Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 20, 2015 | Jun. 30, 2014 | |
Document And Entity Information | |||
Entity Registrant Name | F&M BANK CORP | ||
Entity Central Index Key | 740806 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 3,293,909 | ||
Entity Public Float | $52,213,903 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Assets | ||
Cash and due from banks (notes 3 and 15) | $6,241,016 | $5,834,596 |
Money market funds | 910,527 | 708,049 |
Federal funds sold | 16,051,000 | 2,000 |
Cash and cash equivalents | 23,202,543 | 6,544,645 |
Securities: | ||
Held to maturity - fair value of $125,150 and $106,387 in 2014 and 2013, respectively (note 4) | 125,150 | 106,387 |
Available for sale (note 4) | 13,215,112 | 30,265,781 |
Other investments (note 4) | 8,964,640 | 8,113,600 |
Loans held for sale | 13,381,941 | 3,804,425 |
Loans held for investment (notes 5) | 518,201,574 | 478,453,008 |
Less allowance for loan losses (note 6) | -8,724,731 | -8,184,376 |
Net loans held for investment | 509,476,843 | 470,268,632 |
Other real estate owned (note 9) | 3,507,153 | 2,628,418 |
Bank premises and equipment, net (note 8) | 6,458,254 | 6,525,057 |
Interest receivable | 1,674,846 | 1,498,112 |
Goodwill (note 23) | 2,669,517 | 2,669,517 |
Bank owned life insurance (note 24) | 12,581,210 | 12,121,772 |
Other assets | 10,050,893 | 8,241,821 |
Total assets | 605,308,102 | 552,788,167 |
Liabilities | ||
Noninterest bearing | 112,197,722 | 92,396,921 |
Interest bearing: | ||
Demand | 93,693,468 | 92,562,273 |
Money market accounts | 25,900,061 | 24,894,002 |
Savings | 64,249,199 | 58,292,273 |
Time deposits over $100,000 | 79,812,757 | 69,673,722 |
All other time deposits | 115,651,329 | 126,330,053 |
Total deposits | 491,504,536 | 464,149,244 |
Short-term debt (note 11) | 14,358,492 | 3,423,078 |
Accrued liabilities | 11,771,671 | 9,383,610 |
Subordinated debt (note 12) | 10,191,000 | |
Long-term debt (note 12) | 9,875,000 | 11,500,000 |
Total liabilities | 527,509,699 | 498,646,932 |
Commitments and Contingencies (notes 4 and 16) | ||
Stockholders' Equity (Note 22) | ||
Preferred Stock $5 par value, 400,000 shares authorized, issued and outstanding for 2014 and none in 2013 | 9,425,123 | |
Common stock $5 par value, 6,000,000 shares authorized, 3,291,766 and 2,511,735 shares issued and outstanding for 2014 and 2013, respectively | 16,458,830 | 12,558,675 |
Additional paid in capital - common stock | 11,259,995 | 3,104,441 |
Retained earnings (note 19) | 42,554,421 | 38,984,724 |
Noncontrolling interest | 426,365 | 418,228 |
Accumulated other comprehensive income (loss) | -2,326,331 | -924,833 |
Total stockholders' equity | 77,798,403 | 54,141,235 |
Total liabilities and stockholders' equity | $605,308,102 | $552,788,167 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Assets | ||
Held to maturity - fair value | $125,150 | $106,387 |
Time deposits | $100,000 | |
STOCKHOLDERS EQUITY: | ||
Preferred Stock,par value | $5 | $0 |
Preferred Stock,shares authorized | 400,000 | 0 |
Preferred Stock,shares issued | 400,000 | 0 |
Preferred Stock,shares outstanding | 400,000 | 0 |
Common stock, par value | $5 | $5 |
Common stock shares authorized | 6,000,000 | 6,000,000 |
Common stock shares issued | 3,291,766 | 2,511,735 |
Common stock shares outstanding | 3,291,766 | 2,511,735 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Interest and Dividend Income | |||
Interest and fees on loans held for investment | $26,210,609 | $25,070,039 | $25,247,444 |
Interest on loans held for sale | 312,364 | 647,622 | 1,736,361 |
Interest on deposits and federal funds sold | 44,435 | 54,679 | 30,363 |
Interest on debt securities | 204,649 | 193,244 | 210,371 |
Total Interest and Dividend Income | 26,772,057 | 25,965,584 | 27,224,539 |
Interest Expense | |||
Interest on demand deposits | 663,618 | 791,245 | 1,194,567 |
Interest on savings deposits | 121,808 | 119,020 | 182,479 |
Interest on time deposits over $100,000 | 589,673 | 781,950 | 908,389 |
Interest on all other time deposits | 1,114,470 | 1,549,273 | 2,035,900 |
Total interest on deposits | 2,489,569 | 3,241,488 | 4,321,335 |
Interest on short-term debt | 9,437 | 23,956 | 51,380 |
Interest on long-term debt | 1,148,716 | 1,507,299 | 1,921,356 |
Total interest expense | 3,647,722 | 4,772,743 | 6,294,071 |
Net Interest Income | 23,124,335 | 21,192,841 | 20,930,468 |
Provision for Loan losses (note 6) | 2,250,000 | 3,775,000 | 4,200,000 |
Net Interest Income After Provision for Loan Losses | 20,874,335 | 17,417,841 | 16,730,468 |
Noninterest Income | |||
Service charges on deposit accounts | 1,033,959 | 1,117,910 | 1,168,221 |
Insurance and other commissions | 635,543 | 868,464 | 868,965 |
Other operating income | 1,393,897 | 1,537,397 | 1,254,490 |
Income on bank owned life insurance | 466,936 | 508,658 | 481,681 |
Total Noninterest Income | 3,530,335 | 4,032,429 | 3,773,357 |
Noninterest Expenses | |||
Salaries | 6,898,400 | 6,524,515 | 5,823,204 |
Employee benefits (note 14) | 1,911,250 | 2,146,871 | 1,972,835 |
Occupancy expense | 621,855 | 606,935 | 553,655 |
Equipment expense | 589,919 | 547,948 | 549,564 |
FDIC insurance assessment | 690,000 | 704,103 | 706,673 |
Other real estate owned expenses | 407,219 | 214,832 | 303,802 |
Other operating expenses | 4,537,269 | 3,974,791 | 3,451,645 |
Total Noninterest Expenses | 15,655,912 | 14,719,995 | 13,361,378 |
Income before Income Taxes | 8,748,758 | 6,730,275 | 7,142,447 |
Income Tax Expense (note 13) | 2,901,496 | 1,907,297 | 2,095,397 |
Consolidated Net Income - F & M Bank Corp. | 5,847,262 | 4,822,978 | 5,047,050 |
Net income - Noncontrolling interest | -45,653 | -107,185 | -145,966 |
Net Income - F & M Bank Corp. | 5,801,609 | 4,715,793 | 4,901,084 |
Dividends paid/accumulated on preferred stock | 127,500 | ||
Net Income available to common stockholders | $5,674,109 | $4,715,793 | $4,901,084 |
Per Share Data | |||
Net Income - basic | $1.82 | $1.88 | $1.96 |
Net Income - diluted | $1.80 | $1.88 | $1.96 |
Cash dividends | $0.68 | $0.68 | $0.64 |
Average Common Shares Outstanding - basic | 3,119,333 | 2,504,015 | 2,496,300 |
Average Common Shares Outstanding - diluted | 3,229,942 | 2,504,015 | 2,496,300 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Consolidated Statements Of Comprehensive Income | |||
Net Income - F & M Bank Corp | $5,801,609 | $4,715,793 | $4,901,084 |
Net Income attributable to noncontrolling interest | 45,653 | 107,185 | 145,966 |
Total net income | 5,847,262 | 4,822,978 | 5,047,050 |
Other comprehensive income (loss): | |||
Pension plan adjustment | -2,145,868 | 2,314,274 | -557,609 |
Tax effect | 729,595 | -786,853 | 189,587 |
Pension plan adjustment, net of tax | -1,416,273 | 1,527,421 | -368,022 |
Unrealized holding gains (losses)on available-for-sale securities | 22,386 | -75,127 | 26,470 |
Tax effect | -7,611 | 25,543 | -9,000 |
Unrealized holding gain (losses), net of tax | 14,775 | -49,584 | 17,470 |
Total comprehensive income | $4,445,764 | $6,300,815 | $4,696,498 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Stockholders' Equity (USD $) | Preferred Stock | Common Stock | Additional Paid In Capital | Retained Earnings | Noncontrolling Interest | Accumulated Other comprehensive Income (Loss) | Total |
Begining balance, Amount at Dec. 31, 2011 | $12,463,580 | $2,080,691 | $32,671,401 | $216,165 | ($2,052,118) | $46,179,719 | |
Net income | 4,901,084 | 145,966 | 5,047,050 | ||||
Other comprehensive income (loss) | -350,552 | -350,552 | |||||
Dividends on preferred stock | |||||||
Dividends on common stock | -1,597,673 | -1,597,673 | |||||
Stock issued | 34,140 | 71,276 | 105,416 | ||||
Ending balance, Amount at Dec. 31, 2012 | 12,497,720 | 2,951,967 | 35,974,812 | 362,131 | -2,402,670 | 49,383,960 | |
Net income | 4,715,793 | 107,185 | 4,822,978 | ||||
Other comprehensive income (loss) | 1,477,837 | 1,477,837 | |||||
Minority Interest Contributed Capital (Distributions) | -51,088 | -51,088 | |||||
Dividends on preferred stock | |||||||
Dividends on common stock | -1,705,881 | -1,705,881 | |||||
Stock issued | 60,955 | 152,474 | 213,429 | ||||
Ending balance, Amount at Dec. 31, 2013 | 12,558,675 | 3,104,441 | 38,984,724 | 418,228 | -924,833 | 54,141,235 | |
Net income | 5,801,609 | 45,653 | 5,847,262 | ||||
Other comprehensive income (loss) | -1,401,498 | -1,401,498 | |||||
Minority Interest Contributed Capital (Distributions) | -37,516 | -37,516 | |||||
Dividends on preferred stock | -127,500 | -127,500 | |||||
Dividends on common stock | -2,104,412 | -2,104,412 | |||||
Preferred stock issued | 9,425,123 | 9,425,123 | |||||
Common Stock issued | 3,900,155 | 8,155,554 | 12,055,709 | ||||
Ending balance, Amount at Dec. 31, 2014 | $9,425,123 | $16,458,830 | $11,259,995 | $42,554,421 | $426,365 | ($2,326,331) | $77,798,403 |
Consolidated_Statements_of_Cha1
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Statement of Stockholders' Equity [Abstract] | |||
Stock issued | 12,141 | 6,828 | |
Preferred stock issued | 400,000 | ||
Common Stock issued | 780,031 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Cash flows from operating activities | |||
Net income | $5,801,609 | $4,715,793 | $4,901,084 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation | 612,116 | 581,625 | 597,920 |
Amortization (Accretion) of securities | 76,057 | 45,416 | 74,190 |
Sale of loans held for sale originated | 56,210,640 | 79,778,381 | 76,622,865 |
Loans held for sale originated | -56,044,669 | -71,169,362 | -81,529,577 |
Provision for loan losses | 2,250,000 | 3,775,000 | 4,200,000 |
Benefit (expense) for deferred taxes | -515,538 | -568,858 | 494,733 |
(Increase) decrease in interest receivable | -176,734 | 204,735 | 113,014 |
(Increase) decrease in other assets | -1,473,634 | -967,516 | 1,729,648 |
Increase (decrease) in accrued expenses | 1,159,913 | 1,731,973 | 528,576 |
Amortization of limited partnership investments | 608,360 | 581,737 | 550,989 |
Loss on sale and valuation adjustments of other real estate owned | 318,714 | 97,155 | 200,865 |
Income from life insurance investment | -466,936 | -508,658 | -481,681 |
Net Cash Provided by Operating Activities | 8,359,898 | 18,297,421 | 8,002,626 |
Cash flows from investing activities | |||
(Increase) decrease in interest bearing bank deposits | 248,000 | -95,585 | |
Purchase of bank owned life insurance | -4,063,687 | ||
Proceeds from maturities of securities available for sale | 27,495,319 | 10,712,508 | 20,647,760 |
Proceeds from maturities of securities held to maturity | 106,000 | ||
Purchases of securities available for sale | -11,957,235 | -31,093,384 | -17,946,019 |
Purchases of securities held to maturity | -125,250 | ||
Net increase in loans held for investment | -43,642,033 | -17,149,156 | -18,806,297 |
Net (increase) decrease in loans held for sale participations | -9,743,487 | 64,793,073 | -11,756,993 |
Net purchase of property and equipment | -545,313 | -661,621 | -565,898 |
Proceeds from sale of other real estate owned | 986,373 | 928,897 | 1,564,272 |
Net cash provided by (used in) investing activities | -37,425,626 | 27,778,317 | -31,022,447 |
Cash flows from financing activities | |||
Net change in demand and savings deposits | 27,894,981 | 15,867,944 | 19,689,196 |
Net change in time deposits | -539,689 | -5,514,239 | -1,840,280 |
Net change in short-term debt | 10,935,414 | -31,174,274 | 16,058,389 |
Dividends paid in cash | -2,231,912 | -1,705,881 | -1,597,673 |
Proceeds from long-term debt | 10,000,000 | ||
Proceeds from issuance of preferred stock | 6,831,123 | ||
Proceeds from issuance of common stock | 12,055,709 | 213,429 | 105,416 |
Repayments of long-term debt | -19,222,000 | -26,214,286 | -9,392,857 |
Net cash provided by (used in) financing activities | 45,723,626 | -48,527,307 | 23,022,191 |
Net Increase (Decrease) in Cash and Cash Equivalents | 16,657,898 | -2,451,569 | 2,370 |
Cash and Cash Equivalents, Beginning of Year | 6,544,645 | 8,996,214 | 8,993,844 |
Cash and Cash Equivalents, End of Year | 23,202,543 | 6,544,645 | 8,996,214 |
Supplemental Disclosure: | |||
Cash paid for Interest expense | 3,703,190 | 6,500,592 | 6,245,244 |
Cash paid for Income taxes | 1,607,000 | 800,000 | 1,700,000 |
Transfers from loans to other real estate owned | 2,914,958 | 1,337,890 | 1,972,032 |
Noncash exchange of other real estate owned | -780,097 | -569,245 | -567,171 |
Conversion of subordinated debt to preferred stock | $2,594,000 | $0 | $0 |
NATURE_OF_OPERATIONS
NATURE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2014 | |
Nature Of Operations | |
NOTE 1. NATURE OF OPERATIONS | F & M Bank Corp. (the “Company”), through its subsidiary Farmers & Merchants Bank (the “Bank”), operates under a charter issued by the Commonwealth of Virginia and provides commercial banking services. As a state chartered bank, the Bank is subject to regulation by the Virginia Bureau of Financial Institutions and the Federal Reserve Bank. The Bank provides services to customers located mainly in Rockingham, Shenandoah and Page Counties in Virginia, and the adjacent counties of Augusta, Virginia and Hardy, West Virginia. Services are provided at nine branch offices, a Dealer Finance Division and a loan production office. The Company offers insurance, mortgage lending and financial services through its subsidiaries, TEB Life Insurance, Inc., Farmers & Merchants Financial Services, Inc, and VBS Mortgage, LLC. |
The Company raised an additional $12 million (net of fees) in common stock in a private placement offering in March of 2014. They also issued $9.4 million (net of fees) in a new offering of preferred stock during December 2014. This additional capital will be used to fund loan growth as well as support new branches in an adjoining county. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | The accounting and reporting policies of the Company and its subsidiaries conform to generally accepted accounting principles and to accepted practice within the banking industry. | ||||||||||||
The following is a summary of the more significant policies: | |||||||||||||
Principles of Consolidation | |||||||||||||
The consolidated financial statements include the accounts of Farmers and Merchants Bank, TEB Life Insurance Company, Farmers & Merchants Financial Services, Inc. and VBS Mortgage, LLC, (net of minority interest). Significant inter-company accounts and transactions have been eliminated. | |||||||||||||
Use of Estimates in the Preparation of Financial Statements | |||||||||||||
In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts in those statements; actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near term are the determination of the allowance for loan losses, which is sensitive to changes in local and national economic conditions, and the other than temporary impairment of investments in the investment portfolio. | |||||||||||||
Cash and Cash Equivalents | |||||||||||||
Cash and cash equivalents include cash on hand, deposits at other financial institutions whose initial maturity is ninety days or less and Federal funds sold. | |||||||||||||
Investment Securities | |||||||||||||
Management reviews the securities portfolio and classifies all securities as either held to maturity or available for sale at the date of acquisition. Securities that the Company has both the positive intent and ability to hold to maturity (at time of purchase) are classified as held to maturity securities. All other securities are classified as available for sale. Securities held to maturity are carried at historical cost and adjusted for amortization of premiums and accretion of discounts, using the effective interest method. Securities available for sale are carried at fair value with any valuation adjustments reported, net of deferred taxes, as a part of other accumulated comprehensive income. | |||||||||||||
Interest, amortization of premiums and accretion of discounts on securities are reported as interest income using the effective interest method. Gains (losses) realized on sales and calls of securities are determined on the specific identification method. | |||||||||||||
Accounting for Historic Rehabilitation and Low Income Housing Partnerships | |||||||||||||
The Company periodically invests in low income housing partnerships whose primary benefit is the distribution of federal income tax credits to partners. The Company recognizes these benefits and the cost of the investments over the life of the partnership (usually 15 years). In addition, state and federal historic rehabilitation credits are generated from some of the partnerships. Amortization of these investments is prorated based on the amount of benefits received in each year to the total estimated benefits over the life of the projects. All benefits have been shown as a part of income tax expense. | |||||||||||||
Loans Held for Investment | |||||||||||||
Loans are carried on the balance sheet net of any unearned interest and the allowance for loan losses. Interest income on loans is determined using the effective interest method on the daily amount of principal outstanding except where serious doubt exists as to collectability of the loan, in which case the accrual of income is discontinued. | |||||||||||||
Loans Held for Sale | |||||||||||||
These loans consists of fixed rate loans made through its subsidiary, VBS Mortgage and loans purchased from Gateway Savings Bank, Oakland, CA and NorthPointe Bank, Grand Rapids, MI. | |||||||||||||
VBS Mortgage originates conforming mortgage loans for sale in the secondary market. The bank (VBS) gives the customer a rate commitment at the time the rate is locked. The bank then immediately gets a rate lock-in from the investor that will be buying the loan upon closing. Both the rate lock and the purchase commitments (which is a blanket agreement) are best effort agreements, subject to final approval and underwriting. Because either party can walk away from these agreements prior to closing, neither the rate lock commitment nor the purchase commitment is considered a derivative contract. The bank provides a warehouse line for the Mortgage subsidiary after closing, until the loan is purchased by the investor. The average time on the line is two or three weeks. Although VBS does have a line, loans are actually assigned to the bank at closing and then reassigned prior to purchase from investor. There were $2.6 million of these mortgage loans held for resale at the end of the year. All of these loans are under contract to deliver to an investor as a specified price. Because of this and the short holding period, these loans are carried at par and a gain is recorded at transfer to the investor. The effect of not marking these loans to market is not material to the current year financial statements. | |||||||||||||
Gateway Savings Bank (“Gateway”) loans are originated by a network of mortgage loan originators throughout the United States. A take out commitment is in place at the time the loans are purchased. The Gateway arrangement has been used since 2003 as a higher yielding alternative to federal funds sold or investment securities. These loans are short-term, residential real estate loans that have an average life in our portfolio of approximately two weeks. The Bank holds these loans during the period of time between loan closing and when the loan is paid off by the ultimate secondary market purchaser. Gateway Savings Bank discontinued the loan participation program in December of 2014 and the Company became a participant with NorthPointe Bank which obtained the Gateway Savings Bank program and incorporated it into their existing program. The NorthPointe Bank program and procedures are the same as described above for Gateway. | |||||||||||||
Allowance for Loan Losses | |||||||||||||
The provision for loan losses charged to operations is an amount sufficient to bring the allowance for loan losses to an estimated balance that management considers adequate to absorb potential losses in the portfolio. Loans are charged against the allowance when management believes the collectability of the principal is unlikely. Recoveries of amounts previously charged-off are credited to the allowance. Management’s determination of the adequacy of the allowance is based on an evaluation of the composition of the loan portfolio, the value and adequacy of collateral, current economic conditions, historical loan loss experience, and other risk factors. Management believes that the allowance for loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions, particularly those affecting real estate values. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination. | |||||||||||||
A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. | |||||||||||||
Other Real Estate Owned (OREO) | |||||||||||||
As of December 31, 2014, the Bank had $3.5 million classified as OREO on the balance sheet, compared to $2.63 million as of December 31, 2013. The table in Note 9 reflects the OREO activity in 2014. The Company’s policy is to carry OREO on its balance sheet at the lower of cost or market. Values are reviewed periodically and additional losses are recognized if warranted based on market conditions. | |||||||||||||
Nonaccrual Loans | |||||||||||||
Loans are placed on nonaccrual status when they become ninety days or more past due, unless there is an expectation that the loan will either be brought current or paid in full in a reasonable period of time. | |||||||||||||
Bank Premises and Equipment | |||||||||||||
Bank premises and equipment are stated at cost less accumulated depreciation. Depreciation is charged to income over the estimated useful lives of the assets on a combination of the straight-line and accelerated methods. The ranges of the useful lives of the premises and equipment are as follows: | |||||||||||||
Buildings and Improvements | 10 - 40 years | ||||||||||||
Furniture and Fixtures | 5 - 20 years | ||||||||||||
Maintenance, repairs, and minor improvements are charged to operations as incurred. Gains and losses on dispositions are reflected in other income or expense. | |||||||||||||
Goodwill | |||||||||||||
In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard ASC 805, Business Combinations and ASC 350, Intangibles. ASC 805 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001. Additionally, it further clarifies the criteria for the initial recognition and measurement of intangible assets separate from goodwill. ASC 350 became effective for fiscal years beginning after December 15, 2001 and prescribes the accounting for goodwill and intangible assets subsequent to initial recognition. The provisions of ASC 350 discontinue the amortization of goodwill and intangible assets with indefinite lives. Instead, these assets are subject to an impairment review on an annual basis and more frequently if certain impairment indicators are in evidence. ASC 350 also requires that reporting units be identified for the purpose of assessing potential future impairments of goodwill. | |||||||||||||
Goodwill totaled $2,669,517 at December 31, 2014 and 2013. The goodwill is no longer amortized, but instead tested for impairment at least annually. Based on the testing, there were no impairment charges for 2014, 2013 or 2012. | |||||||||||||
Pension Plans | |||||||||||||
The Bank has a qualified noncontributory defined benefit pension plan which covers all full time employees hired prior to April 1, 2012. The benefits are primarily based on years of service and earnings. On December 31, 2006 the Company adopted ASC 325-960 “Defined Benefit Pension Plans” (formerly SFAS No. 158), which was issued in September of 2006 to require recognition of the over-funded or under-funded status of pension and other postretirement benefit plans on the balance sheet. Under ASC 325-960, gains and losses, prior service costs and credits, and any remaining transition amounts that have not yet been recognized through net periodic benefit cost will be recognized in accumulated other comprehensive income, net of tax effects, until they are amortized as a component of net periodic cost. | |||||||||||||
Advertising Costs | |||||||||||||
The Company follows the policy of charging the cost of advertising to expense as incurred. Total advertising costs included in other operating expenses for 2014, 2013, and 2012 were $317,780, $278,555, and $251,258, respectively. | |||||||||||||
Income Taxes | |||||||||||||
Amounts provided for income tax expense are based on income reported for financial statement purposes rather than amounts currently payable under income tax laws. Deferred taxes, which arise principally from temporary differences between the period in which certain income and expenses are recognized for financial accounting purposes and the period in which they affect taxable income, are included in the amounts provided for income taxes. | |||||||||||||
Comprehensive Income | |||||||||||||
Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain changes in assets and liabilities and changes in pension plan funding status, such as unrealized gains and losses on available-for-sale securities and gains or losses on certain derivative contracts, are reported as a separate component of the equity section of the balance sheet. Such items, along with operating net income, are components of comprehensive income. | |||||||||||||
Earnings per Share | |||||||||||||
Accounting guidance specifies the computation, presentation and disclosure requirements for earnings per share (“EPS”) for entities with publicly held common stock or potential common stock such as options, warrants, convertible securities or contingent stock agreements if those securities trade in a public market. Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding. Diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive common shares had been issued. The dilutive effect of conversion of preferred stock is reflected in the diluted earnings per share calculation. | |||||||||||||
Net income available to common stockholders represents consolidated net income adjusted for preferred dividends declared. | |||||||||||||
The following table provides a reconciliation of net income to net income available to common stockholders for the periods presented: | |||||||||||||
For the year ended | |||||||||||||
31-Dec-14 | |||||||||||||
Earnings Available to Common Stockholders: | |||||||||||||
Net Income | $ | 5,801,609 | |||||||||||
Preferred Stock Dividends | 127,500 | ||||||||||||
Net Income Available to Common Stockolders | $ | 5,674,109 | |||||||||||
The following table shows the effect of dilutive preferred stock conversion on the Company's earnings per share for the periods indicated: | |||||||||||||
Year ending December 31, 2014 | |||||||||||||
Income | Shares | Per Share Amounts | |||||||||||
Basic EPS | $ | 5,674,109 | 3,119,333 | $ | 1.82 | ||||||||
Effect of Dilutive Securities: | |||||||||||||
Convertible Preferred Stock | 127,500 | 110,609 | (0.02 | ) | |||||||||
Diluted EPS | $ | 5,801,609 | 3,229,942 | $ | 1.8 | ||||||||
There were no dilutive securities for the years ended December 31, 2013 and 2012. | |||||||||||||
Derivative Financial Instruments and Change in Accounting Principle | |||||||||||||
On January 1, 2001, the Company adopted ASC 815 “Derivative and Hedging Investments” (formerly SFAS No. 133). This statement requires that all derivatives be recognized as assets or liabilities in the balance sheet and measured at fair value. | |||||||||||||
Under ASC 815, the gain or loss on a derivative designated and qualifying as a fair value hedging instrument, as well as the offsetting gain or loss on the hedging item attributable to the risk being hedged, is recognized currently in earnings in the same accounting period. The effective portion of the gain or loss on a derivative designated and qualifying as a cash flow hedging instrument is initially reported as a component of other comprehensive income and subsequently reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument, if any, is recognized currently in earnings. | |||||||||||||
Interest rate derivative financial instruments receive hedge accounting treatment only if they are designated as a hedge and are expected to be, and are, effective in substantially reducing interest rate risk arising from the assets and liabilities identified as exposing the Company to risk. Those derivative financial instruments that do not meet the hedging criteria discussed below would be classified as trading activities and would be recorded at fair value with changes in fair value recorded in income. Derivative hedge contracts must meet specific effectiveness tests (i.e., over time the change in their fair values due to the designated hedge risk must be within 80 to 125 percent of the opposite change in the fair value of the hedged assets or liabilities). Changes in fair value of the derivative financial instruments must be effective at offsetting changes in the fair value of the hedging items due to the designated hedge risk during the term of the hedge. Further, if the underlying financial instrument differs from the hedged asset or liability, there must be a clear economic relationship between the prices of the two financial instruments. If periodic assessment indicates derivatives no longer provide an effective hedge, the derivatives contracts would be closed out and settled or classified as a trading activity. | |||||||||||||
Recent Accounting Pronouncements | |||||||||||||
Standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. | |||||||||||||
Subsequent Events | |||||||||||||
In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued. |
CASH_AND_DUE_FROM_BANKS
CASH AND DUE FROM BANKS | 12 Months Ended |
Dec. 31, 2014 | |
Accounting Policies [Abstract] | |
NOTE 3. CASH AND DUE FROM BANKS | The Bank is required to maintain average reserve balances based on a percentage of deposits. The average balance of cash, which the Federal Reserve Bank requires to be on reserve, was $25,000 for the years ended December 31, 2014 and 2013. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Investment Securities | |||||||||||||||||||||||||
NOTE 4. INVESTMENT SECURITIES | The amortized cost and fair value of securities held to maturity are as follows: | ||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 125,150 | $ | - | $ | - | $ | 125,150 | |||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 106,387 | $ | - | $ | - | $ | 106,387 | |||||||||||||||||
The amortized cost and fair value of securities available for sale are as follows: | |||||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 4,025,740 | $ | - | $ | 6,100 | $ | 4,019,640 | |||||||||||||||||
Government sponsored enterprises | 8,039,540 | 8,940 | 9,880 | 8,038,600 | |||||||||||||||||||||
Mortgage-backed obligations of federal agencies | 1,011,092 | 10,780 | - | 1,021,872 | |||||||||||||||||||||
Marketable equities | 135,000 | - | - | 135,000 | |||||||||||||||||||||
Total Securities Available for Sale | $ | 13,211,372 | $ | 19,720 | $ | 15,980 | $ | 13,215,112 | |||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
U. S. Treasuries | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||
Government sponsored enterprises | 29,075,893 | 11,460 | 22,253 | 29,065,100 | |||||||||||||||||||||
Mortgage-backed obligations of federal agencies | 1,208,533 | - | 7,852 | 1,200,681 | |||||||||||||||||||||
Marketable equities | - | - | - | - | |||||||||||||||||||||
Total Securities Available for Sale | $ | 30,284,426 | $ | 11,460 | $ | 30,105 | $ | 30,265,781 | |||||||||||||||||
The amortized cost and fair value of securities at December 31, 2014, by contractual maturity are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. | |||||||||||||||||||||||||
Securities Held to Maturity | Securities Available for Sale | ||||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||||
Due in one year or less | $ | 125,150 | $ | 125,150 | $ | 2,000,000 | $ | 1,999,980 | |||||||||||||||||
Due after one year through five years | - | - | 10,065,280 | 10,058,260 | |||||||||||||||||||||
Due after five years | - | - | 1,146,092 | 1,156,872 | |||||||||||||||||||||
Total | 125,150 | 125,150 | 13,211,372 | 13,215,112 | |||||||||||||||||||||
There were no sales of debt or equity securities during 2014, 2013 or 2012 | |||||||||||||||||||||||||
The carrying value (which approximates fair value) of securities pledged by the Bank to secure deposits and for other purposes amounted to $13,080,000 at December 31, 2014 and $10,255,000 at December 31, 2013. | |||||||||||||||||||||||||
Other investments consist of investments in eighteen low-income housing and historic equity partnerships (carrying basis of $6,340,000), stock in the Federal Home Loan Bank (carrying basis of $1,392,000), and various other investments (carrying basis of $1,233,000). The interests in the low-income housing and historic equity partnerships have limited transferability and the interests in the other stocks are restricted as to sales. The market values of these securities are estimated to approximate their carrying value as of December 31, 2014. At December 31, 2014, the Company was committed to invest an additional $3,679,541 in seven low-income housing limited partnerships. These funds will be paid as requested by the general partner to complete the projects. This additional investment has been reflected in the above carrying basis and in accrued liabilities on the balance sheet. | |||||||||||||||||||||||||
The primary purpose of the investment portfolio is to generate income and meet liquidity needs of the Company through readily saleable financial instruments. The portfolio includes fixed rate bonds, whose prices move inversely with rates and variable rate bonds. At the end of any accounting period, the investment portfolio has unrealized gains and losses. The Company monitors the portfolio, which is subject to liquidity needs, market rate changes and credit risk changes, to see if adjustments are needed. The primary concern in a loss situation is the credit quality of the business behind the instrument. Bonds deteriorate in value due to credit quality of the individual issuer and changes in market conditions. These losses relate to market conditions and the timing of purchases. | |||||||||||||||||||||||||
A summary of these losses (in thousands) is as follows: | |||||||||||||||||||||||||
Less than 12 Months | More than 12 Months | Total | |||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||
2014 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 4,020 | $ | (6 | ) | $ | - | $ | - | $ | 4,020 | $ | (6 | ) | |||||||||||
Government sponsored enterprises | 2,004 | (2 | ) | 1,991 | (8 | ) | 3,995 | (10 | ) | ||||||||||||||||
Mortgage-backed obligations | - | - | - | - | - | - | |||||||||||||||||||
Total | $ | 6,024 | $ | (8 | ) | $ | 1,991 | $ | (8 | ) | $ | 8,015 | $ | (16 | ) | ||||||||||
2013 | |||||||||||||||||||||||||
U. S. Treasuries | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Government sponsored enterprises | 4,984 | (22 | ) | - | - | 4,984 | (22 | ) | |||||||||||||||||
Mortgage-backed obligations | 1,191 | (8 | ) | - | - | 1,191 | (8 | ) | |||||||||||||||||
Total | $ | 6,175 | $ | (30 | ) | $ | - | $ | - | $ | 6,175 | $ | (30 | ) | |||||||||||
Management evaluates securities for other-than-temporary impairment on at least a quarterly basis, and more frequently when economic or market conditions warrant such evaluation. Consideration is given to (1) the length of time and the extent to which the fair value has been less than the cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery of fair value. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell these securities before recovery of their amortized cost. The Company did not recognize any other-than-temporary impairment losses in 2014, 2013 or 2012. |
LOANS
LOANS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||
NOTE 5. LOANS | Loans held for investment as of December 31: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Construction/Land Development | $ | 67,180,467 | $ | 68,512,341 | |||||||||||||||||
Farmland | 12,507,446 | 13,197,398 | |||||||||||||||||||
Real Estate | 162,248,606 | 154,628,068 | |||||||||||||||||||
Multi-Family | 11,775,205 | 11,797,010 | |||||||||||||||||||
Commercial Real Estate | 122,305,417 | 113,415,234 | |||||||||||||||||||
Home Equity – closed end | 9,393,805 | 10,228,264 | |||||||||||||||||||
Home Equity – open end | 52,181,679 | 47,357,787 | |||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 28,160,584 | 25,903,011 | |||||||||||||||||||
Consumer | 9,109,994 | 10,162,457 | |||||||||||||||||||
Credit cards | 2,705,285 | 2,679,718 | |||||||||||||||||||
Dealer Finance | 40,633,086 | 20,571,720 | |||||||||||||||||||
Total | $ | 518,201,574 | $ | 478,453,008 | |||||||||||||||||
The Company has pledged loans as collateral for borrowings with the Federal Home Loan Bank of Atlanta totaling $183,483,000 and $164,605,000 as of December 31, 2014 and 2013, respectively. The Company maintains a blanket lien on its entire residential real estate portfolio and also began pledges commercial and home equity loans. | |||||||||||||||||||||
The following is a summary of information pertaining to impaired loans (in thousands): | |||||||||||||||||||||
Unpaid | Average | Interest | |||||||||||||||||||
December 31, 2014 | Recorded | Principal | Related | Recorded | Income | ||||||||||||||||
Investment | Balance | Allowance | Investment | Recognized | |||||||||||||||||
Impaired loans without a valuation allowance: | |||||||||||||||||||||
Construction/Land Development | $ | 4,982 | $ | 5,402 | $ | - | $ | 5,412 | $ | 251 | |||||||||||
Farmland | - | - | - | 1,163 | - | ||||||||||||||||
Real Estate | 141 | 141 | - | 85 | 5 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 1,159 | 1,459 | - | 1,450 | 66 | ||||||||||||||||
Home Equity – closed end | - | - | - | 123 | - | ||||||||||||||||
Home Equity – open end | 1,649 | 1,649 | - | 330 | 57 | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | 191 | 191 | - | 237 | 11 | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
8,122 | 8,842 | - | 8,800 | 390 | |||||||||||||||||
Impaired loans with a valuation allowance | |||||||||||||||||||||
Construction/Land Development | 12,976 | 14,749 | 1,469 | 12,056 | 326 | ||||||||||||||||
Farmland | - | - | - | - | - | ||||||||||||||||
Real Estate | 926 | 926 | 101 | 988 | 105 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 938 | 938 | 47 | 1,030 | 4 | ||||||||||||||||
Home Equity – closed end | - | - | - | 72 | - | ||||||||||||||||
Home Equity – open end | - | - | - | 40 | - | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | - | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
14,840 | 16,613 | 1,617 | 14,186 | 435 | |||||||||||||||||
Total impaired loans | $ | 22,962 | $ | 25,455 | $ | 1,617 | $ | 22,986 | $ | 825 | |||||||||||
The following is a summary of information pertaining to impaired loans (in thousands): | |||||||||||||||||||||
The Recorded Investment is defined as the principal balance less principal payments and charge-offs. | |||||||||||||||||||||
Unpaid | Average | Interest | |||||||||||||||||||
December 31, 2013 | Recorded | Principal | Related | Recorded | Income | ||||||||||||||||
Investment | Balance | Allowance | Investment | Recognized | |||||||||||||||||
Impaired loans without a valuation allowance: | |||||||||||||||||||||
Construction/Land Development | $ | 3,960 | $ | 4,543 | $ | - | $ | 5,750 | $ | 153 | |||||||||||
Farmland | 1,459 | 1,459 | - | 1,475 | 67 | ||||||||||||||||
Real Estate | 49 | 49 | - | 529 | 3 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 851 | 851 | - | 616 | 56 | ||||||||||||||||
Home Equity – closed end | 308 | 308 | - | 284 | 25 | ||||||||||||||||
Home Equity – open end | - | - | - | 20 | - | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | 242 | 242 | - | 64 | 12 | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
6,869 | 7,452 | - | 8,738 | 316 | |||||||||||||||||
Impaired loans with a valuation allowance | |||||||||||||||||||||
Construction/Land Development | 8,291 | 9,716 | 1,560 | 10,855 | 175 | ||||||||||||||||
Farmland | - | - | - | - | - | ||||||||||||||||
Real Estate | 1,145 | 1,145 | 154 | 966 | 48 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 818 | 1,118 | 282 | 1,171 | 4 | ||||||||||||||||
Home Equity – closed end | 180 | 180 | 17 | 409 | 3 | ||||||||||||||||
Home Equity – open end | 100 | 100 | 9 | 93 | 5 | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | 141 | - | ||||||||||||||||
Consumer | 2 | 2 | - | 1 | 1 | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
10,536 | 12,261 | 2,022 | 13,636 | 236 | |||||||||||||||||
Total impaired loans | $ | 17,405 | $ | 19,713 | $ | 2,022 | $ | 22,374 | $ | 552 | |||||||||||
Loans held for sale consists of loans originated by VBS Mortgage and the Bank’s commitment to purchase residential mortgage loan participations from Gateway Bank and NorthPointe Bank. The volume of loans purchased fluctuates due to a number of factors including changes in secondary market rates, which affects demand for mortgage loans; the number of participating banks involved in the program; the number of mortgage loan originators selling loans to the lead bank and the funding capabilities of the lead bank. Loans held for sale as of December 31, 2014 and 2013 were $13,381,941 and $3,804,425, respectively. |
ALLOWANCE_FOR_LOAN_LOSSES
ALLOWANCE FOR LOAN LOSSES | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||
NOTE 6. ALLOWANCE FOR LOAN LOSSES | A summary of changes in the allowance for loan losses is shown in the following schedule: | |||||||||||||||||||||||||||||||||||||||||||
31-Dec-14 | Beginning Balance | Charge-offs | Recoveries | Provision | Ending Balance | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | |||||||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | ||||||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 4,007 | $ | 1,611 | $ | 223 | $ | 2,119 | $ | 4,738 | $ | 1,469 | $ | 3,269 | ||||||||||||||||||||||||||||||
Farmland | (2 | ) | - | - | 2 | - | - | - | ||||||||||||||||||||||||||||||||||||
Real Estate | 400 | 208 | - | 431 | 623 | 101 | 522 | |||||||||||||||||||||||||||||||||||||
Multi-Family | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 777 | - | 108 | (759 | ) | 126 | 47 | 79 | ||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 157 | - | - | 31 | 188 | - | 188 | |||||||||||||||||||||||||||||||||||||
Home Equity – open end | 476 | 80 | - | (242 | ) | 154 | - | 154 | ||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 1,464 | 385 | 356 | (224 | ) | 1,211 | - | 1,211 | ||||||||||||||||||||||||||||||||||||
Consumer | 156 | 33 | 33 | 58 | 214 | - | 214 | |||||||||||||||||||||||||||||||||||||
Dealer Finance | 628 | 107 | 6 | 809 | 1,336 | - | 1,336 | |||||||||||||||||||||||||||||||||||||
Credit Cards | 121 | 46 | 35 | 25 | 135 | - | 135 | |||||||||||||||||||||||||||||||||||||
Total | $ | 8,184 | $ | 2,470 | $ | 761 | $ | 2,250 | $ | 8,725 | $ | 1,617 | $ | 7,108 | ||||||||||||||||||||||||||||||
A summary of changes in the allowance for loan losses is shown in the following schedule: | ||||||||||||||||||||||||||||||||||||||||||||
31-Dec-13 | Beginning Balance | Charge-offs | Recoveries | Provision | Ending Balance | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | |||||||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | ||||||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 2,771 | $ | 2,127 | $ | 40 | $ | 3,323 | $ | 4,007 | $ | 1,560 | $ | 2,447 | ||||||||||||||||||||||||||||||
Farmland | (2 | ) | - | - | - | (2 | ) | - | (2 | ) | ||||||||||||||||||||||||||||||||||
Real Estate | 924 | 173 | - | (351 | ) | 400 | 154 | 246 | ||||||||||||||||||||||||||||||||||||
Multi-Family | (37 | ) | - | - | 37 | - | - | - | ||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 1,113 | 201 | 42 | (177 | ) | 777 | 282 | 495 | ||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 360 | 159 | - | (44 | ) | 157 | 17 | 140 | ||||||||||||||||||||||||||||||||||||
Home Equity – open end | 659 | 68 | 29 | (144 | ) | 476 | 9 | 467 | ||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 2,113 | 986 | 127 | 210 | 1,464 | - | 1,464 | |||||||||||||||||||||||||||||||||||||
Consumer | 51 | 173 | 14 | 264 | 156 | - | 156 | |||||||||||||||||||||||||||||||||||||
Dealer Finance | 72 | 17 | - | 573 | 628 | - | 628 | |||||||||||||||||||||||||||||||||||||
Credit Cards | 130 | 121 | 28 | 84 | 121 | - | 121 | |||||||||||||||||||||||||||||||||||||
Total | $ | 8,154 | $ | 4,025 | $ | 280 | $ | 3,775 | $ | 8,184 | $ | 2,022 | $ | 6,162 | ||||||||||||||||||||||||||||||
Recorded Investment in Loan Receivables (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||
31-Dec-14 | Loan Receivable | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | |||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 67,181 | $ | 17,958 | $ | 49,223 | ||||||||||||||||||||||||||||||||||||||
Farmland | 12,507 | - | 12,507 | |||||||||||||||||||||||||||||||||||||||||
Real Estate | 162,249 | 1,067 | 161,182 | |||||||||||||||||||||||||||||||||||||||||
Multi-Family | 11,775 | - | 11,775 | |||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 122,305 | 2,097 | 120,208 | |||||||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 9,394 | - | 9,394 | |||||||||||||||||||||||||||||||||||||||||
Home Equity –open end | 52,182 | 1,649 | 50,533 | |||||||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 28,161 | 191 | 27,970 | |||||||||||||||||||||||||||||||||||||||||
Consumer | 9,110 | - | 9,110 | |||||||||||||||||||||||||||||||||||||||||
Dealer Finance | 40,633 | 40,633 | ||||||||||||||||||||||||||||||||||||||||||
Credit Cards | 2,705 | - | 2,705 | |||||||||||||||||||||||||||||||||||||||||
$ | 518,202 | $ | 22,962 | $ | 495,240 | |||||||||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||||||||||||||
31-Dec-13 | Loan Receivable | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | |||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 68,512 | $ | 12,251 | $ | 56,261 | ||||||||||||||||||||||||||||||||||||||
Farmland | 13,197 | 1,459 | 11,738 | |||||||||||||||||||||||||||||||||||||||||
Real Estate | 154,628 | 1,194 | 153,434 | |||||||||||||||||||||||||||||||||||||||||
Multi-Family | 11,797 | - | 11,797 | |||||||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 113,415 | 1,669 | 111,746 | |||||||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 10,228 | 488 | 9,740 | |||||||||||||||||||||||||||||||||||||||||
Home Equity –open end | 47,358 | 100 | 47,258 | |||||||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 25,903 | 242 | 25,661 | |||||||||||||||||||||||||||||||||||||||||
Consumer | 10,163 | 2 | 10,161 | |||||||||||||||||||||||||||||||||||||||||
Dealer Finance | 20,572 | 20,572 | ||||||||||||||||||||||||||||||||||||||||||
Credit Cards | 2,680 | - | 2,680 | |||||||||||||||||||||||||||||||||||||||||
$ | 478,453 | $ | 17,405 | $ | 461,048 | |||||||||||||||||||||||||||||||||||||||
Total | ||||||||||||||||||||||||||||||||||||||||||||
Aging of Past Due Loans Receivable (in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
30-59 Days Past due | 60-89 Days Past Due | Greater than 90 Days (excluding non-accrual) | Non-Accrual Loans | Total Past Due | Current | Total Loan Receivable | ||||||||||||||||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 205 | $ | 166 | $ | - | $ | 4,508 | $ | 4,879 | $ | 62,302 | $ | 67,181 | ||||||||||||||||||||||||||||||
Farmland | - | - | - | - | - | 12,507 | 12,507 | |||||||||||||||||||||||||||||||||||||
Real Estate | 5,085 | 635 | - | 973 | 6,693 | 155,556 | 162,249 | |||||||||||||||||||||||||||||||||||||
Multi-Family | - | - | - | - | - | 11,775 | 11,775 | |||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 747 | - | - | 1,165 | 1,912 | 120,393 | 122,305 | |||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 162 | 15 | - | 10 | 187 | 9,207 | 9,394 | |||||||||||||||||||||||||||||||||||||
Home Equity – open end | 730 | 25 | - | 143 | 898 | 51,284 | 52,182 | |||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non- Real Estate | - | - | - | 14 | 14 | 28,147 | 28,161 | |||||||||||||||||||||||||||||||||||||
Consumer | 290 | 9 | - | - | 299 | 8,811 | 9,110 | |||||||||||||||||||||||||||||||||||||
Dealer Finance | 696 | 189 | - | 161 | 1,046 | 39,587 | 40,633 | |||||||||||||||||||||||||||||||||||||
Credit Cards | 36 | - | 1 | - | 37 | 2,668 | 2,705 | |||||||||||||||||||||||||||||||||||||
Total | $ | 7,951 | $ | 1,039 | $ | 1 | $ | 6,974 | $ | 15,965 | $ | 502,237 | $ | 518,202 | ||||||||||||||||||||||||||||||
30-59 Days Past due | 60-89 Days Past Due | Greater than 90 Days (excluding non-accrual) | Non-Accrual Loans | Total Past Due | Current | Total Loan Receivable | ||||||||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 167 | $ | 735 | $ | - | $ | 8,556 | $ | 9,458 | $ | 59,054 | $ | 68,512 | ||||||||||||||||||||||||||||||
Farmland | - | - | - | - | - | 13,197 | 13,197 | |||||||||||||||||||||||||||||||||||||
Real Estate | 4,659 | 920 | 246 | 1,407 | 7,232 | 147,396 | 154,628 | |||||||||||||||||||||||||||||||||||||
Multi-Family | 107 | - | - | - | 107 | 11,690 | 11,797 | |||||||||||||||||||||||||||||||||||||
Commercial Real Estate | 858 | - | - | 1,474 | 2,332 | 111,083 | 113,415 | |||||||||||||||||||||||||||||||||||||
Home Equity – closed end | 122 | 79 | 10 | 180 | 391 | 9,837 | 10,228 | |||||||||||||||||||||||||||||||||||||
Home Equity – open end | 549 | 39 | 51 | 222 | 861 | 46,497 | 47,358 | |||||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non- Real Estate | 148 | 20 | 4 | 416 | 588 | 25,315 | 25,903 | |||||||||||||||||||||||||||||||||||||
Consumer | 169 | 71 | 5 | - | 245 | 9,918 | 10,163 | |||||||||||||||||||||||||||||||||||||
Dealer Finance | 335 | 72 | 11 | - | 418 | 20,154 | 20,572 | |||||||||||||||||||||||||||||||||||||
Credit Cards | 21 | 3 | - | - | 24 | 2,656 | 2,680 | |||||||||||||||||||||||||||||||||||||
Total | $ | 7,135 | $ | 1,939 | $ | 327 | $ | 12,255 | $ | 21,656 | $ | 456,797 | $ | 478,453 | ||||||||||||||||||||||||||||||
CREDIT QUALITY INDICATORS (in thousands) | ||||||||||||||||||||||||||||||||||||||||||||
AS OF DECEMBER 31, 2014 | ||||||||||||||||||||||||||||||||||||||||||||
Corporate Credit Exposure | ||||||||||||||||||||||||||||||||||||||||||||
Credit Risk Profile by Creditworthiness Category | ||||||||||||||||||||||||||||||||||||||||||||
Grade 1 Minimal Risk | Grade 2 Modest Risk | Grade 3 Average Risk | Grade 4 Acceptable Risk | Grade 5 Marginally Acceptable | Grade 6 Watch | Grade 7 Substandard | Grade 8 Doubtful | Total | ||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | - | $ | 165 | $ | 8,460 | $ | 24,227 | $ | 9,605 | $ | 3,815 | $ | 20,909 | $ | - | $ | 67,181 | ||||||||||||||||||||||||||
Farmland | 68 | - | 1,640 | 3,451 | 5,228 | - | 2,120 | - | 12,507 | |||||||||||||||||||||||||||||||||||
Real Estate | - | 629 | 60,290 | 66,464 | 23,934 | 7,083 | 3,849 | - | 162,249 | |||||||||||||||||||||||||||||||||||
Multi-Family | - | 468 | 4,145 | 2,183 | 4,979 | - | - | - | 11,775 | |||||||||||||||||||||||||||||||||||
Commercial Real Estate | - | 1,687 | 22,800 | 65,653 | 19,058 | 10,571 | 2,536 | - | 122,305 | |||||||||||||||||||||||||||||||||||
Home Equity – closed end | - | - | 4,327 | 3,090 | 1,812 | 154 | 11 | - | 9,394 | |||||||||||||||||||||||||||||||||||
Home Equity – open end | - | 1,555 | 13,433 | 28,425 | 4,309 | 1,936 | 2,524 | - | 52,182 | |||||||||||||||||||||||||||||||||||
Commercial & Industrial (Non-Real Estate) | 643 | 74 | 4,692 | 18,039 | 3,948 | 735 | 30 | - | 28,161 | |||||||||||||||||||||||||||||||||||
Total | $ | 711 | $ | 4,578 | $ | 119,787 | $ | 211,532 | $ | 72,873 | $ | 24,294 | $ | 31,979 | $ | - | $ | 465.754 | ||||||||||||||||||||||||||
Consumer Credit Exposure | ||||||||||||||||||||||||||||||||||||||||||||
Credit Risk Profile Based on Payment Activity | ||||||||||||||||||||||||||||||||||||||||||||
Credit Cards | Consumer | |||||||||||||||||||||||||||||||||||||||||||
Performing | $ | 2,704 | $ | 49,582 | ||||||||||||||||||||||||||||||||||||||||
Non performing | 1 | 161 | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 2,705 | $ | 49,743 | ||||||||||||||||||||||||||||||||||||||||
AS OF DECEMBER 31, 2013 | ||||||||||||||||||||||||||||||||||||||||||||
Corporate Credit Exposure | ||||||||||||||||||||||||||||||||||||||||||||
Credit Risk Profile by Creditworthiness Category | ||||||||||||||||||||||||||||||||||||||||||||
Grade 1 Minimal Risk | Grade 2 Modest Risk | Grade 3 Average Risk | Grade 4 Acceptable Risk | Grade 5 Marginally Acceptable | Grade 6 Watch | Grade 7 Substandard | Grade 8 Doubtful | Total | ||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | - | $ | - | $ | 3,166 | $ | 25,657 | $ | 11,116 | $ | 2,946 | $ | 25,627 | $ | - | $ | 68,512 | ||||||||||||||||||||||||||
Farmland | 69 | - | 1,406 | 5,206 | 4,816 | 143 | 1,557 | - | 13,197 | |||||||||||||||||||||||||||||||||||
Real Estate | - | 562 | 68,241 | 52,190 | 19,037 | 7,821 | 6,777 | - | 154,628 | |||||||||||||||||||||||||||||||||||
Multi-Family | - | 668 | 4,442 | 2,275 | 4,412 | - | - | - | 11,797 | |||||||||||||||||||||||||||||||||||
Commercial Real Estate | - | 1,897 | 18,062 | 55,350 | 21,677 | 13,406 | 3,023 | - | 113,415 | |||||||||||||||||||||||||||||||||||
Home Equity – closed end | - | - | 4,574 | 3,117 | 1,870 | 281 | 386 | - | 10,228 | |||||||||||||||||||||||||||||||||||
Home Equity – open end | - | 1,482 | 13,308 | 26,734 | 4,840 | 327 | 667 | - | 47,358 | |||||||||||||||||||||||||||||||||||
Commercial & Industrial (Non-Real Estate) | 815 | 92 | 3,631 | 16,265 | 3,108 | 1,516 | 476 | - | 25,903 | |||||||||||||||||||||||||||||||||||
Total | $ | 884 | $ | 4,701 | $ | 116,830 | $ | 186,794 | $ | 70,876 | $ | 26,440 | $ | 38,513 | $ | - | $ | 445,038 | ||||||||||||||||||||||||||
Consumer Credit Exposure | ||||||||||||||||||||||||||||||||||||||||||||
Credit Risk Profile Based on Payment Activity | ||||||||||||||||||||||||||||||||||||||||||||
Credit Cards | Consumer | |||||||||||||||||||||||||||||||||||||||||||
Performing | $ | 2,680 | $ | 30,719 | ||||||||||||||||||||||||||||||||||||||||
Non performing | - | 16 | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 2,680 | $ | 30,735 | ||||||||||||||||||||||||||||||||||||||||
Description of loan grades: | ||||||||||||||||||||||||||||||||||||||||||||
Grade 1 – Minimal Risk: Excellent credit, superior asset quality, excellent debt capacity and coverage, and recognized management capabilities. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 2 – Modest Risk: Borrower consistently generates sufficient cash flow to fund debt service, excellent credit, above average asset quality and liquidity. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 3 – Average Risk: Borrower generates sufficient cash flow to fund debt service. Employment (or business) is stable with good future trends. Credit is very good. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 4 – Acceptable Risk: Borrower’s cash flow is adequate to cover debt service; however, unusual expenses or capital expenses must by covered through additional long term debt. Employment (or business) stability is reasonable, but future trends may exhibit slight weakness. Credit history is good. No unpaid judgments or collection items appearing on credit report. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 5 – Marginally acceptable: Credit to borrowers who may exhibit declining earnings, may have leverage that is materially above industry averages, liquidity may be marginally acceptable. Employment or business stability may be weak or deteriorating. May be currently performing as agreed, but would be adversely affected by developing factors such as layoffs, illness, reduced hours or declining business prospects. Credit history shows weaknesses, past dues, paid or disputed collections and judgments, but does not include borrowers that are currently past due on obligations or with unpaid, undisputed judgments. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 6 – Watch: Loans are currently protected, but are weak due to negative balance sheet or income statement trends. There may be a lack of effective control over collateral or the existence of documentation deficiencies. These loans have potential weaknesses that deserve management’s close attention. Other reasons supporting this classification include adverse economic or market conditions, pending litigation or any other material weakness. Existing loans that become 60 or more days past due are placed in this category pending a return to current status. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 7 – Substandard: Loans having well-defined weaknesses where a payment default and or loss is possible, but not yet probable. Cash flow is inadequate to service the debt under the current payment, or terms, with prospects that the condition is permanent. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the borrower and there is the likelihood that collateral will have to be liquidated and/or guarantor(s) called upon to repay the debt. Generally, the loan is considered collectible as to both principal and interest, primarily because of collateral coverage, however, if the deficiencies are not corrected quickly; there is a probability of loss. | ||||||||||||||||||||||||||||||||||||||||||||
Grade 8 – Doubtful: The loan has all the characteristics of a substandard credit, but available information indicates it is unlikely the loan will be repaid in its entirety. Cash flow is insufficient to service the debt. It may be difficult to project the exact amount of loss, but the probability of some loss is great. Loans are to be placed on non-accrual status when any portion is classified doubtful. |
TROUBLED_DEBT_RESTRUCTURING
TROUBLED DEBT RESTRUCTURING | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
NOTE 7. TROUBLED DEBT RESTRUCTURING | In the determination of the allowance for loan losses, management considers troubled debt restructurings and subsequent defaults in these restructurings by adjusting the loan grades of such loans, which figure into the environmental factors associated with the allowance. Defaults resulting in charge-offs affect the historical loss experience ratios which are a component of the allowance calculation. Additionally, specific reserves may be established on restructured loans evaluated individually. | ||||||||||||
During the twelve months ended December 31, 2014, the Bank modified 3 loans that were considered to be troubled debt restructurings. These modifications include rate adjustments, revisions to amortization schedules, suspension of principal payments for a temporary period, re-advancing funds to be applied as payments to bring the loan(s) current, or any combination thereof. | |||||||||||||
31-Dec-14 | |||||||||||||
Pre-Modification | Post-Modification | ||||||||||||
(in thousands) | Outstanding | Outstanding | |||||||||||
Number of Contracts | Recorded Investment | Recorded Investment | |||||||||||
Troubled Debt Restructurings | |||||||||||||
Real Estate | 2 | $ | 179 | $ | 179 | ||||||||
Consumer | 1 | 22 | 22 | ||||||||||
$ | 201 | $ | 201 | ||||||||||
As of December 31, 2014, there was one loans restructured in the previous twelve months, in default. This was a real estate loan of $97,000. A restructured loan is considered in default when it becomes 90 days past due. | |||||||||||||
During the twelve months ended December 31, 2013, the Bank modified 4 loans that were considered to be troubled debt restructurings. These modifications include rate adjustments, revisions to amortization schedules, suspension of principal payments for a temporary period, re-advancing funds to be applied as payments to bring the loan(s) current, or any combination thereof. | |||||||||||||
31-Dec-13 | |||||||||||||
Pre-Modification | Post-Modification | ||||||||||||
(in thousands) | Outstanding | Outstanding | |||||||||||
Number of Contracts | Recorded Investment | Recorded Investment | |||||||||||
Troubled Debt Restructurings | |||||||||||||
Construction/Land Development | 1 | $ | 937 | $ | 937 | ||||||||
Real Estate | 1 | 50 | 50 | ||||||||||
Commercial Real Estate | 1 | 312 | 312 | ||||||||||
Commercial & Industrial – Non- Real Estate | 1 | 201 | 201 | ||||||||||
$ | 1,500 | $ | 1,500 | ||||||||||
As of December 31, 2013, there were no loans restructured in the previous twelve months, in default. A restructured loan is considered in default when it becomes 90 days past due. |
BANK_PREMISES_AND_EQUIPMENT
BANK PREMISES AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
NOTE 8. BANK PREMISES AND EQUIPMENT | Bank premises and equipment as of December 31 are summarized as follows: | ||||||||
2014 | 2013 | ||||||||
Land | $ | 1,418,003 | $ | 1,418,003 | |||||
Buildings and improvements | 6,793,644 | 6,771,867 | |||||||
Furniture and equipment | 6,479,815 | 5,963,779 | |||||||
14,691,462 | 14,153,649 | ||||||||
Less - accumulated depreciation | (8,233,208 | ) | (7,628,592 | ) | |||||
Net | $ | 6,458,254 | $ | 6,525,057 | |||||
Provisions for depreciation of $612,116 in 2014, $581,625 in 2013, and $597,920 in 2012 were charged to operations. |
OTHER_REAL_ESTATE_OWNED
OTHER REAL ESTATE OWNED | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
NOTE 9. OTHER REAL ESTATE OWNED | The tables below reflect OREO activity for 2014 and 2013: | ||||||||
Other Real Estate Owned | |||||||||
2014 | 2013 | ||||||||
Balance beginning of year | $ | 2,628,418 | $ | 2,883,947 | |||||
Property acquired at foreclosure | 2,914,958 | 1,337,890 | |||||||
Capital improvements on foreclosed property | 48,961 | 11,329 | |||||||
Sale of other real estate owned financed by Bank | (780,097 | ) | (569,245 | ) | |||||
Sales of foreclosed properties | (1,029,452 | ) | (964,149 | ) | |||||
Valuation adjustments | (275,635 | ) | (71,354 | ) | |||||
Balance as of December 31 | $ | 3,507,153 | $ | 2,628,418 |
DEPOSITS
DEPOSITS | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Banking and Thrift [Abstract] | |||||||||
NOTE 10. DEPOSITS | The composition of deposits at December 31, 2014 and 2013 was as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Noninterest bearing demand deposits | $ | 112,197,722 | $ | 92,396,921 | |||||
Savings and interest bearing demand deposits: | |||||||||
Interest checking accounts | 119,593,529 | 117,456,275 | |||||||
Savings accounts | 64,249,199 | 58,292,273 | |||||||
Time Deposits: | |||||||||
Balances of less than $100,000 | 115,651,329 | 126,330,053 | |||||||
Balances of $100,000 and more | 79,812,757 | 69,673,722 | |||||||
Total Deposits | $ | 491,504,536 | $ | 464,149,244 | |||||
At December 31, 2014, the scheduled maturities of time deposits are as follows: | |||||||||
2015 | $ | 92,047,350 | |||||||
2016 | 58,857,584 | ||||||||
2017 | 16,213,687 | ||||||||
2018 | 15,150,944 | ||||||||
2019 and after | 13,194,521 | ||||||||
Total | $ | 195,464,086 |
SHORTTERM_DEBT
SHORT-TERM DEBT | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||
NOTE 11. SHORT-TERM DEBT | Short-term debt information is summarized as follows: | ||||||||||||||||||||
Maximum | Weighted | ||||||||||||||||||||
Outstanding | Outstanding | Average | Average | Year End | |||||||||||||||||
at any | at | Balance | Interest | Interest | |||||||||||||||||
Month End | Year End | Outstanding | Rate | Rate | |||||||||||||||||
2014 | |||||||||||||||||||||
Federal funds purchased | $ | 491,000 | $ | - | $ | 7,704 | 0.001 | % | 0.61 | % | |||||||||||
FHLB short term | 10,000 ,000 | 10,000,000 | 27,397 | 0.001 | % | 0.17 | % | ||||||||||||||
Securities sold under agreements to repurchase | 5,066,238 | 4,358,492 | 3,837,612 | 0.23 | % | 0.24 | % | ||||||||||||||
Totals | $ | 14,358,492 | $ | 3,872,713 | 0.23 | % | 0.23 | % | |||||||||||||
2013 | |||||||||||||||||||||
Federal funds purchased | $ | - | $ | - | $ | 42,838 | 0.01 | % | 0.97 | % | |||||||||||
FHLB short term | 17,500,000 | - | 2,938,356 | 0.23 | % | 0.49 | % | ||||||||||||||
Securities sold under agreements to repurchase | 3,522,999 | 3,423,078 | 3,190,186 | 0.14 | % | 0.28 | % | ||||||||||||||
Totals | $ | 3,423,078 | $ | 6,171,380 | 0.38 | % | 0.39 | % | |||||||||||||
2012 | |||||||||||||||||||||
Federal funds purchased | $ | 9,283,000 | $ | 9,283,000 | $ | 776,617 | 0.51 | % | 0.9 | % | |||||||||||
FHLB short term | 32,500,000 | 22,500,000 | 8,088,798 | 0.46 | % | 0.37 | % | ||||||||||||||
Securities sold under agreements to repurchase | 4,773,045 | 2,814,352 | 3,949,934 | 0.35 | % | 0.38 | % | ||||||||||||||
Totals | $ | 34,597,352 | $ | 12,815,349 | 0.41 | % | 0.41 | % | |||||||||||||
Repurchase agreements are secured transactions with customers and generally mature the day following the date sold. Federal funds purchased are unsecured overnight borrowings from other financial institutions. FHLB daily rate credit, which is secured by the loan portfolio, is a variable rate loan that acts as a line of credit to meet financing needs. | |||||||||||||||||||||
As of December 31, 2014, the Company had unsecured lines of credit with correspondent banks totaling $26,000,000, which may be used in the management of short-term liquidity. |
LONGTERM_DEBT
LONG-TERM DEBT | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Debt Disclosure [Abstract] | |||||
NOTE 12. LONG-TERM DEBT | The Company borrowed $10,000,000 from the Federal Home Loan Bank of Atlanta (FHLB) in 2014 to fund loan growth and extend maturities at lower rates. There were no new borrowings from FHLB in 2013 and 2012. The interest rates on the notes payable are fixed at the time of the advance and range from 2.00% to 2.56%; the weighted average interest rate was 2.33% and 3.37% at December 31, 2014 and 2013, respectively. The balance of these obligations at December 31, 2014 and December 31, 2013 were $9,875,000 and $11,500,000, respectively. The long-term debt is secured by qualifying mortgage loans owned by the Company. | ||||
In August 2009, the Company began to issue Subordinated debt agreements with local investors bearing terms of seven to ten years. Interest rates are fixed on the notes for the full term but vary by maturity. Rates range from 7.0% on the seven year note to 8.05% on the ten year note. As of December 31, 2014 all of the subordinated debt agreements had been redeemed and/or converted to Preferred stock. The balance outstanding as of December 31, 2013 was $10,191,000. Due to their terms (greater than five years) and priority (subordinate to deposits and other borrowings) this debt was counted with capital for purposes of calculating the Total Risk Based Capital Ratio. All of the subordinated debt agreements were either redeemed or converted to Preferred stock in December 2014. | |||||
The maturities of long-term Federal Home Loan Bank borrowings as of December 31, 2014 are as follows: | |||||
2015 | $ | 500,000 | |||
2016 | 500,000 | ||||
2017 | 500,000 | ||||
2018 | 500,000 | ||||
Thereafter | 7,875,000 | ||||
Total | $ | 9,875,000 |
INCOME_TAX_EXPENSE
INCOME TAX EXPENSE | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
NOTE 13. INCOME TAX EXPENSE | The components of the income tax expense are as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Current expense | |||||||||||||
Federal | $ | 2,385,958 | $ | 1,338,439 | $ | 2,590,130 | |||||||
Deferred (benefit) expense | |||||||||||||
Federal | 505,684 | 636,452 | (412,621 | ) | |||||||||
State | 9,854 | (67,594 | ) | (82,112 | ) | ||||||||
Total Deferred (benefit) expense | 515,538 | 568,858 | (494,733 | ) | |||||||||
Total Income Tax Expense | $ | 2,901,496 | $ | 1,907,297 | $ | 2,095,397 | |||||||
The components of the deferred taxes as of December 31 are as follows: | |||||||||||||
Deferred Tax Assets: | 2014 | 2013 | |||||||||||
Allowance for loan losses | $ | 2,201,291 | $ | 1,788,360 | |||||||||
Split Dollar Life Insurance | 4,440 | 4,440 | |||||||||||
Nonqualified deferred compensation | 594,132 | 527,909 | |||||||||||
Low income housing partnerships losses | 308,539 | - | |||||||||||
Securities impairment | - | 532,211 | |||||||||||
Core deposit amortization | 72,188 | 298,019 | |||||||||||
State historic tax credits | - | 26,432 | |||||||||||
Other real estate owned | 3,746 | 3,746 | |||||||||||
Pension plan | 1,199,686 | 470,091 | |||||||||||
Total Assets | $ | 4,384,022 | $ | 3,651,208 | |||||||||
Deferred Tax Liabilities: | 2014 | 2013 | |||||||||||
Unearned low income housing credits | $ | 523,769 | $ | 661,841 | |||||||||
Depreciation | 320,743 | 363,946 | |||||||||||
Pension | 1,864,964 | 1,423,461 | |||||||||||
Goodwill tax amortization | 853,880 | 791,771 | |||||||||||
Securities available for sale | 1,272 | (6,339 | ) | ||||||||||
Other | - | (74,926 | ) | ||||||||||
Total Liabilities | 3,564,628 | 3,159,754 | |||||||||||
Net Deferred Tax Asset (included in Other Assets on Balance Sheet) | $ | 819,394 | $ | 491,454 | |||||||||
The following table summarizes the differences between the actual income tax expense and the amounts computed using the federal statutory tax rates: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Tax expense at federal statutory rates | $ | 2,959,056 | $ | 2,251,851 | $ | 2,378,804 | |||||||
Increases (decreases) in taxes resulting from: | |||||||||||||
State income taxes, net | 8,659 | 9,229 | 6,132 | ||||||||||
Partially exempt income | (54,529 | ) | (44,676 | ) | (49,828 | ) | |||||||
Tax-exempt income | (190,192 | ) | (197,482 | ) | (188,932 | ) | |||||||
Prior year LIH credits | (21,787 | ) | (61,768 | ) | 97,857 | ||||||||
Deferred Tax Asset Valuation Allowance | 396,440 | - | - | ||||||||||
Other | (196,151 | ) | (49,857 | ) | (148,636 | ) | |||||||
Total Income Tax Expense | $ | 2,901,496 | $ | 1,907,297 | $ | 2,095,397 | |||||||
Management evaluated the likelihood of recognizing the Company’s deferred tax asset. Based on the evidence supporting this asset, it was decided to record a partial valuation allowance against the asset on the Company’s books in the amount of $781,936 and $385,496 for the years ended 2014 and 2013. A deferred tax asset is created from the difference between book income using Generally Accepted Accounting Principles and taxable income. | |||||||||||||
The Corporation 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 accounting guidance related to income taxes. | |||||||||||||
The Corporation and its subsidiaries file federal income tax returns and state income tax returns. With few exceptions, the Corporation is no longer subject to federal or state income tax examinations by tax authorities for years before 2011. |
EMPLOYEE_BENEFITS
EMPLOYEE BENEFITS | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
NOTE 14. EMPLOYEE BENEFITS | The Bank has a qualified noncontributory defined benefit pension plan which covers substantially all of its employees. The benefits are primarily based on years of service and earnings. | ||||||||||||
The following table provides a reconciliation of the changes in the benefit obligations and fair value of plan assets for 2014, 2013 and 2012: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Change in Benefit Obligation | |||||||||||||
Benefit obligation, beginning | $ | 7,933,568 | $ | 8,931,940 | $ | 7,296,932 | |||||||
Service cost | 501,032 | 599,933 | 518,634 | ||||||||||
Interest cost | 377,706 | 350,314 | 327,924 | ||||||||||
Actuarial gain (loss) | 2,030,583 | (1,300,094 | ) | 1,066,019 | |||||||||
Benefits paid | (65,474 | ) | (648,525 | ) | (277,569 | ) | |||||||
Benefit obligation, ending | $ | 10,777,415 | $ | 7,933,568 | $ | 8,931,940 | |||||||
Change in Plan Assets | |||||||||||||
Fair value of plan assets, beginning | $ | 9,687,226 | $ | 8,123,437 | $ | 6,760,513 | |||||||
Actual return on plan assets | 562,093 | 1,462,314 | 890,493 | ||||||||||
Employer contribution | 1,500,000 | 750,000 | 750,000 | ||||||||||
Benefits paid | (65,474 | ) | (648,525 | ) | (277,569 | ) | |||||||
Fair value of plan assets, ending | 11,683,845 | 9,687,226 | 8,123,437 | ||||||||||
Funded status at the end of the year | $ | 906,430 | $ | 1,753,658 | $ | (808,503 | ) | ||||||
The fair value of plan assets is measured based on the fair value hierarchy as discussed in Note 21, “Fair Value Measurements” to the Consolidated Financial Statements. The valuations are based on third party data received as of the balance sheet date. All plan assets are considered Level 1 assets, as quoted prices exist in active markets for identical assets. | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Amount recognized in the Balance Sheet | |||||||||||||
Accrued prepaid benefit cost | $ | 4,434,917 | $ | 3,136,277 | $ | 2,888,390 | |||||||
Unfunded pension benefit obligation under ASC 325-960 | (3,528,487 | ) | (1,382,619 | ) | (3,696,893 | ) | |||||||
Amount recognized in accumulated other | |||||||||||||
comprehensive income | |||||||||||||
Net Gain/(Loss) | $ | (3,616,087 | ) | $ | (1,485,455 | ) | $ | (3,814,965 | ) | ||||
Prior service cost | 87,600 | 102,836 | 118,072 | ||||||||||
Net obligation at transition | - | - | - | ||||||||||
Amount recognized | (3,528,487 | ) | (1,382,619 | ) | (3,696,893 | ) | |||||||
Deferred Taxes | 1,199,686 | 470,090 | 1,256,944 | ||||||||||
Amount recognized in accumulated | |||||||||||||
comprehensive income | $ | (2,328,801 | ) | $ | (912,529 | ) | $ | (2,439,949 | ) | ||||
(Accrued) Prepaid benefit detail | |||||||||||||
Benefit obligation | $ | (10,777,415 | ) | $ | (7,933,568 | ) | $ | (8,931,940 | ) | ||||
Fair value of assets | 11,683,845 | 9,687,226 | 8,123,437 | ||||||||||
Unrecognized net actuarial loss | 3,616,087 | 1,485,455 | 3,814,965 | ||||||||||
Unrecognized transition obligation | |||||||||||||
Unrecognized prior service cost | (87,600 | ) | (102,836 | ) | (118,072 | ) | |||||||
Prepaid (accrued) benefits | $ | 4,434,917 | $ | 3,136,277 | $ | 2,888,390 | |||||||
Components of net periodic benefit cost | |||||||||||||
Service cost | $ | 501,032 | $ | 599,933 | $ | 518,634 | |||||||
Interest cost | 377,706 | 350,314 | 327,924 | ||||||||||
Expected return on plan assets | (698,252 | ) | (636,081 | ) | (540,069 | ) | |||||||
Amortization of prior service cost | (15,236 | ) | (15,236 | ) | (15,236 | ) | |||||||
Amortization of transition obligation | |||||||||||||
Recognized net actuarial (gain) loss | 36,110 | 203,183 | 173,222 | ||||||||||
Net periodic benefit cost | $ | 201,360 | $ | 502,113 | $ | 464,475 | |||||||
Additional disclosure information | |||||||||||||
Accumulated benefit obligation | $ | 7,543,340 | $ | 5,474,048 | $ | 6,214,325 | |||||||
Vested benefit obligation | $ | 7,408,014 | $ | 5,388,808 | $ | 6,087,194 | |||||||
Discount rate used for net pension cost | 5 | % | 4 | % | 4.5 | % | |||||||
Discount rate used for disclosure | 4 | % | 5 | % | 4 | % | |||||||
Expected return on plan assets | 7.5 | % | 8 | % | 8 | % | |||||||
Rate of compensation increase | 3 | % | 3 | % | 3 | % | |||||||
Average remaining service (years) | 14 | 14 | 14 | ||||||||||
Funding Policy | |||||||||||||
It is the Bank’s policy to contribute at least the annual pension cost each year as determined by the plan administrator. In some years the Bank will contribute additional amounts up to the maximum tax deductible amount depending on a variety of factors including liquidity and expected return on plan assets. The Company’s contributions for 2014, 2013 and 2012 were $1,500,000, $750,000, and $750,000, respectively. Based on current information, the 2015 contribution will be $750,000 and pension cost for 2015 will be approximately $386,000. | |||||||||||||
Long-Term Rate of Return | |||||||||||||
The plan sponsor selects the expected long-term rate of return on assets assumption in consultation with their advisors and the plan actuary, and with concurrence from their auditor. This rate is intended to reflect the average rate of earnings expected to be earned on the funds invested or to be invested to provide plan benefits. Historical performance is reviewed, especially with respect to real rates of return (net of inflation) for the major asset classes held or anticipated to be held by the trust. Undue weight is not given to recent experience, which may not continue over the measurement period, with higher significance placed on current forecasts of future long-term economic conditions. | |||||||||||||
Because assets are held in a qualified trust, anticipated returns are not reduced for taxes. Further – solely for this purpose the plan is assumed to continue in force and not terminate during the period during which the assets are invested. However, consideration is given to the potential impact of current and future investment policy, cash flow into and out of the trust, and expenses (both investment and non-investment) typically paid from plan assets (to the extent such expenses are not explicitly estimated within periodic cost). | |||||||||||||
Asset Allocation | |||||||||||||
The following table provides the pension plan’s asset allocation as of December 31: | |||||||||||||
2014 | 2013 | ||||||||||||
Mutual funds - equity | 61 | % | 62 | % | |||||||||
Mutual funds –fixed income | 39 | % | 38 | % | |||||||||
Cash and equivalents | 0 | % | 0 | % | |||||||||
The trust fund is sufficiently diversified to maintain a reasonable level of risk without imprudently sacrificing return, with a targeted asset allocation of 40% fixed income and 60% equity. The Investment Manager selects investment fund managers with demonstrated experience and expertise, and funds with demonstrated historical performance, for the implementation of the Plan’s investment strategy. The Investment Manager will consider both actively and passively managed investment strategies and will allocate funds across the asset classes to develop an efficient investment structure. | |||||||||||||
Estimated Future Benefit Payments | |||||||||||||
2015 | $ | 1,017,602 | |||||||||||
2016 | 148,021 | ||||||||||||
2017 | 65,614 | ||||||||||||
2018 | 1,234,133 | ||||||||||||
2019 | 681,525 | ||||||||||||
2020-2024 | 4,526,371 | ||||||||||||
$ | 7,673,266 | ||||||||||||
Employee Stock Ownership Plan (ESOP) | |||||||||||||
The Company sponsors an ESOP which provides stock ownership to substantially all employees of the Bank. The Plan provides total vesting upon the attainment of five years of service. Contributions to the plan are made at the discretion of the Board of Directors and are allocated based on the compensation of each employee relative to total compensation paid by the Bank. All shares issued and held by the Plan are considered outstanding in the computation of earnings per share. Dividends on Company stock are allocated and paid to participants at least annually. Shares of Company stock, when distributed, have restrictions on transferability. The Company contributed $360,000 in 2014, $360,000 in 2013, and $270,000 in 2012 to the Plan and charged this expense to operations. The shares held by the ESOP totaled 188,396 and 176,485 at December 31, 2014 and 2013, respectively. | |||||||||||||
401K Plan | |||||||||||||
The Company sponsors a 401(k) savings plan under which eligible employees may choose to save up to 20 percent of their salary on a pretax basis, subject to certain IRS limits. Under the Safe Harbor rules employees are automatically enrolled at 3% (in the third year this increases by 1% per year up to 6%) of their salary unless elected otherwise. The Company matches a hundred percent of the first 1% contributed by the employee and fifty percent from 2% to 6% of employee contributions. Vesting in the contributions made by the Company is 100% after two years of service. Contributions under the plan amounted to $190,057, $183,468 and $165,724 in 2014, 2013 and 2012, respectively. | |||||||||||||
Deferred Compensation Plan | |||||||||||||
The Company has a nonqualified deferred compensation plan for several of its key employees and directors. The Company may make annual contributions to the plan, and the employee or director has the option to defer a portion of their salary or bonus based on qualifying annual elections. Contributions to the plan totaled $100,000 in 2014, $90,000 in 2013 and $85,000 in 2012. |
CONCENTRATIONS_OF_CREDIT
CONCENTRATIONS OF CREDIT | 12 Months Ended |
Dec. 31, 2014 | |
Fair Value Disclosures [Abstract] | |
NOTE 15. CONCENTRATIONS OF CREDIT | The Company had cash deposits in other commercial banks totaling $1,731,223 and $1,512,428 at December 31, 2014 and 2013, respectively. |
The Company grants commercial, residential real estate and consumer loans to customers located primarily in the northwestern portion of the State of Virginia. Loan concentration areas greater than 25% of capital include land development. Collateral required by the Company is determined on an individual basis depending on the purpose of the loan and the financial condition of the borrower. Approximately 84% of the loan portfolio is secured by real estate. |
COMMITMENTS
COMMITMENTS | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||
NOTE 16. COMMITMENTS | The Company makes commitments to extend credit in the normal course of business and issues standby letters of credit to meet the financing needs of its customers. The amount of the commitments represents the Company's exposure to credit loss that is not included in the balance sheet. As of the balance sheet dates, the Company had the following commitments outstanding: | ||||||||
2014 | 2013 | ||||||||
Commitments to loan money | $ | 120,922,771 | $ | 103,782,380 | |||||
Standby letters of credit | 2,077,870 | 985,331 | |||||||
The Company uses the same credit policies in making commitments to lend money and issue standby letters of credit as it does for the loans reflected in the balance sheet. | |||||||||
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. The Company evaluates each customer's creditworthiness on a case-by-case basis. Collateral required, if any, upon extension of credit is based on management's credit evaluation of the borrower’s ability to pay. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment. | |||||||||
The Bank leases three of its branch offices, both of its loan production offices and a future branch site under long term lease arrangements which had initial terms of either three, five or ten years. Lease expense was $120,728, $121,025 and $95,558 for 2014, 2013 and 2012, respectively. As of December 31, 2014, the required lease payments for the next five years are as follows: | |||||||||
2015 | $ | 135,909 | |||||||
2016 | 79,762 | ||||||||
2017 | 56,791 | ||||||||
2018 | 44,359 | ||||||||
2019 | 45,468 |
ON_BALANCE_SHEET_DERIVATIVE_IN
ON BALANCE SHEET DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
NOTE 17. ON BALANCE SHEET DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | Derivative Financial Instruments | ||||||||
The Company has stand alone derivative financial instruments in the form of forward option contracts. These transactions involve both credit and market risk. The notional amounts are amounts on which calculations, payments, and the value of the derivative are based. Notional amounts do not represent direct credit exposures. Direct credit exposure is limited to the net difference between the calculated amounts to be received and paid, if any. Such difference, which represents the fair value of the derivative instruments, is reflected on the Company’s balance sheet as derivative assets and derivative liabilities. | |||||||||
The Company is exposed to credit-related losses in the event of nonperformance by the counterparties to these agreements. The Company controls the credit risk of its financial contracts through credit approvals, limits and monitoring procedures, and does not expect any counterparties to fail their obligations. The Company deals only with primary dealers. | |||||||||
Derivative instruments are generally either negotiated OTC contracts or standardized contracts executed on a recognized exchange. Negotiated OTC derivative contracts are generally entered into between two counterparties that negotiate specific agreement terms, including the underlying instrument, amount, exercise prices and maturity. | |||||||||
The Company issues to customers certificates of deposit with an interest rate that is derived from the rate of return on the stock of the companies that comprise The Dow Jones Industrial Average. In order to manage the interest rate risk associated with this deposit product, the Company has purchased a series of forward option contracts. These contracts provide the Company with a rate of return commensurate with the return of The Dow Jones Industrial Average from the time of the contract until maturity of the related certificate of deposit. These contracts are accounted for as fair value hedges. Because the certificates of deposit can be redeemed by the customer at anytime and the related forward options contracts cannot be cancelled by the Company, the hedge is not considered effective. | |||||||||
At December 31, the information pertaining to the forward option contracts, included in other assets and other liabilities on the balance sheet, is as follows: | |||||||||
2014 | 2013 | ||||||||
Notional amount | $ | 87,782 | $ | 91,223 | |||||
Fair market value of contracts | 32,795 | 30,741 |
TRANSACTIONS_WITH_RELATED_PART
TRANSACTIONS WITH RELATED PARTIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Notes to Financial Statements | |||||||||
NOTE 18. TRANSACTIONS WITH RELATED PARTIES | During the year, officers and directors (and companies controlled by them) were customers of and had transactions with the Company in the normal course of business. These transactions were made on substantially the same terms as those prevailing for other customers and did not involve any abnormal risk. | ||||||||
Loan transactions with related parties are shown in the following schedule: | |||||||||
2014 | 2013 | ||||||||
Total loans, beginning of year | $ | 7,786,058 | $ | 7,299,706 | |||||
New loans | 5,249,565 | 6,127,927 | |||||||
Relationship Change | - | 702,135 | |||||||
Repayments | (5,586,483 | ) | (6,343,710 | ) | |||||
Total loans, end of year | $ | 7,449,140 | $ | 7,786,058 |
DIVIDEND_LIMITATIONS_ON_SUBSID
DIVIDEND LIMITATIONS ON SUBSIDIARY BANK | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
NOTE 19. DIVIDEND LIMITATIONS ON SUBSIDIARY BANK | The principal source of funds of F & M Bank Corp. is dividends paid by the Farmers and Merchants Bank. The Federal Reserve Act restricts the amount of dividends the Bank may pay. Approval by the Board of Governors of the Federal Reserve System is required if the dividends declared by a state member bank, in any year, exceed the sum of (1) net income of the current year and (2) income net of dividends for the preceding two years. As of January 1, 2015, approximately $7,803,000 was available for dividend distribution without permission of the Board of Governors. Dividends paid by the Bank to the Company totaled $1,300,000 in 2014, $1,550,000 in 2013 and $1,100,000 in 2012. |
DISCLOSURES_ABOUT_FAIR_VALUE_O
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Notes to Financial Statements | |||||||||||||||||
NOTE 20. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | ASC 825 “Financial Instruments” (formerly SFAS 107) defines the fair value of a financial instrument as the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced liquidation or sale. As the majority of the Bank's financial instruments lack an available trading market, significant estimates, assumptions and present value calculations are required to determine estimated fair value. The following presents the carrying amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments as of December 31, 2014 and December 31, 2013. This table excludes financial instruments for which the carrying amount approximates the fair value, which would be Level 1; inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. All financial instruments below are considered Level 2 (except for impaired loans which are level 3); inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Estimated | Carrying | Estimated | Carrying | ||||||||||||||
Fair Value | Value | Fair Value | Value | ||||||||||||||
Financial Assets (in thousands) | |||||||||||||||||
Loans | $ | 551,338 | $ | 518,202 | $ | 512,250 | $ | 478,453 | |||||||||
Financial Liabilities | |||||||||||||||||
Time deposits | 196,826 | 195,464 | 197,729 | 196,004 | |||||||||||||
Long-term debt | 9,862 | 9,875 | 12,613 | 11,500 | |||||||||||||
The carrying value of cash and cash equivalents, other investments, deposits with no stated maturities, short-term borrowings, and accrued interest approximate fair value. The fair value of securities was calculated using the most recent transaction price or a pricing model, which takes into consideration maturity, yields and quality. The remaining financial instruments were valued based on the present value of estimated future cash flows, discounted at various rates in effect for similar instruments entered into during the month of December of each year. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
NOTE 21. FAIR VALUE MEASUREMENTS | Accounting Standards Codification (ASC 820), “Fair Value Measurement Disclosures” (formerly “FAS No. 157”), defines fair value, establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurement and enhances disclosure requirements for fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: | ||||||||||||||||
Level1- | Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||||||||||||||||
Level2- | Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | ||||||||||||||||
Level3- | Inputs to the valuation methodology are unobservable and significant to the fair value measurement. | ||||||||||||||||
The following sections provide a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy: | |||||||||||||||||
Securities: Where quoted prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities would include highly liquid government bonds, mortgage products and exchange traded equities. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics, or discounted cash flow. Level 2 securities would include U.S. agency securities, mortgage-backed agency securities, obligations of states and political subdivisions and certain corporate, asset backed and other securities. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within Level 3 of the valuation hierarchy. | |||||||||||||||||
Loans Held for Sale: Loans held for sale are short-term loans purchased at par for resale to investors at the par value of the loan. These loans are generally repurchased within 15 days. Because of the short-term nature and fixed repurchased price, the book value of these loans approximates fair value. | |||||||||||||||||
Impaired Loans: ASC 310 applies to loans measured for impairment using the practical expedients permitted by SFAS No. 114, “Accounting by Creditors for Impairment of a Loan,” including impaired loans measured at an observable market price (if available), or at the fair value of the loan’s collateral (if the loan is collateral dependent). Fair value of the loan’s collateral, when the loan is dependent on collateral, is determined by appraisals or independent valuation which is then adjusted for the cost related to liquidation of the collateral. | |||||||||||||||||
Other Real Estate Owned: Certain assets such as other real estate owned (OREO) are initially measured at fair value less cost to sell. We believe that the fair value component in its valuation follows the provisions of ASC 310. | |||||||||||||||||
For level 3 assets and liabilities measured at fair value on a recurring basis or non-recurring basis as of December 31, 2014 significant unobservable inputs used in the fair value measurements were as follows: | |||||||||||||||||
Fair Value at December 31, 2014 | Valuation Technique | Significant Unobservable Inputs | Range | ||||||||||||||
Impaired Loans | $ | 13,223 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Other Real Estate Owned | $ | 3,507 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Fair Value at December 31, 2013 | Valuation Technique | Significant Unobservable Inputs | Range | ||||||||||||||
Impaired Loans | $ | 8,514 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Other Real Estate Owned | $ | 2,628 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Assets and Liabilities Recorded at Fair Value on a Recurring Basis (in thousands) | |||||||||||||||||
December 31, 2014 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
U. S. Treasuries | $ | 4,020 | $ | - | $ | 4,020 | $ | - | |||||||||
Government sponsored enterprises | 8,038 | - | 8,038 | - | |||||||||||||
Mortgage-backed obligations of federal agencies | 1,022 | - | 1,022 | - | |||||||||||||
Marketable equities | 135 | - | 135 | - | |||||||||||||
Investment securities available for sale | 13,215 | - | 13,215 | - | |||||||||||||
Total assets at fair value | $ | 13,215 | $ | - | $ | 13,215 | $ | - | |||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Derivative financial instruments at fair value | $ | 33 | $ | - | $ | 33 | $ | - | |||||||||
31-Dec-13 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Government sponsored enterprises | $ | 29,065 | $ | - | $ | 29,065 | $ | - | |||||||||
Mortgage-backed obligations of federal agencies | 1,201 | - | 1,201 | - | |||||||||||||
Investment securities available for sale | 30,266 | - | 30,266 | - | |||||||||||||
Total assets at fair value | $ | 30,266 | $ | - | $ | 30,266 | $ | - | |||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Derivative financial instruments at fair value | $ | 31 | $ | - | $ | 31 | $ | - | |||||||||
Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis (in thousands) | |||||||||||||||||
31-Dec-14 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Other Real Estate Owned | $ | 3,507 | - | - | $ | 3,507 | |||||||||||
- | - | ||||||||||||||||
Construction/Land Development | 11,507 | - | - | 11,507 | |||||||||||||
Farmland | - | - | - | - | |||||||||||||
Real Estate | 825 | - | - | 825 | |||||||||||||
Multi-Family | - | - | - | - | |||||||||||||
Commercial Real Estate | 891 | - | - | 891 | |||||||||||||
Home Equity – closed end | - | - | - | - | |||||||||||||
Home Equity – open end | - | - | - | - | |||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | |||||||||||||
Consumer | - | - | - | - | |||||||||||||
Credit cards | - | - | - | - | |||||||||||||
Dealer Finance | - | - | - | - | |||||||||||||
Impaired loans | 13,223 | - | - | 13,223 | |||||||||||||
Total assets at fair value | $ | 16,730 | - | $ | - | $ | 16,730 | ||||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis (in thousands) | |||||||||||||||||
The table below presents the recorded amount of assets and liabilities measured at fair value on a non-recurring basis. | |||||||||||||||||
31-Dec-13 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Other Real Estate Owned | $ | 2,628 | - | - | $ | 2,628 | |||||||||||
- | - | ||||||||||||||||
Construction/Land Development | 6,731 | - | - | 6,731 | |||||||||||||
Farmland | - | - | - | - | |||||||||||||
Real Estate | 991 | - | - | 991 | |||||||||||||
Multi-Family | - | - | - | - | |||||||||||||
Commercial Real Estate | 536 | - | - | 536 | |||||||||||||
Home Equity – closed end | 163 | - | - | 163 | |||||||||||||
Home Equity – open end | 91 | - | - | 91 | |||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | |||||||||||||
Consumer | 2 | - | - | 2 | |||||||||||||
Credit cards | - | - | - | - | |||||||||||||
Dealer Finance | - | - | - | - | |||||||||||||
Impaired loans | 8,514 | - | - | 8,514 | |||||||||||||
Total assets at fair value | $ | 11,142 | - | $ | - | 11,142 | |||||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
There were no significant transfers between levels 1 and 2. Level 3 assets consist of Other Real Estate Owned and Impaired loans. These assets have been valued based on Managements’ estimate. These estimates were derived from a review of appraisals, tax assessments and discussions with appraisers and realtors. |
REGULATORY_MATTERS
REGULATORY MATTERS | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Notes to Financial Statements | ||||||||||||||||
NOTE 22. REGULATORY MATTERS | The Company and its subsidiary bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s assets, liabilities, and certain off balance-sheet items as calculated under regulatory accounting practices. The Company’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. | |||||||||||||||
Quantitative measures established by regulation, to ensure capital adequacy, require the Company to maintain minimum amounts and ratios. These ratios are defined in the regulations and the amounts are set forth in the table below. Management believes, as of December 31, 2014, that the Company and its subsidiary bank meet all capital adequacy requirements to which they are subject. | ||||||||||||||||
As of the most recent notification from the Federal Reserve Bank Report of Examination (which was as of May 13, 2013), the subsidiary bank was categorized as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Company must maintain minimum total risk based, Tier I risk-based, and Tier I leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the institution’s category. | ||||||||||||||||
The Company’s actual consolidated capital ratios are presented in the following table (dollars in thousands): | ||||||||||||||||
Analysis of Capital | Regulatory Requirements | |||||||||||||||
At December 31, | Adequately | Well | ||||||||||||||
2014 | 2013 | 2012 | Capitalized | Capitalized | ||||||||||||
Tier1 capital: | ||||||||||||||||
Preferred stock | $ | 9,425 | $ | - | $ | - | ||||||||||
Common stock | 16,459 | 12,559 | 12,498 | |||||||||||||
Retained earnings | 53,815 | 42,089 | 38,927 | |||||||||||||
Intangible assets | (2,670 | ) | (2,670 | ) | (2,670 | ) | ||||||||||
Accumulated other comprehensive income | - | - | - | |||||||||||||
Total Tier 1 Capital | $ | 77,029 | $ | 51,978 | $ | 48,755 | ||||||||||
Tier 2 capital: | ||||||||||||||||
Qualifying subordinated debt | $ | - | $ | 8,487 | $ | 9,284 | ||||||||||
Allowance for loan losses | 6,018 | 5,389 | 5,716 | |||||||||||||
Unrealized gains on AFS equity securities | - | - | - | |||||||||||||
Total risked based capital | $ | 83,047 | $ | 65,854 | $ | 63,755 | ||||||||||
Risk-weighted assets | $ | 478,725 | $ | 428,349 | $ | 456,066 | ||||||||||
Capital ratios: | ||||||||||||||||
Total risk-based ratio | 17.35 | % | 15.37 | % | 13.98 | % | 8.00% | 10.00% | ||||||||
Tier 1 risk-based ratio | 16.09 | % | 12.13 | % | 10.69 | % | 4.00% | 6.00% | ||||||||
Total assets leverage ratio | 12.88 | % | 9.37 | % | 8.29 | % | 3.00% | 5.00% | ||||||||
The actual capital ratios for the subsidiary bank are presented in the following table (dollars in thousands): | ||||||||||||||||
Analysis of Capital | Regulatory Requirements | |||||||||||||||
At December 31, | Adequately | Well | ||||||||||||||
2014 | 2013 | 2012 | Capitalized | Capitalized | ||||||||||||
Tier1 capital: | ||||||||||||||||
Common stock | $ | 500 | $ | 500 | $ | 500 | ||||||||||
Capital surplus | 37,971 | 18,971 | 18,971 | |||||||||||||
Retained earnings | 40,114 | 35,361 | 32,310 | |||||||||||||
Intangible assets | (2,670 | ) | (2,670 | ) | (2,670 | ) | ||||||||||
Accumulated other comprehensive income | - | - | - | |||||||||||||
Total Tier 1 Capital | $ | 75,915 | $ | 52,162 | $ | 49,111 | ||||||||||
Tier 2 capital: | ||||||||||||||||
Qualifying subordinated debt | $ | - | $ | 8,487 | $ | 9,284 | ||||||||||
Allowance for loan losses | 6,006 | 5,384 | 5,716 | |||||||||||||
Unrealized gains on AFS securities | - | - | - | |||||||||||||
Total risked based capital | $ | 81,921 | $ | 66,033 | $ | 64,111 | ||||||||||
Risk-weighted assets | $ | 478,512 | $ | 427,957 | $ | 454,804 | ||||||||||
Capital ratios: | ||||||||||||||||
Total risk-based ratio | 17.12 | % | 15.43 | % | 14.1 | % | 8.00% | 10.00% | ||||||||
Tier 1 risk-based ratio | 15.86 | % | 12.19 | % | 10.8 | % | 4.00% | 6.00% | ||||||||
Total assets leverage ratio | 12.7 | % | 9.41 | % | 8.36 | % | 3.00% | 5.00% |
INTANGIBLES
INTANGIBLES | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
NOTE 23. INTANGIBLES | Goodwill associated with the purchase of the Edinburg and Woodstock branches and VBS Mortgage totaled $2,638,677 and $30,840, respectively, at the acquisition date. |
INVESTMENTS_IN_LIFE_INSURANCE_
INVESTMENTS IN LIFE INSURANCE CONTRACTS | 12 Months Ended |
Dec. 31, 2014 | |
Notes to Financial Statements | |
NOTE 24. INVESTMENTS IN LIFE INSURANCE CONTRACTS | The Bank currently offers a variety of benefit plans to all full time employees. While the costs of these plans are generally tax deductible to the Bank, the cost has been escalating greatly in recent years. To help offset escalating benefit costs and to attract and retain qualified employees, the Bank purchased Bank Owned Life Insurance (BOLI) contracts that will provide benefits to employees during their lifetime. Dividends received on these policies are tax-deferred and the death benefits under the policies are tax exempt. Rates of return on a tax-equivalent basis are very favorable when compared to other long-term investments which the Bank might make. |
PARENT_CORPORATION_ONLY_FINANC
PARENT CORPORATION ONLY FINANCIAL STATEMENTS | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
NOTE 25. PARENT CORPORATION ONLY FINANCIAL STATEMENTS | Balance Sheets | ||||||||||||
December 31, 2014 and 2013 | |||||||||||||
2014 | 2013 | ||||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 1,214,140 | $ | 77,952 | |||||||||
Investment in subsidiaries | 76,684,121 | 54,325,282 | |||||||||||
Securities available for sale | 135,000 | - | |||||||||||
Income tax receivable (including due from subsidiary) | 453,585 | - | |||||||||||
Other assets | - | 8,700 | |||||||||||
Total Assets | $ | 78,486,846 | $ | 54,411,934 | |||||||||
Liabilities | |||||||||||||
Other liabilities | $ | 137,977 | $ | 160 | |||||||||
Deferred income taxes | 383,125 | 103,198 | |||||||||||
Demand obligations for low income housing investment | 167,341 | 167,341 | |||||||||||
Total Liabilities | $ | 688,443 | $ | 270,699 | |||||||||
Stockholders’ Equity | |||||||||||||
Preferred stock par value $5 per share, 400,000 shares authorized, issued and outstanding | $ | 9,425,123 | $ | - | |||||||||
Common stock par value $5 per share, 6,000,000 shares authorized, 3,291,766 and 2,511,735 shares issued and outstanding for 2014 and 2013, respectively | 16,458,830 | 12,558,675 | |||||||||||
Retained earnings | 53,814,416 | 42,089,165 | |||||||||||
Noncontrolling interest | 426,365 | 418,228 | |||||||||||
Accumulated other comprehensive income (loss) | (2,326,331 | ) | (924,833 | ) | |||||||||
Total Stockholders' Equity | 77,798,403 | 54,141,235 | |||||||||||
Total Liabilities and Stockholders' Equity | $ | 78,486,846 | $ | 54,411,934 | |||||||||
Statements of Net Income and Retained Earnings | |||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income | |||||||||||||
Dividends from affiliate | $ | 1,300,000 | $ | 1,550,000 | $ | 1,100,000 | |||||||
Interest Income | 0 | 5 | 17 | ||||||||||
Other income | - | - | 350 | ||||||||||
Net limited partnership income (loss) | - | 90,863 | 11,930 | ||||||||||
Total Income | 1,300,000 | 1,640,868 | 1,112,297 | ||||||||||
Expenses | |||||||||||||
Other expense | 7,100 | - | - | ||||||||||
Administrative expenses | - | 60,209 | 185,834 | ||||||||||
Total Expenses | 7,100 | 60,209 | 185,834 | ||||||||||
Net income before income tax expense (benefit) | |||||||||||||
and undistributed subsidiary net income | 1,292,900 | 1,580,659 | 926,463 | ||||||||||
Income Tax Expense (Benefit) | 243,492 | (83,880 | ) | (22,500 | ) | ||||||||
Income before undistributed subsidiary | |||||||||||||
net income | 1,049,408 | 1,664,539 | 948,963 | ||||||||||
Undistributed subsidiary net income | 4,752,201 | 3,051,254 | 3,952,121 | ||||||||||
Net Income | $ | 5,801,609 | $ | 4,715,793 | $ | 4,901,084 | |||||||
Statements of Cash Flows | |||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Cash Flows from Operating Activities | |||||||||||||
Net income | $ | 5,801,609 | $ | 4,715,793 | $ | 4,901,084 | |||||||
Adjustments to reconcile net income to net | |||||||||||||
cash provided by operating activities: | |||||||||||||
Undistributed subsidiary income | (4,752,201 | ) | (3,051,254 | ) | (3,952,121 | ) | |||||||
Deferred tax (benefit) expense | 279,928 | 8,577 | (18,567 | ) | |||||||||
Decrease (increase) in other assets | (444,885 | ) | (174,367 | ) | 201,537 | ||||||||
Increase (decrease) in other liabilities | 137,817 | (1,109,728 | ) | 992,626 | |||||||||
Net change in deferred tax credits | - | (27,918 | ) | (15,727 | ) | ||||||||
Amortization of limited partnership investments | - | 65,165 | 65,164 | ||||||||||
Net Cash Provided by Operating Activities | 1,022,268 | 426,268 | 2,173,996 | ||||||||||
Cash Flows from Investing Activities | |||||||||||||
Change in loans receivable | - | 1,000,000 | - | ||||||||||
Purchase of securities available for sale | (135,000 | ) | - | (1,000,000 | ) | ||||||||
Net Cash Provided by (Used in) Investing Activities | (135,000 | ) | 1,000,000 | (1,000,000 | ) | ||||||||
Cash Flows from Financing Activities | |||||||||||||
Capital contributed to subsidiary | (19,000,000 | ) | - | - | |||||||||
Proceeds from issuance of preferred stock | 9,425,123 | ||||||||||||
Proceeds from issuance of common stock | 12,055,709 | 213,429 | 105,416 | ||||||||||
Dividends paid in cash | (2,231,912 | ) | (1,705,881 | ) | (1,597,673 | ) | |||||||
Net Provided by (Cash Used) in Financing Activities | 248,920 | (1,492,452 | ) | (1,492,257 | ) | ||||||||
Net Increase (decreases) in Cash and Cash Equivalents | 1,136,188 | (66,184 | ) | (318,261 | ) | ||||||||
Cash and Cash Equivalents, Beginning of Year | 77,952 | 144,136 | 462,397 | ||||||||||
Cash and Cash Equivalents, End of Year | $ | 1,214,140 | $ | 77,952 | $ | 144,136 |
INVESTMENT_IN_VBS_MORTGAGE_LLC
INVESTMENT IN VBS MORTGAGE, LLC | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
NOTE 26. INVESTMENT IN VBS MORTGAGE, LLC | On November 3, 2008, the Bank acquired a 70% ownership interest in VBS Mortgage, LLC (formerly Valley Broker Services, DBA VBS Mortgage). VBS originates both conventional and government sponsored mortgages for sale in the secondary market. As of December 31, 2014 and 2013, VBS’ summarized balance sheet and income statement were as follows: | ||||||||||||
Balance Sheets | |||||||||||||
December 31, 2014 and 2013 | |||||||||||||
2014 | 2013 | ||||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 610,973 | $ | 490,225 | |||||||||
Loans Receivable | 818,054 | 871,674 | |||||||||||
Property and equipment, net | 45,600 | 53,903 | |||||||||||
Other Assets | 162,304 | 187,356 | |||||||||||
Total Assets | $ | 1,636,931 | $ | 1,603,158 | |||||||||
Liabilities | |||||||||||||
Other liabilities | 215,713 | 209,065 | |||||||||||
Total Liabilities | $ | 215,713 | $ | 209,065 | |||||||||
Equity | |||||||||||||
Capital | 219,634 | 219,634 | |||||||||||
Retained earnings | 1,201,584 | 1,174,459 | |||||||||||
Total Equity | $ | 1,421,218 | $ | 1,394,093 | |||||||||
Total Liabilities and Equity | $ | 1,636,931 | $ | 1,603,158 | |||||||||
Statements of Income | |||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income | |||||||||||||
Mortgage origination income | $ | 1,907,804 | $ | 2,528,108 | $ | 2,378,023 | |||||||
Other Income | 53,528 | 42,092 | 40,022 | ||||||||||
Total Income | 1,961,332 | 2,570,200 | 2,418,045 | ||||||||||
Expenses | |||||||||||||
Salaries and employee benefits | 1,105,902 | 1,461,797 | 1,254,735 | ||||||||||
Occupancy and equipment expense | 177,014 | 164,717 | 157,514 | ||||||||||
Management and professional fees | 321,053 | 301,558 | 268,337 | ||||||||||
Other | 205,188 | 284,845 | 250,902 | ||||||||||
Total Expenses | 1,809,157 | 2,212,917 | 1,931,488 | ||||||||||
Net income(loss) | $ | 152,175 | $ | 357,283 | $ | 486 557 |
1_SUMMARY_OF_SIGNIFICANT_ACCOU
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Notes to Financial Statements | |||||||||||||
Principles of Consolidation | The consolidated financial statements include the accounts of Farmers and Merchants Bank, TEB Life Insurance Company, Farmers & Merchants Financial Services, Inc. and VBS Mortgage, LLC, (net of minority interest). Significant inter-company accounts and transactions have been eliminated. | ||||||||||||
Use of Estimates in the Preparation of Financial Statements | In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts in those statements; actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant changes in the near term are the determination of the allowance for loan losses, which is sensitive to changes in local and national economic conditions, and the other than temporary impairment of investments in the investment portfolio. | ||||||||||||
Cash and Cash Equivalents | Cash and cash equivalents include cash on hand, deposits at other financial institutions whose initial maturity is ninety days or less and Federal funds sold. | ||||||||||||
Investment Securities | Management reviews the securities portfolio and classifies all securities as either held to maturity or available for sale at the date of acquisition. Securities that the Company has both the positive intent and ability to hold to maturity (at time of purchase) are classified as held to maturity securities. All other securities are classified as available for sale. Securities held to maturity are carried at historical cost and adjusted for amortization of premiums and accretion of discounts, using the effective interest method. Securities available for sale are carried at fair value with any valuation adjustments reported, net of deferred taxes, as a part of other accumulated comprehensive income. | ||||||||||||
Interest, amortization of premiums and accretion of discounts on securities are reported as interest income using the effective interest method. Gains (losses) realized on sales and calls of securities are determined on the specific identification method. | |||||||||||||
Accounting for Historic Rehabilitation and Low Income Housing Partnerships | The Company periodically invests in low income housing partnerships whose primary benefit is the distribution of federal income tax credits to partners. The Company recognizes these benefits and the cost of the investments over the life of the partnership (usually 15 years). In addition, state and federal historic rehabilitation credits are generated from some of the partnerships. Amortization of these investments is prorated based on the amount of benefits received in each year to the total estimated benefits over the life of the projects. All benefits have been shown as a part of income tax expense. | ||||||||||||
Loans Held for Investment | Loans are carried on the balance sheet net of any unearned interest and the allowance for loan losses. Interest income on loans is determined using the effective interest method on the daily amount of principal outstanding except where serious doubt exists as to collectability of the loan, in which case the accrual of income is discontinued. | ||||||||||||
Loans Held for Sale | These loans consists of fixed rate loans made through its subsidiary, VBS Mortgage and loans purchased from Gateway Savings Bank, Oakland, CA and NorthPointe Bank, Grand Rapids, MI. | ||||||||||||
VBS Mortgage originates conforming mortgage loans for sale in the secondary market. The bank (VBS) gives the customer a rate commitment at the time the rate is locked. The bank then immediately gets a rate lock-in from the investor that will be buying the loan upon closing. Both the rate lock and the purchase commitments (which is a blanket agreement) are best effort agreements, subject to final approval and underwriting. Because either party can walk away from these agreements prior to closing, neither the rate lock commitment nor the purchase commitment is considered a derivative contract. The bank provides a warehouse line for the Mortgage subsidiary after closing, until the loan is purchased by the investor. The average time on the line is two or three weeks. Although VBS does have a line, loans are actually assigned to the bank at closing and then reassigned prior to purchase from investor. There were $2.6 million of these mortgage loans held for resale at the end of the year. All of these loans are under contract to deliver to an investor as a specified price. Because of this and the short holding period, these loans are carried at par and a gain is recorded at transfer to the investor. The effect of not marking these loans to market is not material to the current year financial statements. | |||||||||||||
Gateway Savings Bank (“Gateway”) loans are originated by a network of mortgage loan originators throughout the United States. A take out commitment is in place at the time the loans are purchased. The Gateway arrangement has been used since 2003 as a higher yielding alternative to federal funds sold or investment securities. These loans are short-term, residential real estate loans that have an average life in our portfolio of approximately two weeks. The Bank holds these loans during the period of time between loan closing and when the loan is paid off by the ultimate secondary market purchaser. Gateway Savings Bank discontinued the loan participation program in December of 2014 and the Company became a participant with NorthPointe Bank which obtained the Gateway Savings Bank program and incorporated it into their existing program. The NorthPointe Bank program and procedures are the same as described above for Gateway. | |||||||||||||
Allowance for Loan Losses | The provision for loan losses charged to operations is an amount sufficient to bring the allowance for loan losses to an estimated balance that management considers adequate to absorb potential losses in the portfolio. Loans are charged against the allowance when management believes the collectability of the principal is unlikely. Recoveries of amounts previously charged-off are credited to the allowance. Management’s determination of the adequacy of the allowance is based on an evaluation of the composition of the loan portfolio, the value and adequacy of collateral, current economic conditions, historical loan loss experience, and other risk factors. Management believes that the allowance for loan losses is adequate. While management uses available information to recognize losses on loans, future additions to the allowance may be necessary based on changes in economic conditions, particularly those affecting real estate values. In addition, regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination. | ||||||||||||
A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. | |||||||||||||
Other Real Estate Owned (OREO) | As of December 31, 2014, the Bank had $3.5 million classified as OREO on the balance sheet, compared to $2.63 million as of December 31, 2013. The table in Note 9 reflects the OREO activity in 2014. The Company’s policy is to carry OREO on its balance sheet at the lower of cost or market. Values are reviewed periodically and additional losses are recognized if warranted based on market conditions. | ||||||||||||
Nonaccrual Loans | Loans are placed on nonaccrual status when they become ninety days or more past due, unless there is an expectation that the loan will either be brought current or paid in full in a reasonable period of time. | ||||||||||||
Bank Premises and Equipment | Bank premises and equipment are stated at cost less accumulated depreciation. Depreciation is charged to income over the estimated useful lives of the assets on a combination of the straight-line and accelerated methods. The ranges of the useful lives of the premises and equipment are as follows: | ||||||||||||
Buildings and Improvements | 10 - 40 years | ||||||||||||
Furniture and Fixtures | 5 - 20 years | ||||||||||||
Maintenance, repairs, and minor improvements are charged to operations as incurred. Gains and losses on dispositions are reflected in other income or expense. | |||||||||||||
Goodwill | In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard ASC 805, Business Combinations and ASC 350, Intangibles. ASC 805 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001. Additionally, it further clarifies the criteria for the initial recognition and measurement of intangible assets separate from goodwill. ASC 350 became effective for fiscal years beginning after December 15, 2001 and prescribes the accounting for goodwill and intangible assets subsequent to initial recognition. The provisions of ASC 350 discontinue the amortization of goodwill and intangible assets with indefinite lives. Instead, these assets are subject to an impairment review on an annual basis and more frequently if certain impairment indicators are in evidence. ASC 350 also requires that reporting units be identified for the purpose of assessing potential future impairments of goodwill. | ||||||||||||
Goodwill totaled $2,669,517 at December 31, 2014 and 2013. The goodwill is no longer amortized, but instead tested for impairment at least annually. Based on the testing, there were no impairment charges for 2014, 2013 or 2012. | |||||||||||||
Pension Plans | The Bank has a qualified noncontributory defined benefit pension plan which covers all full time employees hired prior to April 1, 2012. The benefits are primarily based on years of service and earnings. On December 31, 2006 the Company adopted ASC 325-960 “Defined Benefit Pension Plans” (formerly SFAS No. 158), which was issued in September of 2006 to require recognition of the over-funded or under-funded status of pension and other postretirement benefit plans on the balance sheet. Under ASC 325-960, gains and losses, prior service costs and credits, and any remaining transition amounts that have not yet been recognized through net periodic benefit cost will be recognized in accumulated other comprehensive income, net of tax effects, until they are amortized as a component of net periodic cost. | ||||||||||||
Advertising Costs | The Company follows the policy of charging the cost of advertising to expense as incurred. Total advertising costs included in other operating expenses for 2014, 2013, and 2012 were $317,780, $278,555, and $251,258, respectively. | ||||||||||||
Income Taxes | Amounts provided for income tax expense are based on income reported for financial statement purposes rather than amounts currently payable under income tax laws. Deferred taxes, which arise principally from temporary differences between the period in which certain income and expenses are recognized for financial accounting purposes and the period in which they affect taxable income, are included in the amounts provided for income taxes. | ||||||||||||
Comprehensive Income | Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain changes in assets and liabilities and changes in pension plan funding status, such as unrealized gains and losses on available-for-sale securities and gains or losses on certain derivative contracts, are reported as a separate component of the equity section of the balance sheet. Such items, along with operating net income, are components of comprehensive income. | ||||||||||||
Earnings per Share | Accounting guidance specifies the computation, presentation and disclosure requirements for earnings per share (“EPS”) for entities with publicly held common stock or potential common stock such as options, warrants, convertible securities or contingent stock agreements if those securities trade in a public market. Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding. Diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive common shares had been issued. The dilutive effect of conversion of preferred stock is reflected in the diluted earnings per share calculation. | ||||||||||||
Net income available to common stockholders represents consolidated net income adjusted for preferred dividends declared. | |||||||||||||
The following table provides a reconciliation of net income to net income available to common stockholders for the periods presented: | |||||||||||||
For the year ended | |||||||||||||
31-Dec-14 | |||||||||||||
Earnings Available to Common Stockholders: | |||||||||||||
Net Income | $ | 5,801,609 | |||||||||||
Preferred Stock Dividends | 127,500 | ||||||||||||
Net Income Available to Common Stockolders | $ | 5,674,109 | |||||||||||
The following table shows the effect of dilutive preferred stock conversion on the Company's earnings per share for the periods indicated: | |||||||||||||
Year ending December 31, 2014 | |||||||||||||
Income | Shares | Per Share Amounts | |||||||||||
Basic EPS | $ | 5,674,109 | 3,119,333 | $ | 1.82 | ||||||||
Effect of Dilutive Securities: | |||||||||||||
Convertible Preferred Stock | 127,500 | 110,609 | (0.02 | ) | |||||||||
Diluted EPS | $ | 5,801,609 | 3,229,942 | $ | 1.8 | ||||||||
There were no dilutive securities for the years ended December 31, 2013 and 2012. | |||||||||||||
Derivative Financial Instruments and Change in Accounting Principle | On January 1, 2001, the Company adopted ASC 815 “Derivative and Hedging Investments” (formerly SFAS No. 133). This statement requires that all derivatives be recognized as assets or liabilities in the balance sheet and measured at fair value. | ||||||||||||
Under ASC 815, the gain or loss on a derivative designated and qualifying as a fair value hedging instrument, as well as the offsetting gain or loss on the hedging item attributable to the risk being hedged, is recognized currently in earnings in the same accounting period. The effective portion of the gain or loss on a derivative designated and qualifying as a cash flow hedging instrument is initially reported as a component of other comprehensive income and subsequently reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument, if any, is recognized currently in earnings. | |||||||||||||
Interest rate derivative financial instruments receive hedge accounting treatment only if they are designated as a hedge and are expected to be, and are, effective in substantially reducing interest rate risk arising from the assets and liabilities identified as exposing the Company to risk. Those derivative financial instruments that do not meet the hedging criteria discussed below would be classified as trading activities and would be recorded at fair value with changes in fair value recorded in income. Derivative hedge contracts must meet specific effectiveness tests (i.e., over time the change in their fair values due to the designated hedge risk must be within 80 to 125 percent of the opposite change in the fair value of the hedged assets or liabilities). Changes in fair value of the derivative financial instruments must be effective at offsetting changes in the fair value of the hedging items due to the designated hedge risk during the term of the hedge. Further, if the underlying financial instrument differs from the hedged asset or liability, there must be a clear economic relationship between the prices of the two financial instruments. If periodic assessment indicates derivatives no longer provide an effective hedge, the derivatives contracts would be closed out and settled or classified as a trading activity. | |||||||||||||
Recent Accounting Pronouncements | Standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. | ||||||||||||
Subsequent Events | In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date the financial statements were issued. |
2_SUMMARY_OF_SIGNIFICANT_ACCOU
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Summary Of Significant Accounting Policies Tables | |||||||||||||
Bank Premises and Equipment | The ranges of the useful lives of the premises and equipment are as follows: | ||||||||||||
Buildings and Improvements | 10 - 40 years | ||||||||||||
Furniture and Fixtures | 5 - 20 years | ||||||||||||
Earnings per Share | The following table provides a reconciliation of net income to net income available to common stockholders for the periods presented: | ||||||||||||
For the year ended | |||||||||||||
31-Dec-14 | |||||||||||||
Earnings Available to Common Stockholders: | |||||||||||||
Net Income | $ | 5,801,609 | |||||||||||
Preferred Stock Dividends | 127,500 | ||||||||||||
Net Income Available to Common Stockolders | $ | 5,674,109 | |||||||||||
The following table shows the effect of dilutive preferred stock conversion on the Company's earnings per share for the periods indicated: | |||||||||||||
Year ending December 31, 2014 | |||||||||||||
Income | Shares | Per Share Amounts | |||||||||||
Basic EPS | $ | 5,674,109 | 3,119,333 | $ | 1.82 | ||||||||
Effect of Dilutive Securities: | |||||||||||||
Convertible Preferred Stock | 127,500 | 110,609 | (0.02 | ) | |||||||||
Diluted EPS | $ | 5,801,609 | 3,229,942 | $ | 1.8 |
4_INVESTMENT_SECURITIES_Tables
4. INVESTMENT SECURITIES (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||
Schedule Amortized Cost and Fair Value for Securities | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 125,150 | $ | - | $ | - | $ | 125,150 | |||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 106,387 | $ | - | $ | - | $ | 106,387 | |||||||||||||||||
Amortized cost and fair value of securities | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 4,025,740 | $ | - | $ | 6,100 | $ | 4,019,640 | |||||||||||||||||
Government sponsored enterprises | 8,039,540 | 8,940 | 9,880 | 8,038,600 | |||||||||||||||||||||
Mortgage-backed obligations of federal agencies | 1,011,092 | 10,780 | - | 1,021,872 | |||||||||||||||||||||
Marketable equities | 135,000 | - | - | 135,000 | |||||||||||||||||||||
Total Securities Available for Sale | $ | 13,211,372 | $ | 19,720 | $ | 15,980 | $ | 13,215,112 | |||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
U. S. Treasuries | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||
Government sponsored enterprises | 29,075,893 | 11,460 | 22,253 | 29,065,100 | |||||||||||||||||||||
Mortgage-backed obligations of federal agencies | 1,208,533 | - | 7,852 | 1,200,681 | |||||||||||||||||||||
Marketable equities | - | - | - | - | |||||||||||||||||||||
Total Securities Available for Sale | $ | 30,284,426 | $ | 11,460 | $ | 30,105 | $ | 30,265,781 | |||||||||||||||||
Schedule of gain and losses on sales of debt and equity securities | Securities Held to Maturity | Securities Available for Sale | |||||||||||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | ||||||||||||||||||||||
Due in one year or less | $ | 125,150 | $ | 125,150 | $ | 2,000,000 | $ | 1,999,980 | |||||||||||||||||
Due after one year through five years | - | - | 10,065,280 | 10,058,260 | |||||||||||||||||||||
Due after five years | - | - | 1,146,092 | 1,156,872 | |||||||||||||||||||||
Total | 125,150 | 125,150 | 13,211,372 | 13,215,112 | |||||||||||||||||||||
Schedule of Securities with Unrealized Losses | Less than 12 Months | More than 12 Months | Total | ||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||
2014 | |||||||||||||||||||||||||
U. S. Treasuries | $ | 4,020 | $ | (6 | ) | $ | - | $ | - | $ | 4,020 | $ | (6 | ) | |||||||||||
Government sponsored enterprises | 2,004 | (2 | ) | 1,991 | (8 | ) | 3,995 | (10 | ) | ||||||||||||||||
Mortgage-backed obligations | - | - | - | - | - | - | |||||||||||||||||||
Total | $ | 6,024 | $ | (8 | ) | $ | 1,991 | $ | (8 | ) | $ | 8,015 | $ | (16 | ) | ||||||||||
2013 | |||||||||||||||||||||||||
U. S. Treasuries | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Government sponsored enterprises | 4,984 | (22 | ) | - | - | 4,984 | (22 | ) | |||||||||||||||||
Mortgage-backed obligations | 1,191 | (8 | ) | - | - | 1,191 | (8 | ) | |||||||||||||||||
Total | $ | 6,175 | $ | (30 | ) | $ | - | $ | - | $ | 6,175 | $ | (30 | ) |
5_LOANS_Tables
5. LOANS (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||
Schedule of Loans Outstanding | Loans held for investment as of December 31: | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Construction/Land Development | $ | 67,180,467 | $ | 68,512,341 | |||||||||||||||||
Farmland | 12,507,446 | 13,197,398 | |||||||||||||||||||
Real Estate | 162,248,606 | 154,628,068 | |||||||||||||||||||
Multi-Family | 11,775,205 | 11,797,010 | |||||||||||||||||||
Commercial Real Estate | 122,305,417 | 113,415,234 | |||||||||||||||||||
Home Equity – closed end | 9,393,805 | 10,228,264 | |||||||||||||||||||
Home Equity – open end | 52,181,679 | 47,357,787 | |||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 28,160,584 | 25,903,011 | |||||||||||||||||||
Consumer | 9,109,994 | 10,162,457 | |||||||||||||||||||
Credit cards | 2,705,285 | 2,679,718 | |||||||||||||||||||
Dealer Finance | 40,633,086 | 20,571,720 | |||||||||||||||||||
Total | $ | 518,201,574 | $ | 478,453,008 | |||||||||||||||||
Schedule Impaired Loans | The following is a summary of information pertaining to impaired loans (in thousands): | ||||||||||||||||||||
Unpaid | Average | Interest | |||||||||||||||||||
December 31, 2014 | Recorded | Principal | Related | Recorded | Income | ||||||||||||||||
Investment | Balance | Allowance | Investment | Recognized | |||||||||||||||||
Impaired loans without a valuation allowance: | |||||||||||||||||||||
Construction/Land Development | $ | 4,982 | $ | 5,402 | $ | - | $ | 5,412 | $ | 251 | |||||||||||
Farmland | - | - | - | 1,163 | - | ||||||||||||||||
Real Estate | 141 | 141 | - | 85 | 5 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 1,159 | 1,459 | - | 1,450 | 66 | ||||||||||||||||
Home Equity – closed end | - | - | - | 123 | - | ||||||||||||||||
Home Equity – open end | 1,649 | 1,649 | - | 330 | 57 | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | 191 | 191 | - | 237 | 11 | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
8,122 | 8,842 | - | 8,800 | 390 | |||||||||||||||||
Impaired loans with a valuation allowance | |||||||||||||||||||||
Construction/Land Development | 12,976 | 14,749 | 1,469 | 12,056 | 326 | ||||||||||||||||
Farmland | - | - | - | - | - | ||||||||||||||||
Real Estate | 926 | 926 | 101 | 988 | 105 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 938 | 938 | 47 | 1,030 | 4 | ||||||||||||||||
Home Equity – closed end | - | - | - | 72 | - | ||||||||||||||||
Home Equity – open end | - | - | - | 40 | - | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | - | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
14,840 | 16,613 | 1,617 | 14,186 | 435 | |||||||||||||||||
Total impaired loans | $ | 22,962 | $ | 25,455 | $ | 1,617 | $ | 22,986 | $ | 825 | |||||||||||
The following is a summary of information pertaining to impaired loans (in thousands): | |||||||||||||||||||||
Unpaid | Average | Interest | |||||||||||||||||||
December 31, 2013 | Recorded | Principal | Related | Recorded | Income | ||||||||||||||||
Investment | Balance | Allowance | Investment | Recognized | |||||||||||||||||
Impaired loans without a valuation allowance: | |||||||||||||||||||||
Construction/Land Development | $ | 3,960 | $ | 4,543 | $ | - | $ | 5,750 | $ | 153 | |||||||||||
Farmland | 1,459 | 1,459 | - | 1,475 | 67 | ||||||||||||||||
Real Estate | 49 | 49 | - | 529 | 3 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 851 | 851 | - | 616 | 56 | ||||||||||||||||
Home Equity – closed end | 308 | 308 | - | 284 | 25 | ||||||||||||||||
Home Equity – open end | - | - | - | 20 | - | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | 242 | 242 | - | 64 | 12 | ||||||||||||||||
Consumer | - | - | - | - | - | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
6,869 | 7,452 | - | 8,738 | 316 | |||||||||||||||||
Impaired loans with a valuation allowance | |||||||||||||||||||||
Construction/Land Development | 8,291 | 9,716 | 1,560 | 10,855 | 175 | ||||||||||||||||
Farmland | - | - | - | - | - | ||||||||||||||||
Real Estate | 1,145 | 1,145 | 154 | 966 | 48 | ||||||||||||||||
Multi-Family | - | - | - | - | - | ||||||||||||||||
Commercial Real Estate | 818 | 1,118 | 282 | 1,171 | 4 | ||||||||||||||||
Home Equity – closed end | 180 | 180 | 17 | 409 | 3 | ||||||||||||||||
Home Equity – open end | 100 | 100 | 9 | 93 | 5 | ||||||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | 141 | - | ||||||||||||||||
Consumer | 2 | 2 | - | 1 | 1 | ||||||||||||||||
Credit cards | - | - | - | - | - | ||||||||||||||||
Dealer Finance | - | - | - | - | - | ||||||||||||||||
10,536 | 12,261 | 2,022 | 13,636 | 236 | |||||||||||||||||
Total impaired loans | $ | 17,405 | $ | 19,713 | $ | 2,022 | $ | 22,374 | $ | 552 |
6_ALLOWANCE_FOR_LOAN_LOSSES_Ta
6. ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||
Summary Loan Loss Allowance Transactions | A summary of changes in the allowance for loan losses is shown in the following schedule: | ||||||||||||||||||||||||||||||||||||
31-Dec-14 | Beginning Balance | Charge-offs | Recoveries | Provision | Ending Balance | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 4,007 | $ | 1,611 | $ | 223 | $ | 2,119 | $ | 4,738 | $ | 1,469 | $ | 3,269 | |||||||||||||||||||||||
Farmland | (2 | ) | - | - | 2 | - | - | - | |||||||||||||||||||||||||||||
Real Estate | 400 | 208 | - | 431 | 623 | 101 | 522 | ||||||||||||||||||||||||||||||
Multi-Family | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Commercial Real Estate | 777 | - | 108 | (759 | ) | 126 | 47 | 79 | |||||||||||||||||||||||||||||
Home Equity – closed end | 157 | - | - | 31 | 188 | - | 188 | ||||||||||||||||||||||||||||||
Home Equity – open end | 476 | 80 | - | (242 | ) | 154 | - | 154 | |||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 1,464 | 385 | 356 | (224 | ) | 1,211 | - | 1,211 | |||||||||||||||||||||||||||||
Consumer | 156 | 33 | 33 | 58 | 214 | - | 214 | ||||||||||||||||||||||||||||||
Dealer Finance | 628 | 107 | 6 | 809 | 1,336 | - | 1,336 | ||||||||||||||||||||||||||||||
Credit Cards | 121 | 46 | 35 | 25 | 135 | - | 135 | ||||||||||||||||||||||||||||||
Total | $ | 8,184 | $ | 2,470 | $ | 761 | $ | 2,250 | $ | 8,725 | $ | 1,617 | $ | 7,108 | |||||||||||||||||||||||
A summary of changes in the allowance for loan losses is shown in the following schedule: | |||||||||||||||||||||||||||||||||||||
31-Dec-13 | Beginning Balance | Charge-offs | Recoveries | Provision | Ending Balance | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | ||||||||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||||||||||||||
Allowance for loan losses: | |||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 2,771 | $ | 2,127 | $ | 40 | $ | 3,323 | $ | 4,007 | $ | 1,560 | $ | 2,447 | |||||||||||||||||||||||
Farmland | (2 | ) | - | - | - | (2 | ) | - | (2 | ) | |||||||||||||||||||||||||||
Real Estate | 924 | 173 | - | (351 | ) | 400 | 154 | 246 | |||||||||||||||||||||||||||||
Multi-Family | (37 | ) | - | - | 37 | - | - | - | |||||||||||||||||||||||||||||
Commercial Real Estate | 1,113 | 201 | 42 | (177 | ) | 777 | 282 | 495 | |||||||||||||||||||||||||||||
Home Equity – closed end | 360 | 159 | - | (44 | ) | 157 | 17 | 140 | |||||||||||||||||||||||||||||
Home Equity – open end | 659 | 68 | 29 | (144 | ) | 476 | 9 | 467 | |||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 2,113 | 986 | 127 | 210 | 1,464 | - | 1,464 | ||||||||||||||||||||||||||||||
Consumer | 51 | 173 | 14 | 264 | 156 | - | 156 | ||||||||||||||||||||||||||||||
Dealer Finance | 72 | 17 | - | 573 | 628 | - | 628 | ||||||||||||||||||||||||||||||
Credit Cards | 130 | 121 | 28 | 84 | 121 | - | 121 | ||||||||||||||||||||||||||||||
Total | $ | 8,154 | $ | 4,025 | $ | 280 | $ | 3,775 | $ | 8,184 | $ | 2,022 | $ | 6,162 | |||||||||||||||||||||||
Schedule of Aging of Past Due Receivables | Recorded Investment in Loan Receivables (in thousands): | ||||||||||||||||||||||||||||||||||||
31-Dec-14 | Loan Receivable | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | ||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 67,181 | $ | 17,958 | $ | 49,223 | |||||||||||||||||||||||||||||||
Farmland | 12,507 | - | 12,507 | ||||||||||||||||||||||||||||||||||
Real Estate | 162,249 | 1,067 | 161,182 | ||||||||||||||||||||||||||||||||||
Multi-Family | 11,775 | - | 11,775 | ||||||||||||||||||||||||||||||||||
Commercial Real Estate | 122,305 | 2,097 | 120,208 | ||||||||||||||||||||||||||||||||||
Home Equity – closed end | 9,394 | - | 9,394 | ||||||||||||||||||||||||||||||||||
Home Equity –open end | 52,182 | 1,649 | 50,533 | ||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 28,161 | 191 | 27,970 | ||||||||||||||||||||||||||||||||||
Consumer | 9,110 | - | 9,110 | ||||||||||||||||||||||||||||||||||
Dealer Finance | 40,633 | 40,633 | |||||||||||||||||||||||||||||||||||
Credit Cards | 2,705 | - | 2,705 | ||||||||||||||||||||||||||||||||||
$ | 518,202 | $ | 22,962 | $ | 495,240 | ||||||||||||||||||||||||||||||||
Total | |||||||||||||||||||||||||||||||||||||
31-Dec-13 | Loan Receivable | Individually Evaluated for Impairment | Collectively Evaluated for Impairment | ||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 68,512 | $ | 12,251 | $ | 56,261 | |||||||||||||||||||||||||||||||
Farmland | 13,197 | 1,459 | 11,738 | ||||||||||||||||||||||||||||||||||
Real Estate | 154,628 | 1,194 | 153,434 | ||||||||||||||||||||||||||||||||||
Multi-Family | 11,797 | - | 11,797 | ||||||||||||||||||||||||||||||||||
Commercial Real Estate | 113,415 | 1,669 | 111,746 | ||||||||||||||||||||||||||||||||||
Home Equity – closed end | 10,228 | 488 | 9,740 | ||||||||||||||||||||||||||||||||||
Home Equity –open end | 47,358 | 100 | 47,258 | ||||||||||||||||||||||||||||||||||
Commercial & Industrial – Non-Real Estate | 25,903 | 242 | 25,661 | ||||||||||||||||||||||||||||||||||
Consumer | 10,163 | 2 | 10,161 | ||||||||||||||||||||||||||||||||||
Dealer Finance | 20,572 | 20,572 | |||||||||||||||||||||||||||||||||||
Credit Cards | 2,680 | - | 2,680 | ||||||||||||||||||||||||||||||||||
$ | 478,453 | $ | 17,405 | $ | 461,048 | ||||||||||||||||||||||||||||||||
Total | |||||||||||||||||||||||||||||||||||||
Consumer Credit Exposure | Aging of Past Due Loans Receivable (in thousands) | ||||||||||||||||||||||||||||||||||||
30-59 Days Past due | 60-89 Days Past Due | Greater than 90 Days (excluding non-accrual) | Non-Accrual Loans | Total Past Due | Current | Total Loan Receivable | |||||||||||||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 205 | $ | 166 | $ | - | $ | 4,508 | $ | 4,879 | $ | 62,302 | $ | 67,181 | |||||||||||||||||||||||
Farmland | - | - | - | - | - | 12,507 | 12,507 | ||||||||||||||||||||||||||||||
Real Estate | 5,085 | 635 | - | 973 | 6,693 | 155,556 | 162,249 | ||||||||||||||||||||||||||||||
Multi-Family | - | - | - | - | - | 11,775 | 11,775 | ||||||||||||||||||||||||||||||
Commercial Real Estate | 747 | - | - | 1,165 | 1,912 | 120,393 | 122,305 | ||||||||||||||||||||||||||||||
Home Equity – closed end | 162 | 15 | - | 10 | 187 | 9,207 | 9,394 | ||||||||||||||||||||||||||||||
Home Equity – open end | 730 | 25 | - | 143 | 898 | 51,284 | 52,182 | ||||||||||||||||||||||||||||||
Commercial & Industrial – Non- Real Estate | - | - | - | 14 | 14 | 28,147 | 28,161 | ||||||||||||||||||||||||||||||
Consumer | 290 | 9 | - | - | 299 | 8,811 | 9,110 | ||||||||||||||||||||||||||||||
Dealer Finance | 696 | 189 | - | 161 | 1,046 | 39,587 | 40,633 | ||||||||||||||||||||||||||||||
Credit Cards | 36 | - | 1 | - | 37 | 2,668 | 2,705 | ||||||||||||||||||||||||||||||
Total | $ | 7,951 | $ | 1,039 | $ | 1 | $ | 6,974 | $ | 15,965 | $ | 502,237 | $ | 518,202 | |||||||||||||||||||||||
30-59 Days Past due | 60-89 Days Past Due | Greater than 90 Days (excluding non-accrual) | Non-Accrual Loans | Total Past Due | Current | Total Loan Receivable | |||||||||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||||||||||||||
Construction/Land Development | $ | 167 | $ | 735 | $ | - | $ | 8,556 | $ | 9,458 | $ | 59,054 | $ | 68,512 | |||||||||||||||||||||||
Farmland | - | - | - | - | - | 13,197 | 13,197 | ||||||||||||||||||||||||||||||
Real Estate | 4,659 | 920 | 246 | 1,407 | 7,232 | 147,396 | 154,628 | ||||||||||||||||||||||||||||||
Multi-Family | 107 | - | - | - | 107 | 11,690 | 11,797 | ||||||||||||||||||||||||||||||
Commercial Real Estate | 858 | - | - | 1,474 | 2,332 | 111,083 | 113,415 | ||||||||||||||||||||||||||||||
Home Equity – closed end | 122 | 79 | 10 | 180 | 391 | 9,837 | 10,228 | ||||||||||||||||||||||||||||||
Home Equity – open end | 549 | 39 | 51 | 222 | 861 | 46,497 | 47,358 | ||||||||||||||||||||||||||||||
Commercial & Industrial – Non- Real Estate | 148 | 20 | 4 | 416 | 588 | 25,315 | 25,903 | ||||||||||||||||||||||||||||||
Consumer | 169 | 71 | 5 | - | 245 | 9,918 | 10,163 | ||||||||||||||||||||||||||||||
Dealer Finance | 335 | 72 | 11 | - | 418 | 20,154 | 20,572 | ||||||||||||||||||||||||||||||
Credit Cards | 21 | 3 | - | - | 24 | 2,656 | 2,680 | ||||||||||||||||||||||||||||||
Total | $ | 7,135 | $ | 1,939 | $ | 327 | $ | 12,255 | $ | 21,656 | $ | 456,797 | $ | 478,453 | |||||||||||||||||||||||
CREDIT QUALITY INDICATORS (in thousands) | |||||||||||||||||||||||||||||||||||||
AS OF DECEMBER 31, 2014 | |||||||||||||||||||||||||||||||||||||
Corporate Credit Exposure | |||||||||||||||||||||||||||||||||||||
Credit Risk Profile by Creditworthiness Category | |||||||||||||||||||||||||||||||||||||
Grade 1 Minimal Risk | Grade 2 Modest Risk | Grade 3 Average Risk | Grade 4 Acceptable Risk | Grade 5 Marginally Acceptable | Grade 6 Watch | Grade 7 Substandard | Grade 8 Doubtful | Total | |||||||||||||||||||||||||||||
Construction/Land Development | $ | - | $ | 165 | $ | 8,460 | $ | 24,227 | $ | 9,605 | $ | 3,815 | $ | 20,909 | $ | - | $ | 67,181 | |||||||||||||||||||
Farmland | 68 | - | 1,640 | 3,451 | 5,228 | - | 2,120 | - | 12,507 | ||||||||||||||||||||||||||||
Real Estate | - | 629 | 60,290 | 66,464 | 23,934 | 7,083 | 3,849 | - | 162,249 | ||||||||||||||||||||||||||||
Multi-Family | - | 468 | 4,145 | 2,183 | 4,979 | - | - | - | 11,775 | ||||||||||||||||||||||||||||
Commercial Real Estate | - | 1,687 | 22,800 | 65,653 | 19,058 | 10,571 | 2,536 | - | 122,305 | ||||||||||||||||||||||||||||
Home Equity – closed end | - | - | 4,327 | 3,090 | 1,812 | 154 | 11 | - | 9,394 | ||||||||||||||||||||||||||||
Home Equity – open end | - | 1,555 | 13,433 | 28,425 | 4,309 | 1,936 | 2,524 | - | 52,182 | ||||||||||||||||||||||||||||
Commercial & Industrial (Non-Real Estate) | 643 | 74 | 4,692 | 18,039 | 3,948 | 735 | 30 | - | 28,161 | ||||||||||||||||||||||||||||
Total | $ | 711 | $ | 4,578 | $ | 119,787 | $ | 211,532 | $ | 72,873 | $ | 24,294 | $ | 31,979 | $ | - | $ | 465.754 | |||||||||||||||||||
Consumer Credit Exposure | |||||||||||||||||||||||||||||||||||||
Credit Risk Profile Based on Payment Activity | |||||||||||||||||||||||||||||||||||||
Credit Cards | Consumer | ||||||||||||||||||||||||||||||||||||
Performing | $ | 2,704 | $ | 49,582 | |||||||||||||||||||||||||||||||||
Non performing | 1 | 161 | |||||||||||||||||||||||||||||||||||
Total | $ | 2,705 | $ | 49,743 | |||||||||||||||||||||||||||||||||
CREDIT QUALITY INDICATORS (in thousands) | |||||||||||||||||||||||||||||||||||||
AS OF DECEMBER 31, 2013 | |||||||||||||||||||||||||||||||||||||
Corporate Credit Exposure | |||||||||||||||||||||||||||||||||||||
Credit Risk Profile by Creditworthiness Category | |||||||||||||||||||||||||||||||||||||
Grade 1 Minimal Risk | Grade 2 Modest Risk | Grade 3 Average Risk | Grade 4 Acceptable Risk | Grade 5 Marginally Acceptable | Grade 6 Watch | Grade 7 Substandard | Grade 8 Doubtful | Total | |||||||||||||||||||||||||||||
Construction/Land Development | $ | - | $ | - | $ | 3,166 | $ | 25,657 | $ | 11,116 | $ | 2,946 | $ | 25,627 | $ | - | $ | 68,512 | |||||||||||||||||||
Farmland | 69 | - | 1,406 | 5,206 | 4,816 | 143 | 1,557 | - | 13,197 | ||||||||||||||||||||||||||||
Real Estate | - | 562 | 68,241 | 52,190 | 19,037 | 7,821 | 6,777 | - | 154,628 | ||||||||||||||||||||||||||||
Multi-Family | - | 668 | 4,442 | 2,275 | 4,412 | - | - | - | 11,797 | ||||||||||||||||||||||||||||
Commercial Real Estate | - | 1,897 | 18,062 | 55,350 | 21,677 | 13,406 | 3,023 | - | 113,415 | ||||||||||||||||||||||||||||
Home Equity – closed end | - | - | 4,574 | 3,117 | 1,870 | 281 | 386 | - | 10,228 | ||||||||||||||||||||||||||||
Home Equity – open end | - | 1,482 | 13,308 | 26,734 | 4,840 | 327 | 667 | - | 47,358 | ||||||||||||||||||||||||||||
Commercial & Industrial (Non-Real Estate) | 815 | 92 | 3,631 | 16,265 | 3,108 | 1,516 | 476 | - | 25,903 | ||||||||||||||||||||||||||||
Total | $ | 884 | $ | 4,701 | $ | 116,830 | $ | 186,794 | $ | 70,876 | $ | 26,440 | $ | 38,513 | $ | - | $ | 445,038 | |||||||||||||||||||
Consumer Credit Exposure | |||||||||||||||||||||||||||||||||||||
Credit Risk Profile Based on Payment Activity | |||||||||||||||||||||||||||||||||||||
Credit Cards | Consumer | ||||||||||||||||||||||||||||||||||||
Performing | $ | 2,680 | $ | 30,719 | |||||||||||||||||||||||||||||||||
Non performing | - | 16 | |||||||||||||||||||||||||||||||||||
Total | $ | 2,680 | $ | 30,735 |
7_TROUBLED_DEBT_RESTRUCTURING_
7. TROUBLED DEBT RESTRUCTURING (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Troubled Debt Restructuring Tables | |||||||||||||
Troubled Debt Restructurings | 31-Dec-14 | ||||||||||||
Pre-Modification | Post-Modification | ||||||||||||
(in thousands) | Outstanding | Outstanding | |||||||||||
Number of Contracts | Recorded Investment | Recorded Investment | |||||||||||
Troubled Debt Restructurings | |||||||||||||
Real Estate | 2 | $ | 179 | $ | 179 | ||||||||
Consumer | 1 | 22 | 22 | ||||||||||
$ | 201 | $ | 201 | ||||||||||
31-Dec-13 | |||||||||||||
Pre-Modification | Post-Modification | ||||||||||||
(in thousands) | Outstanding | Outstanding | |||||||||||
Number of Contracts | Recorded Investment | Recorded Investment | |||||||||||
Troubled Debt Restructurings | |||||||||||||
Construction/Land Development | 1 | $ | 937 | $ | 937 | ||||||||
Real Estate | 1 | 50 | 50 | ||||||||||
Commercial Real Estate | 1 | 312 | 312 | ||||||||||
Commercial & Industrial – Non- Real Estate | 1 | 201 | 201 | ||||||||||
$ | 1,500 | $ | 1,500 |
8_BANK_PREMISES_AND_EQUIPMENT_
8. BANK PREMISES AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Bank Premises And Equipment Tables | |||||||||
Bank premises and equipment | 2014 | 2013 | |||||||
Land | $ | 1,418,003 | $ | 1,418,003 | |||||
Buildings and improvements | 6,793,644 | 6,771,867 | |||||||
Furniture and equipment | 6,479,815 | 5,963,779 | |||||||
14,691,462 | 14,153,649 | ||||||||
Less - accumulated depreciation | (8,233,208 | ) | (7,628,592 | ) | |||||
Net | $ | 6,458,254 | $ | 6,525,057 |
9_OTHER_REAL_ESTATE_OWNED_Tabl
9. OTHER REAL ESTATE OWNED (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Other Real Estate Owned Tables | |||||||||
Other Real Estate Owned Activity | The tables below reflect OREO activity for 2014 and 2013: | ||||||||
Other Real Estate Owned | |||||||||
2014 | 2013 | ||||||||
Balance beginning of year | $ | 2,628,418 | $ | 2,883,947 | |||||
Property acquired at foreclosure | 2,914,958 | 1,337,890 | |||||||
Capital improvements on foreclosed property | 48,961 | 11,329 | |||||||
Sale of other real estate owned financed by Bank | (780,097 | ) | (569,245 | ) | |||||
Sales of foreclosed properties | (1,029,452 | ) | (964,149 | ) | |||||
Valuation adjustments | (275,635 | ) | (71,354 | ) | |||||
Balance as of December 31 | $ | 3,507,153 | $ | 2,628,418 |
10_DEPOSITS_Tables
10. DEPOSITS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Deposits Tables | |||||||||
Composition of deposits | The composition of deposits at December 31, 2014 and 2013 was as follows: | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Noninterest bearing demand deposits | $ | 112,197,722 | $ | 92,396,921 | |||||
Savings and interest bearing demand deposits: | |||||||||
Interest checking accounts | 119,593,529 | 117,456,275 | |||||||
Savings accounts | 64,249,199 | 58,292,273 | |||||||
Time Deposits: | |||||||||
Balances of less than $100,000 | 115,651,329 | 126,330,053 | |||||||
Balances of $100,000 and more | 79,812,757 | 69,673,722 | |||||||
Total Deposits | $ | 491,504,536 | $ | 464,149,244 | |||||
Maturity of Deposits | At December 31, 2014, the scheduled maturities of time deposits are as follows: | ||||||||
2015 | $ | 92,047,350 | |||||||
2016 | 58,857,584 | ||||||||
2017 | 16,213,687 | ||||||||
2018 | 15,150,944 | ||||||||
2019 and after | 13,194,521 | ||||||||
Total | $ | 195,464,086 |
11_SHORTTERM_DEBT_Tables
11. SHORT-TERM DEBT (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Short-Term Debt Tables | |||||||||||||||||||||
Short-term debt | Short-term debt information is summarized as follows: | ||||||||||||||||||||
Maximum | Weighted | ||||||||||||||||||||
Outstanding | Outstanding | Average | Average | Year End | |||||||||||||||||
at any | at | Balance | Interest | Interest | |||||||||||||||||
Month End | Year End | Outstanding | Rate | Rate | |||||||||||||||||
2014 | |||||||||||||||||||||
Federal funds purchased | $ | 491,000 | $ | - | $ | 7,704 | 0.001 | % | 0.61 | % | |||||||||||
FHLB short term | 10,000 ,000 | 10,000,000 | 27,397 | 0.001 | % | 0.17 | % | ||||||||||||||
Securities sold under agreements to repurchase | 5,066,238 | 4,358,492 | 3,837,612 | 0.23 | % | 0.24 | % | ||||||||||||||
Totals | $ | 14,358,492 | $ | 3,872,713 | 0.23 | % | 0.23 | % | |||||||||||||
2013 | |||||||||||||||||||||
Federal funds purchased | $ | - | $ | - | $ | 42,838 | 0.01 | % | 0.97 | % | |||||||||||
FHLB short term | 17,500,000 | - | 2,938,356 | 0.23 | % | 0.49 | % | ||||||||||||||
Securities sold under agreements to repurchase | 3,522,999 | 3,423,078 | 3,190,186 | 0.14 | % | 0.28 | % | ||||||||||||||
Totals | $ | 3,423,078 | $ | 6,171,380 | 0.38 | % | 0.39 | % | |||||||||||||
2012 | |||||||||||||||||||||
Federal funds purchased | $ | 9,283,000 | $ | 9,283,000 | $ | 776,617 | 0.51 | % | 0.9 | % | |||||||||||
FHLB short term | 32,500,000 | 22,500,000 | 8,088,798 | 0.46 | % | 0.37 | % | ||||||||||||||
Securities sold under agreements to repurchase | 4,773,045 | 2,814,352 | 3,949,934 | 0.35 | % | 0.38 | % | ||||||||||||||
Totals | $ | 34,597,352 | $ | 12,815,349 | 0.41 | % | 0.41 | % |
12_LONGTERM_DEBT_Tables
12. LONG-TERM DEBT (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Long-Term Debt Tables | |||||
Maturities of long-term debt | The maturities of long-term Federal Home Loan Bank borrowings as of December 31, 2014 are as follows: | ||||
2015 | $ | 500,000 | |||
2016 | 500,000 | ||||
2017 | 500,000 | ||||
2018 | 500,000 | ||||
Thereafter | 7,875,000 | ||||
Total | $ | 9,875,000 |
13_INCOME_TAX_EXPENSE_Tables
13. INCOME TAX EXPENSE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Tax Expense Tables | |||||||||||||
Components of the income tax expense | The components of the income tax expense are as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Current expense | |||||||||||||
Federal | $ | 2,385,958 | $ | 1,338,439 | $ | 2,590,130 | |||||||
Deferred (benefit) expense | |||||||||||||
Federal | 505,684 | 636,452 | (412,621 | ) | |||||||||
State | 9,854 | (67,594 | ) | (82,112 | ) | ||||||||
Total Deferred (benefit) expense | 515,538 | 568,858 | (494,733 | ) | |||||||||
Total Income Tax Expense | $ | 2,901,496 | $ | 1,907,297 | $ | 2,095,397 | |||||||
Components of the deferred taxes | The components of the deferred taxes as of December 31 are as follows: | ||||||||||||
Deferred Tax Assets: | 2014 | 2013 | |||||||||||
Allowance for loan losses | $ | 2,201,291 | $ | 1,788,360 | |||||||||
Split Dollar Life Insurance | 4,440 | 4,440 | |||||||||||
Nonqualified deferred compensation | 594,132 | 527,909 | |||||||||||
Low income housing partnerships losses | 308,539 | - | |||||||||||
Securities impairment | - | 532,211 | |||||||||||
Core deposit amortization | 72,188 | 298,019 | |||||||||||
State historic tax credits | - | 26,432 | |||||||||||
Other real estate owned | 3,746 | 3,746 | |||||||||||
Pension plan | 1,199,686 | 470,091 | |||||||||||
Total Assets | $ | 4,384,022 | $ | 3,651,208 | |||||||||
Deferred Tax Liabilities: | 2014 | 2013 | |||||||||||
Unearned low income housing credits | $ | 523,769 | $ | 661,841 | |||||||||
Depreciation | 320,743 | 363,946 | |||||||||||
Pension | 1,864,964 | 1,423,461 | |||||||||||
Goodwill tax amortization | 853,880 | 791,771 | |||||||||||
Securities available for sale | 1,272 | (6,339 | ) | ||||||||||
Other | - | (74,926 | ) | ||||||||||
Total Liabilities | 3,564,628 | 3,159,754 | |||||||||||
Net Deferred Tax Asset (included in Other Assets on Balance Sheet) | $ | 819,394 | $ | 491,454 | |||||||||
Differences in actual income tax expense and the amounts computed using the federal statutory tax rates | The following table summarizes the differences between the actual income tax expense and the amounts computed using the federal statutory tax rates: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Tax expense at federal statutory rates | $ | 2,959,056 | $ | 2,251,851 | $ | 2,378,804 | |||||||
Increases (decreases) in taxes resulting from: | |||||||||||||
State income taxes, net | 8,659 | 9,229 | 6,132 | ||||||||||
Partially exempt income | (54,529 | ) | (44,676 | ) | (49,828 | ) | |||||||
Tax-exempt income | (190,192 | ) | (197,482 | ) | (188,932 | ) | |||||||
Prior year LIH credits | (21,787 | ) | (61,768 | ) | 97,857 | ||||||||
Deferred Tax Asset Valuation Allowance | 396,440 | - | - | ||||||||||
Other | (196,151 | ) | (49,857 | ) | (148,636 | ) | |||||||
Total Income Tax Expense | $ | 2,901,496 | $ | 1,907,297 | $ | 2,095,397 |
14_EMPLOYEE_BENEFITS_Tables
14. EMPLOYEE BENEFITS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Employee Benefits Tables | |||||||||||||
Reconciliation of the changes in the benefit obligations and fair value of plan assets | The following table provides a reconciliation of the changes in the benefit obligations and fair value of plan assets for 2014, 2013 and 2012: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Change in Benefit Obligation | |||||||||||||
Benefit obligation, beginning | $ | 7,933,568 | $ | 8,931,940 | $ | 7,296,932 | |||||||
Service cost | 501,032 | 599,933 | 518,634 | ||||||||||
Interest cost | 377,706 | 350,314 | 327,924 | ||||||||||
Actuarial gain (loss) | 2,030,583 | (1,300,094 | ) | 1,066,019 | |||||||||
Benefits paid | (65,474 | ) | (648,525 | ) | (277,569 | ) | |||||||
Benefit obligation, ending | $ | 10,777,415 | $ | 7,933,568 | $ | 8,931,940 | |||||||
Change in Plan Assets | |||||||||||||
Fair value of plan assets, beginning | $ | 9,687,226 | $ | 8,123,437 | $ | 6,760,513 | |||||||
Actual return on plan assets | 562,093 | 1,462,314 | 890,493 | ||||||||||
Employer contribution | 1,500,000 | 750,000 | 750,000 | ||||||||||
Benefits paid | (65,474 | ) | (648,525 | ) | (277,569 | ) | |||||||
Fair value of plan assets, ending | 11,683,845 | 9,687,226 | 8,123,437 | ||||||||||
Funded status at the end of the year | $ | 906,430 | $ | 1,753,658 | $ | (808,503 | ) | ||||||
Fair value of plan assets | 2014 | 2013 | 2012 | ||||||||||
Amount recognized in the Balance Sheet | |||||||||||||
Accrued prepaid benefit cost | $ | 4,434,917 | $ | 3,136,277 | $ | 2,888,390 | |||||||
Unfunded pension benefit obligation under ASC 325-960 | (3,528,487 | ) | (1,382,619 | ) | (3,696,893 | ) | |||||||
Amount recognized in accumulated other | |||||||||||||
comprehensive income | |||||||||||||
Net Gain/(Loss) | $ | (3,616,087 | ) | $ | (1,485,455 | ) | $ | (3,814,965 | ) | ||||
Prior service cost | 87,600 | 102,836 | 118,072 | ||||||||||
Net obligation at transition | - | - | - | ||||||||||
Amount recognized | (3,528,487 | ) | (1,382,619 | ) | (3,696,893 | ) | |||||||
Deferred Taxes | 1,199,686 | 470,090 | 1,256,944 | ||||||||||
Amount recognized in accumulated | |||||||||||||
comprehensive income | $ | (2,328,801 | ) | $ | (912,529 | ) | $ | (2,439,949 | ) | ||||
(Accrued) Prepaid benefit detail | |||||||||||||
Benefit obligation | $ | (10,777,415 | ) | $ | (7,933,568 | ) | $ | (8,931,940 | ) | ||||
Fair value of assets | 11,683,845 | 9,687,226 | 8,123,437 | ||||||||||
Unrecognized net actuarial loss | 3,616,087 | 1,485,455 | 3,814,965 | ||||||||||
Unrecognized transition obligation | |||||||||||||
Unrecognized prior service cost | (87,600 | ) | (102,836 | ) | (118,072 | ) | |||||||
Prepaid (accrued) benefits | $ | 4,434,917 | $ | 3,136,277 | $ | 2,888,390 | |||||||
Components of net periodic benefit cost | |||||||||||||
Service cost | $ | 501,032 | $ | 599,933 | $ | 518,634 | |||||||
Interest cost | 377,706 | 350,314 | 327,924 | ||||||||||
Expected return on plan assets | (698,252 | ) | (636,081 | ) | (540,069 | ) | |||||||
Amortization of prior service cost | (15,236 | ) | (15,236 | ) | (15,236 | ) | |||||||
Amortization of transition obligation | |||||||||||||
Recognized net actuarial (gain) loss | 36,110 | 203,183 | 173,222 | ||||||||||
Net periodic benefit cost | $ | 201,360 | $ | 502,113 | $ | 464,475 | |||||||
Additional disclosure information | |||||||||||||
Accumulated benefit obligation | $ | 7,543,340 | $ | 5,474,048 | $ | 6,214,325 | |||||||
Vested benefit obligation | $ | 7,408,014 | $ | 5,388,808 | $ | 6,087,194 | |||||||
Discount rate used for net pension cost | 5 | % | 4 | % | 4.5 | % | |||||||
Discount rate used for disclosure | 4 | % | 5 | % | 4 | % | |||||||
Expected return on plan assets | 7.5 | % | 8 | % | 8 | % | |||||||
Rate of compensation increase | 3 | % | 3 | % | 3 | % | |||||||
Average remaining service (years) | 14 | 14 | 14 | ||||||||||
Pension plan's asset allocation | The following table provides the pension plan’s asset allocation as of December 31: | ||||||||||||
2014 | 2013 | ||||||||||||
Mutual funds - equity | 61 | % | 62 | % | |||||||||
Mutual funds –fixed income | 39 | % | 38 | % | |||||||||
Cash and equivalents | 0 | % | 0 | % | |||||||||
Estimated Future Benefit Payments | Estimated Future Benefit Payments | ||||||||||||
2015 | $ | 1,017,602 | |||||||||||
2016 | 148,021 | ||||||||||||
2017 | 65,614 | ||||||||||||
2018 | 1,234,133 | ||||||||||||
2019 | 681,525 | ||||||||||||
2020-2024 | 4,526,371 | ||||||||||||
$ | 7,673,266 |
16_COMMITMENTS_Tables
16. COMMITMENTS (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Commitments Tables | |||||||||
Commitments outstanding | As of the balance sheet dates, the Company had the following commitments outstanding: | ||||||||
2014 | 2013 | ||||||||
Commitments to loan money | $ | 120,922,771 | $ | 103,782,380 | |||||
Standby letters of credit | 2,077,870 | 985,331 | |||||||
Long term lease arrangements | As of December 31, 2014, the required lease payments for the next five years are as follows: | ||||||||
2015 | $ | 135,909 | |||||||
2016 | 79,762 | ||||||||
2017 | 56,791 | ||||||||
2018 | 44,359 | ||||||||
2019 | 45,468 |
17_ON_BALANCE_SHEET_DERIVATIVE
17. ON BALANCE SHEET DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
On Balance Sheet Derivative Instruments And Hedging Activities Tables | |||||||||
Forward option contracts | At December 31, the information pertaining to the forward option contracts, included in other assets and other liabilities on the balance sheet, is as follows: | ||||||||
2014 | 2013 | ||||||||
Notional amount | $ | 87,782 | $ | 91,223 | |||||
Fair market value of contracts | 32,795 | 30,741 |
18_TRANSACTIONS_WITH_RELATED_P
18. TRANSACTIONS WITH RELATED PARTIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Transactions With Related Parties Tables | |||||||||
Loan transactions with related parties | Loan transactions with related parties are shown in the following schedule: | ||||||||
2014 | 2013 | ||||||||
Total loans, beginning of year | $ | 7,786,058 | $ | 7,299,706 | |||||
New loans | 5,249,565 | 6,127,927 | |||||||
Relationship Change | - | 702,135 | |||||||
Repayments | (5,586,483 | ) | (6,343,710 | ) | |||||
Total loans, end of year | $ | 7,449,140 | $ | 7,786,058 |
20_DISCLOSURES_ABOUT_FAIR_VALU
20. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
DisclosuresAboutFairValueOfFinancialInstrumentsTablesAbstract | |||||||||||||||||
Carrying Value and Estimated Fair Value for Financial Instruments | 2014 | 2013 | |||||||||||||||
Estimated | Carrying | Estimated | Carrying | ||||||||||||||
Fair Value | Value | Fair Value | Value | ||||||||||||||
Financial Assets (in thousands) | |||||||||||||||||
Loans | $ | 551,338 | $ | 518,202 | $ | 512,250 | $ | 478,453 | |||||||||
Financial Liabilities | |||||||||||||||||
Time deposits | 196,826 | 195,464 | 197,729 | 196,004 | |||||||||||||
Long-term debt | 9,862 | 9,875 | 12,613 | 11,500 |
21_FAIR_VALUE_MEASUREMENTS_Tab
21. FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Measurements Tables | |||||||||||||||||
Fair value measurements | Fair Value at | Valuation Technique | Significant Unobservable Inputs | Range | |||||||||||||
31-Dec-14 | |||||||||||||||||
Impaired Loans | $ | 13,223 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Other Real Estate Owned | $ | 3,507 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Fair Value at | Valuation Technique | Significant Unobservable Inputs | Range | ||||||||||||||
31-Dec-13 | |||||||||||||||||
Impaired Loans | $ | 8,514 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Other Real Estate Owned | $ | 2,628 | Discounted appraised value | Discount for selling costs and age of appraisals | 15%-55 | % | |||||||||||
Assets and liabilities measured at fair value on a recurring basis | Assets and Liabilities Recorded at Fair Value on a Recurring Basis (in thousands) | ||||||||||||||||
December 31, 2014 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
U. S. Treasuries | $ | 4,020 | $ | - | $ | 4,020 | $ | - | |||||||||
Government sponsored enterprises | 8,038 | - | 8,038 | - | |||||||||||||
Mortgage-backed obligations of federal agencies | 1,022 | - | 1,022 | - | |||||||||||||
Marketable equities | 135 | - | 135 | - | |||||||||||||
Investment securities available for sale | 13,215 | - | 13,215 | - | |||||||||||||
Total assets at fair value | $ | 13,215 | $ | - | $ | 13,215 | $ | - | |||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Derivative financial instruments at fair value | $ | 33 | $ | - | $ | 33 | $ | - | |||||||||
31-Dec-13 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Government sponsored enterprises | $ | 29,065 | $ | - | $ | 29,065 | $ | - | |||||||||
Mortgage-backed obligations of federal agencies | 1,201 | - | 1,201 | - | |||||||||||||
Investment securities available for sale | 30,266 | - | 30,266 | - | |||||||||||||
Total assets at fair value | $ | 30,266 | $ | - | $ | 30,266 | $ | - | |||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Derivative financial instruments at fair value | $ | 31 | $ | - | $ | 31 | $ | - | |||||||||
Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis | Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis (in thousands) | ||||||||||||||||
31-Dec-14 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Other Real Estate Owned | $ | 3,507 | - | - | $ | 3,507 | |||||||||||
- | - | ||||||||||||||||
Construction/Land Development | 11,507 | - | - | 11,507 | |||||||||||||
Farmland | - | - | - | - | |||||||||||||
Real Estate | 825 | - | - | 825 | |||||||||||||
Multi-Family | - | - | - | - | |||||||||||||
Commercial Real Estate | 891 | - | - | 891 | |||||||||||||
Home Equity – closed end | - | - | - | - | |||||||||||||
Home Equity – open end | - | - | - | - | |||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | |||||||||||||
Consumer | - | - | - | - | |||||||||||||
Credit cards | - | - | - | - | |||||||||||||
Dealer Finance | - | - | - | - | |||||||||||||
Impaired loans | 13,223 | - | - | 13,223 | |||||||||||||
Total assets at fair value | $ | 16,730 | - | $ | - | $ | 16,730 | ||||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - | |||||||||
Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis (in thousands) | |||||||||||||||||
The table below presents the recorded amount of assets and liabilities measured at fair value on a non-recurring basis. | |||||||||||||||||
31-Dec-13 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Other Real Estate Owned | $ | 2,628 | - | - | $ | 2,628 | |||||||||||
- | - | ||||||||||||||||
Construction/Land Development | 6,731 | - | - | 6,731 | |||||||||||||
Farmland | - | - | - | - | |||||||||||||
Real Estate | 991 | - | - | 991 | |||||||||||||
Multi-Family | - | - | - | - | |||||||||||||
Commercial Real Estate | 536 | - | - | 536 | |||||||||||||
Home Equity – closed end | 163 | - | - | 163 | |||||||||||||
Home Equity – open end | 91 | - | - | 91 | |||||||||||||
Commercial & Industrial – Non-Real Estate | - | - | - | - | |||||||||||||
Consumer | 2 | - | - | 2 | |||||||||||||
Credit cards | - | - | - | - | |||||||||||||
Dealer Finance | - | - | - | - | |||||||||||||
Impaired loans | 8,514 | - | - | 8,514 | |||||||||||||
Total assets at fair value | $ | 11,142 | - | $ | - | 11,142 | |||||||||||
Total liabilities at fair value | $ | - | $ | - | $ | - | $ | - |
22_REGULATORY_MATTERS_Tables
22. REGULATORY MATTERS (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Regulatory Matters Tables | ||||||||||||||||
Actual consolidated capital ratios | The Company’s actual consolidated capital ratios are presented in the following table (dollars in thousands): | |||||||||||||||
Analysis of Capital | Regulatory Requirements | |||||||||||||||
At December 31, | Adequately | Well | ||||||||||||||
2014 | 2013 | 2012 | Capitalized | Capitalized | ||||||||||||
Tier1 capital: | ||||||||||||||||
Preferred stock | $ | 9,425 | $ | - | $ | - | ||||||||||
Common stock | 16,459 | 12,559 | 12,498 | |||||||||||||
Retained earnings | 53,815 | 42,089 | 38,927 | |||||||||||||
Intangible assets | (2,670 | ) | (2,670 | ) | (2,670 | ) | ||||||||||
Accumulated other comprehensive income | - | - | - | |||||||||||||
Total Tier 1 Capital | $ | 77,029 | $ | 51,978 | $ | 48,755 | ||||||||||
Tier 2 capital: | ||||||||||||||||
Qualifying subordinated debt | $ | - | $ | 8,487 | $ | 9,284 | ||||||||||
Allowance for loan losses | 6,018 | 5,389 | 5,716 | |||||||||||||
Unrealized gains on AFS equity securities | - | - | - | |||||||||||||
Total risked based capital | $ | 83,047 | $ | 65,854 | $ | 63,755 | ||||||||||
Risk-weighted assets | $ | 478,725 | $ | 428,349 | $ | 456,066 | ||||||||||
Capital ratios: | ||||||||||||||||
Total risk-based ratio | 17.35 | % | 15.37 | % | 13.98 | % | 8.00% | 10.00% | ||||||||
Tier 1 risk-based ratio | 16.09 | % | 12.13 | % | 10.69 | % | 4.00% | 6.00% | ||||||||
Total assets leverage ratio | 12.88 | % | 9.37 | % | 8.29 | % | 3.00% | 5.00% | ||||||||
Actual capital ratios for the subsidiary bank | The actual capital ratios for the subsidiary bank are presented in the following table (dollars in thousands): | |||||||||||||||
Analysis of Capital | Regulatory Requirements | |||||||||||||||
At December 31, | Adequately | Well | ||||||||||||||
2014 | 2013 | 2012 | Capitalized | Capitalized | ||||||||||||
Tier1 capital: | ||||||||||||||||
Common stock | $ | 500 | $ | 500 | $ | 500 | ||||||||||
Capital surplus | 37,971 | 18,971 | 18,971 | |||||||||||||
Retained earnings | 40,114 | 35,361 | 32,310 | |||||||||||||
Intangible assets | (2,670 | ) | (2,670 | ) | (2,670 | ) | ||||||||||
Accumulated other comprehensive income | - | - | - | |||||||||||||
Total Tier 1 Capital | $ | 75,915 | $ | 52,162 | $ | 49,111 | ||||||||||
Tier 2 capital: | ||||||||||||||||
Qualifying subordinated debt | $ | - | $ | 8,487 | $ | 9,284 | ||||||||||
Allowance for loan losses | 6,006 | 5,384 | 5,716 | |||||||||||||
Unrealized gains on AFS securities | - | - | - | |||||||||||||
Total risked based capital | $ | 81,921 | $ | 66,033 | $ | 64,111 | ||||||||||
Risk-weighted assets | $ | 478,512 | $ | 427,957 | $ | 454,804 | ||||||||||
Capital ratios: | ||||||||||||||||
Total risk-based ratio | 17.12 | % | 15.43 | % | 14.1 | % | 8.00% | 10.00% | ||||||||
Tier 1 risk-based ratio | 15.86 | % | 12.19 | % | 10.8 | % | 4.00% | 6.00% | ||||||||
Total assets leverage ratio | 12.7 | % | 9.41 | % | 8.36 | % | 3.00% | 5.00% |
25_PARENT_CORPORATION_ONLY_FIN
25. PARENT CORPORATION ONLY FINANCIAL STATEMENTS (Tables) (Parent [Member]) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Parent [Member] | |||||||||||||
Balance Sheets | Balance Sheets | ||||||||||||
December 31, 2014 and 2013 | |||||||||||||
2014 | 2013 | ||||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 1,214,140 | $ | 77,952 | |||||||||
Investment in subsidiaries | 76,684,121 | 54,325,282 | |||||||||||
Securities available for sale | 135,000 | - | |||||||||||
Income tax receivable (including due from subsidiary) | 453,585 | - | |||||||||||
Other assets | - | 8,700 | |||||||||||
Total Assets | $ | 78,486,846 | $ | 54,411,934 | |||||||||
Liabilities | |||||||||||||
Other liabilities | $ | 137,977 | $ | 160 | |||||||||
Deferred income taxes | 383,125 | 103,198 | |||||||||||
Demand obligations for low income housing investment | 167,341 | 167,341 | |||||||||||
Total Liabilities | $ | 688,443 | $ | 270,699 | |||||||||
Stockholders’ Equity | |||||||||||||
Preferred stock par value $5 per share, 400,000 shares authorized, issued and outstanding | $ | 9,425,123 | $ | - | |||||||||
Common stock par value $5 per share, 6,000,000 shares authorized, 3,291,766 and 2,511,735 shares issued and outstanding for 2014 and 2013, respectively | 16,458,830 | 12,558,675 | |||||||||||
Retained earnings | 53,814,416 | 42,089,165 | |||||||||||
Noncontrolling interest | 426,365 | 418,228 | |||||||||||
Accumulated other comprehensive income (loss) | (2,326,331 | ) | (924,833 | ) | |||||||||
Total Stockholders' Equity | 77,798,403 | 54,141,235 | |||||||||||
Total Liabilities and Stockholders' Equity | $ | 78,486,846 | $ | 54,411,934 | |||||||||
Statements of Net Income and Retained Earnings | Statements of Net Income and Retained Earnings | ||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income | |||||||||||||
Dividends from affiliate | $ | 1,300,000 | $ | 1,550,000 | $ | 1,100,000 | |||||||
Interest Income | 0 | 5 | 17 | ||||||||||
Other income | - | - | 350 | ||||||||||
Net limited partnership income (loss) | - | 90,863 | 11,930 | ||||||||||
Total Income | 1,300,000 | 1,640,868 | 1,112,297 | ||||||||||
Expenses | |||||||||||||
Other expense | 7,100 | - | - | ||||||||||
Administrative expenses | - | 60,209 | 185,834 | ||||||||||
Total Expenses | 7,100 | 60,209 | 185,834 | ||||||||||
Net income before income tax expense (benefit) | |||||||||||||
and undistributed subsidiary net income | 1,292,900 | 1,580,659 | 926,463 | ||||||||||
Income Tax Expense (Benefit) | 243,492 | (83,880 | ) | (22,500 | ) | ||||||||
Income before undistributed subsidiary | |||||||||||||
net income | 1,049,408 | 1,664,539 | 948,963 | ||||||||||
Undistributed subsidiary net income | 4,752,201 | 3,051,254 | 3,952,121 | ||||||||||
Net Income | $ | 5,801,609 | $ | 4,715,793 | $ | 4,901,084 | |||||||
Statements of Cash Flows | Statements of Cash Flows | ||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Cash Flows from Operating Activities | |||||||||||||
Net income | $ | 5,801,609 | $ | 4,715,793 | $ | 4,901,084 | |||||||
Adjustments to reconcile net income to net | |||||||||||||
cash provided by operating activities: | |||||||||||||
Undistributed subsidiary income | (4,752,201 | ) | (3,051,254 | ) | (3,952,121 | ) | |||||||
Deferred tax (benefit) expense | 279,928 | 8,577 | (18,567 | ) | |||||||||
Decrease (increase) in other assets | (444,885 | ) | (174,367 | ) | 201,537 | ||||||||
Increase (decrease) in other liabilities | 137,817 | (1,109,728 | ) | 992,626 | |||||||||
Net change in deferred tax credits | - | (27,918 | ) | (15,727 | ) | ||||||||
Amortization of limited partnership investments | - | 65,165 | 65,164 | ||||||||||
Net Cash Provided by Operating Activities | 1,022,268 | 426,268 | 2,173,996 | ||||||||||
Cash Flows from Investing Activities | |||||||||||||
Change in loans receivable | - | 1,000,000 | - | ||||||||||
Purchase of securities available for sale | (135,000 | ) | - | (1,000,000 | ) | ||||||||
Net Cash Provided by (Used in) Investing Activities | (135,000 | ) | 1,000,000 | (1,000,000 | ) | ||||||||
Cash Flows from Financing Activities | |||||||||||||
Capital contributed to subsidiary | (19,000,000 | ) | - | - | |||||||||
Proceeds from issuance of preferred stock | 9,425,123 | ||||||||||||
Proceeds from issuance of common stock | 12,055,709 | 213,429 | 105,416 | ||||||||||
Dividends paid in cash | (2,231,912 | ) | (1,705,881 | ) | (1,597,673 | ) | |||||||
Net Provided by (Cash Used) in Financing Activities | 248,920 | (1,492,452 | ) | (1,492,257 | ) | ||||||||
Net Increase (decreases) in Cash and Cash Equivalents | 1,136,188 | (66,184 | ) | (318,261 | ) | ||||||||
Cash and Cash Equivalents, Beginning of Year | 77,952 | 144,136 | 462,397 | ||||||||||
Cash and Cash Equivalents, End of Year | $ | 1,214,140 | $ | 77,952 | $ | 144,136 |
26_INVESTMENT_IN_VBS_MORTGAGE_
26. INVESTMENT IN VBS MORTGAGE, LLC (Tables) (VBS MORTGAGE, LLC [Member]) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
VBS MORTGAGE, LLC [Member] | |||||||||||||
Balance Sheets | Balance Sheets | ||||||||||||
December 31, 2014 and 2013 | |||||||||||||
2014 | 2013 | ||||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 610,973 | $ | 490,225 | |||||||||
Loans Receivable | 818,054 | 871,674 | |||||||||||
Property and equipment, net | 45,600 | 53,903 | |||||||||||
Other Assets | 162,304 | 187,356 | |||||||||||
Total Assets | $ | 1,636,931 | $ | 1,603,158 | |||||||||
Liabilities | |||||||||||||
Other liabilities | 215,713 | 209,065 | |||||||||||
Total Liabilities | $ | 215,713 | $ | 209,065 | |||||||||
Equity | |||||||||||||
Capital | 219,634 | 219,634 | |||||||||||
Retained earnings | 1,201,584 | 1,174,459 | |||||||||||
Total Equity | $ | 1,421,218 | $ | 1,394,093 | |||||||||
Total Liabilities and Equity | $ | 1,636,931 | $ | 1,603,158 | |||||||||
Statements of Income | Statements of Income | ||||||||||||
For the years ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Income | |||||||||||||
Mortgage origination income | $ | 1,907,804 | $ | 2,528,108 | $ | 2,378,023 | |||||||
Other Income | 53,528 | 42,092 | 40,022 | ||||||||||
Total Income | 1,961,332 | 2,570,200 | 2,418,045 | ||||||||||
Expenses | |||||||||||||
Salaries and employee benefits | 1,105,902 | 1,461,797 | 1,254,735 | ||||||||||
Occupancy and equipment expense | 177,014 | 164,717 | 157,514 | ||||||||||
Management and professional fees | 321,053 | 301,558 | 268,337 | ||||||||||
Other | 205,188 | 284,845 | 250,902 | ||||||||||
Total Expenses | 1,809,157 | 2,212,917 | 1,931,488 | ||||||||||
Net income(loss) | $ | 152,175 | $ | 357,283 | $ | 486 557 |
2_SUMMARY_OF_SIGNIFICANT_ACCOU1
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Buildings and Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | P10Y |
Buildings and Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | P40Y |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | P5Y |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | P20Y |
2_SUMMARY_OF_SIGNIFICANT_ACCOU2
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Earnings Available to Common Stockholders: | |||
Net income | $5,801,609 | $4,715,793 | $4,901,084 |
Preferred Stock Dividends | 127,500 | ||
Net Income Available to Common Stockolders | $5,674,109 | $4,715,793 | $4,901,084 |
2_SUMMARY_OF_SIGNIFICANT_ACCOU3
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Accounting Policies [Abstract] | |||
Basic EPS, Income | $5,674,109 | $4,715,793 | $4,901,084 |
Effect of Dilutive SecuritiesConvertible Preferred Stock, Income | 127,500 | ||
Diluted EPS, Income | $5,801,609 | $4,715,793 | $4,901,084 |
Basic EPS, Shares | 3,119,333 | 2,504,015 | 2,496,300 |
Effect of Dilutive SecuritiesConvertible Preferred Stock, Shares | 110,609 | ||
Diluted EPS, Shares | 3,229,942 | 2,504,015 | 2,496,300 |
Basic EPS, Per Share Amounts | $1.82 | $1.88 | $1.96 |
Effect of Dilutive SecuritiesConvertible Preferred Stock, Per Share Amounts | ($0.02) | ||
Diluted EPS, Per Share Amounts | $1.80 | $1.88 | $1.96 |
2_SUMMARY_OF_SIGNIFICANT_ACCOU4
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Summary Of Significant Accounting Policies Details Narrative | |||
OREO on balance sheet | $3,507,153 | $2,628,418 | |
Goodwill | 2,669,517 | 2,669,517 | |
Advertising costs | $317,780 | $278,555 | $251,258 |
3_CASH_AND_DUE_FROM_BANKS_Deta
3. CASH AND DUE FROM BANKS (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash And Due From Banks Details Narrative | ||
Average balance of cash | $25,000 | $25,000 |
4_INVESTMENT_SECURITIES_Detail
4. INVESTMENT SECURITIES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Available-for-Sale Securities | ||
Amortized Cost | $13,211,372 | $30,284,426 |
Gross Unrealized Gains | 19,720 | 11,460 |
Gross Unrealized Losses | 15,980 | 30,105 |
Fair Value | 13,215,112 | 30,265,781 |
Mortgage Backed Obligations of Federal Agencies [Member] | ||
Available-for-Sale Securities | ||
Amortized Cost | 1,011,092 | 1,208,533 |
Gross Unrealized Gains | 10,780 | 0 |
Gross Unrealized Losses | 0 | 7,852 |
Fair Value | 1,021,872 | 1,200,681 |
US Treasury | ||
Available-for-Sale Securities | ||
Amortized Cost | 4,025,740 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 6,100 | 0 |
Fair Value | 4,019,640 | 0 |
Held-to-Maturity Securities | ||
Amortized Cost - Held-to-Maturity | 125,150 | 106,387 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value - Held-to-Maturity | 125,150 | 106,387 |
Government sponsored enterprises | ||
Available-for-Sale Securities | ||
Amortized Cost | 8,039,540 | 29,075,893 |
Gross Unrealized Gains | 8,940 | 11,460 |
Gross Unrealized Losses | 9,880 | 22,253 |
Fair Value | 8,038,600 | 29,065,100 |
Marketable equities | ||
Available-for-Sale Securities | ||
Amortized Cost | 135,000 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | $135,000 | $0 |
4_INVESTMENT_SECURITIES_Detail1
4. INVESTMENT SECURITIES (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Total, Amortized Cost | $125,150 | $106,387 |
Held to maturity Securities [Member] | ||
Due in one year or less, Amortized Cost | 125,150 | |
Due in one year or less, Fair Value | 125,150 | |
Due after one year through five years, Amortized Cost | 0 | |
Due after one year through five years, Fair Value | 0 | |
Due after five years, Amortized Cost | 0 | |
Due after five years, Fair Value | 0 | |
Total, Amortized Cost | 125,150 | |
Total, Fair Value | 125,150 | |
Available for sale Securities [Member] | ||
Due in one year or less, Amortized Cost | 2,000,000 | |
Due in one year or less, Fair Value | 1,999,980 | |
Due after one year through five years, Amortized Cost | 10,065,280 | |
Due after one year through five years, Fair Value | 10,058,260 | |
Due after five years, Amortized Cost | 1,146,092 | |
Due after five years, Fair Value | 1,156,872 | |
Total, Amortized Cost | 13,211,372 | |
Total, Fair Value | $13,215,112 |
4_INVESTMENT_SECURITIES_Detail2
4. INVESTMENT SECURITIES (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Less than 12 Months | $6,024,000 | $6,175,000 |
Unrealized Losses Less than 12 Months | -8,000 | -30,000 |
Fair Value More than 12 Months | 1,991,000 | 0 |
Unrealized Losses More than 12 Months | -8,000 | 0 |
Fair Value Total | 8,015,000 | 6,175,000 |
Unrealized Losses Total | -16,000 | -30,000 |
US Treasury | ||
Fair Value Less than 12 Months | 4,020,000 | 0 |
Unrealized Losses Less than 12 Months | -6,000 | 0 |
Fair Value More than 12 Months | 0 | 0 |
Unrealized Losses More than 12 Months | 0 | 0 |
Fair Value Total | 4,020,000 | 0 |
Unrealized Losses Total | -6,000 | 0 |
Government sponsored enterprises | ||
Fair Value Less than 12 Months | 2,004,000 | 4,984,000 |
Unrealized Losses Less than 12 Months | -2,000 | -22,000 |
Fair Value More than 12 Months | 1,991,000 | 0 |
Unrealized Losses More than 12 Months | -8,000 | 0 |
Fair Value Total | 3,995,000 | 4,984,000 |
Unrealized Losses Total | -10,000 | -22,000 |
Mortgage-backed obligations | ||
Fair Value Less than 12 Months | 0 | 1,191,000 |
Unrealized Losses Less than 12 Months | 0 | -8,000 |
Fair Value More than 12 Months | 0 | 0 |
Unrealized Losses More than 12 Months | 0 | 0 |
Fair Value Total | 0 | 1,191,000 |
Unrealized Losses Total | $0 | ($8,000) |
4_INVESTMENT_SECURITIES_Detail3
4. INVESTMENT SECURITIES (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Investment Securities Details Narrative | ||
Carrying value of securities pledged by Bank | $13,080,000 | $10,255,000 |
Committment to invest six low-income housing limited partnerships | $3,679,541 |
5_LOANS_Details
5. LOANS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Loans held for investment | $518,201,574 | $478,453,008 |
Construction/Land Development [Member] | ||
Loans held for investment | 67,180,467 | 68,512,341 |
Farmland [Member] | ||
Loans held for investment | 12,507,446 | 13,197,398 |
Real Estate [Member] | ||
Loans held for investment | 162,248,606 | 154,628,068 |
Multi-Family [Member] | ||
Loans held for investment | 11,775,205 | 11,797,010 |
Commercial Real Estate [Member] | ||
Loans held for investment | 122,305,417 | 113,415,234 |
Home Equity - Closed End [Member] | ||
Loans held for investment | 9,393,805 | 10,228,264 |
Home Equity - Open End [Member] | ||
Loans held for investment | 52,181,679 | 47,357,787 |
Commercial and Industrial Non-Real Estate [Member] | ||
Loans held for investment | 28,160,584 | 25,903,011 |
Consumer [Member] | ||
Loans held for investment | 9,109,994 | 10,162,457 |
Credit Cards [Member] | ||
Loans held for investment | 2,705,285 | 2,679,718 |
Dealer Finance [Member] | ||
Loans held for investment | $40,633,086 | $20,571,720 |
5_LOANS_Details_1
5. LOANS (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Impaired loans without a valuation allowance | ||
Recorded Investment | $8,122,000 | $6,869,000 |
Unpaid Principal Balance | 8,842,000 | 7,452,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 8,800,000 | 8,738,000 |
Interest Income Recognized | 390,000 | 316,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 14,840,000 | 10,536,000 |
Unpaid Principal Balance | 16,613,000 | 12,261,000 |
Related Allowance | 1,617,000 | 2,022,000 |
Average Recorded Investment | 14,186,000 | 13,636,000 |
Interest Income Recognized | 435,000 | 236,000 |
Impaired loans valuation allowance | ||
Recorded Investment | 22,962,000 | 17,405,000 |
Unpaid Principal Balance | 25,455,000 | 19,713,000 |
Related Allowance | 1,617,000 | 2,022,000 |
Average Recorded Investment | 22,986,000 | 22,374,000 |
Interest Income Recognized | 825,000 | 552,000 |
Construction/Land Development [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 4,982,000 | 3,960,000 |
Unpaid Principal Balance | 5,402,000 | 4,543,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 5,412,000 | 5,750,000 |
Interest Income Recognized | 251,000 | 153,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 12,976,000 | 8,291,000 |
Unpaid Principal Balance | 14,749,000 | 9,716,000 |
Related Allowance | 1,469,000 | 1,560,000 |
Average Recorded Investment | 12,056,000 | 10,855,000 |
Interest Income Recognized | 326,000 | 175,000 |
Farmland [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 1,459,000 |
Unpaid Principal Balance | 0 | 1,459,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 1,163,000 | 1,475,000 |
Interest Income Recognized | 0 | 67,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Real Estate [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 141,000 | 49,000 |
Unpaid Principal Balance | 141,000 | 49,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 85,000 | 529,000 |
Interest Income Recognized | 5,000 | 3,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 926,000 | 1,145,000 |
Unpaid Principal Balance | 926,000 | 1,145,000 |
Related Allowance | 101,000 | 154,000 |
Average Recorded Investment | 988,000 | 966,000 |
Interest Income Recognized | 105,000 | 48,000 |
Multi-Family [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Commercial Real Estate [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 1,159,000 | 851,000 |
Unpaid Principal Balance | 1,459,000 | 851,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 1,450,000 | 616,000 |
Interest Income Recognized | 66,000 | 56,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 938,000 | 818,000 |
Unpaid Principal Balance | 938,000 | 1,118,000 |
Related Allowance | 47,000 | 282,000 |
Average Recorded Investment | 1,030,000 | 1,171,000 |
Interest Income Recognized | 4,000 | 4,000 |
Home Equity - Closed End [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 308,000 |
Unpaid Principal Balance | 0 | 308,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 123,000 | 284,000 |
Interest Income Recognized | 0 | 25,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 180,000 |
Unpaid Principal Balance | 0 | 180,000 |
Related Allowance | 0 | 17,000 |
Average Recorded Investment | 72,000 | 409,000 |
Interest Income Recognized | 0 | 3,000 |
Home Equity - Open End [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 1,649,000 | 0 |
Unpaid Principal Balance | 1,649,000 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 330,000 | 20,000 |
Interest Income Recognized | 57,000 | 0 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 100,000 |
Unpaid Principal Balance | 0 | 100,000 |
Related Allowance | 0 | 9,000 |
Average Recorded Investment | 40,000 | 93,000 |
Interest Income Recognized | 0 | 5,000 |
Commercial and Industrial Non-Real Estate [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 191,000 | 242,000 |
Unpaid Principal Balance | 191,000 | 242,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 237,000 | 64,000 |
Interest Income Recognized | 11,000 | 12,000 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 141,000 |
Interest Income Recognized | 0 | 0 |
Consumer [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 2,000 |
Unpaid Principal Balance | 0 | 2,000 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 1,000 |
Interest Income Recognized | 0 | 1,000 |
Credit Cards [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Dealer Finance [Member] | ||
Impaired loans without a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | 0 | 0 |
Impaired loans with a valuation allowance | ||
Recorded Investment | 0 | 0 |
Unpaid Principal Balance | 0 | 0 |
Related Allowance | 0 | 0 |
Average Recorded Investment | 0 | 0 |
Interest Income Recognized | $0 | $0 |
5_LOANS_Details_Narrative
5. LOANS (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Loans Details Narrative | ||
Federal Home Loan Bank of Atlanta | $183,483,000 | $164,605,000 |
Loans held for sale | $13,381,941 | $3,804,425 |
6_ALLOWANCE_FOR_LOAN_LOSSES_De
6. ALLOWANCE FOR LOAN LOSSES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Beginning Balance | $8,184,000 | $8,154,000 |
Charge-offs | 2,470,000 | 4,025,000 |
Recoveries | 761,000 | 280,000 |
Provision | 2,250,000 | 3,775,000 |
Ending Balance | 8,725,000 | 8,184,000 |
Individually Evaluated for Impairment | 1,617,000 | 2,022,000 |
Collectively Evaluated for Impairment | 7,108,000 | 6,162,000 |
Construction/Land Development [Member] | ||
Beginning Balance | 4,007,000 | 2,771,000 |
Charge-offs | 1,611,000 | 2,127,000 |
Recoveries | 223,000 | 40,000 |
Provision | 2,119,000 | 3,323,000 |
Ending Balance | 4,738,000 | 4,007,000 |
Individually Evaluated for Impairment | 1,469,000 | 1,560,000 |
Collectively Evaluated for Impairment | 3,269,000 | 2,447,000 |
Farmland [Member] | ||
Beginning Balance | -2,000 | -2,000 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | 2,000 | 0 |
Ending Balance | 0 | -2,000 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | 0 | -2,000 |
Real Estate [Member] | ||
Beginning Balance | 400,000 | 924,000 |
Charge-offs | 208,000 | 173,000 |
Recoveries | 0 | 0 |
Provision | 431,000 | -351,000 |
Ending Balance | 623,000 | 400,000 |
Individually Evaluated for Impairment | 101,000 | 154,000 |
Collectively Evaluated for Impairment | 522,000 | 246,000 |
Multi-Family [Member] | ||
Beginning Balance | 0 | -37,000 |
Charge-offs | 0 | 0 |
Recoveries | 0 | 0 |
Provision | 0 | 37,000 |
Ending Balance | 0 | 0 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | 0 | 0 |
Commercial Real Estate [Member] | ||
Beginning Balance | 777,000 | 1,113,000 |
Charge-offs | 0 | 201,000 |
Recoveries | 108,000 | 42,000 |
Provision | -759,000 | -177,000 |
Ending Balance | 126,000 | 777,000 |
Individually Evaluated for Impairment | 47,000 | 282,000 |
Collectively Evaluated for Impairment | 79,000 | 495,000 |
Home Equity - Closed End [Member] | ||
Beginning Balance | 157,000 | 360,000 |
Charge-offs | 0 | 159,000 |
Recoveries | 0 | 0 |
Provision | 31,000 | -44,000 |
Ending Balance | 188,000 | 157,000 |
Individually Evaluated for Impairment | 0 | 17,000 |
Collectively Evaluated for Impairment | 188,000 | 140,000 |
Home Equity - Open End [Member] | ||
Beginning Balance | 476,000 | 659,000 |
Charge-offs | 80,000 | 68,000 |
Recoveries | 0 | 29,000 |
Provision | -242,000 | -144,000 |
Ending Balance | 154,000 | 476,000 |
Individually Evaluated for Impairment | 0 | 9,000 |
Collectively Evaluated for Impairment | 154,000 | 467,000 |
Commercial and Industrial Non-Real Estate [Member] | ||
Beginning Balance | 1,464,000 | 2,113,000 |
Charge-offs | 385,000 | 986,000 |
Recoveries | 356,000 | 127,000 |
Provision | -224,000 | 210,000 |
Ending Balance | 1,211,000 | 1,464,000 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | 1,211,000 | 1,464,000 |
Consumer [Member] | ||
Beginning Balance | 156,000 | 51,000 |
Charge-offs | 33,000 | 173,000 |
Recoveries | 33,000 | 14,000 |
Provision | 58,000 | 264,000 |
Ending Balance | 214,000 | 156,000 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | 214,000 | 156,000 |
Dealer Finance [Member] | ||
Beginning Balance | 628,000 | 72,000 |
Charge-offs | 107,000 | 17,000 |
Recoveries | 6,000 | 0 |
Provision | 809,000 | 573,000 |
Ending Balance | 1,336,000 | 628,000 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | 1,336,000 | 628,000 |
Credit Cards [Member] | ||
Beginning Balance | 121,000 | 130,000 |
Charge-offs | 46,000 | 121,000 |
Recoveries | 35,000 | 28,000 |
Provision | 25,000 | 84,000 |
Ending Balance | 135,000 | 121,000 |
Individually Evaluated for Impairment | 0 | 0 |
Collectively Evaluated for Impairment | $135,000 | $121,000 |
6_ALLOWANCE_FOR_LOAN_LOSSES_De1
6. ALLOWANCE FOR LOAN LOSSES (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Loan Receivable | $518,202,000 | $478,453,000 |
Individually evaluated for impairment | 22,962,000 | 17,405,000 |
Collectively evaluated for impairment | 495,240,000 | 461,048,000 |
Construction/Land Development [Member] | ||
Loan Receivable | 67,181,000 | 68,512,000 |
Individually evaluated for impairment | 17,958,000 | 12,251,000 |
Collectively evaluated for impairment | 49,223,000 | 56,261,000 |
Farmland [Member] | ||
Loan Receivable | 12,507,000 | 13,197,000 |
Individually evaluated for impairment | 0 | 1,459,000 |
Collectively evaluated for impairment | 12,507,000 | 11,738,000 |
Real Estate [Member] | ||
Loan Receivable | 162,249,000 | 154,628,000 |
Individually evaluated for impairment | 1,067,000 | 1,194,000 |
Collectively evaluated for impairment | 161,182,000 | 153,434,000 |
Multi-Family [Member] | ||
Loan Receivable | 11,775,000 | 11,797,000 |
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 11,775,000 | 11,797,000 |
Commercial Real Estate [Member] | ||
Loan Receivable | 122,305,000 | 113,415,000 |
Individually evaluated for impairment | 2,097,000 | 1,669,000 |
Collectively evaluated for impairment | 120,208,000 | 111,746,000 |
Home Equity - Closed End [Member] | ||
Loan Receivable | 9,394,000 | 10,228,000 |
Individually evaluated for impairment | 0 | 488,000 |
Collectively evaluated for impairment | 9,394,000 | 9,740,000 |
Home Equity - Open End [Member] | ||
Loan Receivable | 52,182,000 | 47,358,000 |
Individually evaluated for impairment | 1,649,000 | 100,000 |
Collectively evaluated for impairment | 50,533,000 | 47,258,000 |
Commercial and Industrial Non-Real Estate [Member] | ||
Loan Receivable | 28,161,000 | 25,903,000 |
Individually evaluated for impairment | 191,000 | 242,000 |
Collectively evaluated for impairment | 27,970,000 | 25,661,000 |
Consumer [Member] | ||
Loan Receivable | 9,110,000 | 10,163,000 |
Individually evaluated for impairment | 0 | 2,000 |
Collectively evaluated for impairment | 9,110,000 | 10,161,000 |
Dealer Finance [Member] | ||
Loan Receivable | 40,633,000 | 20,572,000 |
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | 40,633,000 | 20,572,000 |
Credit Cards [Member] | ||
Loan Receivable | 2,705,000 | 2,680,000 |
Individually evaluated for impairment | 0 | 0 |
Collectively evaluated for impairment | $2,705,000 | $2,680,000 |
6_ALLOWANCE_FOR_LOAN_LOSSES_De2
6. ALLOWANCE FOR LOAN LOSSES (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
30-59 Days Past due | $7,951 | $7,135 |
60-89 Days Past due | 1,039 | 1,939 |
Greater than 90 Days (excluding non-accrual) | 1 | 327 |
Non-Accrual Loans | 6,974 | 12,255 |
Total past due | 15,965 | 21,656 |
Current | 502,237 | 456,797 |
Total Loans Receivable | 518,202 | 478,453 |
Construction/Land Development [Member] | ||
30-59 Days Past due | 205 | 167 |
60-89 Days Past due | 166 | 735 |
Greater than 90 Days (excluding non-accrual) | 0 | 0 |
Non-Accrual Loans | 4,508 | 8,556 |
Total past due | 4,879 | 9,458 |
Current | 62,302 | 59,054 |
Total Loans Receivable | 67,181 | 68,512 |
Farmland [Member] | ||
30-59 Days Past due | 0 | 0 |
60-89 Days Past due | 0 | 0 |
Greater than 90 Days (excluding non-accrual) | 0 | 0 |
Non-Accrual Loans | 0 | 0 |
Total past due | 0 | 0 |
Current | 12,507 | 13,197 |
Total Loans Receivable | 12,507 | 13,197 |
Real Estate [Member] | ||
30-59 Days Past due | 5,085 | 4,659 |
60-89 Days Past due | 635 | 920 |
Greater than 90 Days (excluding non-accrual) | 0 | 246 |
Non-Accrual Loans | 973 | 1,407 |
Total past due | 6,693 | 7,232 |
Current | 155,556 | 147,396 |
Total Loans Receivable | 162,249 | 154,628 |
Multi-Family [Member] | ||
30-59 Days Past due | 0 | 107 |
60-89 Days Past due | 0 | 0 |
Greater than 90 Days (excluding non-accrual) | 0 | 0 |
Non-Accrual Loans | 0 | 0 |
Total past due | 0 | 107 |
Current | 11,775 | 11,690 |
Total Loans Receivable | 11,775 | 11,797 |
Commercial Real Estate [Member] | ||
30-59 Days Past due | 747 | 858 |
60-89 Days Past due | 0 | 0 |
Greater than 90 Days (excluding non-accrual) | 0 | 0 |
Non-Accrual Loans | 1,165 | 1,474 |
Total past due | 1,912 | 2,332 |
Current | 120,393 | 111,083 |
Total Loans Receivable | 122,305 | 113,415 |
Home Equity - Closed End [Member] | ||
30-59 Days Past due | 162 | 122 |
60-89 Days Past due | 15 | 79 |
Greater than 90 Days (excluding non-accrual) | 0 | 10 |
Non-Accrual Loans | 10 | 180 |
Total past due | 187 | 391 |
Current | 9,207 | 9,837 |
Total Loans Receivable | 9,394 | 10,228 |
Home Equity - Open End [Member] | ||
30-59 Days Past due | 730 | 549 |
60-89 Days Past due | 25 | 39 |
Greater than 90 Days (excluding non-accrual) | 0 | 51 |
Non-Accrual Loans | 143 | 222 |
Total past due | 898 | 861 |
Current | 51,284 | 46,497 |
Total Loans Receivable | 52,182 | 47,358 |
Commercial and Industrial Non-Real Estate [Member] | ||
30-59 Days Past due | 0 | 148 |
60-89 Days Past due | 0 | 20 |
Greater than 90 Days (excluding non-accrual) | 0 | 4 |
Non-Accrual Loans | 14 | 416 |
Total past due | 14 | 588 |
Current | 28,147 | 25,315 |
Total Loans Receivable | 28,161 | 25,903 |
Consumer [Member] | ||
30-59 Days Past due | 290 | 169 |
60-89 Days Past due | 9 | 71 |
Greater than 90 Days (excluding non-accrual) | 0 | 5 |
Non-Accrual Loans | 0 | 0 |
Total past due | 299 | 245 |
Current | 8,811 | 9,918 |
Total Loans Receivable | 9,110 | 10,163 |
Dealer Finance [Member] | ||
30-59 Days Past due | 696 | 335 |
60-89 Days Past due | 189 | 72 |
Greater than 90 Days (excluding non-accrual) | 0 | 11 |
Non-Accrual Loans | 161 | 0 |
Total past due | 1,046 | 418 |
Current | 39,587 | 20,154 |
Total Loans Receivable | 40,633 | 20,572 |
Credit Cards [Member] | ||
30-59 Days Past due | 36 | 21 |
60-89 Days Past due | 0 | 3 |
Greater than 90 Days (excluding non-accrual) | 1 | 0 |
Non-Accrual Loans | 0 | 0 |
Total past due | 37 | 24 |
Current | 2,668 | 2,656 |
Total Loans Receivable | $2,705 | $2,680 |
6_ALLOWANCE_FOR_LOAN_LOSSES_De3
6. ALLOWANCE FOR LOAN LOSSES (Details 3) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Construction/Land Development | $67,181,000 | $68,512,000 |
Farmland | 12,507,000 | 13,197,000 |
Real Estate | 162,249,000 | 154,628,000 |
Multi-Family | 11,775,000 | 11,797,000 |
Commercial Real Estate | 122,305,000 | 113,415,000 |
Home Equity - closed end | 9,394,000 | 10,228,000 |
Home Equity - open end | 52,182,000 | 47,358,000 |
Commercial & Industrial (Non-Real Estate) | 28,161,000 | 25,903,000 |
Total | 465,754,000 | 445,038,000 |
Grade 1 Minimal Risk [Member] | ||
Construction/Land Development | 0 | 0 |
Farmland | 68,000 | 69,000 |
Real Estate | 0 | 0 |
Multi-Family | 0 | 0 |
Commercial Real Estate | 0 | 0 |
Home Equity - closed end | 0 | 0 |
Home Equity - open end | 0 | 0 |
Commercial & Industrial (Non-Real Estate) | 643,000 | 815,000 |
Total | 711,000 | 884,000 |
Grade 2 Modest Risk [Member] | ||
Construction/Land Development | 165,000 | 0 |
Farmland | 0 | 0 |
Real Estate | 629,000 | 562,000 |
Multi-Family | 468,000 | 668,000 |
Commercial Real Estate | 1,687,000 | 1,897,000 |
Home Equity - closed end | 0 | 0 |
Home Equity - open end | 1,555,000 | 1,482,000 |
Commercial & Industrial (Non-Real Estate) | 74,000 | 92,000 |
Total | 4,578,000 | 4,701,000 |
Grade 3 Average Risk [Member] | ||
Construction/Land Development | 8,460,000 | 3,166,000 |
Farmland | 1,640,000 | 1,406,000 |
Real Estate | 60,290,000 | 68,241,000 |
Multi-Family | 4,145,000 | 4,442,000 |
Commercial Real Estate | 22,800,000 | 18,062,000 |
Home Equity - closed end | 4,327,000 | 4,574,000 |
Home Equity - open end | 13,433,000 | 13,308,000 |
Commercial & Industrial (Non-Real Estate) | 4,692,000 | 3,631,000 |
Total | 119,787,000 | 116,830,000 |
Grade 4 Acceptable Risk [Member] | ||
Construction/Land Development | 24,227,000 | 25,657,000 |
Farmland | 3,451,000 | 5,206,000 |
Real Estate | 66,464,000 | 52,190,000 |
Multi-Family | 2,183,000 | 2,275,000 |
Commercial Real Estate | 65,653,000 | 55,350,000 |
Home Equity - closed end | 3,090,000 | 3,117,000 |
Home Equity - open end | 28,425,000 | 26,734,000 |
Commercial & Industrial (Non-Real Estate) | 18,039,000 | 16,265,000 |
Total | 211,532,000 | 186,794,000 |
Grade 5 Marginally Acceptable [Member] | ||
Construction/Land Development | 9,605,000 | 11,116,000 |
Farmland | 5,228,000 | 4,816,000 |
Real Estate | 23,934,000 | 19,037,000 |
Multi-Family | 4,979,000 | 4,412,000 |
Commercial Real Estate | 19,058,000 | 21,677,000 |
Home Equity - closed end | 1,812,000 | 1,870,000 |
Home Equity - open end | 4,309,000 | 4,840,000 |
Commercial & Industrial (Non-Real Estate) | 3,948,000 | 3,108,000 |
Total | 72,873,000 | 70,876,000 |
Grade 6 Watch [Member] | ||
Construction/Land Development | 3,815,000 | 2,946,000 |
Farmland | 0 | 143,000 |
Real Estate | 7,083,000 | 7,821,000 |
Multi-Family | 0 | 0 |
Commercial Real Estate | 10,571,000 | 13,406,000 |
Home Equity - closed end | 154,000 | 281,000 |
Home Equity - open end | 1,936,000 | 327,000 |
Commercial & Industrial (Non-Real Estate) | 735,000 | 1,516,000 |
Total | 24,294,000 | 26,440,000 |
Grade 7 Substandard [Member] | ||
Construction/Land Development | 20,909,000 | 25,627,000 |
Farmland | 2,120,000 | 1,557,000 |
Real Estate | 3,849,000 | 6,777,000 |
Multi-Family | 0 | 0 |
Commercial Real Estate | 2,536,000 | 3,023,000 |
Home Equity - closed end | 11,000 | 386,000 |
Home Equity - open end | 2,524,000 | 667,000 |
Commercial & Industrial (Non-Real Estate) | 30,000 | 476,000 |
Total | 31,979,000 | 38,513,000 |
Grade 8 Doubtful [Member] | ||
Construction/Land Development | 0 | 0 |
Farmland | 0 | 0 |
Real Estate | 0 | 0 |
Multi-Family | 0 | 0 |
Commercial Real Estate | 0 | 0 |
Home Equity - closed end | 0 | 0 |
Home Equity - open end | 0 | 0 |
Commercial & Industrial (Non-Real Estate) | 0 | 0 |
Total | $0 | $0 |
6_ALLOWANCE_FOR_LOAN_LOSSES_De4
6. ALLOWANCE FOR LOAN LOSSES (Details 4) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Credit cards | $2,705,000 | $2,680,000 |
Consumer | 49,743,000 | 30,735,000 |
Performing Financing Receivable [Member] | ||
Credit cards | 2,704,000 | 2,680,000 |
Consumer | 49,582,000 | 30,719,000 |
Nonperforming Financing Receivable [Member] | ||
Credit cards | 1,000 | 0 |
Consumer | $161,000 | $16,000 |
7_TROUBLED_DEBT_RESTRUCTURING_1
7. TROUBLED DEBT RESTRUCTURING (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Troubled Debt Restructurings | ||
Pre-Modification Outstanding Recorded Investment | $201,000 | $1,500,000 |
Post-Modification Outstanding Recorded Investment | 201,000 | 1,500,000 |
Real Estate [Member] | ||
Troubled Debt Restructurings | ||
Number of Contracts | 2 | 1 |
Pre-Modification Outstanding Recorded Investment | 179,000 | 50,000 |
Post-Modification Outstanding Recorded Investment | 179,000 | 50,000 |
Consumer [Member] | ||
Troubled Debt Restructurings | ||
Number of Contracts | 1 | |
Pre-Modification Outstanding Recorded Investment | 22,000 | |
Post-Modification Outstanding Recorded Investment | 22,000 | |
Construction/Land Development [Member] | ||
Troubled Debt Restructurings | ||
Number of Contracts | 1 | |
Pre-Modification Outstanding Recorded Investment | 937,000 | |
Post-Modification Outstanding Recorded Investment | 937,000 | |
Commercial Real Estate [Member] | ||
Troubled Debt Restructurings | ||
Number of Contracts | 1 | |
Pre-Modification Outstanding Recorded Investment | 312,000 | |
Post-Modification Outstanding Recorded Investment | 312,000 | |
Commercial and Industrial Non-Real Estate [Member] | ||
Troubled Debt Restructurings | ||
Number of Contracts | 1 | |
Pre-Modification Outstanding Recorded Investment | 201,000 | |
Post-Modification Outstanding Recorded Investment | $201,000 |
7_TROUBLED_DEBT_RESTRUCTURING_2
7. TROUBLED DEBT RESTRUCTURING (Details Narrative) (USD $) | Dec. 31, 2014 |
Notes to Financial Statements | |
Real estate loan | $97,000 |
8_BANK_PREMISES_AND_EQUIPMENT_1
8. BANK PREMISES AND EQUIPMENT (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Notes to Financial Statements | ||
Land | $1,418,003 | $1,418,003 |
Buildings and improvements | 6,793,644 | 6,771,867 |
Furniture and equipment | 6,479,815 | 5,963,779 |
Gross | 14,691,462 | 14,153,649 |
Less - accumulated depreciation | -8,233,208 | -7,628,592 |
Net | $6,458,254 | $6,525,057 |
8_BANK_PREMISES_AND_EQUIPMENT_2
8. BANK PREMISES AND EQUIPMENT (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Notes to Financial Statements | |||
Provisions for depreciation | $612,116 | $581,625 | $597,920 |
9_OTHER_REAL_ESTATE_OWNED_Deta
9. OTHER REAL ESTATE OWNED (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Other Real Estate Owned Details | ||
Balance beginning of year | $2,628,418 | $2,883,947 |
Property acquired at foreclosure | 2,914,958 | 1,337,890 |
Capital improvements on foreclosed property | 48,961 | 11,329 |
Sale of other real estate owned financed by Bank | -780,097 | -569,245 |
Sales of foreclosed properties | -1,029,452 | -964,149 |
Valuation adjustments | -275,635 | -71,354 |
Balance as of December 31 | $3,507,153 | $2,628,418 |
10_DEPOSITS_Details
10. DEPOSITS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Banking and Thrift [Abstract] | ||
Noninterest bearing demand deposits | $112,197,722 | $92,396,921 |
Savings and interest bearing demand deposits: | ||
Interest checking accounts | 119,593,529 | 117,456,275 |
Savings accounts | 64,249,199 | 58,292,273 |
Time Deposits: | ||
Balances of less than $100,000 | 115,651,329 | 126,330,053 |
Balances of $100,000 and more | 79,812,757 | 69,673,722 |
Total Deposits | $491,504,536 | $464,149,244 |
10_DEPOSITS_Details_1
10. DEPOSITS (Details 1) (USD $) | Dec. 31, 2014 |
Banking and Thrift [Abstract] | |
2015 | $92,047,350 |
2016 | 58,857,584 |
2017 | 16,213,687 |
2018 | 15,150,944 |
2019 and after | 13,194,521 |
Total | $195,464,086 |
11_SHORTTERM_DEBT_Details
11. SHORT-TERM DEBT (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Outstanding at Year End | $14,358,492 | $3,423,078 | $34,597,352 |
Average Balance Outstanding | 3,872,713 | 6,171,380 | 12,815,349 |
Weighted Average Interest Rate | 0.23% | 0.38% | 0.41% |
Year End Interest Rate | 0.23% | 0.39% | 0.41% |
Federal funds purchased [Member] | |||
Maximum Outstanding at any Month End | 491,000 | 0 | 9,283,000 |
Outstanding at Year End | 0 | 0 | 9,283,000 |
Average Balance Outstanding | 7,704 | 42,838 | 776,617 |
Weighted Average Interest Rate | 0.01% | 0.01% | 0.51% |
Year End Interest Rate | 0.61% | 0.97% | 0.90% |
FHLB short term [Member] | |||
Maximum Outstanding at any Month End | 10,000,000 | 17,500,000 | 32,500,000 |
Outstanding at Year End | 10,000,000 | 0 | 22,500,000 |
Average Balance Outstanding | 27,397 | 2,938,356 | 8,088,798 |
Weighted Average Interest Rate | 0.01% | 0.23% | 0.46% |
Year End Interest Rate | 0.17% | 0.49% | 0.37% |
Securities sold under agreements to repurchase [Member] | |||
Maximum Outstanding at any Month End | 5,066,238 | 3,522,999 | 4,773,045 |
Outstanding at Year End | 4,358,492 | 3,423,078 | 2,814,352 |
Average Balance Outstanding | $3,837,612 | $3,190,186 | $3,949,934 |
Weighted Average Interest Rate | 0.23% | 0.14% | 0.35% |
Year End Interest Rate | 0.24% | 0.28% | 0.38% |
11_SHORTTERM_DEBT_Details_Narr
11. SHORT-TERM DEBT (Details Narrative) (USD $) | Dec. 31, 2014 |
Debt Disclosure [Abstract] | |
Unsecured lines of credit | $26,000,000 |
12_LONGTERM_DEBT_Details
12. LONG-TERM DEBT (Details) (USD $) | Dec. 31, 2014 |
Debt Disclosure [Abstract] | |
2015 | $500,000 |
2016 | 500,000 |
2017 | 500,000 |
2018 | 500,000 |
Thereafter | 7,875,000 |
Total | $9,875,000 |
12LONGTERM_DEBT_Details_Narrat
12.LONG-TERM DEBT (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ||
New borrowings from the Federal Home Loan Bank of Atlanta | $10,000,000 | |
Interest rates on the notes payable | 2.00% | 2.56% |
Weighted average interest | 2.33% | 3.37% |
Balance of obligations | 9,875,000 | 11,500,000 |
Outstanding balance | $0 | $10,191,000 |
13_INCOME_TAX_EXPENSE_Details
13. INCOME TAX EXPENSE (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Current expense | |||
Federal | $2,385,958 | $1,338,439 | $2,590,130 |
Deferred (benefit) expense | |||
Federal | 505,684 | 636,452 | -412,621 |
State | 9,854 | -67,594 | -82,112 |
Total Deferred (benefit) expense | 515,538 | 568,858 | -494,733 |
Total Income Tax Expense | $2,901,496 | $1,907,297 | $2,095,397 |
13_INCOME_TAX_EXPENSE_Details_
13. INCOME TAX EXPENSE (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Deferred Tax Assets: | ||
Allowance for loan losses | $2,201,291 | $1,788,360 |
Split Dollar Life Insurance | 4,440 | 4,440 |
Nonqualified deferred compensation | 594,132 | 527,909 |
Low income housing partnerships losses | 308,539 | 0 |
Securities impairment | 0 | 532,211 |
Core deposit amortization | 72,188 | 298,019 |
State historic tax credits | 0 | 26,432 |
Other real estate owned | 3,746 | 3,746 |
Pension plan | 1,199,686 | 470,091 |
Total Assets | 4,384,022 | 3,651,208 |
Deferred Tax Liabilities: | ||
Unearned low income housing credits | 523,769 | 661,841 |
Depreciation | 320,743 | 363,946 |
Pension | 1,864,964 | 1,423,461 |
Goodwill tax amortization | 853,880 | 791,771 |
Securities available for sale | 1,272 | -6,339 |
Other | 0 | -74,926 |
Total Liabilities | 3,564,628 | 3,159,754 |
Net Deferred Tax Asset (included in Other Assets on Balance Sheet) | $819,394 | $491,454 |
13_INCOME_TAX_EXPENSE_Details_1
13. INCOME TAX EXPENSE (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | |||
Tax expense at federal statutory rates | $2,959,056 | $2,251,851 | $2,378,804 |
Increases (decreases) in taxes resulting from: | |||
State income taxes, net | 8,659 | 9,229 | 6,132 |
Partially exempt income | -54,529 | -44,676 | -49,828 |
Tax-exempt income | -190,192 | -197,482 | -188,932 |
Prior year LIH credits | -21,787 | -61,768 | 97,857 |
Deferred Tax Asset Valuation Allowance | 396,440 | 0 | 0 |
Other | -196,151 | -49,857 | -148,636 |
Total Income Tax Expense | $2,901,496 | $1,907,297 | $2,095,397 |
13_INCOME_TAX_EXPENSE_Details_2
13. INCOME TAX EXPENSE (Details Narrative) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance | $781,936 | $385,496 |
14_EMPLOYEE_BENEFITS_Details
14. EMPLOYEE BENEFITS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Change in Benefit Obligation | |||
Benefit obligation, beginning | $7,933,568 | $8,931,940 | $7,296,932 |
Service cost | 501,032 | 599,933 | 518,634 |
Interest cost | 377,706 | 350,314 | 327,924 |
Actuarial gain (loss) | 2,030,583 | -1,300,094 | 1,066,019 |
Benefits paid | -65,474 | -648,525 | -277,569 |
Benefit obligation, ending | 10,777,415 | 7,933,568 | 8,931,940 |
Change in Plan Assets | |||
Fair value of plan assets, beginning | 9,687,226 | 8,123,437 | 6,760,513 |
Actual return on plan assets | 562,093 | 1,462,314 | 890,493 |
Employer contribution | 1,500,000 | 750,000 | 750,000 |
Benefits paid | -65,474 | -648,525 | -277,569 |
Fair value of plan assets, ending | 11,683,845 | 9,687,226 | 8,123,437 |
Funded status at the end of the year | $906,430 | $1,753,658 | ($808,503) |
14_EMPLOYEE_BENEFITS_Details_1
14. EMPLOYEE BENEFITS (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Amount recognized in the Balance Sheet | |||
Accrued prepaid benefit cost | $4,434,917 | $3,136,277 | $2,888,390 |
Unfunded pension benefit obligation under ASC 325-960 | -3,528,487 | -1,382,619 | -3,696,893 |
Amount recognized in accumulated other comprehensive income | |||
Net Gain/-Loss) | -3,616,087 | -1,485,455 | -3,814,965 |
Prior service cost | 87,600 | 102,836 | 118,072 |
Net obligation at transition | 0 | 0 | 0 |
Amount recognized | -3,528,487 | -1,382,619 | -3,696,893 |
Deferred Taxes | 1,199,686 | 470,090 | 1,256,944 |
Amount recognized in accumulated comprehensive income | -2,328,801 | -912,529 | -2,439,949 |
(Accrued) Prepaid benefit detail | |||
Benefit obligation | -10,777,415 | -7,933,568 | -8,931,940 |
Fair value of assets | 11,683,845 | 9,687,226 | 8,123,437 |
Unrecognized net actuarial loss | 3,616,087 | 1,485,455 | 3,814,965 |
Unrecognized transition obligation | 0 | 0 | 0 |
Unrecognized prior service cost | -87,600 | -102,836 | -118,072 |
Prepaid -accrued) benefits | 4,434,917 | 3,136,277 | 2,888,390 |
Components of net periodic benefit cost | |||
Service cost | 501,032 | 599,933 | 518,634 |
Interest cost | 377,706 | 350,314 | 327,924 |
Expected return on plan assets | -698,252 | -636,081 | -540,069 |
Amortization of prior service cost | -15,236 | -15,236 | -15,236 |
Amortization of transition obligation | 0 | 0 | 0 |
Recognized net acutuarial (gain)loss | 36,110 | 203,183 | 173,222 |
Net periodic benefit cost | 201,360 | 502,113 | 464,475 |
Additional disclosure information | |||
Accumulated benefit obligation | 7,543,340 | 5,474,048 | 6,214,325 |
Vested benefit obligation | $7,408,014 | $5,388,808 | $6,087,194 |
Discount rate used for net pension cost | 5.00% | 4.00% | 4.50% |
Discount rate used for disclosure | 4.00% | 5.00% | 4.00% |
Expected return on plan assets | 7.50% | 8.00% | 8.00% |
Rate of compensation increase | 3.00% | 3.00% | 3.00% |
Average remaining service -years) | 14 years | 14 years | 14 years |
14_EMPLOYEE_BENEFITS_Details_2
14. EMPLOYEE BENEFITS (Details 2) | Dec. 31, 2014 | Dec. 31, 2013 |
Notes to Financial Statements | ||
Mutual funds - equity | 61.00% | 62.00% |
Mutual funds - fixed income | 39.00% | 38.00% |
Cash and equivalents | 0.00% | 0.00% |
14_EMPLOYEE_BENEFITS_Details_3
14. EMPLOYEE BENEFITS (Details 3) (USD $) | Dec. 31, 2014 |
Notes to Financial Statements | |
2015 | $1,017,602 |
2016 | 148,021 |
2017 | 65,614 |
2018 | 1,234,133 |
2019 | 681,525 |
2020-2024 | 4,526,371 |
Total | $7,673,266 |
14_EMPLOYEE_BENEFITS_Details_N
14. EMPLOYEE BENEFITS (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Employee Benefits Details Narrative | |||
ESOP contributions | $1,500,000 | $750,000 | $750,000 |
Shares held by ESOP | 188,396 | 176,485 | |
ESOP | 360,000 | 360,000 | 270,000 |
Contributions under employee benefit plan - 401K Plan | 190,057 | 183,468 | 165,724 |
Contributions to employee benefit plan - Deferred Compensation Plan | $100,000 | $90,000 | $85,000 |
15_CONCENTRATIONS_OF_CREDIT_De
15. CONCENTRATIONS OF CREDIT (Details Narrative) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Concentrations Of Credit Details Narrative | ||
Cash deposits in other commercial banks | $1,731,223 | $1,512,428 |
16_COMMITMENTS_Details
16. COMMITMENTS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Commitments Details | ||
Commitments to loan money | $120,922,771 | $103,782,380 |
Standby letters of credit | $2,077,870 | $985,331 |
16_COMMITMENTS_Details_1
16. COMMITMENTS (Details 1) (USD $) | Dec. 31, 2014 |
Operating Leases | |
2015 | $135,909 |
2016 | 79,762 |
2017 | 56,791 |
2018 | 44,359 |
2019 | $45,468 |
16_COMMITMENTS_Details_Narrati
16. COMMITMENTS (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Commitments Details Narrative | |||
Lease expense | $120,728 | $121,025 | $95,558 |
17_ON_BALANCE_SHEET_DERIVATIVE1
17. ON BALANCE SHEET DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
On Balance Sheet Derivative Instruments And Hedging Activities Details | ||
Notional amount | $87,782 | $91,223 |
Fair market value of contracts | $32,795 | $30,741 |
18_TRANSACTIONS_WITH_RELATED_P1
18. TRANSACTIONS WITH RELATED PARTIES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Transactions With Related Parties Details | ||
Total loans, beginning of year | $7,786,058 | $7,299,706 |
New loans | 5,249,565 | 6,127,927 |
Relationship Change | 0 | 702,135 |
Repayments | -5,586,483 | -6,343,710 |
Total loans, end of year | $7,449,140 | $7,786,058 |
19_DIVIDEND_LIMITATIONS_ON_SUB
19. DIVIDEND LIMITATIONS ON SUBSIDIARY BANK (Details Narrative) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Dividend Limitations On Subsidiary Bank Details Narrative | |||
Dividends paid | $1,300,000 | $1,550,000 | $1,100,000 |
20_DISCLOSURES_ABOUT_FAIR_VALU1
20. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Financial Assets | ||
Loans, Estimated Fair Value | $551,338,000 | $512,250,000 |
Loans, Carrying value | 518,202,000 | 478,453,000 |
Financial Liabilities | ||
Time deposits, Estimated Fair Value | 196,826,000 | 197,729,000 |
Time deposits, Carrying Value | 195,464,000 | 196,004,000 |
Long-term debt, Estimated Fair Value | 9,862,000 | 12,613,000 |
Long-term debt, Carrying Value | $9,875,000 | $11,500,000 |
21_FAIR_VALUE_MEASUREMENTS_Det
21. FAIR VALUE MEASUREMENTS (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Impaired loans | $13,223,000 | $8,514,000 |
Other Real Estate Owned Loans | 3,507,000 | 2,628,000 |
Fair Value Measurements, Valuation Techniques | Discounted appraised value | Discounted appraised value |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Asset Types | Discount for selling costs and age of appraisals | Discount for selling costs and age of appraisals |
Fair Value, Liabilities, Measured on Recurring Basis, Unobservable Input Reconciliation, by Liability Class | Discount for selling costs and age of appraisals | Discount for selling costs and age of appraisals |
Fair Value Inputs Level 3 [Member] | ||
Impaired loans | 13,223,000 | 8,514,000 |
Other Real Estate Owned Loans | $3,507,000 | $2,628,000 |
Fair Value Inputs Level 3 [Member] | Minimum [Member] | ||
Fair Value Measurements, Valuation range | 15.00% | 15.00% |
Valuation range, her Real Estate Owned | 15.00% | 15.00% |
Fair Value Inputs Level 3 [Member] | Maximum [Member] | ||
Fair Value Measurements, Valuation range | 55.00% | 55.00% |
Valuation range, her Real Estate Owned | 55.00% | 55.00% |
21_FAIR_VALUE_MEASUREMENTS_Det1
21. FAIR VALUE MEASUREMENTS (Details1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Total assets at fair value | $13,215,000 | $30,266,000 |
Total liabilities at fair value | 0 | 0 |
Derivative financial instruments at fair value | 33,000 | 31,000 |
Government Sponsored Enterprises [Member] | ||
Total assets at fair value | 8,038,000 | 29,065,000 |
Available for sale Securities [Member] | ||
Total assets at fair value | 13,215,000 | 30,266,000 |
Mortgage Backed Obligations of Federal Agencies [Member] | ||
Total assets at fair value | 1,022,000 | 1,201,000 |
U. S. Treasuries [Member] | ||
Total assets at fair value | 4,020,000 | |
Marketable equities [Member] | ||
Total assets at fair value | 135,000 | |
Fair Value Inputs Level 2 [Member] | ||
Total assets at fair value | 13,215,000 | 30,266,000 |
Derivative financial instruments at fair value | 33,000 | 31,000 |
Fair Value Inputs Level 2 [Member] | Government Sponsored Enterprises [Member] | ||
Total assets at fair value | 8,038,000 | 29,065,000 |
Fair Value Inputs Level 2 [Member] | Available for sale Securities [Member] | ||
Total assets at fair value | 13,215,000 | 30,266,000 |
Fair Value Inputs Level 2 [Member] | Mortgage Backed Obligations of Federal Agencies [Member] | ||
Total assets at fair value | 1,022,000 | 1,201,000 |
Fair Value Inputs Level 2 [Member] | U. S. Treasuries [Member] | ||
Total assets at fair value | 4,020,000 | |
Fair Value Inputs Level 2 [Member] | Marketable equities [Member] | ||
Total assets at fair value | 135,000 | |
Fair Value Inputs Level 3 [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Government Sponsored Enterprises [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Available for sale Securities [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Mortgage Backed Obligations of Federal Agencies [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 3 [Member] | U. S. Treasuries [Member] | ||
Total assets at fair value | 0 | |
Fair Value Inputs Level 3 [Member] | Marketable equities [Member] | ||
Total assets at fair value | 0 | |
Fair Value Inputs Level 1 [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Government Sponsored Enterprises [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Available for sale Securities [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Mortgage Backed Obligations of Federal Agencies [Member] | ||
Total assets at fair value | 0 | 0 |
Fair Value Inputs Level 1 [Member] | U. S. Treasuries [Member] | ||
Total assets at fair value | 0 | |
Fair Value Inputs Level 1 [Member] | Marketable equities [Member] | ||
Total assets at fair value | $0 |
21_FAIR_VALUE_MEASUREMENTS_Det2
21. FAIR VALUE MEASUREMENTS (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Other Real Estate Owned Loans | $3,507,000 | $2,628,000 |
Impaired loans | 13,223,000 | 8,514,000 |
Assets Fair Value | 16,730,000 | 11,142,000 |
Liabilities Fair Value | 0 | |
Real Estate [Member] | ||
Impaired loans | 825,000 | 991,000 |
Dealer Finance [Member] | ||
Impaired loans | 0 | 0 |
Credit Cards [Member] | ||
Other Real Estate Owned Loans | 0 | |
Consumer [Member] | ||
Impaired loans | 2,000 | |
Commercial and Industrial Non-Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Home Equity - Open End [Member] | ||
Impaired loans | 0 | 91,000 |
Home Equity - Closed End [Member] | ||
Impaired loans | 0 | 163,000 |
Commercial Real Estate [Member] | ||
Impaired loans | 891,000 | 536,000 |
Multi-Family [Member] | ||
Impaired loans | 0 | 0 |
Farmland [Member] | ||
Impaired loans | 0 | 0 |
Construction/Land Development [Member] | ||
Impaired loans | 11,507,000 | 6,731,000 |
Consumer [Member] | ||
Impaired loans | 0 | |
Fair Value Inputs Level 3 [Member] | ||
Other Real Estate Owned Loans | 3,507,000 | 2,628,000 |
Impaired loans | 13,223,000 | 8,514,000 |
Assets Fair Value | 16,730,000 | 11,142,000 |
Liabilities Fair Value | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Real Estate [Member] | ||
Impaired loans | 825,000 | 991,000 |
Fair Value Inputs Level 3 [Member] | Dealer Finance [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Credit Cards [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Consumer [Member] | ||
Impaired loans | 2,000 | |
Fair Value Inputs Level 3 [Member] | Commercial and Industrial Non-Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Home Equity - Open End [Member] | ||
Impaired loans | 0 | 91,000 |
Fair Value Inputs Level 3 [Member] | Home Equity - Closed End [Member] | ||
Impaired loans | 0 | 163,000 |
Fair Value Inputs Level 3 [Member] | Commercial Real Estate [Member] | ||
Impaired loans | 891,000 | 536,000 |
Fair Value Inputs Level 3 [Member] | Multi-Family [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Farmland [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 3 [Member] | Construction/Land Development [Member] | ||
Impaired loans | 11,507,000 | 6,731,000 |
Fair Value Inputs Level 3 [Member] | Consumer [Member] | ||
Impaired loans | 0 | |
Fair Value Inputs Level 1 [Member] | ||
Impaired loans | 0 | 0 |
Assets Fair Value | 0 | |
Liabilities Fair Value | 0 | |
Fair Value Inputs Level 1 [Member] | Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Dealer Finance [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Credit Cards [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Consumer [Member] | ||
Impaired loans | 0 | |
Fair Value Inputs Level 1 [Member] | Commercial and Industrial Non-Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Home Equity - Open End [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Home Equity - Closed End [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Commercial Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Multi-Family [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Farmland [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Construction/Land Development [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 1 [Member] | Consumer [Member] | ||
Impaired loans | 0 | |
Fair Value Inputs Level 2 [Member] | ||
Impaired loans | 0 | 0 |
Assets Fair Value | 0 | |
Liabilities Fair Value | 0 | |
Fair Value Inputs Level 2 [Member] | Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Dealer Finance [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Credit Cards [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Consumer [Member] | ||
Impaired loans | 0 | |
Fair Value Inputs Level 2 [Member] | Commercial and Industrial Non-Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Home Equity - Open End [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Home Equity - Closed End [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Commercial Real Estate [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Multi-Family [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Farmland [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Construction/Land Development [Member] | ||
Impaired loans | 0 | 0 |
Fair Value Inputs Level 2 [Member] | Consumer [Member] | ||
Impaired loans | $0 |
22_REGULATORY_MATTERS_Details
22. REGULATORY MATTERS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Preferred stock | $9,425,123 | ||
Accumulated other comprehensive income | -2,326,331 | -924,833 | |
Qualifying subordinated debt | 10,191,000 | 10,191,000 | |
Allowance for loan losses | -8,724,731 | -8,184,376 | -8,154,074 |
Risk-based ratio regulatory requirements for adequately capitalized | 8.00% | ||
Risk-based ratio regulatory requirements for well capitalized | 10.00% | ||
Tier 1 risk-based ratio | 15.86% | 12.19% | 10.80% |
Risk based ratio regulatory requirements for adequately capitalized | 4.00% | ||
Risk based ratio regulatory requirements for well capitalized | 6.00% | ||
Total assets leverage ratio | 12.70% | 9.41% | 8.36% |
Assets leverage ratio regulatory requirements for adequately capitalized | 3.00% | ||
Assets leverage ratio regulatory requirements for well capitalized | 5.00% | ||
Tier 1 [Member] | |||
Common stock | 500,000 | 500,000 | 500,000 |
Retained earnings | 40,114,000 | 35,361,000 | 32,310,000 |
Intangible assets | -2,670,000 | -2,670,000 | -2,670,000 |
Accumulated other comprehensive income | 0 | 0 | 0 |
Total Capital | 75,915,000 | 52,162,000 | 49,111,000 |
Tier 2 [Member] | |||
Qualifying subordinated debt | 0 | 8,487,000 | 9,284,000 |
Allowance for loan losses | 6,006,000 | 5,384,000 | 5,716,000 |
Unrealized gains on AFS equity securities | 0 | 0 | 0 |
Total risked based capital | 81,921,000 | 66,033,000 | 64,111,000 |
Risk-weighted assets | 478,512,000 | 427,957,000 | 454,804,000 |
Consolidated [Member] | |||
Total risk-based ratio | 17.35% | 15.37% | 13.98% |
Risk-based ratio regulatory requirements for adequately capitalized | 8.00% | ||
Risk-based ratio regulatory requirements for well capitalized | 10.00% | ||
Tier 1 risk-based ratio | 16.09% | 12.13% | 10.69% |
Risk based ratio regulatory requirements for adequately capitalized | 4.00% | ||
Risk based ratio regulatory requirements for well capitalized | 6.00% | ||
Total assets leverage ratio | 12.88% | 9.37% | 8.29% |
Assets leverage ratio regulatory requirements for adequately capitalized | 3.00% | ||
Assets leverage ratio regulatory requirements for well capitalized | 5.00% | ||
Consolidated [Member] | Tier 1 [Member] | |||
Preferred stock | 9,425,000 | 0 | 0 |
Common stock | 16,459,000 | 12,559,000 | 12,498,000 |
Retained earnings | 53,815,000 | 42,089,000 | 38,927,000 |
Intangible assets | -2,670,000 | -2,670,000 | -2,670,000 |
Accumulated other comprehensive income | 0 | 0 | 0 |
Total Capital | 77,029,000 | 51,978,000 | 48,755,000 |
Consolidated [Member] | Tier 2 [Member] | |||
Qualifying subordinated debt | 0 | 8,487,000 | 9,284,000 |
Allowance for loan losses | 6,018,000 | 5,389,000 | 5,716,000 |
Unrealized gains on AFS equity securities | 0 | ||
Total risked based capital | 83,047,000 | 65,854,000 | 63,755,000 |
Risk-weighted assets | $478,725,000 | $428,349,000 | $456,066,000 |
22_REGULATORY_MATTERS_Details_
22. REGULATORY MATTERS (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Accumulated other comprehensive income | ($2,326,331) | ($924,833) | |
Qualifying subordinated debt | 10,191,000 | 10,191,000 | |
Allowance for loan losses | -8,724,731 | -8,184,376 | -8,154,074 |
Total risk-based ratio | 17.12% | 15.43% | 14.10% |
Risk-based ratio regulatory requirements for adequately capitalized | 8.00% | ||
Risk-based ratio regulatory requirements for well capitalized | 10.00% | ||
Tier 1 risk-based ratio | 15.86% | 12.19% | 10.80% |
Risk based ratio regulatory requirements for adequately capitalized | 4.00% | ||
Risk based ratio regulatory requirements for well capitalized | 6.00% | ||
Total assets leverage ratio | 12.70% | 9.41% | 8.36% |
Assets leverage ratio regulatory requirements for adequately capitalized | 3.00% | ||
Assets leverage ratio regulatory requirements for well capitalized | 5.00% | ||
Tier 1 [Member] | |||
Common stock | 500,000 | 500,000 | 500,000 |
Capital surplus | 37,971,000 | 18,971,000 | 18,971,000 |
Retained earnings | 40,114,000 | 35,361,000 | 32,310,000 |
Intangible assets | -2,670,000 | -2,670,000 | -2,670,000 |
Accumulated other comprehensive income | 0 | 0 | 0 |
Total Capital | 75,915,000 | 52,162,000 | 49,111,000 |
Tier 2 [Member] | |||
Qualifying subordinated debt | 0 | 8,487,000 | 9,284,000 |
Allowance for loan losses | 6,006,000 | 5,384,000 | 5,716,000 |
Unrealized gains on AFS equity securities | 0 | 0 | 0 |
Total risked based capital | 81,921,000 | 66,033,000 | 64,111,000 |
Risk-weighted assets | $478,512,000 | $427,957,000 | $454,804,000 |
25_PARENT_CORPORATION_ONLY_FIN1
25. PARENT CORPORATION ONLY FINANCIAL STATEMENTS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Assets | ||||
Cash and cash equivalents | $23,202,543 | $6,544,645 | ||
Other assets | 10,050,893 | 8,241,821 | ||
Total Assets | 605,308,102 | 552,788,167 | ||
Liabilities | ||||
Long term debt | 9,875,000 | 11,500,000 | ||
Total Liabilities | 527,509,699 | 498,646,932 | ||
Stockholders' Equity | ||||
Preferred stock par value $5 per share, 400,000 shares authorized, issued and outstanding | 9,425,123 | |||
Common stock par value $5 per share, 6,000,000 shares authorized, 3,291,766 and 2,511,735 shares issued and outstanding for 2014 and 2013, respectively | 16,458,830 | 12,558,675 | ||
Retained earnings | 42,554,421 | 38,984,724 | ||
Noncontrolling interest | 426,365 | 418,228 | ||
Accumulated other comprehensive income (loss) | -2,326,331 | -924,833 | ||
Total Stockholders' Equity | 77,798,403 | 54,141,235 | 49,383,960 | 46,179,719 |
Total Liabilities and Stockholders' Equity | 605,308,102 | 552,788,167 | ||
Parent [Member] | ||||
Assets | ||||
Cash and cash equivalents | 1,214,140 | 77,952 | ||
Investment in subsidiaries | 76,684,121 | 54,325,282 | ||
Securities available for sale | 135,000 | 0 | ||
Income tax receivable (including due from subsidiary) | 453,585 | 0 | ||
Other assets | 0 | 8,700 | ||
Total Assets | 78,486,846 | 54,411,934 | ||
Liabilities | ||||
Other liabilities | 137,977 | 160 | ||
Deferred income taxes | 383,125 | 103,198 | ||
Demand obligations for low income housing investment | 167,341 | 167,341 | ||
Total Liabilities | 688,443 | 270,699 | ||
Stockholders' Equity | ||||
Preferred stock par value $5 per share, 400,000 shares authorized, issued and outstanding | 9,425,123 | 0 | ||
Common stock par value $5 per share, 6,000,000 shares authorized, 3,291,766 and 2,511,735 shares issued and outstanding for 2014 and 2013, respectively | 16,458,830 | 12,558,675 | ||
Retained earnings | 53,814,416 | 42,089,165 | ||
Noncontrolling interest | 426,365 | 418,228 | ||
Accumulated other comprehensive income (loss) | -2,326,331 | -924,833 | ||
Total Stockholders' Equity | 77,798,403 | 54,141,235 | ||
Total Liabilities and Stockholders' Equity | $78,486,846 | $54,411,934 |
25_PARENT_CORPORATION_ONLY_FIN2
25. PARENT CORPORATION ONLY FINANCIAL STATEMENTS (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income | |||
Interest Income | $204,649 | $193,244 | $210,371 |
Other income | 1,393,897 | 1,537,397 | 1,254,490 |
Expenses | |||
Other expense | 3,647,722 | 4,772,743 | 6,294,071 |
Income Tax Expense (Benefit) | 2,901,496 | 1,907,297 | 2,095,397 |
Income before undistributed subsidiary net income | 5,847,262 | 4,822,978 | 5,047,050 |
Undistributed subsidiary net income | -45,653 | -107,185 | -145,966 |
Net income | 5,801,609 | 4,715,793 | 4,901,084 |
Stock issuance | 12,055,709 | ||
Parent [Member] | |||
Income | |||
Dividends from affiliate | 1,300,000 | 1,550,000 | 1,100,000 |
Interest Income | 0 | 5 | 17 |
Other than temporary impairment losses | 0 | 0 | 350 |
Net limited partnership income (loss) | 0 | 90,863 | 11,930 |
Total Income | 1,300,000 | 1,640,868 | 1,112,297 |
Expenses | |||
Other expense | 7,100 | 0 | 0 |
Administrative expenses | 0 | 60,209 | 185,834 |
Total Expenses | 7,100 | 60,209 | 185,834 |
Net income before income tax expense (benefit) and undistributed subsidiary net income | 1,292,900 | 1,580,659 | 926,463 |
Income Tax Expense (Benefit) | 243,492 | -83,880 | -22,500 |
Income before undistributed subsidiary net income | 1,049,408 | 1,664,539 | 948,963 |
Undistributed subsidiary net income | 4,752,201 | 3,051,254 | 3,952,121 |
Net income | $5,801,609 | $4,715,793 | $4,901,084 |
25_PARENT_CORPORATION_ONLY_FIN3
25. PARENT CORPORATION ONLY FINANCIAL STATEMENTS (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Cash Flows from Operating Activities | |||
Net income | $5,801,609 | $4,715,793 | $4,901,084 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Decrease (increase) in other assets | 1,473,634 | 967,516 | -1,729,648 |
Amortization of limited partnership investments | 608,360 | 581,737 | 550,989 |
Net Cash Provided by Operating Activities | 8,359,898 | 18,297,421 | 8,002,626 |
Cash Flows from Investing Activities | |||
Net Cash Provided by (Used in) Investing Activities | -37,425,626 | 27,778,317 | -31,022,447 |
Cash Flows from Financing Activities | |||
Payments on long-term debt | -19,222,000 | -26,214,286 | -9,392,857 |
Proceeds from issuance of common stock | 12,055,709 | 213,429 | 105,416 |
Net Provided by (Cash Used) in Financing Activities | 45,723,626 | -48,527,307 | 23,022,191 |
Net Increase (decreases) in Cash and Cash Equivalents | 16,657,898 | -2,451,569 | 2,370 |
Cash and Cash Equivalents, Beginning of Year | 6,544,645 | 8,996,214 | 8,993,844 |
Cash and Cash Equivalents, End of Year | 23,202,543 | 6,544,645 | 8,996,214 |
Parent [Member] | |||
Cash Flows from Operating Activities | |||
Net income | 5,801,609 | 4,715,793 | 4,901,084 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Undistributed subsidiary income | -4,752,201 | -3,051,254 | -3,952,121 |
Deferred tax (benefit) expense | 279,928 | 8,577 | -18,567 |
Decrease (increase) in other assets | -444,885 | -174,367 | 201,537 |
Increase (decrease) in other liabilities | 137,817 | -1,109,728 | 992,626 |
Net change in deferred tax credits | 0 | -27,918 | -15,727 |
Amortization of limited partnership investments | 0 | 65,165 | 65,164 |
Net Cash Provided by Operating Activities | 1,022,268 | 426,268 | 2,173,996 |
Cash Flows from Investing Activities | |||
Change in loans receivable | 0 | 1,000,000 | 0 |
Purchase of securities available for sale | -135,000 | 0 | -1,000,000 |
Net Cash Provided by (Used in) Investing Activities | -135,000 | 1,000,000 | -1,000,000 |
Cash Flows from Financing Activities | |||
Capital contributed to subsidiary | -19,000,000 | 0 | 0 |
Proceeds from issuance of preferred stock | 9,425,123 | ||
Proceeds from issuance of common stock | 12,055,709 | 213,429 | 105,416 |
Dividends paid in cash | -2,231,912 | -1,705,881 | -1,597,673 |
Net Provided by (Cash Used) in Financing Activities | 248,920 | -1,492,452 | -1,492,257 |
Net Increase (decreases) in Cash and Cash Equivalents | 1,136,188 | -66,184 | -318,261 |
Cash and Cash Equivalents, Beginning of Year | 77,952 | 144,136 | 462,397 |
Cash and Cash Equivalents, End of Year | $1,214,140 | $77,952 | $144,136 |
26_INVESTMENT_IN_VBS_MORTGAGE_1
26. INVESTMENT IN VBS MORTGAGE, LLC (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Assets | ||||
Cash and cash equivalents | $23,202,543 | $6,544,645 | ||
Property and equipment, net | 6,458,254 | 6,525,057 | ||
Other Assets | 10,050,893 | 8,241,821 | ||
Total Assets | 605,308,102 | 552,788,167 | ||
Liabilities | ||||
Total Liabilities | 527,509,699 | 498,646,932 | ||
Stockholders' Equity | ||||
Retained earnings | 42,554,421 | 38,984,724 | ||
Total Equity | 77,798,403 | 54,141,235 | 49,383,960 | 46,179,719 |
Total Liabilities and Equity | 605,308,102 | 552,788,167 | ||
VBS MORTGAGE, LLC [Member] | ||||
Assets | ||||
Cash and cash equivalents | 610,973 | 490,225 | ||
Loans Receivable | 818,054 | 871,674 | ||
Property and equipment, net | 45,600 | 53,903 | ||
Other Assets | 162,304 | 187,356 | ||
Total Assets | 1,636,931 | 1,603,158 | ||
Liabilities | ||||
Other liabilities | 215,713 | 209,065 | ||
Total Liabilities | 215,713 | 209,065 | ||
Stockholders' Equity | ||||
Capital | 219,634 | 219,634 | ||
Retained earnings | 1,201,584 | 1,174,459 | ||
Total Equity | 1,421,218 | 1,394,093 | ||
Total Liabilities and Equity | $1,636,931 | $1,603,158 |
26_INVESTMENT_IN_VBS_MORTGAGE_2
26. INVESTMENT IN VBS MORTGAGE, LLC (Details 1) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Expenses | |||
Net income | $5,801,609 | $4,715,793 | $4,901,084 |
VBS MORTGAGE, LLC [Member] | |||
Income | |||
Mortgage origination income | 1,907,804 | 2,528,108 | 2,378,023 |
Other Income | 53,528 | 42,092 | 40,022 |
Total Income | 1,961,332 | 2,570,200 | 2,418,045 |
Expenses | |||
Salaries and employee benefits | 1,105,902 | 1,461,797 | 1,254,735 |
Occupancy and equipment expense | 177,014 | 164,717 | 157,514 |
Management and professional fees | 321,053 | 301,558 | 268,337 |
Other | 205,188 | 284,845 | 250,902 |
Total Expenses | 1,809,157 | 2,212,917 | 1,931,488 |
Net income | $152,175 | $357,283 | $486,557 |