class at December 31, 2018, 2017 and 2016. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Allowance for Loan Losses: Beginning Balance $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 Charge-offs (31,250 ) — — — (84,637 ) (115,887 ) Recoveries 14,000 — 56,827 45,412 13,581 129,820 Provisions 279,075 40,238 (314,236 ) (455,745 ) 775,668 325,000 Ending Balance $ 1,665,413 $ 63,876 $ 1,292,346 $ 386,585 $ 806,111 $ 4,214,331 December 31, 2017 Commercial Commercial Real Estate Construction Commercial Real Estate Other Consumer Real Estate Consumer Other Total Allowance for Loan Losses Beginning Balance $ 1,545,188 $ 51,469 $ 1,374,706 $ 726,391 $ 153,863 $ 3,851,617 Charge-offs — — (180,587 ) — (4,862 ) (185,449 ) Recoveries 6,000 — 87,030 60,000 1,200 154,230 Provisions (147,600 ) (27,831 ) 268,606 10,527 (48,702 ) 55,000 Ending Balance $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 December 31, 2016 Commercial Commercial Real Estate Construction Commercial Real Estate Other Consumer Real Estate Consumer Other Total Allowance for Loan Losses Beginning Balance $ 896,854 $ 59,861 $ 1,345,094 $ 941,470 $ 174,548 $ 3,417,827 Charge-offs (33,046 ) — (78,300 ) (82,015 ) (14,934 ) (208,295 ) Recoveries — — 65,000 — 7,085 72,085 Provisions 681,380 (8,392 ) 42,912 (133,064 ) (12,836 ) 570,000 Ending Balance $ 1,545,188 $ 51,469 $ 1,374,706 $ 726,391 $ 153,863 $ 3,851,617 |
Schedule of allocation of the allowance for loan losses and the gross investment in loans by class and reserving methodology | The following tables present, by class and reserving methodology, the allocation of the allowance for loan losses and the gross investment in loans. December 31, 2018 Commercial Commercial Commercial Consumer Consumer Total Allowance for Loan Losses Individually evaluated for impairment $ 1,132,805 $ — $ 37,416 $ — $ 21,324 $ 1,191,545 Collectively evaluated for impairment 532,608 63,876 1,254,930 386,585 784,787 3,022,786 Total Allowance for Loan Losses $ 1,665,413 $ 63,876 $ 1,292,346 $ 386,585 $ 806,111 $ 4,214,331 Loans Receivable Individually evaluated for impairment $ 1,996,579 $ — $ 1,280,890 $ 879,753 $ 21,324 $ 4,178,546 Collectively evaluated for impairment 52,832,499 7,304,300 142,422,511 62,907,658 5,018,753 270,485,721 Total Loans Receivable $ 54,829,078 $ 7,304,300 $ 143,703,401 $ 63,787,411 $ 5,040,077 $ 274,664,267 December 31, 2017 Commercial Commercial Commercial Real Estate Consumer Consumer Other Total Allowance for Loan Losses Individually evaluated for impairment $ 832,571 $ — $ 99,523 $ 43,042 $ 34,107 $ 1,009,243 Collectively evaluated for impairment 571,017 23,638 1,450,232 753,876 67,392 2,866,155 Total Allowance for Losses $ 1,403,588 $ 23,638 $ 1,549,755 $ 796,918 $ 101,499 $ 3,875,398 Loans Receivable Individually evaluated for impairment $ 1,812,461 $ — $ 1,584,821 $ 292,873 $ 34,107 $ 3,724,262 Collectively evaluated for impairment 49,910,776 2,317,857 138,601,503 70,505,100 5,121,142 266,456,378 Total Loans Receivable $ 51,723,237 $ 2,317,857 $ 140,186,324 $ 70,797,973 $ 5,155,249 $ 270,180,640 |
Schedule of loans individually evaluated for impairment and the corresponding allowance for loan losses | As of December 31, 2018 and 2017, loans individually evaluated for impairment and the corresponding allowance for loan losses are presented in the following table. Impaired and Restructured Loans as of the year ended December 31, 2018 2017 Unpaid Principal Balance Recorded Investment Related Allowance Unpaid Principal Balance Recorded Investment Related Allowance With no related allowance recorded: Commercial $ 115,983 $ 115,983 $ — $ 152,490 $ 152,490 $ — Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 974,249 974,249 — 1,058,601 1,058,601 — Consumer Real Estate 879,753 879,753 — 249,754 249,754 — Consumer Other — — — — — — Total $ 1,969,985 $ 1,969,985 $ — $ 1,460,845 $ 1,460,845 $ — With an allowance recorded: Commercial $ 1,880,596 $ 1,880,596 $ 1,132,805 $ 1,659,971 $ 1,659,971 $ 832,571 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 406,442 306,641 37,416 626,021 526,220 99,523 Consumer Real Estate — — — 43,119 43,119 43,042 Consumer Other 21,324 21,324 21,324 34,107 34,107 34,107 Total $ 2,308,362 $ 2,208,561 $ 1,191,545 $ 2,363,218 $ 2,263,417 $ 1,009,243 Total Commercial $ 1,996,579 $ 1,996,579 $ 1,132,805 $ 1,812,461 $ 1,812,461 $ 832,571 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 1,380,691 1,280,890 37,416 1,684,622 1,584,821 99,523 Consumer Real Estate 879,753 879,753 — 292,873 292,873 43,042 Consumer Other 21,324 21,324 21,324 34,107 34,107 34,107 Total $ 4,278,347 $ 4,178,546 $ 1,191,545 $ 3,824,063 $ 3,724,262 $ 1,009,243 |
Schedule of average impaired loans and interest income recognized on those impaired loans by class | The following table presents average impaired loans and interest income recognized on those impaired loans, by class segment, for the periods indicated. For the year ended December 31, 2018 2017 2016 Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial $ 133,413 $ 8,637 $ 173,964 $ 7,416 $ 267,747 $ 12,282 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 982,078 40,174 1,275,402 23,084 2,267,288 81,582 Consumer Real Estate 879,753 51,520 451,025 16,938 1,242,515 22,111 Consumer Other — — — — — — Total $ 1,995,244 $ 100,331 $ 1,900,391 $ 47,438 $ 3,777,550 $ 115,975 With an allowance recorded: Commercial $ 1,915,139 $ 100,395 $ 1,711,259 $ 76,544 $ 1,087,559 $ 49,985 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 416,569 10,999 930,420 5,367 1,047,685 16,138 Consumer Real Estate — — 43,119 1,296 43,155 1,514 Consumer Other 26,314 1,382 36,056 1,419 94,945 5,533 Total $ 2,358,022 $ 112,776 $ 2,720,854 $ 84,626 $ 2,273,344 $ 73,170 Total Commercial $ 2,048,552 $ 109,032 $ 1,885,223 $ 83,960 $ 1,355,306 $ 62,267 Commercial Real Estate Construction — — — — — — Commercial Real Estate Other 1,398,647 51,173 2,205,822 28,451 3,314,973 97,720 Consumer Real Estate 879,753 51,520 494,144 18,234 1,285,670 23,625 Consumer Other 26,314 1,382 36,056 1,419 94,945 5,533 Total $ 4,353,266 $ 213,107 $ 4,621,245 $ 132,064 $ 6,050,894 $ 189,145 |
CONCENTRATIONS OF CREDIT RISK (
CONCENTRATIONS OF CREDIT RISK (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule of loan concentration | Our loans were concentrated in the following categories. December 31, 2018 December 31, 2017 Commercial 19.96 % 19.14 % Commercial Real Estate Construction 2.67 % 0.86 % Commercial Real Estate Other 52.32 % 51.89 % Consumer Real Estate 23.22 % 26.20 % Consumer Other 1.83 % 1.91 % Total Loans 100.00 % 100.00 % |
PREMISES, EQUIPMENT AND LEASE_2
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of premises, equipment and leasehold improvements | Premises, equipment and leasehold improvements are summarized in the table below. December 31, December 31, Bank buildings $ 1,861,237 $ 1,824,613 Land 838,075 838,075 Leasehold purchases 30,000 30,000 Leasehold improvements 709,520 690,212 Construction in progress 120,849 11,754 Equipment 3,526,404 3,405,686 7,086,085 6,800,340 Accumulated depreciation (4,750,878 ) (4,555,815 ) Total $ 2,335,207 $ 2,244,525 |
Schedule of minimum rental commitments for leases | Minimum rental commitments for these leases as of December 31, 2018 are presented in the table below. 2019 $ 619,492 2020 589,492 2021 589,492 2022 589,492 2023 and thereafter 8,603,721 Total $ 10,991,689 |
OTHER REAL ESTATE OWNED (Tables
OTHER REAL ESTATE OWNED (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Real Estate Owned, Disclosure of Detailed Components [Abstract] | |
Schedule of activity in other real estate owned | The following table summarizes the activity in other real estate owned at December 31, 2018 and December 31, 2017. December 31, 2018 December 31, 2017 Balance, beginning of the year $ 435,479 $ 521,943 Additions - foreclosure — 90,832 Sales (411,842 ) (90,832 ) Write-downs (23,637 ) (86,464 ) Balance, end of the year $ — $ 435,479 |
DEPOSITS (Tables)
DEPOSITS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposits: | |
Schedule of maturities of certificates of deposits | The scheduled maturities of certificates of deposit as of December 31, 2018 are presented in the table below: 2019 $ 32,319,817 2020 675,338 2021 579,684 2022 402,255 2023 and thereafter 491,631 $ 34,468,725 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income tax expense | Total income taxes for the years ended December 31, 2018, 2017 and 2016 are presented in the table below. For the year ended December 31, 2018 2017 2016 Income tax expense $ 1,108,982 $ 2,814,634 $ 1,688,433 Unrealized gains (losses) on securities available for sale presented in accumulated other comprehensive income (loss) (192, 280) (116,007 ) (939,482 ) Total $ 916,702 $ 2,698,627 $ 748,951 Income tax expense was as follows: For the year ended December 31, 2018 2017 2016 Current income taxes Federal $ 1,326,619 $ 2,538,272 $ 2,438,687 State — — — Total current tax expense 1,326,619 2,538,272 2,438,687 Deferred income tax (benefit) expense (217,637 ) 276,362 (750,254 ) Total income tax expense $ 1,108,982 $ 2,814,634 $ 1,688,433 |
Schedule of income tax reconciliation | The differences between actual income tax expense and the amounts computed by applying the U.S. federal income tax rate of 21% to pretax income from continuing operations for the periods indicated are reconciled in the table below. For the year ended December 31, 2018 2017 2016 Computed “expected” tax expense $ 1,686,702 $ 2,623,595 $ 2,358,069 Increase (reduction) in income taxes resulting from: Tax rate change impact — 666,674 — Amortization of credit and gain 196,477 163,411 163,411 Stock based compensation 15,205 24,378 26,012 Valuation Allowance 7,538 16,952 4,314 Other 38,936 (4,768 ) (203,854 ) State income tax, net of federal benefit (226,578 ) (329,412 ) (319,525 ) Federal Credits (454,985 ) — — Tax exempt interest income (154,315 ) (346,196 ) (339,994 ) $ 1,108,980 $ 2,814,634 $ 1,688,433 |
Schedule of deferred tax assets and liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2018 and 2017 are presented below. December 31, December 31, Deferred tax assets: Allowance for loan losses $ 850,964 $ 782,714 State credit carryforward 647,190 488,052 Unrealized gain (loss) on securities available for sale 472,421 284,877 Passthrough income 68,438 70,603 State net operating loss carryforward 74,791 67,253 Nonaccrual interest 27,956 19,209 Other real estate owned — 18,157 Other 6,155 5,214 Total gross deferred tax assets 2,147,915 1,736,079 Valuation allowance (74,791 ) (67,253 ) Total gross deferred tax assets, net of valuation allowance 2,073,124 1,668,826 Deferred tax liabilities: Fixed assets, principally due to differences in depreciation (39,294 ) (36,424 ) Deferred loan fees (32,825 ) (31,930 ) Other (56,481 ) (53,591 ) Prepaid expenses (210 ) (210 ) (128,810 ) (122,155 ) Net deferred tax assets $ 1,944,314 $ 1,546,671 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of related party loans | The table below summarizes related party loans. December 31, December 31, Balance at beginning of the year $ 4,569,780 $ 3,944,140 New loans or advances 1,428,098 2,879,435 Repayments (1,596,169 ) (2,253,795 ) Balance at the end of the year $ 4,401,710 $ 4,569,780 |
OTHER EXPENSE (Tables)
OTHER EXPENSE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |
Schedule of other operating expenses | The table below summarizes of the components of other operating expense. For the year ended December 31, 2018 2017 2016 Advertising and business development $ 12,217 $ 10,844 $ 16,159 Supplies 85,984 75,965 94,006 Telephone and postage 175,520 207,526 194,853 Insurance 43,866 44,613 42,192 Professional fees 459,348 451,882 431,424 Data processing services 579,666 585,497 594,550 State and FDIC insurance and fees 183,867 165,280 242,926 Courier service 54,044 82,907 96,823 Amortization of state tax credit 306,106 306,105 325,000 Amortization of federal tax credit 354,888 — — Other 697,957 587,118 601,843 Total other operating expenses $ 2,953,463 $ 2,517,737 $ 2,639,776 |
STOCK INCENTIVE PLAN (Tables)
STOCK INCENTIVE PLAN (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of fair value weighted-average assumptions as of options | The fair value of options granted was determined using the following weighted-average assumptions as of grant date: 2018 2017 2016 Risk free interest rate 2.88 % 2.43 % 2.33 % Expected life (in years) 7.5 7.5 10 Expected stock price volatility 33.69 % 34.20 % 27.95 % Dividend yield 3.61 % 4.00 % 3.47 % |
Schedule of activity under stock incentive plan | The following table presents a summary of the activity under the 1998 and 2010 Omnibus Stock Incentive Plans for the years ended December 31. 2018 2017 2016 Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Shares Weighted Average Exercise Price Outstanding, January 1 117,191 $ 10.79 154,085 $ 10.19 201,151 $ 9.97 Granted 11,275 18.23 10,175 20.72 11,000 14.54 Expired — — — — — — Exercised (24,056 ) 8.96 (36,454 ) 9.57 (43,100 ) 9.51 Forfeited (1,650 ) 20.02 (10,615 ) 15.83 (14,966 ) 12.28 Outstanding, December 31 102,760 $ 11.89 117,191 $ 10.79 154,085 $ 10.19 Exercisable at year end 32,219 $ 8.81 31,694 $ 8.77 13,882 $ 10.35 |
Schedule of information pertaining to options outstanding | The following table presents information pertaining to options outstanding at December 31, 2018. December 31, 2018 Exercise Price Number of Options Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Intrinsic Value of Options Outstanding Number of Options Exercisable Weighted Average Exercise Price Intrinsic Value of Options Exercisable $ 8.61 41,075 6.33 $ 8.61 $ 353,656 24,645 $ 8.61 $ 277,504 $ 8.90 2,541 1.75 $ 8.90 $ 22,615 2,033 $ 8.90 $ 22,300 $ 9.18 7,199 3.50 $ 9.18 $ 66,087 2,880 $ 9.18 $ 30,783 $ 9.65 2,420 2.25 $ 9.65 $ 23,353 1,452 $ 9.65 $ 14,840 $ 9.92 1,815 3.75 $ 9.92 $ 18,005 726 $ 9.92 $ 7,224 $ 12.26 5,444 5.59 $ 12.26 $ 66,743 — $ 12.26 $ — $ 12.40 2,419 5.00 $ 12.40 $ 29,996 484 $ 12.40 $ 3,614 $ 13.05 14,217 6.33 $ 13.05 $ 185,532 — $ 13.05 $ — $ 13.62 3,630 6.50 $ 13.62 $ 49,441 — $ 13.62 $ — $ 14.54 5,500 7.25 $ 14.54 $ 79,970 — $ 14.54 $ — $ 18.23 10,450 9.25 $ 18.23 $ 190,504 — $ 18.23 $ — $ 19.00 2,750 8.17 $ 19.00 $ 52,250 — $ 19.00 $ — $ 19.82 3,300 8.09 $ 19.82 $ 65,406 — $ 19.82 $ — 102,760 6.26 $ 11.71 $ 1,203,558 32,220 $ 11.7 1 $ 356,265 |
INCOME PER COMMON SHARE (Tables
INCOME PER COMMON SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of average shares outstanding | The following table is a summary of the reconciliation of average shares outstanding for the years ended December 31. 2018 2017 2017 Numerator: Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Denominator: Weighted average shares outstanding 5,500,027 5,471,001 5,428,884 Effect of dilutive shares 88,985 97,492 132,855 Weighted average shares outstanding - diluted 5,589,012 5,568,493 5,561,739 Earnings per share - basic $ 1.26 $ 0.90 $ 0.97 Earnings per share - diluted $ 1.24 $ 0.88 $ 0.94 |
REGULATORY CAPITAL REQUIREMEN_2
REGULATORY CAPITAL REQUIREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory Capital Requirements [Abstract] | |
Schedule of Regulatory Capital Requirements | The following tables present the actual and required capital amounts and ratios for the Company and Bank at December 31, 2018 and 2017: December 31, 2018 Actual For Capital Adequacy Purposes To Be Well Capitalized Under Prompt Corrective Action Provisions ( in thousands Amount Ratio Amount Ratio Amount Ratio Total capital to risk-weighted assets: Company $ 50,657 16.69 % $ 24,280 8.00 % N/A N/A Bank $ 49,695 16.39 % $ 24,262 8.00 % $ 30,328 10.00 % Tier 1 capital to risk-weighted assets: Company $ 46,864 15.44 % $ 18,210 6.00 % N/A N/A Bank $ 45,898 15.13 % $ 18,197 6.00 % $ 24,262 8.00 % Tier 1 capital to average assets: Company $ 46,864 10.76 % $ 17,428 4.00 % N/A N/A Bank $ 45,898 10.54 % $ 17,419 4.00 % $ 21,773 5.00 % Common equity Tier 1 capital: Company $ 46,864 15.44 % $ 13,658 4.50 % N/A N/A Bank $ 45,898 15.13 % $ 13,647 4.50 % $ 13,647 4.50 % December 31, 2017 Actual For Capital Adequacy Purposes To Be Well Capitalized Under Prompt Corrective Action Provisions ( in thousands Amount Ratio Amount Ratio Amount Ratio Total capital to risk-weighted assets: Company $ 47,986 15.97 % $ 23,213 8.00 % N/A N/A Bank $ 47,100 15.69 % $ 24,020 8.00 % $ 30,025 10.00 % Tier 1 capital to risk-weighted assets: Company $ 44,253 14.73 % $ 17,410 6.00 % N/A N/A Bank $ 43,344 14.44 % $ 18,015 6.00 % $ 24,020 8.00 % Tier 1 capital to average assets: Company $ 44,253 10.01 % $ 16,738 4.00 % N/A N/A Bank $ 43,344 9.82 % $ 17,661 4.00 % $ 22,077 5.00 % Common equity Tier 1 capital: Company $ 44,253 14.73 % $ 13,058 4.50 % N/A N/A Bank $ 43,344 14.44 % $ 13,511 4.50 % $ 19,516 6.50 % |
DISCLOSURES REGARDING FAIR VA_2
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | Assets and liabilities measured at fair value on a recurring basis at December 31, 2018 and 2017 are in the following table. Balance as of December 31, 2018 Quoted Market Price in Active Markets Significant Other Observable Inputs Significant Unobservable Inputs Total U.S. Treasury Notes $ 32,356,634 $ — $ — $ 32,356,634 Government-Sponsored Enterprises — 59,369,280 — 59,369,280 Municipal Securities — 21,701,005 6,241,955 27,942,960 Total $ 32,356,634 $ 81,070,285 $ 6,241,955 $ 119,668,874 Balance as of December 31, 2017 Quoted Market Price in Active Markets Level 1 Significant Other Observable Inputs Level 2 Significant Unobservable Inputs Level 3 Total U.S. Treasury Notes $ 35,559,845 $ — $ — $ 35,559,845 Government-Sponsored Enterprises — 63,556,504 — 63,556,504 Municipal Securities — 28,675,012 11,458,889 40,133,901 Total $ 35,559,845 $ 92,231,516 $ 11,458,889 $ 139,250,250 |
Schedule of changes in assets measured at fair value on a recurring basis using significant unobservable inputs | The following table reconciles the changes in assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2018 and 2017. December 31, December 31, Beginning balance $ 11,458,889 $ 13,977,857 Total realized/unrealized gains (losses) Included in earnings — — Included in other comprehensive income 150,993 137,751 Purchases, issuances, and settlements, net of maturities (5,367,927 ) (2,656,719 ) Transfers in and/or out of Level 3 — — Ending balance $ 6,241,955 $ 11,458,889 |
Schedule of certain assets and liabilities measured at fair value on a nonrecurring basis | The following tables present information about certain assets and liabilities measured at fair value on a nonrecurring basis at December 31, 2018 and 2017. December 31, 2018 Quoted Market Price in Active Markets Significant Other Observable Inputs Significant Unobservable Inputs Total Impaired loans $ — $ — $ 2,223,028 $ 2,223,028 Other real estate owned — — — — Loans held for sale — 1,199,438 — 1,199,438 Total $ — $ 1,199,438 $ 2,223,028 $ 3,422,466 December 31, 2017 Quoted Market Price in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Impaired loans $ — $ — $ 1,735,051 $ 1,735,051 Other real estate owned — — 435,479 435,479 Mortgage loans to be sold — 2,093,723 — 2,093,723 Total $ — $ 2,093,723 $ 2,170,530 $ 4,264,253 |
Schedule of unobservable inputs used in Level 3 fair value measurement | The following table provides information describing the unobservable inputs used in Level 3 fair value measurements at December 31, 2018: Inputs Valuation Technique Unobservable Input General Range of Inputs Impaired Loans Appraisal Value/Comparison Sales/Other Estimates Appraisals and/or Sales of Comparable Properties Appraisals Discounted 10% to 20% for Sales Commissions and Other Holding Costs Other Real Estate Owned Appraisal Value/Comparison Sales/Other Estimates Appraisals and/or Sales of Comparable Properties Appraisals Discounted 10% to 20% for Sales Commissions and Other Holding Costs |
Schedule of carrying amount, fair value, and placement in the fair value hierarchy of financial instruments | The following tables present the carrying amount, fair value, and placement in the fair value hierarchy of our financial instruments as of December 31, 2018 and 2017, respectively. Fair Value Measurements at December 31, 2018 Carrying Estimated Level 1 Level 2 Level 3 Financial Assets: Cash and due from banks $ 6,325,457 $ 6,325,457 $ 6,325,457 $ — $ — Interest-bearing deposits at the Federal Reserve 25,506,784 25,506,784 25,506,784 — — Investment securities available for sale 119,668,874 119,668,874 32,356,634 81,070,285 6,241,955 Mortgage loans to be sold 1,199,438 1,199,438 — 1,199,438 — Loans, net 270,449,936 263,780,751 — 263,780,751 Accrued interest receivable 1,561,915 1,561,915 — 1,561,915 — Financial Liabilities: Demand deposits 347,909,663 347,909,663 — 347,909,663 — Time deposits 34,468,725 38,747,898 — 38,747,898 — Accrued interest payable 163,876 163,876 — 163,876 — Fair Value Measurements at December 31, 2017 Carrying Amount Estimated Fair Value Level 1 Level 2 Level 3 Financial Assets: Cash and due from banks $ 8,486,025 $ 8,486,025 $ 8,486,025 $ — $ — Interest-bearing deposits at the Federal Reserve 24,034,194 24,034,194 24,034,194 — — Investment securities available for sale 139,250,250 139,250,250 35,559,845 92,231,516 11,458,889 Mortgage loans to be sold 2,093,723 2,093,723 — 2,093,723 — Net loans 266,305,242 265,277,204 — — 265,277,204 Accrued interest receivable 1,720,920 1,720,920 — 1,720,920 — Financial Liabilities: Demand deposits 360,967,884 360,967,884 — 360,967,884 — Time deposits 41,920,416 40,722,870 — 40,722,870 — Accrued interest payable 96,190 96,190 — 96,190 — |
BANK OF SOUTH CAROLINA CORPOR_2
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of condensed financial statements of parent company | The Company’s condensed statements of financial condition as of December 31, 2018 and 2017, and the related condensed statements of income and cash flows for the years ended December 31, 2018, 2017 and 2016, are as follows: Condensed Statements of Financial Condition 2018 2017 Assets Cash $ 1,007,501 $ 947,216 Investment in wholly-owned bank subsidiary 45,103,068 42,437,503 Other assets 178,629 127,274 Total assets $ 46,289,198 $ 43,511,993 Liabilities and shareholders’ equity Other liabilities $ 826,637 $ 747,358 Shareholders’ equity 45,462,561 42,764,635 Total liabilities and shareholders’ equity $ 46,289,198 $ 43,511,993 Condensed Statements of Income For the years ended December 31, 2018 2017 2016 Interest income $ 1,157 $ 484 $ 571 Net operating expenses (224,316 ) (189,872 ) (177,612 ) Dividends received from bank 3,775,000 2,685,000 2,340,000 Equity in undistributed earnings of subsidiary 3,371,093 2,406,213 3,084,104 Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Condensed Statements of Cash Flows For the years ended December 31, 2018 2017 2016 Cash flows from operating activities: Net income $ 6,922,934 $ 4,901,825 $ 5,247,063 Stock-based compensation expense 72,408 71,701 76,529 Equity in undistributed earnings of subsidiary (3,371,093 ) (2,406,213 ) (3,084,104 ) Decrease in other assets (51,355 ) (51,197 ) (55,923 ) (Decrease) Increase in other liabilities (6,333 ) 151 — Net cash provided by operating activities 3,566,561 2,516,267 2,183,565 Cash flows from financing activities: Dividends paid (3,699,845 ) (2,832,489 ) (2,613,715 ) Stock options exercised 193,569 340,843 405,749 Net cash used in financing activities (3,506,276 ) (2,491,646 ) (2,207,966 ) Net increase (decrease) in cash 60,285 24,621 (24,401 ) Cash at the beginning of the year 947,216 922,595 946,996 Cash at the end of the year $ 1,007 ,501 $ 947,216 $ 922,595 Supplemental disclosure for non-cash investing and financing activity $ 85,615 $ 53,340 $ 74,706 |
QUARTERLY RESULTS OF OPERATIO_2
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly operating results | The tables below represent the quarterly results of operations for the years ended December 31, 2018 and 2017, respectively: 2018 Fourth Third Second First Total interest and fee income $ 4,727,449 $ 4,665,586 $ 4,423,867 $ 4,320,009 Total interest expense 249,425 195,434 139,697 109,830 Net interest income 4,478,024 4,470,152 4,284,170 4,210,179 Provision for loan losses 95,000 100,000 75,000 55,000 Net interest income after provision for loan losses 4,383,024 4,370,152 4,209,170 4,155,179 Total other income 532,891 458,693 555,096 447,945 Total other expense 2,970,411 2,816,474 2,651,515 2,641,834 Income before income tax expense 1,945,504 2,012,371 2,112,751 1,961,290 Income tax expense 139,310 234,218 386,394 349,060 Net income $ 1,806,194 $ 1,778,153 $ 1,726,357 $ 1,612,230 Basic income per common share $ 0.33 $ 0.32 $ 0.31 $ 0.29 Diluted income per common share $ 0.32 $ 0.32 $ 0.31 $ 0.29 2017 Fourth Third Second First Total interest and fee income $ 4,327,409 $ 4,117,032 $ 3,933,285 $ 3,791,421 Total interest expense 109,934 110,625 106,522 96,782 Net interest income 4,217,475 4,006,407 3,826,763 3,694,639 Provision for loan losses 2,500 20,000 30,000 2,500 Net interest income after provision for loan losses 4,214,975 3,986,407 3,796,763 3,692,139 Other income 538,236 481,882 696,479 551,874 Other expense 2,696,005 2,484,538 2,590,123 2,471,630 Income before income tax expense 2,057,206 1,983,751 1,903,119 1,772,383 Income tax expense 1,208,507 543,098 516,734 546,295 Net income $ 848,699 $ 1,440,653 $ 1,386,385 $ 1,226,088 Basic income per common share $ 0.15 $ 0.26 $ 0.25 $ 0.22 Diluted income per common share $ 0.15 $ 0.26 $ 0.25 $ 0.22 |
SUMMARY OFSIGNIFICANT ACCOUNTIN
SUMMARY OFSIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Property, Plant and Equipment [Line Items] | |
Operating leases | $ 7,300,000 |
Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 3 years |
Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 5 years |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 40 years |
INVESTMENT SECURITIES AVAILAB_3
INVESTMENT SECURITIES AVAILABLE FOR SALE (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Amortized Cost | $ 121,918,501 | $ 140,606,807 |
Gross Unrealized Gains | 112,971 | 487,545 |
Gross Unrealized Losses | (2,362,598) | (1,844,102) |
Estimated Fair Value | 119,668,874 | 139,250,250 |
U.S. Treasury Notes [Member] | ||
Amortized Cost | 32,965,693 | 35,970,990 |
Gross Unrealized Losses | (609,059) | (411,145) |
Estimated Fair Value | 32,356,634 | 35,559,845 |
Government-Sponsored Enterprises [Member] | ||
Amortized Cost | 60,684,878 | 64,444,315 |
Gross Unrealized Losses | (1,315,598) | (887,811) |
Estimated Fair Value | 59,369,280 | 63,556,504 |
Municipal Securities [Member] | ||
Amortized Cost | 28,267,930 | 40,191,502 |
Gross Unrealized Gains | 112,971 | 487,545 |
Gross Unrealized Losses | (437,941) | (545,146) |
Estimated Fair Value | $ 27,942,960 | $ 40,133,901 |
INVESTMENT SECURITIES AVAILAB_4
INVESTMENT SECURITIES AVAILABLE FOR SALE (Details 1) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Amortized Cost | ||
Due in one year or less | $ 4,246,325 | $ 11,554,040 |
Due in one year to five years | 99,753,174 | 72,622,056 |
Due in five years to ten years | 17,504,456 | 53,290,088 |
Due in ten years and over | 414,546 | 3,140,623 |
Total | 121,918,501 | 140,606,807 |
Estimated Fair Value | ||
Due in one year or less | 4,249,570 | 11,546,968 |
Due in one year to five years | 97,915,185 | 72,124,395 |
Due in five years to ten years | 17,128,425 | 52,576,036 |
Due in ten years and over | 375,694 | 3,002,851 |
Total | $ 119,668,874 | $ 139,250,250 |
INVESTMENT SECURITIES AVAILAB_5
INVESTMENT SECURITIES AVAILABLE FOR SALE (Details 2) | Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($)Number |
Less than 12 Months | ||
Number of positions | Number | 4 | 40 |
Fair Value | $ 11,329,286 | $ 96,650,130 |
Gross Unrealized Losses | $ (21,849) | $ (1,008,317) |
12 months or Longer | ||
Number of positions | Number | 49 | 32 |
Fair value | $ 93,599,826 | $ 21,337,625 |
Gross Unrealized Losses | $ (2,340,749) | $ (835,785) |
Total | ||
Number of positions | Number | 53 | 72 |
Fair value | $ 104,929,112 | $ 117,987,755 |
Gross Unrealized Losses | $ (2,362,598) | $ (1,844,102) |
U.S. Treasury Notes [Member] | ||
Less than 12 Months | ||
Number of positions | Number | 8 | |
Fair Value | $ 35,559,845 | |
Gross Unrealized Losses | $ (411,145) | |
12 months or Longer | ||
Number of positions | Number | 7 | |
Fair value | $ 32,356,634 | |
Gross Unrealized Losses | $ (609,059) | |
Total | ||
Number of positions | Number | 7 | 8 |
Fair value | $ 32,356,634 | $ 35,559,845 |
Gross Unrealized Losses | $ (609,059) | $ (411,145) |
Government-Sponsored Enterprises [Member] | ||
Less than 12 Months | ||
Number of positions | Number | 2 | 12 |
Fair Value | $ 9,967,000 | $ 53,275,064 |
Gross Unrealized Losses | $ (14,302) | $ (462,174) |
12 months or Longer | ||
Number of positions | Number | 11 | 3 |
Fair value | $ 49,402,280 | $ 10,281,440 |
Gross Unrealized Losses | $ (1,301,296) | $ (425,637) |
Total | ||
Number of positions | Number | 13 | 15 |
Fair value | $ 59,369,280 | $ 63,556,504 |
Gross Unrealized Losses | $ (1,315,598) | $ (887,811) |
Municipal Securities [Member] | ||
Less than 12 Months | ||
Number of positions | Number | 2 | 20 |
Fair Value | $ 1,362,286 | $ 7,815,221 |
Gross Unrealized Losses | $ (7,547) | $ (134,998) |
12 months or Longer | ||
Number of positions | Number | 31 | 29 |
Fair value | $ 11,840,912 | $ 11,056,185 |
Gross Unrealized Losses | $ (430,394) | $ (410,148) |
Total | ||
Number of positions | Number | 33 | 49 |
Fair value | $ 13,203,198 | $ 18,871,406 |
Gross Unrealized Losses | $ (437,941) | $ (545,146) |
INVESTMENT SECURITIES AVAILAB_6
INVESTMENT SECURITIES AVAILABLE FOR SALE (Details 3) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |||
Gross proceeds | $ 21,434,634 | $ 20,231,265 | $ 36,218,087 |
Gross realized gains | 104,634 | 154,692 | 384,963 |
Gross realized losses | $ (99,899) | $ (108,872) | $ (4,059) |
INVESTMENT SECURITIES AVAILAB_7
INVESTMENT SECURITIES AVAILABLE FOR SALE (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | ||
Investment securities pledged to secure deposits, fair value | $ 41,547,205 | $ 49,424,692 |
Gross realized gains (losses) on sale of investments, tax | $ 994 | $ 15,578 |
LOANS AND ALLOWANCE FOR LOAN _3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Loans | $ 274,664,267 | $ 270,180,640 |
Allowance for loan losses | (4,214,331) | (3,875,398) |
Total loans, net | 270,449,936 | 266,305,242 |
Commercial [Member] | ||
Loans | 54,829,078 | 51,723,237 |
Commercial Real Estate Construction [Member] | ||
Loans | 7,304,300 | 2,317,857 |
Commercial Real Estate Other [Member] | ||
Loans | 143,703,401 | 140,186,324 |
Consumer Real Estate [Member] | ||
Loans | 63,787,411 | 70,797,973 |
Consumer Other [Member] | ||
Loans | $ 5,040,077 | $ 5,155,249 |
LOANS AND ALLOWANCE FOR LOAN _4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 1) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Credit risks by category and internally assigned grades | ||
Loans | $ 274,664,267 | $ 270,180,640 |
Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 259,978,887 | 257,298,511 |
Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 9,215,844 | 8,511,669 |
OAEM [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 1,097,594 | 610,806 |
SubStandard [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 4,371,942 | 3,759,654 |
Commercial [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 54,829,078 | 51,723,237 |
Commercial [Member] | Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 50,663,356 | 47,456,205 |
Commercial [Member] | Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 1,973,675 | 2,403,978 |
Commercial [Member] | OAEM [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 157,300 | |
Commercial [Member] | SubStandard [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 2,034,747 | 1,863,054 |
Commercial Real Estate Construction [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 7,304,300 | 2,317,857 |
Commercial Real Estate Construction [Member] | Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 7,304,300 | 1,936,335 |
Commercial Real Estate Construction [Member] | Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 381,522 | |
Commercial Real Estate Other [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 143,703,401 | 140,186,324 |
Commercial Real Estate Other [Member] | Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 136,804,420 | 134,401,977 |
Commercial Real Estate Other [Member] | Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 4,938,711 | 3,605,621 |
Commercial Real Estate Other [Member] | OAEM [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 590,294 | 610,806 |
Commercial Real Estate Other [Member] | SubStandard [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 1,369,976 | 1,567,920 |
Consumer Real Estate [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 63,787,411 | 70,797,973 |
Consumer Real Estate [Member] | Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 60,480,317 | 68,570,298 |
Consumer Real Estate [Member] | Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 2,077,341 | 1,934,802 |
Consumer Real Estate [Member] | OAEM [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 350,000 | |
Consumer Real Estate [Member] | SubStandard [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 879,753 | 292,873 |
Consumer Other [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 5,040,077 | 5,155,249 |
Consumer Other [Member] | Pass [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 4,726,494 | 4,933,696 |
Consumer Other [Member] | Watch [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | 226,117 | 185,746 |
Consumer Other [Member] | SubStandard [Member] | ||
Credit risks by category and internally assigned grades | ||
Loans | $ 87,466 | $ 35,807 |
LOANS AND ALLOWANCE FOR LOAN _5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 2) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 1,359,416 | $ 892,364 |
Current | 273,304,851 | 269,288,276 |
Total Loans Receivable | 274,664,267 | 270,180,640 |
Recorded Investment > 90 Days and Accuring Interest | 34,107 | |
30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 326,188 | 13,833 |
60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 232,541 | 192,846 |
Greater Than 90 Days [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 800,687 | 685,685 |
Commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 513,454 | 196,377 |
Current | 54,315,624 | 51,526,860 |
Total Loans Receivable | 54,829,078 | 51,723,237 |
Commercial [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 266,567 | 3,531 |
Commercial [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 17,492 | 192,846 |
Commercial [Member] | Greater Than 90 Days [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 229,395 | |
Commercial Real Estate Construction [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 7,304,300 | 2,317,857 |
Total Loans Receivable | 7,304,300 | 2,317,857 |
Commercial Real Estate Other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 821,341 | 651,578 |
Current | 142,882,060 | 139,534,746 |
Total Loans Receivable | 143,703,401 | 140,186,324 |
Commercial Real Estate Other [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 35,000 | |
Commercial Real Estate Other [Member] | 60-89 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 215,049 | |
Commercial Real Estate Other [Member] | Greater Than 90 Days [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 571,292 | 651,578 |
Consumer Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Current | 63,787,411 | 70,797,973 |
Total Loans Receivable | 63,787,411 | 70,797,973 |
Consumer Other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | 24,621 | 44,409 |
Current | 5,015,456 | 5,110,840 |
Total Loans Receivable | 5,040,077 | 5,155,249 |
Recorded Investment > 90 Days and Accuring Interest | 34,107 | |
Consumer Other [Member] | 30-59 Days Past Due [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 24,621 | 10,302 |
Consumer Other [Member] | Greater Than 90 Days [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total Past Due | $ 34,107 |
LOANS AND ALLOWANCE FOR LOAN _6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 3) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans receivable | $ 823,534 | $ 831,859 |
Commercial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans receivable | 251,219 | 41,651 |
Commercial Real Estate Other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans receivable | 571,292 | $ 790,208 |
Consumer Other [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Non-accrual loans receivable | $ 1,023 |
LOANS AND ALLOWANCE FOR LOAN _7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 4) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | $ 3,875,398 | $ 3,851,617 | $ 3,875,398 | $ 3,851,617 | $ 3,417,827 | ||||||
Charge-offs | (115,887) | (185,449) | (208,295) | ||||||||
Recoveries | 129,820 | 154,230 | 72,085 | ||||||||
Provisions | $ 95,000 | $ 100,000 | $ 75,000 | 55,000 | $ 2,500 | $ 20,000 | $ 30,000 | 2,500 | 325,000 | 55,000 | 570,000 |
Ending Balance | 4,214,331 | 3,875,398 | 4,214,331 | 3,875,398 | 3,851,617 | ||||||
Commercial [Member] | |||||||||||
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | 1,403,588 | 1,545,188 | 1,403,588 | 1,545,188 | 896,854 | ||||||
Charge-offs | (31,250) | (33,046) | |||||||||
Recoveries | 14,000 | 6,000 | |||||||||
Provisions | 279,075 | (147,600) | 681,380 | ||||||||
Ending Balance | 1,665,413 | 1,403,588 | 1,665,413 | 1,403,588 | 1,545,188 | ||||||
Commercial Real Estate Construction [Member] | |||||||||||
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | 23,638 | 51,469 | 23,638 | 51,469 | 59,861 | ||||||
Provisions | 40,238 | (27,831) | (8,392) | ||||||||
Ending Balance | 63,876 | 23,638 | 63,876 | 23,638 | 51,469 | ||||||
Commercial Real Estate Other [Member] | |||||||||||
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | 1,549,755 | 1,374,706 | 1,549,755 | 1,374,706 | 1,345,094 | ||||||
Charge-offs | (180,587) | (78,300) | |||||||||
Recoveries | 56,827 | 87,030 | 65,000 | ||||||||
Provisions | (314,236) | 268,606 | 42,912 | ||||||||
Ending Balance | 1,292,346 | 1,549,755 | 1,292,346 | 1,549,755 | 1,374,706 | ||||||
Consumer Real Estate [Member] | |||||||||||
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | 796,918 | 726,391 | 796,918 | 726,391 | 941,470 | ||||||
Charge-offs | (82,015) | ||||||||||
Recoveries | 45,412 | 60,000 | |||||||||
Provisions | (455,745) | 10,527 | (133,064) | ||||||||
Ending Balance | 386,585 | 796,918 | 386,585 | 796,918 | 726,391 | ||||||
Consumer Other [Member] | |||||||||||
Activity in the allowance for loan losses by portfolio segment | |||||||||||
Beginning Balance | $ 101,499 | $ 153,863 | 101,499 | 153,863 | 174,548 | ||||||
Charge-offs | (84,637) | (4,862) | (14,934) | ||||||||
Recoveries | 13,581 | 1,200 | 7,085 | ||||||||
Provisions | 775,668 | (48,702) | (12,836) | ||||||||
Ending Balance | $ 806,111 | $ 101,499 | $ 806,111 | $ 101,499 | $ 153,863 |
LOANS AND ALLOWANCE FOR LOAN _8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 5) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Allowance for Loan Losses Ending Balances: | ||||
Individually evaluated for impairment | $ 1,191,545 | $ 1,009,243 | ||
Collectively evaluated for impairment | 3,022,786 | 2,866,155 | ||
Total Allowance for Loan Losses | 4,214,331 | 3,875,398 | $ 3,851,617 | $ 3,417,827 |
Loans Receivable: | ||||
Individually evaluated for impairment | 4,178,546 | 3,724,262 | ||
Collectively evaluated for impairment | 270,485,721 | 266,456,378 | ||
Total Loans Receivable | 274,664,267 | 270,180,640 | ||
Commercial [Member] | ||||
Allowance for Loan Losses Ending Balances: | ||||
Individually evaluated for impairment | 1,132,805 | 832,571 | ||
Collectively evaluated for impairment | 532,608 | 571,017 | ||
Total Allowance for Loan Losses | 1,665,413 | 1,403,588 | 1,545,188 | 896,854 |
Loans Receivable: | ||||
Individually evaluated for impairment | 1,996,579 | 1,812,461 | ||
Collectively evaluated for impairment | 52,832,499 | 49,910,776 | ||
Total Loans Receivable | 54,829,078 | 51,723,237 | ||
Commercial Real Estate Construction [Member] | ||||
Allowance for Loan Losses Ending Balances: | ||||
Collectively evaluated for impairment | 63,876 | 23,638 | ||
Total Allowance for Loan Losses | 63,876 | 23,638 | 51,469 | 59,861 |
Loans Receivable: | ||||
Collectively evaluated for impairment | 7,304,300 | 2,317,857 | ||
Total Loans Receivable | 7,304,300 | 2,317,857 | ||
Commercial Real Estate Other [Member] | ||||
Allowance for Loan Losses Ending Balances: | ||||
Individually evaluated for impairment | 37,416 | 99,523 | ||
Collectively evaluated for impairment | 1,254,930 | 1,450,232 | ||
Total Allowance for Loan Losses | 1,292,346 | 1,549,755 | 1,374,706 | 1,345,094 |
Loans Receivable: | ||||
Individually evaluated for impairment | 1,280,890 | 1,584,821 | ||
Collectively evaluated for impairment | 142,422,511 | 138,601,503 | ||
Total Loans Receivable | 143,703,401 | 140,186,324 | ||
Consumer Real Estate [Member] | ||||
Allowance for Loan Losses Ending Balances: | ||||
Individually evaluated for impairment | 43,042 | |||
Collectively evaluated for impairment | 386,585 | 753,876 | ||
Total Allowance for Loan Losses | 386,585 | 796,918 | 726,391 | 941,470 |
Loans Receivable: | ||||
Individually evaluated for impairment | 879,753 | 292,873 | ||
Collectively evaluated for impairment | 62,907,658 | 70,505,100 | ||
Total Loans Receivable | 63,787,411 | 70,797,973 | ||
Consumer Other [Member] | ||||
Allowance for Loan Losses Ending Balances: | ||||
Individually evaluated for impairment | 21,324 | 34,107 | ||
Collectively evaluated for impairment | 784,787 | 67,392 | ||
Total Allowance for Loan Losses | 806,111 | 101,499 | $ 153,863 | $ 174,548 |
Loans Receivable: | ||||
Individually evaluated for impairment | 21,324 | 34,107 | ||
Collectively evaluated for impairment | 5,018,753 | 5,121,142 | ||
Total Loans Receivable | $ 5,040,077 | $ 5,155,249 |
LOANS AND ALLOWANCE FOR LOAN _9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 6) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Impaired and Restructured Loans with no related allowance recorded | ||
Unpaid Principal Balance with no related allowance recorded | $ 1,969,985 | $ 1,460,845 |
Recorded Investment with no related allowance recorded | 1,969,985 | 1,460,845 |
Impaired and Restructured Loans with an allowance recorded | ||
Unpaid Principal Balance with an allowance recorded | 2,308,362 | 2,363,218 |
Recorded Investment with an allowance recorded | 2,208,561 | 2,263,417 |
Related Allowance | 1,191,545 | 1,009,243 |
Total of Impaired and Restructured Loans | ||
Unpaid Principal balance | 4,278,347 | 3,824,063 |
Recorded Investment | 4,178,546 | 3,724,262 |
Related Allowance | 1,191,545 | 1,009,243 |
Commercial [Member] | ||
Impaired and Restructured Loans with no related allowance recorded | ||
Unpaid Principal Balance with no related allowance recorded | 115,983 | 152,490 |
Recorded Investment with no related allowance recorded | 115,983 | 152,490 |
Impaired and Restructured Loans with an allowance recorded | ||
Unpaid Principal Balance with an allowance recorded | 1,880,596 | 1,659,971 |
Recorded Investment with an allowance recorded | 1,880,596 | 1,659,971 |
Related Allowance | 1,132,805 | 832,571 |
Total of Impaired and Restructured Loans | ||
Unpaid Principal balance | 1,996,579 | 1,812,461 |
Recorded Investment | 1,996,579 | 1,812,461 |
Related Allowance | 1,132,805 | 832,571 |
Commercial Real Estate Other [Member] | ||
Impaired and Restructured Loans with no related allowance recorded | ||
Unpaid Principal Balance with no related allowance recorded | 974,249 | 1,058,601 |
Recorded Investment with no related allowance recorded | 974,249 | 1,058,601 |
Impaired and Restructured Loans with an allowance recorded | ||
Unpaid Principal Balance with an allowance recorded | 406,442 | 626,021 |
Recorded Investment with an allowance recorded | 306,641 | 526,220 |
Related Allowance | 37,416 | 99,523 |
Total of Impaired and Restructured Loans | ||
Unpaid Principal balance | 1,380,691 | 1,684,622 |
Recorded Investment | 1,280,890 | 1,584,821 |
Related Allowance | 37,416 | 99,523 |
Consumer Real Estate [Member] | ||
Impaired and Restructured Loans with no related allowance recorded | ||
Unpaid Principal Balance with no related allowance recorded | 879,753 | 249,754 |
Recorded Investment with no related allowance recorded | 879,753 | 249,754 |
Impaired and Restructured Loans with an allowance recorded | ||
Unpaid Principal Balance with an allowance recorded | 43,119 | |
Recorded Investment with an allowance recorded | 43,119 | |
Related Allowance | 43,042 | |
Total of Impaired and Restructured Loans | ||
Unpaid Principal balance | 879,753 | 292,873 |
Recorded Investment | 879,753 | 292,873 |
Related Allowance | 43,042 | |
Consumer Other [Member] | ||
Impaired and Restructured Loans with an allowance recorded | ||
Unpaid Principal Balance with an allowance recorded | 21,324 | 34,107 |
Recorded Investment with an allowance recorded | 21,324 | 34,107 |
Related Allowance | 21,324 | 34,107 |
Total of Impaired and Restructured Loans | ||
Unpaid Principal balance | 21,324 | 34,107 |
Recorded Investment | 21,324 | 34,107 |
Related Allowance | $ 21,324 | $ 34,107 |
LOANS AND ALLOWANCE FOR LOAN_10
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details 7) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Average Impaired Loans with no related allowance recorded | |||
Average Recorded Investment With no related allowance recorded | $ 1,995,244 | $ 1,900,391 | $ 3,777,550 |
Interest Income Recognized With no related allowance recorded | 100,331 | 47,438 | 115,975 |
Average Impaired Loans with an allowance recorded | |||
Average Recorded Investment With an allowance recorded | 2,358,022 | 2,720,854 | 2,273,344 |
Interest Income Recognized With an allowance recorded | 112,776 | 84,626 | 73,170 |
Total Average Impaired Loans | |||
Average Recorded Investment | 4,353,266 | 4,621,245 | 6,050,894 |
Interest Income Recognized | 213,107 | 132,064 | 189,145 |
Commercial [Member] | |||
Average Impaired Loans with no related allowance recorded | |||
Average Recorded Investment With no related allowance recorded | 133,413 | 173,964 | 267,747 |
Interest Income Recognized With no related allowance recorded | 8,637 | 7,416 | 12,282 |
Average Impaired Loans with an allowance recorded | |||
Average Recorded Investment With an allowance recorded | 1,915,139 | 1,711,259 | 1,087,559 |
Interest Income Recognized With an allowance recorded | 100,395 | 76,544 | 49,985 |
Total Average Impaired Loans | |||
Average Recorded Investment | 2,048,552 | 1,885,223 | 1,355,306 |
Interest Income Recognized | 109,032 | 83,960 | 62,267 |
Commercial Real Estate Other [Member] | |||
Average Impaired Loans with no related allowance recorded | |||
Average Recorded Investment With no related allowance recorded | 982,078 | 1,275,402 | 2,267,288 |
Interest Income Recognized With no related allowance recorded | 40,174 | 23,084 | 81,582 |
Average Impaired Loans with an allowance recorded | |||
Average Recorded Investment With an allowance recorded | 416,569 | 930,420 | 1,047,685 |
Interest Income Recognized With an allowance recorded | 10,999 | 5,367 | 16,138 |
Total Average Impaired Loans | |||
Average Recorded Investment | 1,398,647 | 2,205,822 | 3,314,973 |
Interest Income Recognized | 51,173 | 28,451 | 97,720 |
Consumer Real Estate [Member] | |||
Average Impaired Loans with no related allowance recorded | |||
Average Recorded Investment With no related allowance recorded | 879,753 | 451,025 | 1,242,515 |
Interest Income Recognized With no related allowance recorded | 51,520 | 16,938 | 22,111 |
Average Impaired Loans with an allowance recorded | |||
Average Recorded Investment With an allowance recorded | 43,119 | 43,155 | |
Interest Income Recognized With an allowance recorded | 1,296 | 1,514 | |
Total Average Impaired Loans | |||
Average Recorded Investment | 879,753 | 494,144 | 1,285,670 |
Interest Income Recognized | 51,520 | 18,234 | 23,625 |
Consumer Other [Member] | |||
Average Impaired Loans with an allowance recorded | |||
Average Recorded Investment With an allowance recorded | 26,314 | 36,056 | 94,945 |
Interest Income Recognized With an allowance recorded | 1,382 | 1,419 | 5,533 |
Total Average Impaired Loans | |||
Average Recorded Investment | 26,314 | 36,056 | 94,945 |
Interest Income Recognized | $ 1,382 | $ 1,419 | $ 5,533 |
LOANS AND ALLOWANCE FOR LOAN_11
LOANS AND ALLOWANCE FOR LOAN LOSSES (Details Narrative) | Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($)Number | Dec. 31, 2016USD ($)Number |
Receivables [Abstract] | |||
Deferred loan fees | $ 156,309 | $ 152,047 | |
Loans pledged as collateral to secure funding with the Federal Reserve Bank | $ 101,900,000 | $ 113,400,000 | |
Number of loans over 90 days past due and still accruing | Number | 0 | 1 | 2 |
Restructured loans | $ 33,300 | $ 378,392 |
CONCENTRATIONS OF CREDIT RISK_2
CONCENTRATIONS OF CREDIT RISK (Details) - Credit Concentration Risk [Member] | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 100.00% | 100.00% |
Commercial [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 19.96% | 19.14% |
Commercial Real Estate Construction [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 2.67% | 0.86% |
Commercial Real Estate Other [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 52.32% | 51.89% |
Consumer Real Estate [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 23.22% | 26.20% |
Consumer Other [Member] | ||
Concentration Risk [Line Items] | ||
Concentration of Credit Risk | 1.83% | 1.91% |
PREMISES, EQUIPMENT AND LEASE_3
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | $ 7,086,085 | $ 6,800,340 |
Accumulated depreciation | (4,750,878) | (4,555,815) |
Total | 2,335,207 | 2,244,525 |
Bank Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | 1,861,237 | 1,824,613 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | 838,075 | 838,075 |
Leasehold Purchases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | 30,000 | 30,000 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | 709,520 | 690,212 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | 120,849 | 11,754 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises, equipment and leasehold improvements, gross | $ 3,526,404 | $ 3,405,686 |
PREMISES, EQUIPMENT AND LEASE_4
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details 1) | Dec. 31, 2018USD ($) |
Property, Plant and Equipment [Abstract] | |
2,019 | $ 619,492 |
2,020 | 589,492 |
2,021 | 589,492 |
2,022 | 589,492 |
2023 and thereafter | 8,603,721 |
Total | $ 10,991,689 |
PREMISES, EQUIPMENT AND LEASE_5
PREMISES, EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Depreciation and amortization | $ 195,921 | $ 193,298 | $ 189,188 |
Rent expense | 622,396 | 612,717 | 594,567 |
Construction for leased office space | 120,849 | ||
Related Party [Member] | |||
Rent expense | $ 60,840 | $ 54,720 | $ 51,690 |
OTHER REAL ESTATE OWNED (Detail
OTHER REAL ESTATE OWNED (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Summary of activity in other real estate owned: | ||
Balance, beginning of the year | $ 435,479 | $ 521,943 |
Additions - foreclosure | 90,832 | |
Sales | (411,842) | (90,832) |
Write-downs | $ (23,637) | (86,464) |
Balance, end of the year | $ 435,479 |
OTHER REAL ESTATE OWNED (Deta_2
OTHER REAL ESTATE OWNED (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2018USD ($)Number | Dec. 31, 2017USD ($)Number | Dec. 31, 2016USD ($) | |
Real Estate Owned, Disclosure of Detailed Components [Abstract] | |||
Loss on sale of other real estate | $ | $ (33,476) | $ (1,477) | $ (13,450) |
Number of OREO properties | Number | 1 | 1 |
DEPOSITS (Details)
DEPOSITS (Details) | Dec. 31, 2018USD ($) |
Maturities of certificates of deposits | |
2,019 | $ 32,319,817 |
2,020 | 675,338 |
2,021 | 579,684 |
2,022 | 402,255 |
2023 and thereafter | 491,631 |
Certificates of deposit | $ 34,468,725 |
DEPOSITS (Details Narrative)
DEPOSITS (Details Narrative) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Deposits: | ||
Deposits with deficit balance reclassified as other loans | $ 43,118 | |
Time deposits over $250,000 | $ 15,909,991 | $ 18,624,924 |
SHORT-TERM BORROWINGS (Details
SHORT-TERM BORROWINGS (Details Narrative) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||
Unused balance of line of credit | $ 23,000,000 | $ 23,000,000 |
Federal Reserve Bank Advances [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of credit maximum borrowing capacity | $ 79,300,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||||||||
Income tax expense | $ 139,310 | $ 234,218 | $ 386,394 | $ 349,060 | $ 1,208,507 | $ 543,098 | $ 516,734 | $ 546,295 | $ 1,108,982 | $ 2,814,634 | $ 1,688,433 |
Unrealized gains (losses) on securities available for sale presented in accumulated other comprehensive income (loss) | (192,280) | (116,007) | (939,482) | ||||||||
Total | $ 916,702 | $ 2,698,627 | $ 748,951 |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current income tax | |||||||||||
Federal | $ 1,326,619 | $ 2,538,272 | $ 2,438,687 | ||||||||
Total current tax expense | 1,326,619 | 2,538,272 | 2,438,687 | ||||||||
Deferred income tax (benefit) expense | (217,637) | 276,362 | (750,254) | ||||||||
Total income tax expense | $ 139,310 | $ 234,218 | $ 386,394 | $ 349,060 | $ 1,208,507 | $ 543,098 | $ 516,734 | $ 546,295 | $ 1,108,982 | $ 2,814,634 | $ 1,688,433 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||||||||
Computed "expected" tax expense | $ 1,686,702 | $ 2,623,595 | $ 2,358,069 | ||||||||
Increase (reduction) in income taxes resulting from: | |||||||||||
Tax rate change impact | 666,674 | ||||||||||
Amortization of credit and gain | 196,477 | 163,411 | 163,411 | ||||||||
Stock based compensation | 15,205 | 24,378 | 26,012 | ||||||||
Valuation Allowance | 7,538 | 16,952 | 4,314 | ||||||||
Other | 38,938 | (4,768) | (203,854) | ||||||||
State income tax, net of federal benefit | (226,578) | (329,412) | (319,525) | ||||||||
Federal Credits | (454,985) | ||||||||||
Tax exempt interest income | (154,315) | (346,196) | (339,994) | ||||||||
Income tax expense | $ 139,310 | $ 234,218 | $ 386,394 | $ 349,060 | $ 1,208,507 | $ 543,098 | $ 516,734 | $ 546,295 | $ 1,108,982 | $ 2,814,634 | $ 1,688,433 |
INCOME TAXES (Details 3)
INCOME TAXES (Details 3) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets: | ||
Allowance for loan losses | $ 850,964 | $ 782,714 |
State credit carryforward | 647,190 | 488,052 |
Unrealized gain (loss) on securities available for sale | 472,421 | 284,877 |
Passthrough income | 68,438 | 70,603 |
State net operating loss carryforward | 74,791 | 67,253 |
Nonaccrual interest | 27,956 | 19,209 |
Other real estate owned | 18,157 | |
Other | 6,155 | 5,214 |
Total gross deferred tax assets | 2,147,915 | 1,736,079 |
Valuation allowance | (74,791) | (67,253) |
Total gross deferred tax assets, net of valuation allowance | 2,073,124 | 1,668,826 |
Deferred tax liabilities: | ||
Fixed assets, principally due to differences in depreciation | (39,294) | (36,424) |
Deferred loan fees | (32,825) | (31,930) |
Other | (56,481) | (53,591) |
Prepaid expenses | (210) | (210) |
Total gross deferred tax liabilities | (128,810) | (122,155) |
Net deferred tax assets | $ 1,944,314 | $ 1,546,671 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
U.S. Federal statutory rate | 21.00% | 34.00% |
Decrease in deferred tax assets for change in tax rates | $ (666,674) | |
Increase in income tax expense for change in tax rates | 666,674 | |
Federal Rehabilitation Credit [Member] | ||
Amortization of tax credits | $ 354,888 | |
South Carolina Rehabilitation Credit [Member] | ||
Amortization of tax credits | $ 306,105 | $ 306,105 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Standby letters of credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Undiscounted future payments related to standby letters of credit | $ 1,169,644 | $ 1,219,644 |
Commitments to extend credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Commitments to extend credit | $ 96,115,504 | $ 92,869,285 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transactions [Abstract] | ||
Balance at beginning of the year | $ 4,569,780 | $ 3,944,140 |
New loans or advances | 1,428,098 | 2,879,435 |
Repayments | (1,596,169) | (2,253,795) |
Balance at the end of the year | $ 4,401,710 | $ 4,569,780 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Related Party Transactions [Abstract] | ||
Deposits held by related parties | $ 8,914,967 | $ 7,180,958 |
OTHER EXPENSE (Details)
OTHER EXPENSE (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other Income and Expenses [Abstract] | |||
Advertising and business development | $ 12,217 | $ 10,844 | $ 16,159 |
Supplies | 85,984 | 75,965 | 94,006 |
Telephone and postage | 175,520 | 207,526 | 194,853 |
Insurance | 43,866 | 44,613 | 42,192 |
Professional fees | 459,348 | 451,882 | 431,424 |
Data processing services | 579,666 | 585,497 | 594,550 |
State and FDIC insurance and fees | 183,867 | 165,280 | 242,926 |
Courier service | 54,044 | 82,907 | 96,823 |
Amortization of state tax credit | 306,106 | 306,105 | 325,000 |
Amortization of federal tax credit | 354,888 | ||
Other | 697,957 | 587,118 | 601,843 |
Total other operating expenses | $ 2,953,463 | $ 2,517,737 | $ 2,639,776 |
STOCK INCENTIVE PLAN (Details)
STOCK INCENTIVE PLAN (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Risk free interest rate | 2.88% | 2.43% | 2.33% |
Expected life | 7 years 6 months | 7 years 6 months | 10 years |
Expected stock price volatility | 33.69% | 34.20% | 27.95% |
Dividend yield | 3.61% | 4.00% | 3.47% |
STOCK INCENTIVE PLAN (Details 1
STOCK INCENTIVE PLAN (Details 1) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Shares | |||
Outstanding, beginning | 117,191 | 154,085 | 201,151 |
Granted | 11,275 | 10,175 | 11,000 |
Exercised | (24,056) | (36,454) | (43,100) |
Forfeited | (1,650) | (10,615) | (14,966) |
Outstanding, ending | 102,760 | 117,191 | 154,085 |
Exercisable at year end | 32,219 | 31,694 | 13,882 |
Weighted Average Exercise Price | |||
Outstanding, beginning | $ 10.79 | $ 10.19 | $ 9.97 |
Granted | 18.23 | 20.72 | 14.54 |
Exercised | 8.96 | 9.57 | 9.51 |
Forfeited | 20.02 | 15.83 | 12.28 |
Outstanding, ending | 11.89 | 10.79 | 10.19 |
Exercisable at year end | $ 11.71 | $ 8.77 | $ 10.35 |
STOCK INCENTIVE PLAN (Details 2
STOCK INCENTIVE PLAN (Details 2) - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 11.89 | $ 10.79 | $ 10.19 | $ 9.97 |
Number of Options Outstanding | 102,760 | 117,191 | 154,085 | 201,151 |
Weighted Average Remaining Contractual Life | 6 years 3 months 3 days | |||
Weighted Average Exercise Price | $ 11.71 | $ 8.77 | $ 10.35 | |
Intrinsic Value of Options Outstanding | $ 1,203,558 | |||
Number of Options Exercisable | 32,219 | 31,694 | 13,882 | |
Intrinsic Value of Options Exercisable | $ 356,265 | |||
Exercise Price 1 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 8.61 | |||
Number of Options Outstanding | 41,075 | |||
Weighted Average Remaining Contractual Life | 6 years 3 months 29 days | |||
Weighted Average Exercise Price | $ 8.61 | |||
Intrinsic Value of Options Outstanding | $ 353,656 | |||
Number of Options Exercisable | 24,645 | |||
Intrinsic Value of Options Exercisable | $ 277,504 | |||
Exercise Price 2 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 8.9 | |||
Number of Options Outstanding | 2,541 | |||
Weighted Average Remaining Contractual Life | 1 year 9 months | |||
Weighted Average Exercise Price | $ 8.9 | |||
Intrinsic Value of Options Outstanding | $ 22,615 | |||
Number of Options Exercisable | 2,033 | |||
Intrinsic Value of Options Exercisable | $ 22,300 | |||
Exercise Price 3 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 9.18 | |||
Number of Options Outstanding | 7,199 | |||
Weighted Average Remaining Contractual Life | 3 years 6 months | |||
Weighted Average Exercise Price | $ 9.18 | |||
Intrinsic Value of Options Outstanding | $ 66,087 | |||
Number of Options Exercisable | 2,880 | |||
Intrinsic Value of Options Exercisable | $ 30,783 | |||
Exercise Price 4 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 9.65 | |||
Number of Options Outstanding | 2,420 | |||
Weighted Average Remaining Contractual Life | 2 years 3 months | |||
Weighted Average Exercise Price | $ 9.65 | |||
Intrinsic Value of Options Outstanding | $ 23,353 | |||
Number of Options Exercisable | 1,452 | |||
Intrinsic Value of Options Exercisable | $ 14,840 | |||
Exercise Price 5 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 9.92 | |||
Number of Options Outstanding | 1,815 | |||
Weighted Average Remaining Contractual Life | 3 years 9 months | |||
Weighted Average Exercise Price | $ 9.92 | |||
Intrinsic Value of Options Outstanding | $ 18,005 | |||
Number of Options Exercisable | 726 | |||
Intrinsic Value of Options Exercisable | $ 7,224 | |||
Exercise Price 6 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 12.26 | |||
Number of Options Outstanding | 5,444 | |||
Weighted Average Remaining Contractual Life | 5 years 7 months 2 days | |||
Weighted Average Exercise Price | $ 12.26 | |||
Intrinsic Value of Options Outstanding | $ 66,743 | |||
Exercise Price 7 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 12.4 | |||
Number of Options Outstanding | 2,419 | |||
Weighted Average Remaining Contractual Life | 5 years | |||
Weighted Average Exercise Price | $ 12.4 | |||
Intrinsic Value of Options Outstanding | $ 29,996 | |||
Number of Options Exercisable | 484 | |||
Intrinsic Value of Options Exercisable | $ 3,614 | |||
Exercise Price 8 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 13.05 | |||
Number of Options Outstanding | 14,217 | |||
Weighted Average Remaining Contractual Life | 6 years 3 months 29 days | |||
Weighted Average Exercise Price | $ 13.05 | |||
Intrinsic Value of Options Outstanding | $ 185,532 | |||
Exercise Price 9 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 13.62 | |||
Number of Options Outstanding | 3,630 | |||
Weighted Average Remaining Contractual Life | 6 years 6 months | |||
Weighted Average Exercise Price | $ 13.62 | |||
Intrinsic Value of Options Outstanding | $ 49,441 | |||
Exercise Price 10 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 14.54 | |||
Number of Options Outstanding | 5,500 | |||
Weighted Average Remaining Contractual Life | 7 years 3 months | |||
Weighted Average Exercise Price | $ 14.54 | |||
Intrinsic Value of Options Outstanding | $ 79,970 | |||
Exercise Price 11 Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 18.23 | |||
Number of Options Outstanding | 10,450 | |||
Weighted Average Remaining Contractual Life | 9 years 3 months | |||
Weighted Average Exercise Price | $ 18.23 | |||
Intrinsic Value of Options Outstanding | $ 190,504 | |||
Exercise Price 12 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 19 | |||
Number of Options Outstanding | 2,750 | |||
Weighted Average Remaining Contractual Life | 8 years 2 months 1 day | |||
Weighted Average Exercise Price | $ 19 | |||
Intrinsic Value of Options Outstanding | $ 52,250 | |||
Exercise Price 13 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 19.82 | |||
Number of Options Outstanding | 3,300 | |||
Weighted Average Remaining Contractual Life | 8 years 1 month 2 days | |||
Weighted Average Exercise Price | $ 19.82 | |||
Intrinsic Value of Options Outstanding | $ 65,406 |
STOCK INCENTIVE PLAN (Details N
STOCK INCENTIVE PLAN (Details Narrative) | 12 Months Ended | ||||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2010Numbershares | Dec. 31, 1998Numbershares | |
Intrinsic value of options exercised | $ | $ 262,415 | $ 311,836 | $ 273,979 | ||
Stock-based compensation expense | $ | 72,408 | $ 71,701 | $ 76,529 | ||
Unrecognized compensation cost | $ | $ 248,027 | ||||
Period for unrecognized compensation cost to be recognized | 4 years 2 months 8 days | ||||
1998 Stock Incentive Plan [Member] | |||||
Number of share authorized under stock incentive plan | shares | 180,000 | ||||
Number of stock dividends effecting stock plans | Number | 5 | ||||
Stock dividends for share adjustment of plans (percent) | 10.00% | ||||
1998 Stock Incentive Plan [Member] | Adjusted For Stock Dividends [Member] | |||||
Number of share authorized under stock incentive plan | shares | 363,000 | 329,422 | |||
Stock dividends for share adjustment of plans (percent) | 25.00% | ||||
2010 Stock Incentive Plan [Member] | |||||
Number of share authorized under stock incentive plan | shares | 300,000 | ||||
Percent of options vesting in five years | 20.00% | ||||
Percentage of options vesting each following year | 20.00% | ||||
Number of stock dividends effecting stock plans | Number | 2 | ||||
Stock dividends for share adjustment of plans (percent) | 10.00% |
EMPLOYEE STOCK OWNERSHIP PLAN_2
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2018USD ($)Numbershares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
ESOP Award, Tranche One [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Vesting rights by percent | 0.00% | ||
ESOP Award, Tranche Two [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Vesting rights by percent | 25.00% | ||
ESOP Award, Tranche Three [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Vesting rights by percent | 50.00% | ||
ESOP Award, Tranche Four [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Vesting rights by percent | 75.00% | ||
ESOP Award, Tranche Five [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Vesting rights by percent | 100.00% | ||
Employee Stock Ownership Plan (ESOP), Plan [Member] | |||
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items] | |||
Stock-based compensation expense | $ | $ 420,000 | $ 375,000 | $ 345,000 |
Number of common shares the plan currently owns | shares | 308,613 | ||
Minimum age requirement | 21 | ||
Hours of service | 1,000 |
DIVIDENDS (Details Narrative)
DIVIDENDS (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Dividends [Abstract] | ||||
Dividends paid to parent by subsidiaries | $ 3,800,000 | $ 2,700,000 | $ 2,300,000 | |
Common stock dividend (percent) | 10.00% | 10.00% | ||
Increase in shares outstanding due to stock dividends | 499,095 |
INCOME PER COMMON SHARE (Detail
INCOME PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |||||||||||
Net income | $ 1,806,194 | $ 1,778,153 | $ 1,726,357 | $ 1,612,230 | $ 848,699 | $ 1,440,653 | $ 1,386,385 | $ 1,226,088 | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Weighted average shares outstanding | 5,500,027 | 5,471,001 | 5,428,884 | ||||||||
Effect of dilutive shares | 88,985 | 97,492 | 132,855 | ||||||||
Weighted average shares outstanding - diluted | 5,589,012 | 5,568,493 | 5,561,739 | ||||||||
Earnings per share - basic | $ 0.33 | $ 0.32 | $ 0.31 | $ 0.29 | $ 0.15 | $ 0.26 | $ 0.25 | $ 0.22 | $ 1.26 | $ 0.90 | $ 0.97 |
Earnings per share - diluted | $ 0.32 | $ 0.32 | $ 0.31 | $ 0.29 | $ 0.15 | $ 0.26 | $ 0.25 | $ 0.22 | $ 1.24 | $ 0.88 | $ 0.94 |
REGULATORY CAPITAL REQUIREMEN_3
REGULATORY CAPITAL REQUIREMENTS (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Total Capital to risk-weighted assets: | ||
Total Capital | $ 50,657,000 | $ 47,986,000 |
Total Capital (to risk-weighted assets) ratio | 16.69% | 15.97% |
Minimum amount of capital for adequacy purposes | $ 24,280,000 | $ 23,213,000 |
Minimum amount of capital for adequacy purposes, ratio | 8.00% | 8.00% |
Tier 1 capital to risk-weighted assets: | ||
Tier 1 Capital | $ 46,864,000 | $ 44,253,000 |
Tier 1 Capital (to risk-weighted assets) ratio | 15.44% | 14.73% |
Minimum amount of Tier 1 Capital for adequacy purposes | $ 18,210,000 | $ 17,410,000 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 6.00% | 6.00% |
Tier 1 capital to average assets: | ||
Tier 1 Capital | $ 46,864,000 | $ 44,253,000 |
Tier 1 Capital (to average assets) ratio | 10.76% | 10.01% |
Minimum amount of Tier 1 Capital for adequacy purposes | $ 17,428,000 | $ 16,738,000 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Common equity Tier 1 capital: | ||
Tier 1 Capital | $ 46,864,000 | $ 44,253,000 |
Tier 1 Capital (to tangible assets) ratio | 15.44% | 14.73% |
Tier 1 Capital for adequacy purposes | $ 13,658,000 | $ 13,058,000 |
Tier 1 Capital for adequacy purposes, ratio | 4.50% | 4.50% |
Bank [Member] | ||
Total Capital to risk-weighted assets: | ||
Total Capital | $ 49,695,000 | $ 47,100,000 |
Total Capital (to risk-weighted assets) ratio | 16.39% | 15.69% |
Minimum amount of capital for adequacy purposes | $ 24,262,000 | $ 24,020,000 |
Minimum amount of capital for adequacy purposes, ratio | 8.00% | 8.00% |
Minimum Capital required to be well-capitalized | $ 30,328,000 | $ 30,025,000 |
Minimum Capital required to be well-capitalized, ratio | 10.00% | 10.00% |
Tier 1 capital to risk-weighted assets: | ||
Tier 1 Capital | $ 45,898,000 | $ 43,344,000 |
Tier 1 Capital (to risk-weighted assets) ratio | 15.13% | 14.44% |
Minimum amount of Tier 1 Capital for adequacy purposes | $ 18,197,000 | $ 18,015,000 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 6.00% | 6.00% |
Minimum Tier 1 Capital required to be well-capitalized | $ 24,262,000 | $ 24,020,000 |
Minimum Tier 1 Capital required to be well-capitalized, ratio | 8.00% | 8.00% |
Tier 1 capital to average assets: | ||
Tier 1 Capital | $ 45,898,000 | $ 43,344,000 |
Tier 1 Capital (to average assets) ratio | 10.54% | 9.82% |
Minimum amount of Tier 1 Capital for adequacy purposes | $ 17,419,000 | $ 17,661,000 |
Minimum amount of Tier 1 Capital for adequacy purposes, ratio | 4.00% | 4.00% |
Minimum Tier 1 Capital required to be well-capitalized | $ 21,773,000 | $ 22,077,000 |
Minimum Tier 1 Capital required to be well-capitalized, ratio | 5.00% | 5.00% |
Common equity Tier 1 capital: | ||
Tier 1 Capital | $ 45,898,000 | $ 43,344,000 |
Tier 1 Capital (to tangible assets) ratio | 15.13% | 14.44% |
Tier 1 Capital for adequacy purposes | $ 13,647,000 | $ 13,511,000 |
Tier 1 Capital for adequacy purposes, ratio | 4.50% | 4.50% |
Tier 1 Capital required to be well-capitalized | $ 13,647,000 | $ 19,516,000 |
Tier 1 Capital required to be well-capitalized, ratio | 4.50% | 6.50% |
REGULATORY CAPITAL REQUIREMEN_4
REGULATORY CAPITAL REQUIREMENTS (Details Narrative) | Dec. 31, 2018 |
Regulatory Capital Requirements [Abstract] | |
Common equity tier 1 capital conservation buffer (risk-weighted assets) | 8.39% |
DISCLOSURES REGARDING FAIR VA_3
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Investment securities available for sale | $ 119,668,874 | $ 139,250,250 |
Level 1 [Member] | ||
Investment securities available for sale | 32,356,634 | 35,559,845 |
Level 2 [Member] | ||
Investment securities available for sale | 81,070,285 | 92,231,516 |
Level 3 [Member] | ||
Investment securities available for sale | 6,241,955 | 11,458,889 |
U.S. Treasury Notes [Member] | ||
Investment securities available for sale | 32,356,634 | 35,559,845 |
Government-Sponsored Enterprises [Member] | ||
Investment securities available for sale | 59,369,280 | 63,556,504 |
Municipal Securities [Member] | ||
Investment securities available for sale | 27,942,960 | 40,133,901 |
Recurring Basis [Member] | ||
Investment securities available for sale | 119,668,874 | 139,250,250 |
Recurring Basis [Member] | Level 1 [Member] | ||
Investment securities available for sale | 32,356,634 | 35,559,845 |
Recurring Basis [Member] | Level 2 [Member] | ||
Investment securities available for sale | 81,070,285 | 92,231,516 |
Recurring Basis [Member] | Level 3 [Member] | ||
Investment securities available for sale | 6,241,955 | 11,458,889 |
Recurring Basis [Member] | U.S. Treasury Notes [Member] | ||
Investment securities available for sale | 32,356,634 | 35,559,845 |
Recurring Basis [Member] | U.S. Treasury Notes [Member] | Level 1 [Member] | ||
Investment securities available for sale | 32,356,634 | 35,559,845 |
Recurring Basis [Member] | Government-Sponsored Enterprises [Member] | ||
Investment securities available for sale | 59,369,280 | 63,556,504 |
Recurring Basis [Member] | Government-Sponsored Enterprises [Member] | Level 2 [Member] | ||
Investment securities available for sale | 59,369,280 | 63,556,504 |
Recurring Basis [Member] | Municipal Securities [Member] | ||
Investment securities available for sale | 27,942,960 | 40,133,901 |
Recurring Basis [Member] | Municipal Securities [Member] | Level 2 [Member] | ||
Investment securities available for sale | 21,701,005 | 28,675,012 |
Recurring Basis [Member] | Municipal Securities [Member] | Level 3 [Member] | ||
Investment securities available for sale | $ 6,241,955 | $ 11,458,889 |
DISCLOSURES REGARDING FAIR VA_4
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 1) - Level 3 [Member] - Municipal Securities [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Beginning Balance | $ 11,458,889 | $ 13,977,857 |
Total realized/unrealized gains (losses) | ||
Included in other comprehensive income | 150,993 | 137,751 |
Purchases, issuances and settlements, net of maturities | (5,367,927) | (2,656,719) |
Ending balance | $ 6,241,955 | $ 11,458,889 |
DISCLOSURES REGARDING FAIR VA_5
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 2) - Nonrecurring Basis [Member] - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Impaired loans | $ 2,223,028 | $ 1,735,051 |
Other real estate owned | 435,479 | |
Loans held for sale | 1,199,438 | 2,093,723 |
Total | 3,422,466 | 4,264,253 |
Level 2 [Member] | ||
Loans held for sale | 1,199,438 | 2,093,723 |
Total | 1,199,438 | 2,093,723 |
Level 3 [Member] | ||
Impaired loans | 2,223,028 | 1,735,051 |
Other real estate owned | 435,479 | |
Total | $ 2,223,028 | $ 2,170,530 |
DISCLOSURES REGARDING FAIR VA_6
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 3) - Discount Rate [Member] - Number | Dec. 31, 2018 | Dec. 31, 2017 |
Collateral Discounts [Member] | Lower Range [Member] | ||
Impaired loans | 0.10 | 0.10 |
Other real estate owned | 0.10 | 0.10 |
Collateral Discounts [Member] | Maximum [Member] | ||
Impaired loans | 0.20 | 0.20 |
Other real estate owned | 0.20 | 0.20 |
Appraisals and/or Sales [Member] | Lower Range [Member] | ||
Impaired loans | 0.10 | 0.10 |
Other real estate owned | 0.10 | 0.10 |
Appraisals and/or Sales [Member] | Maximum [Member] | ||
Impaired loans | 0.20 | 0.20 |
Other real estate owned | 0.20 | 0.20 |
DISCLOSURES REGARDING FAIR VA_7
DISCLOSURES REGARDING FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 4) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Financial Assets: | ||
Investment securities available for sale | $ 119,668,874 | $ 139,250,250 |
Level 1 [Member] | ||
Financial Assets: | ||
Cash and due from banks | 6,325,457 | 8,486,025 |
Interest-bearing deposits at the Federal Reserve | 25,506,784 | 24,034,194 |
Investment securities available for sale | 32,356,634 | 35,559,845 |
Level 2 [Member] | ||
Financial Assets: | ||
Investment securities available for sale | 81,070,285 | 92,231,516 |
Mortgage loans to be sold | 1,199,438 | 2,093,723 |
Accrued interest receivable | 1,561,915 | 1,720,920 |
Financial Liabilities: | ||
Demand deposits | 347,909,663 | 360,967,884 |
Time deposits | 38,747,898 | 40,722,870 |
Accrued interest payable | 163,876 | 96,190 |
Level 3 [Member] | ||
Financial Assets: | ||
Investment securities available for sale | 6,241,955 | 11,458,889 |
Loans, net | 263,780,751 | 265,277,204 |
Carrying Amount [Member] | ||
Financial Assets: | ||
Cash and due from banks | 6,325,457 | 8,486,025 |
Interest-bearing deposits at the Federal Reserve | 25,506,784 | 24,034,194 |
Investment securities available for sale | 119,668,874 | 139,250,250 |
Mortgage loans to be sold | 1,199,438 | 2,093,723 |
Loans, net | 270,449,936 | 266,305,242 |
Accrued interest receivable | 1,561,915 | 1,720,920 |
Financial Liabilities: | ||
Demand deposits | 347,909,663 | 360,967,884 |
Time deposits | 34,468,725 | 41,920,416 |
Accrued interest payable | 163,876 | 96,190 |
Estimated Fair Value [Member] | ||
Financial Assets: | ||
Cash and due from banks | 6,325,457 | 8,486,025 |
Interest-bearing deposits at the Federal Reserve | 25,506,784 | 24,034,194 |
Investment securities available for sale | 119,668,874 | 139,250,250 |
Mortgage loans to be sold | 1,199,438 | 2,093,723 |
Loans, net | 263,780,751 | 265,277,204 |
Accrued interest receivable | 1,561,915 | 1,720,920 |
Financial Liabilities: | ||
Demand deposits | 347,909,663 | 360,967,884 |
Time deposits | 38,747,898 | 40,722,870 |
Accrued interest payable | $ 163,876 | $ 96,190 |
BANK OF SOUTH CAROLINA CORPOR_3
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets | ||||
Other assets | $ 2,087,587 | $ 1,996,140 | ||
Total assets | 429,135,198 | 446,566,498 | ||
Liabilities and Shareholders' Equity: | ||||
Shareholders' equity | 45,462,561 | 42,764,635 | $ 40,612,974 | $ 39,151,712 |
Total liabilities and shareholders' equity | 429,135,198 | 446,566,498 | ||
Bank of South Carolina Corporation - Parent [Member] | ||||
Assets | ||||
Cash | 1,007,501 | 947,216 | $ 922,595 | $ 946,996 |
Investment in wholly-owned subsidiary | 45,103,068 | 42,437,503 | ||
Other assets | 178,629 | 127,274 | ||
Total assets | 46,289,198 | 43,511,993 | ||
Liabilities and Shareholders' Equity: | ||||
Other liabilities | 826,637 | 747,358 | ||
Shareholders' equity | 45,462,561 | 42,764,635 | ||
Total liabilities and shareholders' equity | $ 46,289,198 | $ 43,511,993 |
BANK OF SOUTH CAROLINA CORPOR_4
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Condensed Statements of Operations | |||||||||||
Interest income | $ 4,478,024 | $ 4,470,152 | $ 4,284,170 | $ 4,210,179 | $ 4,217,475 | $ 4,006,407 | $ 3,826,763 | $ 3,694,639 | $ 17,442,525 | $ 15,745,284 | $ 14,916,857 |
Net Income | $ 1,806,194 | $ 1,778,153 | $ 1,726,357 | $ 1,612,230 | $ 848,699 | $ 1,440,653 | $ 1,386,385 | $ 1,226,088 | 6,922,934 | 4,901,825 | 5,247,063 |
Bank of South Carolina Corporation - Parent [Member] | |||||||||||
Condensed Statements of Operations | |||||||||||
Interest income | 1,157 | 484 | 571 | ||||||||
Net operating expenses | (224,316) | (189,872) | (177,612) | ||||||||
Dividends received from bank | 3,775,000 | 2,685,000 | 2,340,000 | ||||||||
Equity in undistributed earnings of subsidiary | 3,371,093 | 2,406,213 | 3,084,104 | ||||||||
Net Income | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
BANK OF SOUTH CAROLINA CORPOR_5
BANK OF SOUTH CAROLINA CORPORATION - PARENT COMPANY (Details 2) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||||||||||
Net income | $ 1,806,194 | $ 1,778,153 | $ 1,726,357 | $ 1,612,230 | $ 848,699 | $ 1,440,653 | $ 1,386,385 | $ 1,226,088 | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Stock-based compensation expense | 72,408 | 71,701 | 76,529 | ||||||||
Net cash provided by operating activities | 9,317,058 | 8,181,957 | 6,042,824 | ||||||||
Cash flows from financing activities: | |||||||||||
Stock options exercised | 193,569 | 340,843 | 405,749 | ||||||||
Net cash (used in) provided by financing activities | (24,016,188) | 27,873,803 | 11,596,273 | ||||||||
Supplemental disclosure for non-cash investing and financing activity: | |||||||||||
Change in dividends payable | 85,615 | 53,340 | 54,706 | ||||||||
Bank of South Carolina Corporation - Parent [Member] | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income | 6,922,934 | 4,901,825 | 5,247,063 | ||||||||
Stock-based compensation expense | 72,408 | 71,701 | 76,529 | ||||||||
Equity in undistributed earnings of subsidiary | (3,371,093) | (2,406,213) | (3,084,104) | ||||||||
Decrease in other assets | (51,355) | (51,197) | (55,923) | ||||||||
(Decrease) increase in other liabilities | (6,333) | 151 | |||||||||
Net cash provided by operating activities | 3,566,561 | 2,516,267 | 2,183,565 | ||||||||
Cash flows from financing activities: | |||||||||||
Dividends paid | (3,699,845) | (2,832,489) | (2,613,715) | ||||||||
Stock options exercised | 193,569 | 340,843 | 405,749 | ||||||||
Net cash (used in) provided by financing activities | (3,506,276) | (2,491,646) | (2,207,966) | ||||||||
Net increase (decrease) in cash | 60,285 | 24,621 | (24,401) | ||||||||
Cash at the beginning of the year | $ 947,216 | $ 922,595 | 947,216 | 922,595 | 946,996 | ||||||
Cash at the end of the year | $ 1,007,501 | $ 947,216 | 1,007,501 | 947,216 | 922,595 | ||||||
Supplemental disclosure for non-cash investing and financing activity: | |||||||||||
Change in dividends payable | $ 85,615 | $ 53,340 | $ 74,706 |
QUARTERLY RESULTS OF OPERATIO_3
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total interest and fee income | $ 4,727,449 | $ 4,665,586 | $ 4,423,867 | $ 4,320,009 | $ 4,327,409 | $ 4,117,032 | $ 3,933,285 | $ 3,791,421 | $ 18,136,911 | $ 16,169,147 | $ 15,295,597 |
Total interest expense | 249,425 | 195,434 | 139,697 | 109,830 | 109,934 | 110,625 | 106,522 | 96,782 | 694,386 | 423,863 | 378,740 |
Net interest income | 4,478,024 | 4,470,152 | 4,284,170 | 4,210,179 | 4,217,475 | 4,006,407 | 3,826,763 | 3,694,639 | 17,442,525 | 15,745,284 | 14,916,857 |
Provision for loan losses | 95,000 | 100,000 | 75,000 | 55,000 | 2,500 | 20,000 | 30,000 | 2,500 | 325,000 | 55,000 | 570,000 |
Net interest income after provision for loan losses | 4,383,024 | 4,370,152 | 4,209,170 | 4,155,179 | 4,214,975 | 3,986,407 | 3,796,763 | 3,692,139 | 17,117,525 | 15,690,284 | 14,346,857 |
Total other income | 532,891 | 458,693 | 555,096 | 447,945 | 538,236 | 481,882 | 696,479 | 551,874 | 1,994,625 | 2,268,471 | 2,861,083 |
Total other expense | 2,970,411 | 2,816,474 | 2,651,515 | 2,641,834 | 2,696,005 | 2,484,538 | 2,590,123 | 2,471,630 | 11,080,234 | 10,242,296 | 10,272,444 |
Income before income tax expense | 1,945,504 | 2,012,371 | 2,112,751 | 1,961,290 | 2,057,206 | 1,983,751 | 1,903,119 | 1,772,383 | |||
Income tax expense | 139,310 | 234,218 | 386,394 | 349,060 | 1,208,507 | 543,098 | 516,734 | 546,295 | 1,108,982 | 2,814,634 | 1,688,433 |
Net income | $ 1,806,194 | $ 1,778,153 | $ 1,726,357 | $ 1,612,230 | $ 848,699 | $ 1,440,653 | $ 1,386,385 | $ 1,226,088 | $ 6,922,934 | $ 4,901,825 | $ 5,247,063 |
Basic income per common share | $ 0.33 | $ 0.32 | $ 0.31 | $ 0.29 | $ 0.15 | $ 0.26 | $ 0.25 | $ 0.22 | $ 1.26 | $ 0.90 | $ 0.97 |
Diluted income per common share | $ 0.32 | $ 0.32 | $ 0.31 | $ 0.29 | $ 0.15 | $ 0.26 | $ 0.25 | $ 0.22 | $ 1.24 | $ 0.88 | $ 0.94 |