10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)	[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
	OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2017

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission file number 0-23325

Guaranty Federal Bancshares, Inc.

 (Exact name of registrant as specified in its charter)

Delaware	43-1792717
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
1341 West Battlefield
Springfield, Missouri	65807
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (417) 520-4333

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer [  ] Accelerated filer [  ] Non-accelerated filer [  ] Smaller reporting company [X] Emerging growth company [  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period of complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act [  ]

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes [  ] No [X]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding as of November 2, 2017
Common Stock, Par Value $0.10 per share	4,421,775 Shares

GUARANTY FEDERAL BANCSHARES, INC.

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Financial Statements (Unaudited):
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Income	4
Condensed Consolidated Statements of Comprehensive Income	5
Condensed Consolidated Statements of Stockholders’ Equity	6
Condensed Consolidated Statements of Cash Flows	7
Notes to Condensed Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3. Quantitative and Qualitative Disclosures about Market Risk	38
Item 4. Controls and Procedures	39
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	39
Item 1A. Risk factors	39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3. Defaults Upon Senior Securities	39
Item 4. Mine Safety Disclosures	39
Item 5. Other Information	39
Item 6. Exhibits	40
Signatures	41

2

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

GUARANTY FEDERAL BANCSHARES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 2017 (UNAUDITED) AND DECEMBER 31, 2016

	9/30/17			12/31/16
ASSETS
Cash and due from banks	$	3,456,243		$	3,769,478
Interest-bearing deposits in other financial institutions		7,264,941			5,318,963
Cash and cash equivalents		10,721,184			9,088,441
Available-for-sale securities		83,205,195			92,399,235
Held-to-maturity securities		18,424			27,528
Stock in Federal Home Loan Bank, at cost		4,137,500			4,611,000
Mortgage loans held for sale		2,516,520			2,183,633
Loans receivable, net of allowance for loan losses of September 30, 2017 - $7,009,097 - December 31, 2016 - $5,742,449		616,884,052			538,273,640
Accrued interest receivable		2,164,278			1,947,063
Prepaid expenses and other assets		4,283,144			2,961,336
Foreclosed assets held for sale		588,443			2,682,353
Premises and equipment, net		11,713,174			10,871,039
Bank owned life insurance		19,623,719			19,272,893
Deferred and income taxes receivable		3,483,169			3,661,658
	$	759,338,802		$	687,979,819
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits	$	584,088,617		$	505,362,750
Federal Home Loan Bank advances		82,800,000			95,700,000
Subordinated debentures		15,465,000			15,465,000
Advances from borrowers for taxes and insurance		515,087			192,460
Accrued expenses and other liabilities		1,562,509			1,077,396
Accrued interest payable		253,045			207,833
		684,684,258			618,005,439
COMMITMENTS AND CONTINGENCIES		-			-
STOCKHOLDERS' EQUITY
Capital Stock:
Common stock, $0.10 par value; authorized 10,000,000 shares; issued September 30, 2017 and December 31, 2016 - 6,875,503 shares		687,550			687,550
Additional paid-in capital		50,705,315			50,552,077
Retained earnings, substantially restricted		60,759,996			57,347,282
Accumulated other comprehensive loss		(372,776	)		(1,309,241	)
		111,780,085			107,277,668
Treasury stock, at cost; September 30, 2017 and December 31, 2016 - 2,453,728 and 2,465,476 shares, respectively		(37,125,541	)		(37,303,288	)
		74,654,544			69,974,380
	$	759,338,802		$	687,979,819

See Notes to Condensed Consolidated Financial Statements

3

  GUARANTY FEDERAL BANCSHARES, INC.

 CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 THREE  MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (UNAUDITED)

	Three months ended					Nine months ended
	9/30/2017		9/30/2016			9/30/2017		9/30/2016
Interest Income
Loans	$	7,052,544	$	5,854,069		$	20,042,667	$	17,184,094
Investment securities		431,560		461,587			1,361,069		1,445,151
Other		41,083		38,647			134,361		134,417
		7,525,187		6,354,303			21,538,097		18,763,662
Interest Expense
Deposits		893,197		560,168			2,261,752		1,715,179
FHLB and Federal Reserve advancese		419,918		349,575			1,269,543		963,847
Subordinated debentures		160,075		146,438			467,665		429,348
		1,473,190		1,056,181			3,998,960		3,108,374
Net Interest Income		6,051,997		5,298,122			17,539,137		15,655,288
Provision for Loan Losses		450,000		200,000			1,500,000		950,000
Net Interest Income After Provision for Loan Losses		5,601,997		5,098,122			16,039,137		14,705,288
Noninterest Income
Service charges		311,070		303,958			869,102		849,026
Gain on sale of investment securities		11,199		44,060			73,473		155,465
Gain on sale of mortgage loans held for sale		618,732		528,521			1,550,880		1,260,978
Gain on sale of Small Business Administration loans		228,895		85,624			484,240		237,862
Net gain (loss) on foreclosed assets		47,787		(33,808	)		56,051		(53,313	)
Other income		353,186		387,146			1,133,548		1,153,718
		1,570,869		1,315,501			4,167,294		3,603,736
Noninterest Expense
Salaries and employee benefits		3,052,417		2,694,069			8,844,836		7,950,867
Occupancy		591,961		465,237			1,563,344		1,343,062
FDIC deposit insurance premiums		63,522		117,311			176,011		362,025
Data processing		268,508		223,618			730,260		650,283
Advertising		131,250		131,250			393,750		393,750
Impairment on investment tax credits		146,857		-			146,857		-
Other expense		757,317		686,222			2,144,310		2,036,590
		5,011,832		4,317,707			13,999,368		12,736,577
Income Before Income Taxes		2,161,034		2,095,916			6,207,063		5,572,447
Provision for Income Taxes		443,651		554,009			1,467,866		1,497,783
Net Income Available to Common Shareholders	$	1,717,383	$	1,541,907		$	4,739,197	$	4,074,664
Basic Income Per Common Share	$	0.39	$	0.35		$	1.08	$	0.93
Diluted Income Per Common Share	$	0.39	$	0.35		$	1.07	$	0.92

See Notes to Condensed Consolidated Financial Statements

4

GUARANTY FEDERAL BANCSHARES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE  MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (UNAUDITED)

	Three months ended						Nine months ended
	9/30/2017			9/30/2016			9/30/2017			9/30/2016
NET INCOME	$	1,717,383		$	1,541,907		$	4,739,197		$	4,074,664
OTHER ITEMS OF COMPREHENSIVE INCOME (LOSS):
Change in unrealized gain (loss) on investment securities available-for-sale, before income taxes		(39,661	)		(272,470	)		1,408,504			2,174,594
Change in unrealized gain (loss) on interest rate swaps, before income taxes		(76,222	)		-			151,420			-
Less: Reclassification adjustment for realized gains on investment securities included in net income, before income taxes		(11,199	)		(44,060	)		(73,473	)		(155,465	)
Total other items of comprehensive income		(127,082	)		(316,530	)		1,486,451			2,019,129
Income tax expense (benefit) related to other items of comprehensive income		(47,022	)		(117,115	)		549,986			747,078
Other comprehensive income (loss)		(80,060	)		(199,415	)		936,465			1,272,051
TOTAL COMPREHENSIVE INCOME	$	1,637,323		$	1,342,492		$	5,675,662		$	5,346,715

See Notes to Condensed Consolidated Financial Statements

5

GUARANTY FEDERAL BANCSHARES, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

NINE MONTHS ENDED SEPTEMBER 30, 2017 (UNAUDITED)

	Common Stock		Additional Paid- In Capital		Treasury Stock			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total
Balance, January 1, 2017	$	687,550	$	50,552,077	$	(37,303,288	)	$	57,347,282		$	(1,309,241	)	$	69,974,380
Net income		-		-		-			4,739,197			-			4,739,197
Change in unrealized gain on available-for-sale securities and effect of interest rate swaps, net of income taxes												936,465			936,465
Dividends on common stock ($0.30 per share)		-		-		-			(1,326,483	)		-			(1,326,483	)
Stock award plans		-		153,238		177,747			-			-			330,985
Balance, September 30, 2017	$	687,550	$	50,705,315	$	(37,125,541	)	$	60,759,996		$	(372,776	)	$	74,654,544

See Notes to Condensed Consolidated Financial Statements

6

GUARANTY FEDERAL  BANCSHARES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (UNAUDITED)

	9/30/2017			9/30/2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	4,739,197		$	4,074,664
Items not requiring (providing) cash:
Deferred income taxes		(603,683	)		(88,504	)
Depreciation		791,473			615,224
Provision for loan losses		1,500,000			950,000
Gain on sale of mortgage loans held for sale and investment securities		(1,624,353	)		(1,416,443	)
(Gain) loss on sale of foreclosed assets		(119,157	)		2,798
Gain on sale of Small Business Administration Loans		(484,240	)		(237,862	)
Amortization of deferred income, premiums and discounts		728,144			469,088
Stock award plan expense		330,985			293,998
Origination of loans held for sale		(52,757,873	)		(47,274,120	)
Proceeds from sale of loans held for sale		53,975,866			47,873,689
Increase in cash surrender value of bank owned life insurance		(350,826	)		(369,695	)
Changes in:
Accrued interest receivable		(217,215	)		177,712
Prepaid expenses and other assets		44,393			307,528
Accounts payable and accrued expenses		529,150			707,875
Income taxes receivable		232,186			703,175
Net cash provided by operating activities		6,714,047			6,789,127
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of loans receivable		-			(11,132,508	)
Proceeds on sale of loans		24,919,859			-
Net change in loans		(105,083,322	)		(24,782,137	)
Principal payments on available-for-sale securities		5,153,878			6,385,019
Principal payments on held-to-maturity securities		9,104			12,736
Proceeds from calls/maturities of available-for-sale securities		-			535,000
Purchase of premises and equipment		(1,633,608	)		(939,191	)
Purchase of available-for-sale securities		(13,350,996	)		(71,652,913	)
Proceeds from sale of available-for-sale securities		18,388,216			67,177,538
Redemption (purchase) of Federal Home Loan Bank stock		473,500			(929,500	)
Purchase of tax credit investments		(1,214,781	)		-
Proceeds from sale of foreclosed assets held for sale		2,433,660			463,863
Net cash used in investing activities		(69,904,490	)		(34,862,093	)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash dividends paid on common stock		(1,325,308	)		(1,060,619	)
Net increase in demand deposits, NOW accounts and savings accounts		50,768,740			5,344,326
Net increase (decrease) in certificates of deposit		27,957,127			(6,965,873	)
Proceeds from Federal Home Loan Bank advances		333,700,000			173,400,000
Repayments of Federal Home Loan Bank and Federal Reserve advances		(346,600,000	)		(150,900,000	)
Advances from borrowers for taxes and insurance		322,627			343,618
Stock options exercised		-			85,800
Net cash provided by financing activities		64,823,186			20,247,252
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		1,632,743			(7,825,714	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		9,088,441			18,774,419
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	10,721,184		$	10,948,705

 See Notes to Condensed Consolidated Financial Statements

7

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1: Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in Guaranty Federal Bancshares, Inc.’s (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2016 (“2016 Annual Report”) filed with the Securities and Exchange Commission (the “SEC”). The results of operations for the periods are not necessarily indicative of the results to be expected for the full year. The condensed consolidated balance sheet of the Company as of December 31, 2016, has been derived from the audited consolidated balance sheet of the Company as of that date. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted.

Note 2: Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Guaranty Bank (the “Bank”). All significant intercompany transactions and balances have been eliminated in consolidation.

Note 3: Securities

The amortized cost and approximate fair values of securities classified as available-for-sale were as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Municipals	$	34,012,067	$	210,255	$	(328,991	)	$	33,893,331
Corporates		3,000,000		70,000		-			3,070,000
Government sponsored mortgage-backed securities and SBA loan pools		46,936,147		32,472		(726,755	)		46,241,864
	$	83,948,214	$	312,727	$	(1,055,746	)	$	83,205,195

8

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2016
Debt Securities:
Municipals	$	39,357,506	$	65,673	$	(1,085,654	)	$	38,337,525
Corporates		7,003,986		54,050		(4,514	)		7,053,522
Government sponsored mortgage-backed securities and SBA loan pools		48,115,793		19,432		(1,127,037	)		47,008,188
	$	94,477,285	$	139,155	$	(2,217,205	)	$	92,399,235

Maturities of available-for-sale debt securities as of September 30, 2017:

	Amortized Cost		Approximate Fair Value
1-5 years		564,554		581,359
6-10 years		9,254,809		9,317,277
After 10 years		27,192,704		27,064,695
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date		46,936,147		46,241,864
	$	83,948,214	$	83,205,195

The amortized cost and approximate fair values of securities classified as held to maturity are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Government sponsored mortgage-backed securities	$	18,424	$	215	$	(57	)	$	18,582

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Approximate Fair Value
As of December 31, 2016
Debt Securities:
Government sponsored mortgage-backed securities	$	27,528	$	625	$	-	$	28,153

9

Maturities of held-to-maturity securities as of September 30, 2017:

	Amortized Cost		Approximate Fair Value
Government sponsored mortgage-backed securities not due on a single maturity date	$	18,424	$	18,582

The book value of securities pledged as collateral, to secure public deposits and for other purposes, amounted to $48,651,661 and $48,723,259 as of September 30, 2017 and December 31, 2016, respectively. The approximate fair value of pledged securities amounted to $48,125,394 and $47,617,900 as of September 30, 2017 and December 31, 2016, respectively.

Realized gains and losses are recorded as net securities gains. Gains on sales of securities are determined on the specific identification method. Gross gains of $73,473 and $155,465 as of September 30, 2017 and September 30, 2016, respectively, were realized from the sale of available-for-sale securities. The tax effect of these net gains was $27,185 and $57,522 as of September 30, 2017 and September 30, 2016, respectively.

The Company evaluates all securities quarterly to determine if any unrealized losses are deemed to be other than temporary. Certain investment securities are valued at less than their historical cost. These declines are primarily the result of the rate for these investments yielding less than current market rates, or declines in stock prices of equity securities. Based on evaluation of available evidence, management believes the declines in fair value for these securities are temporary. It is management’s intent to hold the debt securities to maturity or until recovery of the unrealized loss. Should the impairment of any of these debt securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified, to the extent the loss is related to credit issues, and to other comprehensive income to the extent the decline on debt securities is related to other factors and the Company does not intend to sell the security prior to recovery of the unrealized loss.

Certain other investments in debt and equity securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at September 30, 2017 and December 31, 2016, was $63,471,654 and $79,361,229, respectively, which is approximately 76% and 86% of the Company’s investment portfolio.

The following table shows gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2017 and December 31, 2016.

	September 30, 2017
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	10,507,517	$	(91,926	)	$	10,671,807	$	(237,065	)	$	21,179,324	$	(328,991	)
Government sponsored mortgage-backed securities and SBA loan pools		21,281,498		(219,697	)		21,010,832		(507,115	)		42,292,330		(726,812	)
	$	31,789,015	$	(311,623	)	$	31,682,639	$	(744,180	)	$	63,471,654	$	(1,055,803	)

10

	December 31, 2016
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	33,084,816	$	(1,082,021	)	$	179,402	$	(3,633	)	$	33,264,218	$	(1,085,654	)
Corporates		1,996,172		(3,828	)		881,100		(686	)		2,877,272		(4,514	)
Government sponsored mortgage-backed securities and SBA loan pools		39,570,463		(1,022,511	)		3,649,276		(104,526	)		43,219,739		(1,127,037	)
	$	74,651,451	$	(2,108,360	)	$	4,709,778	$	(108,845	)	$	79,361,229	$	(2,217,205	)

Note 4: Loans and Allowance for Loan Losses

Categories of loans at September 30, 2017 and December 31, 2016 include:

	September 30,			December 31,
	2017			2016
Real estate - residential mortgage:
One to four family units	$	107,750,990		$	106,410,559
Multi-family		74,653,469			48,483,523
Real estate - construction		62,046,871			40,912,307
Real estate - commercial		266,292,510			249,580,873
Commercial loans		90,186,600			75,404,732
Consumer and other loans		23,661,618			23,606,306
Total loans		624,592,058			544,398,300
Less:
Allowance for loan losses		(7,009,097	)		(5,742,449	)
Deferred loan fees/costs, net		(698,909	)		(382,211	)
Net loans	$	616,884,052		$	538,273,640

Classes of loans by aging at September 30, 2017 and December 31, 2016 were as follows:

As of September 30, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	1,542	$	644	$	249	$	2,435	$	105,316	$	107,751	$	-
Multi-family		783		-		-		783		73,870		74,653		-
Real estate - construction		-		-		-		-		62,047		62,047		-
Real estate - commercial		-		-		215		215		266,077		266,292		-
Commercial loans		-		-		1,384		1,384		88,803		90,187		-
Consumer and other loans		10		4		-		14		23,648		23,662		-
Total	$	2,335	$	648	$	1,848	$	4,831	$	619,761	$	624,592	$	-

11

As of December 31, 2016
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	367	$	495	$	103	$	965	$	105,446	$	106,411	$	-
Multi-family		-		-		-		-		48,483		48,483		-
Real estate - construction		-		-		-		-		40,912		40,912		-
Real estate - commercial		-		-		-		-		249,581		249,581		-
Commercial loans		-		-		593		593		74,812		75,405		-
Consumer and other loans		-		-		38		38		23,568		23,606		-
Total	$	367	$	495	$	734	$	1,596	$	542,802	$	544,398	$	-

Nonaccruing loans are summarized as follows:

	September 30,		December 31,
	2017		2016
Real estate - residential mortgage:
One to four family units	$	2,274,040	$	2,060,180
Multi-family		-		-
Real estate - construction		5,309,728		5,446,896
Real estate - commercial		376,091		161,491
Commercial loans		1,610,950		925,281
Consumer and other loans		124,161		37,791
Total	$	9,694,970	$	8,631,639

The following tables present the activity in the allowance for loan losses based on portfolio segment for the three and nine months ended September 30, 2017 and 2016:

Three months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,739	$	1,954		$	936		$	323	$	1,226		$	335		$	127	$	6,640
Provision charged to expense		524		(116	)		(81	)		52		(99	)		126			44	$	450
Losses charged off		-		(71	)		-			-		-			(46	)		-	$	(117	)
Recoveries		16		-			1			-		7			12			-	$	36
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

Nine months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,377	$	1,687		$	856		$	206	$	1,168		$	337		$	111	$	5,742
Provision charged to expense		847		151			2			169		40			231			60	$	1,500
Losses charged off		-		(71	)		(11	)		-		(85	)		(169	)		-	$	(336	)
Recoveries		55		-			9			-		11			28			-	$	103
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

12

Three months ended September 30, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,668	$	1,613	$	862	$	157	$	1,366		$	288		$	227		$	6,181
Provision charged to expense		282		86		6		6		(40	)		33			(173	)	$	200
Losses charged off		-		-		-		-		(11	)		(58	)		-		$	(69	)
Recoveries		46		-		17		-		8			14			-		$	85
Balance, end of period	$	1,996	$	1,699	$	885	$	163	$	1,323		$	277		$	54		$	6,397

Nine months ended September 30, 2016	Construction			Commercial Real Estate		One to four family			Multi-family			Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,246		$	1,526	$	821		$	177		$	1,382		$	223		$	437		$	5,812
Provision charged to expense		922			141		80			(14	)		102			102			(383	)	$	950
Losses charged off		(252	)		-		(47	)		-			(170	)		(132	)		-		$	(601	)
Recoveries		80			32		31			-			9			84			-		$	236
Balance, end of period	$	1,996		$	1,699	$	885		$	163		$	1,323		$	277		$	54		$	6,397

The following tables present the recorded investment in loans based on portfolio segment and impairment method as of September 30, 2017 and December 31, 2016:

As of September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	830	$	-	$	56	$	-	$	310	$	130	$	-	$	1,326
Ending balance: collectively evaluated for impairment	$	1,449	$	1,767	$	800	$	375	$	824	$	297	$	171	$	5,683
Loans:
Ending balance: individually evaluated for impairment	$	5,310	$	161	$	2,274	$	-	$	931	$	187	$	-	$	8,863
Ending balance: collectively evaluated for impairment	$	56,737	$	266,131	$	105,477	$	74,653	$	89,256	$	23,475	$	-	$	615,729

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	302	$	-	$	14	$	-	$	241	$	45	$	-	$	602
Ending balance: collectively evaluated for impairment	$	1,075	$	1,687	$	842	$	206	$	927	$	292	$	111	$	5,140
Loans:
Ending balance: individually evaluated for impairment	$	5,447	$	161	$	2,060	$	-	$	925	$	106	$	-	$	8,699
Ending balance: collectively evaluated for impairment	$	35,465	$	249,420	$	104,351	$	48,483	$	74,480	$	23,500	$	-	$	535,699

13

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows or collateral value of the impaired loan is lower than the carrying value of that loan. The general component covers nonclassified loans and is based on historical charge-off experience and expected loss given default derived from the Bank’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.

A loan is considered impaired when, based on current information and events, it is probable that the Bank 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 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.

Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans.

14

The following table summarizes the recorded investment in impaired loans at September 30, 2017 and December 31, 2016:

	September 30, 2017						December 31, 2016
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Recorded Balance		Unpaid Principal Balance		Specific Allowance
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,815	$	1,815	$	-	$	2,006	$	2,006	$	-
Multi-family		-		-		-		-		-		-
Real estate - construction		2,937		2,937		-		3,017		3,017		-
Real estate - commercial		161		161		-		161		161		-
Commercial loans		500		500		-		622		622		-
Consumer and other loans		4		4		-		3		3		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	459	$	459	$	56	$	54	$	54	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		2,373		3,606		830		2,430		3,663		302
Real estate - commercial		-		72		-		-		-		-
Commercial loans		431		932		310		303		755		241
Consumer and other loans		183		183		130		103		103		45
Total
Real estate - residential mortgage:
One to four family units	$	2,274	$	2,274		56	$	2,060	$	2,060	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		5,310		6,543		830		5,447		6,680		302
Real estate - commercial		161		233		-		161		161		-
Commercial loans		931		1,432		310		925		1,377		241
Consumer and other loans		187		187		130		106		106		45
Total	$	8,863	$	10,669	$	1,326	$	8,699	$	10,384	$	602

15

The following table summarizes average impaired loans and related interest recognized on impaired loans for the three and nine months ended September 30, 2017 and 2016:

	For the Three Months Ended				For the Three Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,946	$	-	$	2,153	$	-
Multi-family		-		-		-		-
Real estate - construction		2,937		-		5,597		-
Real estate - commercial		161		-		244		-
Commercial loans		504		-		657		-
Consumer and other loans		2		-		185		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	183	$	-	$	28	$	-
Multi-family		-		-		-		-
Real estate - construction		2,373		-		2,051		-
Real estate - commercial		-		-		278		-
Commercial loans		431		-		375		-
Consumer and other loans		123		-		110		-
Total
Real estate - residential mortgage:
One to four family units	$	2,129	$	-	$	2,181	$	-
Multi-family		-		-		-		-
Real estate - construction		5,310		-		7,648		-
Real estate - commercial		161		-		522		-
Commercial loans		935		-		1,032		-
Consumer and other loans		125		-		295		-
Total	$	8,660	$	-	$	11,678	$	-

16

	For the Nine Months Ended				For the Nine Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,886	$	-	$	2,200	$	-
Multi-family		-		-		-		-
Real estate - construction		2,964		-		5,661		-
Real estate - commercial		360		-		657		-
Commercial loans		557		-		960		-
Consumer and other loans		8		-		114		1
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	90	$	-	$	23	$	-
Multi-family		-		-		-		-
Real estate - construction		2,395		-		2,222		-
Real estate - commercial		-		-		93		-
Commercial loans		481		-		489		-
Consumer and other loans		94		-		105		-
Total
Real estate - residential mortgage:
One to four family units	$	1,976	$	-	$	2,223	$	-
Multi-family		-		-		-		-
Real estate - construction		5,359		-		7,883		-
Real estate - commercial		360		-		750		-
Commercial loans		1,038		-		1,449		-
Consumer and other loans		102		-		219		1
Total	$	8,835	$	-	$	12,524	$	1

At September 30, 2017, the Bank’s impaired loans shown in the table above included loans that were classified as troubled debt restructurings (“TDR”). The restructuring of a loan is considered a TDR if both (i) the borrower is experiencing financial difficulties and (ii) the creditor has granted a concession.

In assessing whether or not a borrower is experiencing financial difficulties, the Bank considers information currently available regarding the financial condition of the borrower. This information includes, but is not limited to, whether (i) the debtor is currently in payment default on any of its debt; (ii) a payment default is probable in the foreseeable future without the modification; (iii) the debtor has declared or is in the process of declaring bankruptcy and (iv) the debtor’s projected cash flow is sufficient to satisfy the contractual payments due under the original terms of the loan without a modification.

The Bank considers all aspects of the modification to loan terms to determine whether or not a concession has been granted to the borrower. Key factors considered by the Bank include the debtor’s ability to access funds at a market rate for debt with similar risk characteristics, the significance of the modification relative to unpaid principal balance or collateral value of the debt, and the significance of a delay in the timing of payments relative to the original contractual terms of the loan. The most common concessions granted by the Bank generally include one or more modifications to the terms of the debt, such as (i) a reduction in the interest rate for the remaining life of the debt, (ii) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (iii) a reduction on the face amount or maturity amount of the debt as stated in the original loan, (iv) a temporary period of interest-only payments, (v) a reduction in accrued interest, and (vi) an extension of amortization.

17

The following table summarizes, by class, loans that were newly classified as TDRs for the three months ended September 30, 2017:

	Number of Loans		Pre-Modification Outstanding Recorded Balance		Post-Modification Outstanding Recorded Balance
Real estate - residential mortgage:
One to four family units		-	$	-	$	-
Multi-family		-		-		-
Real estate - construction		-		-		-
Real estate - commercial		-		-		-
Commercial loans		-		-		-
Consumer and other loans		1		119,459		119,459
Total		1	$	119,459	$	119,459

The following table summarizes, by type of concession, loans that were newly classified as TDRs for the three months ended September 30, 2017:

	Interest Rate		Term		Combination		Total Modification
Real estate - residential mortgage:
One to four family units	$	-	$	-	$	-	$	-
Multi-family		-		-		-		-
Real estate - construction		-		-		-		-
Real estate - commercial		-		-		-		-
Commercial loans		-		-		-		-
Consumer and other loans		-		119,459		-		119,459
Total	$	-	$	119,459	$	-	$	119,459

The following table presents the carrying balance of TDRs as of September 30, 2017 and December 31, 2016:

	September 30, 2017		December 31, 2016
Real estate - residential mortgage:
One to four family units	$	1,313,598	$	1,564,468
Multi-family		-		-
Real estate - construction		5,309,728		5,446,895
Real estate - commercial		5,701,518		5,736,849
Commercial loans		246,150		401,403
Consumer and other loans		119,717		-
Total	$	12,690,711	$	13,149,615

18

The Bank has allocated $947,843 and $329,734 of specific reserves to customers whose loan terms have been modified in TDR as of September 30, 2017 and December 31, 2016, respectively.

There were no TDRs for which there was a payment default within twelve months following the modification during the three and nine months ending September 30, 2017 and 2016. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.

As part of the on-going monitoring of the credit quality of the Bank’s loan portfolio, management tracks loans by an internal rating system. All loans are assigned an internal credit quality rating based on an analysis of the borrower’s financial condition. The criteria used to assign quality ratings to extensions of credit that exhibit potential problems or well-defined weaknesses are primarily based upon the degree of risk and the likelihood of orderly repayment, and their effect on the Bank’s safety and soundness. The following are the internally assigned ratings:

Pass: This rating represents loans that have strong asset quality and liquidity along with a multi-year track record of profitability.

Special mention: This rating represents loans that are currently protected but are potentially weak. The credit risk may be relatively minor, yet constitute an increased risk in light of the circumstances surrounding a specific loan.

Substandard: This rating represents loans that show signs of continuing negative financial trends and unprofitability and therefore, is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any.

Doubtful: This rating represents loans that have all the weaknesses of substandard classified loans with the additional characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Risk characteristics applicable to each segment of the loan portfolio are described as follows.

Real estate-Residential 1-4 family: The residential 1-4 family real estate loans are generally secured by owner-occupied 1-4 family residences. Repayment of these loans is primarily dependent on the personal income and credit rating of the borrowers. Credit risk in these loans can be impacted by economic conditions within the Bank’s market areas that might impact either property values or a borrower’s personal income. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers.

Real estate-Construction: Construction and land development real estate loans are usually based upon estimates of costs and estimated value of the completed project and include independent appraisal reviews and a financial analysis of the developers and property owners. Sources of repayment of these loans may include permanent loans, sales of developed property or an interim loan commitment from the Bank until permanent financing is obtained. These loans are considered to be higher risk than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, general economic conditions and the availability of long-term financing. Credit risk in these loans may be impacted by the creditworthiness of a borrower, property values and the local economies in the Bank’s market areas.

Real estate-Commercial: Commercial real estate loans typically involve larger principal amounts, and repayment of these loans is generally dependent on the successful operations of the property securing the loan or the business conducted on the property securing the loan. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Credit risk in these loans may be impacted by the creditworthiness of a borrower, property values and the local economies in the Bank’s market areas.

Commercial: The commercial portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions. The loans in this category are repaid primarily from the cash flow of a borrower’s principal business operation. Credit risk in these loans is driven by creditworthiness of a borrower and the economic conditions that impact the cash flow stability from business operations.

19

Consumer: The consumer loan portfolio consists of various term and line of credit loans such as automobile loans and loans for other personal purposes. Repayment for these types of loans will come from a borrower’s income sources that are typically independent of the loan purpose. Credit risk is driven by consumer economic factors (such as unemployment and general economic conditions in the Bank’s market area) and the creditworthiness of a borrower.

The following tables provide information about the credit quality of the loan portfolio using the Bank’s internal rating system as of September 30, 2017 and December 31, 2016:

September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	56,737	$	259,020	$	97,921	$	73,870	$	88,441	$	23,475	$	599,464
Special Mention		-		5,615		6,190		783		200		-		12,788
Substandard		5,310		1,657		3,640		-		862		187		11,656
Doubtful		-		-		-		-		684		-		684
Total	$	62,047	$	266,292	$	107,751	$	74,653	$	90,187	$	23,662	$	624,592

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	35,465	$	242,200	$	100,367	$	48,483	$	69,093	$	23,380	$	518,988
Special Mention		-		5,922		2,591		-		4,503		-		13,016
Substandard		5,447		1,459		3,453		-		1,225		226		11,810
Doubtful		-		-		-		-		584		-		584
Total	$	40,912	$	249,581	$	106,411	$	48,483	$	75,405	$	23,606	$	544,398

For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees net of certain direct origination costs, are deferred and amortized as a level yield adjustment over the respective term of the loan.

The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the loan is well-secured and in process of collection. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful.

All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Note 5: Benefit Plans

The Company has stock-based employee compensation plans, which are described in the Company’s 2016 Annual Report.     

20

The following tables below summarize transactions under the Company’s equity plans for the nine months ended September 30, 2017:

Stock Options
	Number of shares
	Incentive Stock Option			Non- Incentive Stock Option			Weighted Average Exercise Price
Balance outstanding as of January 1, 2017		60,000			52,500		$	20.15
Granted		-			-			-
Exercised		-			-			-
Forfeited		(11,000	)		(25,000	)		29.48
Balance outstanding as of September 30, 2017		49,000			27,500		$	15.75
Options exercisable as of September 30, 2017		49,000			27,500		$	15.75

The total intrinsic value of stock options exercised for the nine months ended September 30, 2017 and 2016 was $0 and $169,103, respectively. The total intrinsic value of outstanding stock options (including exercisable) was $669,800 and $438,800 at September 30, 2017 and 2016, respectively.

Restricted Stock
	Number of Shares			Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		60,955		$	13.62
Granted		13,386			20.33
Vested		(27,291	)		12.25
Forfeited		-			-
Balance of shares non-vested as of September 30, 2017		47,050		$	16.33

In February 2017, the Company granted 6,960 shares of restricted stock to directors pursuant to the 2015 Equity Plan of which 6,195 have a cliff vesting at the end of one year and thus, expensed over that same period and 765 shares have a cliff vesting at the end of three years, and thus, expensed over that same period. These shares had a grant date market price of $20.35 per share. The total amount of expense for restricted stock grants to directors (including all previous years grants) during the nine months ended September 30, 2017 and 2016 was $101,099 and $94,136, respectively.

For the nine months ended September 30, 2017 and 2016, the Company granted 6,426 and 15,343 shares, respectively, of restricted stock to officers that have a cliff vesting at the end of three years. The expense is being recognized over the applicable vesting period. The total amount of expense for restricted stock grants to officers (including all previous years grants) during the nine months ended September 30, 2017 and 2016 was $159,413 and $209,430, respectively.

21

Performance Stock Units
	Performance Stock Units		Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		-	$	-
Granted		55,823		20.48
Vested		-		-
Forfeited		-		-
Balance of shares non-vested as of September 30, 2017		55,823	$	20.48

On March 29, 2017, the Company granted restricted stock units representing 55,823 hypothetical shares of common stock to officers. There are three possible levels of incentive awards: threshold (25%); target (50%); and maximum (100%). The restricted stock units vest based on two financial performance factors over the period from March 29, 2017 to December 31, 2019 (the “Performance Period”). The two performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) Total Assets (50%) and (ii) Return on Average Assets (50%). In determining compensation expense, the fair value of the restricted stock unit awards was determined based on the closing price of the Company’s common stock on the date of grant, which was $20.48 per share. The expense is being recognized over the applicable vesting period. Due to the fact that the measurements cannot be determined at the time of the grant, the Company estimated that the most likely outcome is the achievement of the target level. If during the Performance Period, additional information becomes available to lead the Company to believe a different level will be achieved for the Performance Period, the Company will reassess the number of units that will vest for the grant and adjust its compensation expense accordingly on a prospective basis. The total amount of expense for restricted stock units during the nine months ended September 30, 2017 was $102,529.

Total stock-based compensation expense recognized for the three months ended September 30, 2017 and 2016 was $136,263 and $100,594, respectively. Total stock-based compensation expense recognized for the nine months ended September 30, 2017 and 2016 was $363,041 and $313,855, respectively. As of September 30, 2017, there was $768,224 of unrecognized compensation expense related to nonvested restricted stock awards, which will be recognized over the remaining vesting period.

Note 6: Income Per Common Share

	For three months ended September 30, 2017						For nine months ended September 30, 2017
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,717,383		4,374,725	$	0.39	$	4,739,197		4,370,877	$	1.08
Effect of Dilutive Securities				72,841						64,815
Diluted Income Per Common Share	$	1,717,383		4,447,566	$	0.39	$	4,739,197		4,435,692	$	1.07

22

	For three months ended September 30, 2016						For nine months ended September 30, 2016
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,541,907		4,370,700	$	0.35	$	4,074,664		4,365,835	$	0.93
Effect of Dilutive Securities				56,853						53,553
Diluted Income Per Common Share	$	1,541,907		4,427,553	$	0.35	$	4,074,664		4,419,388	$	0.92

Stock options to purchase 32,500 shares of common stock were outstanding during the three and nine months ended September 30, 2017 and stock options to purchase 73,500 shares of common stock were outstanding during the three and nine months ended September 30, 2016 but were not included in the computation of diluted income per common share because their exercise price was greater than the average market price of the common shares.

Note 7: New Accounting Pronouncements

 In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, (Topic 606): Revenue from Contracts with Customers (“ASU 2014-09”). The scope of the guidance applies to revenue arising from contracts with customers, except for the following: lease contracts, insurance contracts, contractual rights and obligations within the scope of other guidance and nonmonetary exchanges between entities in the same line of business to facilitate sales to customers. The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration that the entity receives or expects to receive. ASU 2014-09 is not expected to significantly impact the timing or approach to revenue recognition for financial institutions. Initially, the amendments were effective for public entities for annual reporting periods beginning after December 15, 2016, however, the FASB issued ASU 2015-14 Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date” which deferred the effective date of ASU 2014-09 by one year to annual and interim periods beginning after December 15, 2017. The guidance does not apply to revenue associated with financial instruments, including loans and securities that are accounted for under GAAP, which comprises a significant portion of our revenue stream. As the Company plans to adopt the new guidance in the first quarter of 2018, it is currently evaluating the impact of adopting ASU 2014-09 on its consolidated financial statements, but at this time do not believe the standard will have a significant impact on the financial statements, other than the required new disclosures.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”). ASU 2016-01 simplifies the impairment assessment of equity investments, clarifies reporting disclosure requirements for financial instruments measured at amortized cost, and requires the exit price notion be disclosed when measuring fair value of financial instruments. ASU 2016-01 details the required separate presentation in other comprehensive income for the change in fair value of a liability related to change in instrument specific credit risk and details the required separate presentation of financial assets and liabilities by measurement category, and clarifies the guidance for a valuation allowance on deferred tax assets related to available-for-sale securities. ASU 2016-01 is effective for annual and interim reporting periods beginning after December 15, 2017. Adoption of ASU 2016-01 is not expected to have a material impact on our consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”). ASU 2016-02 establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements in relation to the Company’s new leased headquarters that will be put into place during the fourth quarter of 2017. The Company expects to record a right of use asset and related liability for the present value of the lease payments.

23

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The purpose of the update was to simplify the accounting for share-based payment transactions, including the income tax consequences of such transactions. Under the provisions of the update the income tax consequences of excess tax benefits and deficiencies are to be recognized in income tax expense in the reporting period in which the awards vest. Previously, excess tax benefits or deficiencies impact stockholders’ equity directly to the extent there was a cumulative excess tax benefit. In the event that a tax deficiency had occurred during the reporting period and a cumulative excess tax benefit did not exist, the tax deficiency was recognized in income tax expense under previous GAAP. The update also provided that entities may continue to estimate forfeitures in accounting for stock based compensation or recognize them as they occur. The provisions of this update became effective for interim and annual periods beginning after December 15, 2016. The adoption of this amendment did not have a material impact on the Company’s financial position, results of operations or cash flows.  

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. Among other things, the amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. For SEC filers, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with later effective dates for non-SEC registrant public companies and other organizations. Early adoption will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently evaluating the provisions of ASU No. 2016-13 to determine the potential impact the new standard will have on the Company’s consolidated financial statements, and it is too early at this time to determine the impact on the financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The update is intended to reduce the diversity in practice around how certain transactions are classified within the statement of cash flows with respect to eight types of cash flows. This new accounting guidance will be effective for interim and annual reporting periods beginning after December 15, 2017. Adoption of ASU 2016-15 is not expected to have a material impact on our consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic) 310-20): Premium Amortization of Purchased Callable Debt Securities. The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium. The amendments require the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The amendment will be effective for interim and annual reporting periods beginning after December 15, 2018. The Company elected to early adopt ASU 2017-08 during 2017 and it did not have a significant effect on our consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Subtopic 718): Scope of Modification Accounting. ASU 2017-09 clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will not apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU 2017-09 is effective for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU 2017-09 is not expected to have a significant impact on our consolidated financial statements.

24

In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part 1) Accounting for certain financial instruments with down round features and (Part II), Replacement of the indefinite deferral for mandatory redeemable financial instruments of certain nonpublic entities and certain mandatory redeemable non-controlling interests with a scope exception. Part I of the update addresses the complexity of accounting for certain financial instruments with down round features such as warrants or convertible instruments and will be effective for interim and annual reporting periods beginning after December 15, 2019. The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements, but at this time do not believe the standard will have a significant impact on the financial statements.

In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted improvements to accounting for hedging activities. The purpose of this updated guidance is to better align financial reporting for hedging activities with the economic objectives of those activities. The amendments in this update are effective for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted.  The standard requires the modified retrospective transition approach as of the date of adoption.  The Company is currently evaluating the impact that this standard will have on its Consolidated Financial Statements.

Note 8: Derivative Financial Instruments

The Company records all derivative financial instruments at fair value in the financial statements. Derivatives are used as a risk management tool to hedge the exposure to changes in interest rates or other identified market risks.

When a derivative is intended to be a qualifying hedged instrument, the Company prepares written hedge documentation that designates the derivative as 1) a hedge of fair value of a recognized asset or liability (fair value hedge) or 2) a hedge of a forecasted transaction, such as, the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). The written documentation includes identification of, among other items, the risk management objective, hedging instrument, hedged item, and methodologies for assessing and measuring hedge effectiveness and ineffectiveness, along with support for management’s assertion that the hedge will be highly effective.

In June 2017, the Company entered into a forward start interest rate swap agreement totaling $50 million notional amount to hedge against interest rate risk on FHLB advances. As a cash flow hedge, the portion of the change in the fair value of the derivative that has been deemed highly effective is recognized in other comprehensive income until the related cash flows from the hedged item are recognized in earnings. At September 30, 2017, the Company reported a $95,395 unrealized gain, net of a $56,025 tax effect, in other comprehensive income related to this cash flow hedge. The Company documents, both at inception and periodically over the life of the hedge, its analysis of actual and expected hedge effectiveness. To the extent that the hedge of future cash flows is deemed ineffective, changes in the fair value of the derivative are recognized in earnings as a component of other noninterest expense. For the quarter ended September 30, 2017, there was no ineffectiveness attributable to the cash flow hedge.

25

A summary of the Company’s derivative financial instruments at September 30, 2017 is shown in the following table:

Forward Start	Termination	Derivative	Notional		Rate			Rate	Estimated Fair Value
Inception Date	Date	Type	Amount		Paid			Hedged	at September 30, 2017
2/28/2018	2/28/2025	Interest rate swap	$	50,000,000		2.12	%	3 month LIBOR Floating	$	151,420

Note 9: Disclosures about Fair Value of Assets and Liabilities

ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Topic 820 also specifies a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1:      Quoted prices in active markets for identical assets or liabilities;

Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

The following is a description of the inputs and valuation methodologies used for assets measured at fair value on a recurring basis and recognized in the accompanying condensed consolidated balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy.

Available-for-sale securities: Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities include equity securities. 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 flows. For these investments, the inputs used by the pricing service to determine fair value may include one or a combination of observable inputs such as benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bid offers and reference data market research publications and are classified within Level 2 of the valuation hierarchy. Level 2 securities include U.S. government agencies, municipal securities and government sponsored mortgage-backed securities. The Company has no Level 3 securities.

Derivative Financial Instruments: Derivatives are recorded at fair value on a recurring basis utilizing Level 2 inputs. The Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, live trading levels, among other things.

26

The following table presents the fair value measurements of assets recognized in the accompanying condensed consolidated balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2017 and December 31, 2016 (dollar amounts in thousands):

9/30/2017
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	33,893	$	-	$	33,893
Corporates		-		3,070		-		3,070
Government sponsored mortgage-backed securities and SBA loan pools		-		46,242		-		46,242
Available-for-sale securities	$	-	$	83,205	$	-	$	83,205

	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Interest rate swaps	$	-	$	151	$	-	$	151

12/31/2016
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	38,338	$	-	$	38,338
Corporates		-		7,053		-		7,053
Government sponsored mortgage-backed securities and SBA loan pools		-		47,008		-		47,008
Available-for-sale securities	$	-	$	92,399	$	-	$	92,399

The following is a description of the valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying statements of financial condition, as well as the general classification of such assets pursuant to the valuation hierarchy.

Foreclosed Assets Held for Sale:   Fair value is estimated using recent appraisals, comparable sales and other estimates of value obtained principally from independent sources, adjusted for selling costs and discounts based on management’s assessment of the condition and marketability of the collateral. Foreclosed assets held for sale are classified within Level 3 of the valuation hierarchy.

Impaired loans (Collateral Dependent):   Loans for which it is probable that the Company will not collect all principal and interest due according to contractual terms are measured for impairment. Allowable methods for determining the amount of impairment include estimating fair value using the fair value of the collateral for collateral dependent loans.

If the impaired loan is identified as collateral dependent, then the fair value method of measuring the amount of impairment is utilized. This method requires obtaining a current independent appraisal of the collateral and applying a discount factor to the value. Impaired loans that are collateral dependent are classified within Level 3 of the fair value hierarchy when impairment is determined using the fair value method.

27

The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2017 and December 31, 2016 (dollar amounts in thousands):

Impaired loans:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	1,474	$	1,474
December 31, 2016	$	-	$	-	$	1,006	$	1,006

Foreclosed assets held for sale:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	-	$	-
December 31, 2016	$	-	$	-	$	149	$	149

There were no transfers between valuation levels for any asset during the nine months ended September 30, 2017 or 2016. If valuation techniques are deemed necessary, the Company considers those transfers to occur at the end of the period when the assets are valued.

The following table presents quantitative information about unobservable inputs used in nonrecurring Level 3 fair value measurement (dollar amounts in thousands):

	Fair Value September 30, 2017		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,474	Market Comparable	Discount to reflect realizable value		0%	-	100%	(15%)
Foreclosed assets held for sale	$	-	Market Comparable	Discount to reflect realizable value			0%

	Fair Value December 31, 2016		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,006	Market Comparable	Discount to reflect realizable value		0%	-	100%	(7%)
Foreclosed assets held for sale	$	149	Market Comparable	Discount to reflect realizable value			10%

The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying condensed consolidated balance sheets at amounts other than fair value.

Cash and cash equivalents, interest-bearing deposits and Federal Home Loan Bank stock

The carrying amounts reported in the condensed consolidated balance sheets approximate those assets' fair value.

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Held-to-maturity securities

Fair value is based on quoted market prices, if available. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities.

Loans

The fair value of loans is estimated by discounting the future cash flows using the market rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Loans with similar characteristics were aggregated for purposes of the calculations. The carrying amount of accrued interest approximates its fair value.

Deposits

Deposits include demand deposits, savings accounts, NOW accounts and certain money market deposits. The carrying amount approximates fair value. The fair value of fixed-maturity certificates of deposit is estimated by discounting the future cash flows using rates currently offered for deposits of similar remaining maturities.

Federal Home Loan Bank advances

The fair value of advances is estimated by using rates on debt with similar terms and remaining maturities.

Subordinated debentures

For these variable rate instruments, the carrying amount is a reasonable estimate of fair value. There is currently a limited market for similar debt instruments and the Company has the option to call the subordinated debentures at an amount close to its par value.

Interest payable

The carrying amount approximates fair value.

Commitments to originate loans, letters of credit and lines of credit

The fair value of commitments to originate loans is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present credit worthiness of the counterparties. For fixed-rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates. The fair value of letters of credit and lines of credit are based on fees currently charged for similar agreements or on the estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date.

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The following tables present estimated fair values of the Company’s financial instruments at September 30, 2017 and December 31, 2016.

	September 30, 2017
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	10,721,184	$	10,721,184		1
Held-to-maturity securities		18,424		18,582		2
Federal Home Loan Bank stock		4,137,500		4,137,500		2
Mortgage loans held for sale		2,516,520		2,516,520		2
Loans, net		616,884,052		613,749,211		3
Interest receivable		2,164,278		2,164,278		2
Financial liabilities:
Deposits		584,088,617		583,406,521		2
Federal Home Loan Bank advances		82,800,000		83,002,996		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		253,045		253,045		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

	December 31, 2016
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	9,088,441	$	9,088,441		1
Held-to-maturity securities		27,528		28,153		2
Federal Home Loan Bank stock		4,611,000		4,611,000		2
Mortgage loans held for sale		2,183,633		2,183,633		2
Loans, net		538,273,640		537,645,692		3
Interest receivable		1,947,063		1,947,063		2
Financial liabilities:
Deposits		505,362,750		504,829,161		2
Federal Home Loan Bank advances		95,700,000		95,764,840		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		207,833		207,833		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

The primary function of the Company is to monitor and oversee its investment in the Bank. The Company engages in few other activities, and the Company has no significant assets other than its investment in the Bank. As a result, the results of operations of the Company are derived primarily from operations of the Bank. The Bank’s results of operations are primarily dependent on net interest margin, which is the difference between interest income on interest-earning assets and interest expense on interest-bearing liabilities. The Bank’s income is also affected by the level of its noninterest expenses, such as employee salaries and benefits, occupancy expenses and other expenses. The following discussion reviews material changes in the Company’s financial condition as of September 30, 2017, and the results of operations for the three and nine months ended September 30, 2017 and 2016.

The discussion set forth below, as well as other portions of this Form 10-Q, may contain forward-looking comments. Such comments are based upon the information currently available to management of the Company and management’s perception thereof as of the date of this Form 10-Q. When used in this Form 10-Q, words such as “anticipates,” “estimates,” “believes,” “expects,” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Such statements are subject to risks and uncertainties. Actual results of the Company’s operations could materially differ from those forward-looking comments. The differences could be caused by a number of factors or combination of factors including, but not limited to: changes in demand for banking services; changes in portfolio composition; changes in management strategy; increased competition from both bank and non-bank companies; changes in the general level of interest rates; changes in general or local economic conditions; changes in federal or state regulations and legislation governing the operations of the Company or the Bank; and other factors set forth in reports and other documents filed by the Company with the SEC from time to time, including the risk factors described under Item 1A. of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

Financial Condition

The Company’s total assets increased $71,358,983 (10%) from $687,979,819 as of December 31, 2016, to $759,338,802 as of September 30, 2017.

Available-for-sale securities decreased $9,194,040 (10%) from $92,399,235 as of December 31, 2016, to $83,205,195 as of September 30, 2017. The Company had sales and principal payments of $23,693,514 offset by purchases of $13,350,996. The Company had unrealized losses of $743,019 at September 30, 2017 which was an improvement from unrealized losses of $2,078,050 at December 31, 2016.

Net loans receivable increased by $78,610,412 (15%) from $538,273,640 as of December 31, 2016 to $616,884,052 as of September 30, 2017. New production included a mix of multi-family, agriculture, hospitality and Small Business Administration (“SBA”) lending. During the nine month period, permanent multi-family loans increased $26,169,946 (54%), construction loans increased $21,134,564 (52%), commercial loans increased $14,781,868 (20%) and commercial real estate loans increased $16,711,637 (7%). The Company continues to focus its lending efforts in the commercial, owner occupied real estate and small business lending categories.

Allowance for loan losses increased $1,266,648 (22%) from $5,742,449 as of December 31, 2016 to $7,009,097 as of September 30, 2017. In addition to the provision for loan loss of $1,500,000 recorded by the Company for the nine months ended September 30, 2017, charge-offs of specific loans (classified as nonperforming at December 31, 2016) exceeded loan recoveries by $233,353. The increase in the allowance is primarily due to the increased loan balances and reserves on a few specific problem credits. The allowance for loan losses, as a percentage of gross loans outstanding (excluding mortgage loans held for sale), as of September 30, 2017 and December 31, 2016 was 1.12% and 1.06%, respectively. The allowance for loan losses, as a percentage of nonperforming loans outstanding, as of September 30, 2017 and December 31, 2016 was 72.3% and 66.5%, respectively. Management believes the allowance for loan losses is at a level to be sufficient in providing for potential loan losses in the Bank’s existing loan portfolio.

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Deposits increased $78,725,867 (16%) from $505,362,750 as of December 31, 2016, to $584,088,617 as of September 30, 2017. For the nine months ended September 30, 2017, checking and savings accounts increased by $50,768,740 and certificates of deposit increased by $27,957,127. The increase in checking and savings accounts was due to the Bank’s continued focus to increase core transaction deposits, including retail, commercial and public funds. The increase in certificates of deposit was primarily due to the Bank supplementing deposit sources with $24,000,000 of brokered certificate of deposits. The Bank utilizes brokered certificate of deposits as a tool to manage cost of funds and to efficiently match changes in liquidity needs based on loan growth. See also the discussion under Item 3-“Quantitative and Qualitative Disclosure about Market Risk – Asset/Liability Management.”

Federal Home Loan Bank advances decreased $12,900,000 (13%) from $95,700,000 as of December 31, 2016 to $82,800,000 as of September 30, 2017 due to principal reductions.

Stockholders’ equity (including unrealized loss on available-for-sale securities, net of tax) increased $4,680,164 (7%) from $69,974,380 as of December 31, 2016, to $74,654,544 as of September 30, 2017. The Company’s net income during this period exceeded dividends paid or declared by $3,412,714. The equity portion of the Company’s unrealized losses on available-for-sale securities and effects of interest rate swaps improved by $936,465 during the nine month period. On a per common share basis, stockholders’ equity increased from $16.09 as of December 31, 2016 to $17.06 as of September 30, 2017.

Average Balances, Interest and Average Yields

The Company’s profitability is primarily dependent upon net interest income, which represents the difference between interest and fees earned on loans and debt and equity securities, and the cost of deposits and borrowings. Net interest income is dependent on the difference between the average balances and rates earned on interest-earning assets and the average balances and rates paid on interest-bearing liabilities. Non-interest income, non-interest expense, and income taxes also impact net income.

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The following table sets forth certain information relating to the Company’s average consolidated balance sheets and reflects the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense annualized by the average balance of assets or liabilities, respectively, for the periods shown. Average balances were derived from average daily balances. The average balance of loans includes loans on which the Company has discontinued accruing interest. The yields and costs include fees which are considered adjustments to yields. All dollar amounts are in thousands.

	Three months ended 9/30/2017								Three months ended 9/30/2016
	Average Balance		Interest			Yield / Cost			Average Balance		Interest			Yield / Cost
ASSETS
Interest-earning:
Loans	$	618,652	$	7,052			4.52	%	$	527,382	$	5,854			4.42	%
Investment securities		84,577		432			2.03	%		100,338		461			1.83	%
Other assets		10,418		41			1.56	%		15,608		39			0.99	%
Total interest-earning		713,647		7,525			4.18	%		643,328		6,354			3.93	%
Noninterest-earning		40,386								41,110
	$	754,033							$	684,438
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing:
Savings accounts	$	30,026		15			0.20	%	$	27,858		14			0.20	%
Transaction accounts		348,925		524			0.60	%		312,619		301			0.38	%
Certificates of deposit		133,198		354			1.05	%		109,893		245			0.89	%
FHLB advances		89,246		420			1.87	%		88,261		350			1.58	%
Subordinated debentures		15,465		160			4.10	%		15,465		146			3.76	%
Total interest-bearing		616,860		1,473			0.95	%		554,096		1,056			0.76	%
Noninterest-bearing		62,599								59,162
Total liabilities		679,459								613,258
Stockholders’ equity		74,574								71,180
	$	754,033							$	684,438
Net earning balance	$	96,787							$	89,232
Earning yield less costing rate							3.24	%							3.17	%
Net interest income, and net yield spread on interest earning assets			$	6,052			3.36	%			$	5,298			3.28	%
Ratio of interest-earning assets to interest-bearing liabilities				116	%							116	%

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	Nine months ended 9/30/2017								Nine months ended 9/30/2016
	Average Balance		Interest			Yield / Cost			Average Balance		Interest			Yield / Cost
ASSETS
Interest-earning:
Loans	$	598,925	$	20,043			4.47	%	$	507,346	$	17,184			4.52	%
Investment securities		88,783		1,361			2.05	%		103,026		1,445			1.87	%
Other assets		12,623		134			1.42	%		19,324		135			0.93	%
Total interest-earning		700,331		21,538			4.11	%		629,696		18,764			3.98	%
Noninterest-earning		40,512								40,953
	$	740,843							$	670,649
LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing:
Savings accounts	$	29,360		43			0.20	%	$	27,258		41			0.20	%
Transaction accounts		345,247		1,346			0.52	%		318,181		926			0.39	%
Certificates of deposit		119,011		873			0.98	%		111,820		748			0.89	%
FHLB advances		98,306		1,269			1.73	%		70,275		964			1.83	%
Subordinated debentures		15,465		468			4.05	%		15,465		429			3.71	%
Total interest-bearing		607,389		3,999			0.88	%		542,999		3,108			0.76	%
Noninterest-bearing		60,478								58,186
Total liabilities		667,867								601,185
Stockholders’ equity		72,976								69,464
	$	740,843							$	670,649
Net earning balance	$	92,942							$	86,697
Earning yield less costing rate							3.23	%							3.22	%
Net interest income, and net yield spread on interest earning assets			$	17,539			3.35	%			$	15,656			3.32	%
Ratio of interest-earning assets to interest-bearing liabilities				115	%							116	%

Results of Operations - Comparison of Three and Nine Month Periods Ended September 30, 2017 and 2016

Net income for the three and nine months ended September 30, 2017 was $1,717,383 and $4,739,197, respectively, compared to $1,541,907 and $4,074,664 for the three and nine months ended September 30, 2016, respectively, which represents an increase in earnings of $175,476 (11%) for the three month period, and an increase in earnings of $664,533 (16%) for the nine month period.

Interest Income

Total interest income for the three and nine months ended September 30, 2017 increased $1,170,844 (18%) and $2,774,435 (15%), respectively, as compared to the three and nine months ended September 30, 2016. For the three and nine month periods ended September 30, 2017 compared to the same periods in 2016, the average yield on interest earning assets increased 25 basis points to 4.18% and increased 13 basis points to 4.11%, while the average balance of interest earning assets increased approximately $70,319,000 for the three month period and increased approximately $70,635,000 for the nine month period. These increases were primarily due to the Company’s strong loan activity during 2017, in which loan balances increased $78,610,412 compared to December 31, 2016. Despite pricing on the loans remaining very competitive on new and renewing credits, the yield on loans increased for the third quarter when compared to the same quarter in 2016. For the three and nine month period ended September 30, 2017 compared to the same periods in 2016, the yield on loans increased 10 basis points to 4.52% and decreased 5 basis points to 4.47%.

34

Interest Expense

Total interest expense for the three and nine months ended September 30, 2017 increased $417,009 (39%) and $890,586 (29%), respectively, when compared to the three and nine months ended September 30, 2016. For the three and nine months period ended September 30, 2017 compared to the same periods in 2016, the average cost of interest bearing liabilities increased 19 basis points to 0.95% and increased 12 basis points to 0.88%, while the average balance of interest bearing liabilities increased approximately $62,764,000 for the three month period and increased approximately $64,390,000 for the nine month period. The increase in asset growth opportunities among most institutions in the local market have created significant competitive pressures on deposit rates. To fund its asset growth going forward, the Company will continue to utilize a cost effective mix of retail and commercial core deposits along with non-core, wholesale funding.

Net Interest Income

Net interest income for the three and nine months ended September 30, 2017 increased $753,875 (14%) and increased $1,883,849 (12%), respectively, when compared to the same periods in 2016. For the three and nine month periods ended September 30, 2017, the average balance of net interest earning assets over liabilities increased by approximately $7,555,000 and $11,224,000, respectively, when compared to the same periods in 2016. For the three and nine month periods ended September 30, 2017, the net interest margin increased 8 basis points to 3.36% and increased 3 basis points to 3.35%, respectively, when compared to the same periods in 2016.

Provision for Loan Losses

Provisions for loan losses are charged or credited to earnings to bring the total allowance for loan losses to a level considered adequate by the Company to provide for potential loan losses in the existing loan portfolio. When making its assessment, the Company considers prior loss experience, volume and type of lending, local banking trends and impaired and past due loans in the Company’s loan portfolio. In addition, the Company considers general economic conditions and other factors related to collectability of the Company’s loan portfolio.

Based on its internal analysis and methodology, management recorded a provision for loan losses of $450,000 and $1,500,000 for the three months and nine months ended September 30, 2017, respectively, compared to $200,000 and $950,000 for the same periods in 2016.

The Company’s increase in provision was primarily due to the increased loan balances and various reserves on specific problem credits. The Bank will continue to monitor its allowance for loan losses and make future additions based on economic and regulatory conditions. Management may need to increase the allowance for loan losses through charges to the provision for loan losses if anticipated growth in the Bank’s loan portfolio increases or other circumstances warrant.

Although the Bank maintains its allowance for loan losses at a level which it considers to be sufficient to provide for potential loan losses in its existing loan portfolio, there can be no assurance that future loan losses will not exceed internal estimates.  In addition, the amount of the allowance for loan losses is subject to review by regulatory agencies which can order the establishment of additional loan loss provisions.

Noninterest Income

Noninterest income increased $255,368 (19%) and $563,558 (16%) for the three months and nine months ended September 30, 2017, respectively, when compared to the three months and nine months ended September 30, 2016. This is primarily due to the Company’s emphasis on Small Business Administration (SBA) lending and its continued efforts in fixed-rate mortgage lending. The Company’s gains on sales of SBA loans increased $143,271 and $246,378 and gains on fixed-rate mortgage loan sales increased $90,211 and $289,902 for the three and nine months ended September 30, 2017, respectively, when compared to the same periods in 2016.

35

Noninterest Expense

Noninterest expense increased $694,125 (16%) and $1,262,791 (10%) for the three and nine months ended September 30, 2017 when compared to the same periods in 2016 due to a few significant factors.    

First, salaries and employee benefits increased $358,348 (13%) and $893,969 (11%) for the three and nine months ended September 30, 2017 compared to the same periods in 2016. This is primarily due to the Company’s recent expansion in the Joplin, Missouri market and increases in other areas of commercial banking, operations, technology and health/retirement benefits. Also impacting compensation were mortgage commissions which increased due to the significant mortgage activity for the quarter.

Second, the Company’s occupancy expenses increased $126,724 (27%) and $220,282 (16%) for the three and nine months ended September 30, 2017 compared to the same periods in 2016. This was primarily due to the Company’s continued enhancements in facilities (including signage) and significant investments in technology. The ongoing expansion in the Joplin, Missouri market has also played a factor in the increase in expense.

Third, the Company incurred $146,857 of impairment charges on solar tax credit investments in the third quarter of 2017. The Company purchased an interest in a utility scale solar energy project. The project will generate an estimated $557,000 of 2017 investment tax credits assuming certain compliance criteria are met. The cost of the investment will be accounted for under the equity and hypothetical liquidation at book value methods. Under these methods, an impairment charge is recorded on the investment equal to the discounted future cash flows compared to the carrying value of the investment.

Provision for Income Taxes

The provision for income taxes decreased by $110,358 (20%) and $29,917 (2%) for the three and nine months ended September 30, 2017 when compared to the same periods of 2016. The decrease in the provision for income taxes is primarily related to the Company’s investment tax credits discussed above.    

Nonperforming Assets

The allowance for loan losses is calculated based upon an evaluation of pertinent factors underlying the various types and quality of the Bank’s existing loan portfolio. When making such evaluation, management considers such factors as the repayment status of its loans, the estimated net realizable value of the underlying collateral, borrowers’ intent (to the extent known by the Bank) and ability to repay the loan, local economic conditions and the Bank’s historical loss ratios. The allowance for loan losses, as a percentage of nonperforming loans outstanding, as of September 30, 2017 and December 31, 2016 was 72.3% and 66.5%, respectively. Total loans classified as substandard, doubtful or loss as of September 30, 2017, were $12,339,631 or 1.63% of total assets as compared to $12,393,688 or 1.80% of total assets at December 31, 2016. Management considered nonperforming and total classified loans in evaluating the adequacy of the Bank’s allowance for loan losses.

36

The ratio of nonperforming assets to total assets is another useful tool in evaluating exposure to credit risk. Nonperforming assets of the Bank are comprised of nonperforming loans (including troubled debt restructurings) and assets which have been acquired as a result of foreclosure or deed-in-lieu of foreclosure. All dollar amounts are in thousands.

	9/30/2017			12/31/2016			12/31/2015
Nonperforming loans	$	9,695		$	8,632		$	13,755
Real estate acquired in settlement of loans		588			2,682			2,392
Total nonperforming assets	$	10,283		$	11,314		$	16,147
Total nonperforming assets as a percentage of total assets		1.35	%		1.64	%		2.47	%
Allowance for loan losses	$	7,009		$	5,742		$	5,812
Allowance for loan losses as a percentage of gross loans		1.12	%		1.05	%		1.17	%

Liquidity and Capital Resources

Liquidity refers to the ability to manage future cash flows to meet the needs of depositors and borrowers and fund operations. Maintaining appropriate levels of liquidity allows the Company to have sufficient funds available for customer demand for loans, withdrawal of deposit balances and maturities of deposits and other liabilities. The Company’s primary sources of liquidity include cash and cash equivalents, customer deposits, brokered and internet deposits and Federal Home Loan Bank of Des Moines borrowings. The Company also has established borrowing lines available from the Federal Reserve Bank and other correspondent banks, which are considered a secondary source of funds.

The Company’s most liquid assets are cash and cash equivalents, which are cash on hand, amounts due from financial institutions, and certificates of deposit with other financial institutions that have an original maturity of three months or less. The levels of such assets are dependent on the Bank’s operating, financing, and investment activities at any given time. The Company’s cash and cash equivalents totaled $10,721,184 as of September 30, 2017 and $9,088,441 as of December 31, 2016, representing an increase of $1,632,743. The variations in levels of cash and cash equivalents are influenced by many factors but primarily loan originations and payments, deposit flows and anticipated future deposit flows, which are subject to, and influenced by, many factors.

In July 2013, the Board of Governors of the Federal Reserve Board and the FDIC approved the final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks (commonly known as Basel III). Under the final rules, which began for the Company and the Bank on January 1, 2015 and are subject to a phase-in period through January 1, 2019, minimum requirements will increase for both the quantity and quality of capital held by the Company and the Bank. The rules include a new common equity Tier 1 capital to risk-weighted assets ratio (CET1 ratio) of 4.5% and a capital conservation buffer of 2.5% of risk-weighted assets, which when fully phased-in, effectively results in a minimum CET1 ratio of 7.0%. Basel III raises the minimum ratio of Tier 1 capital to risk-weighted assets from 4.0% to 6.0% (which, with the capital conservation buffer, effectively results in a minimum Tier 1 capital ratio of 8.5% when fully phased-in), effectively resulting in a minimum total capital to risk-weighted assets ratio of 10.5% (with the capital conservation buffer fully phased-in), and requires a minimum leverage ratio of 4.0%. Basel III also makes changes to risk weights for certain assets and off-balance-sheet exposures. We expect that the capital ratios for the Company and the Bank under Basel III will continue to exceed the well capitalized minimum capital requirements, when fully phased in.

The Bank’s capital ratios are above the levels required to be considered a well-capitalized financial institution. As of September 30, 2017, the Bank’s common equity Tier 1 ratio was 12.45%, the Bank’s Tier 1 leverage ratio was 11.77%, its Tier 1 risk-based capital ratio was 12.45% and the Bank’s total risk-based capital ratio was 13.44% - all exceeding the minimums of 6.5%, 5.0%, 8.0% and 10.0%, respectively, as well as exceeding the minimums plus the 1.25% of capital conservation buffer required as of September 30, 2017.

37

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Asset/Liability Management

The goal of the Bank’s asset/liability policy is to manage interest rate risk so as to maximize net interest income over time in changing interest rate environments. Management monitors the Bank’s net interest spreads (the difference between yields received on assets and paid on liabilities) and, although constrained by market conditions, economic conditions, and prudent underwriting standards, the Bank offers deposit rates and loan rates designed to maximize net interest income. Management also attempts to fund the Bank’s assets with liabilities of a comparable duration to minimize the impact of changing interest rates on the Bank’s net interest income. Since the relative spread between financial assets and liabilities is constantly changing, the Bank’s current net interest income may not be an indication of future net interest income.

As a part of its asset and liability management strategy and throughout the past several years, the Bank has continued to emphasize the origination of short-term commercial real estate, commercial business and consumer loans, while originating fixed-rate, one- to four-family residential loans primarily for immediate resale in the secondary market.

The Bank constantly monitors its deposits in an effort to decrease their interest rate sensitivity. Rates of interest paid on deposits at the Bank are priced competitively in order to meet the Bank’s asset/liability management objectives and spread requirements. The Bank believes, based on historical experience, that a substantial portion of such accounts represents non-interest rate sensitive core deposits.

Interest Rate Sensitivity Analysis

The following table sets forth as of September 30, 2017 management’s estimates of the projected changes in net portfolio value (“NPV”) in the event of 100 and 200 basis point (“BP”) instantaneous and permanent increases and decreases in market interest rates. Dollar amounts are expressed in thousands.

BP Change	Estimated Net Portfolio Value								NPV as % of PV of Assets
in Rates	$ Amount		$ Change			% Change			NPV Ratio			Change
+200	$	101,547	$	(3,837	)		-4	%		13.85	%		-0.06	%
+100		105,000		(384	)		0	%		14.07	%		0.16	%
NC		105,384		-			0	%		13.91	%		0.00	%
-100		101,703		(3,681	)		-3	%		13.27	%		-0.64	%
-200		85,501		(19,883	)		-19	%		11.08	%		-2.83	%

Computations of prospective effects of hypothetical interest rate changes are based on an internally generated model using actual maturity and repricing schedules for the Bank’s loans and deposits, and are based on numerous assumptions, including relative levels of market interest rates, loan repayments and deposit run-offs, and should not be relied upon as indicative of actual results. Further, the computations do not contemplate any actions the Bank may undertake in response to changes in interest rates. For further discussion of the Company’s market risk, see the Interest Rate Sensitivity Analysis Section of Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

Management cannot predict future interest rates or their effect on the Bank’s NPV in the future. Certain shortcomings are inherent in the method of analysis presented in the computation of NPV. For example, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in differing degrees to changes in market interest rates. Additionally, certain assets, such as adjustable-rate loans, have an initial fixed rate period typically from one to five years, and over the remaining life of the asset changes in the interest rate are restricted. In addition, the proportion of adjustable-rate loans in the Bank’s portfolio could decrease in future periods due to refinancing activity if market interest rates remain steady in the future. Further, in the event of a change in interest rates, prepayment and early withdrawal levels could deviate significantly from those assumed in the table. Finally, the ability of many borrowers to service their adjustable-rate debt may decrease in the event of an interest rate increase.

The Bank’s Board of Directors (the “Board”) is responsible for reviewing the Bank’s asset and liability management policies. The Board meets quarterly to review interest rate risk and trends, as well as liquidity and capital ratios and requirements. The Bank’s management is responsible for administering the policies and determinations of the Board with respect to the Bank’s asset and liability goals and strategies.

38

Item 4. Controls and Procedures

(a) The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

During the quarter ended September 30, 2017, the Company conducted an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of September 30, 2017.

(b) There have been no changes in the Company’s internal control over financial reporting during the quarter ended September 30, 2017 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

Item 1.     Legal Proceedings

None.

Item 1A. Risk Factors

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

ISSUER PURCHASES OF EQUITY SECURITIES

The Company has a repurchase plan which was announced on August 20, 2007. This plan authorizes the purchase by the Company of up to 350,000 shares of the Company’s common stock. There is no expiration date for this plan. There are no other repurchase plans in effect at this time. The Company had no repurchase activity of the Company’s common stock during the quarter ended September 30, 2017.

Item 3.     Defaults Upon Senior Securities

Not applicable.

Item 4.     Mine Safety Disclosures

Not applicable.

Item 5.     Other Information

None

39

Item 6.     Exhibits

11. Statement re: computation of per share earnings (set forth in “Note 6: Income Per Common Share” of the Notes to Condensed Consolidated Financial Statement (unaudited))

31(i).1 Certification of the Principal Executive Officer pursuant to Rule 13a -14(a) of the Exchange Act

31(i).2 Certification of the Principal Financial Officer pursuant to Rule 13a - 14(a) of the Exchange Act

32 Officer certifications pursuant to 18 U.S.C. Section 1350

101 The following materials from Guaranty Federal Bancshares, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 formatted in Extensible Business Reporting Language (XBRL): (i) Condensed Consolidated Balance Sheets (unaudited), (ii) Condensed Consolidated Statements of Income (unaudited), (iii) Condensed Consolidated Statements of Comprehensive Income (unaudited), (iv) Condensed Consolidated Statement of Stockholders’ Equity (unaudited), (v) the Condensed Consolidated Statements of Cash Flows (unaudited), and (vi) related notes.*

* Pursuant to Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

40

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Guaranty Federal Bancshares, Inc.
Signature and Title	Date
/s/ Shaun A. Burke	November 13, 2017
Shaun A. Burke
President and Chief Executive Officer
(Principal Executive Officer and Duly Authorized Officer)
/s/ Carter Peters	November 13, 2017
Carter Peters
Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)

41

EX-31.1

Exhibit 31(i).1

Certification of the Principal Executive Officer

Rule 13a – 14(a) of the Securities Exchange Act of 1934

I, Shaun A. Burke, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Guaranty Federal Bancshares, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 13, 2017	/s/ Shaun A. Burke
	Shaun A. Burke
	Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31(i).2

Certification of the Principal Financial Officer

Rule 13a – 14(a) of the Securities Exchange Act of 1934

I, Carter Peters, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Guaranty Federal Bancshares, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 13, 2017	/s/ Carter Peters
	Carter Peters
	Chief Financial Officer
	(Principal Financial Officer)

EX-32

Exhibit 32

OFFICER CERTIFICATIONS PURSUANT TO
18 U.S.C. SECTION 1350*

In connection with the Quarterly Report of Guaranty Federal Bancshares, Inc. (the “Company”) on Form 10-Q for the quarter ended September 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Shaun A. Burke, President and Chief Executive Officer and Carter Peters, Executive Vice President and Chief Financial Officer, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

1.     The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Shaun A. Burke	/s/ Carter Peters
Shaun A. Burke	Carter Peters
Chief Executive Officer	Chief Financial Officer
(Principal Executive Officer)	(Principal Financial Officer)
November 13, 2017	November 13, 2017

* A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Nov. 02, 2017
Document Information [Line Items]
Entity Registrant Name	Guaranty Federal Bancshares Inc
Entity Central Index Key	0001046203
Trading Symbol	gfed
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		4,421,775
Document Type	10-Q
Document Period End Date	Sep. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
ASSETS
Cash and due from banks	$ 3,456,243	$ 3,769,478
Interest-bearing deposits in other financial institutions	7,264,941	5,318,963
Cash and cash equivalents	10,721,184	9,088,441
Available-for-sale securities	83,205,195	92,399,235
Held-to-maturity securities	18,424	27,528
Stock in Federal Home Loan Bank, at cost	4,137,500	4,611,000
Mortgage loans held for sale	2,516,520	2,183,633
Loans receivable, net of allowance for loan losses of September 30, 2017 - $7,009,097 - December 31, 2016 - $5,742,449	616,884,052	538,273,640
Accrued interest receivable	2,164,278	1,947,063
Prepaid expenses and other assets	4,283,144	2,961,336
Foreclosed assets held for sale	588,443	2,682,353
Premises and equipment, net	11,713,174	10,871,039
Bank owned life insurance	19,623,719	19,272,893
Deferred and income taxes receivable	3,483,169	3,661,658
	759,338,802	687,979,819
LIABILITIES
Deposits	584,088,617	505,362,750
Federal Home Loan Bank advances	82,800,000	95,700,000
Subordinated debentures	15,465,000	15,465,000
Advances from borrowers for taxes and insurance	515,087	192,460
Accrued expenses and other liabilities	1,562,509	1,077,396
Accrued interest payable	253,045	207,833
	684,684,258	618,005,439
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock, $0.10 par value; authorized 10,000,000 shares; issued September 30, 2017 and December 31, 2016 - 6,875,503 shares	687,550	687,550
Additional paid-in capital	50,705,315	50,552,077
Retained earnings, substantially restricted	60,759,996	57,347,282
Accumulated other comprehensive loss	(372,776)	(1,309,241)
	111,780,085	107,277,668
Treasury stock, at cost; September 30, 2017 and December 31, 2016 - 2,453,728 and 2,465,476 shares, respectively	(37,125,541)	(37,303,288)
	74,654,544	69,974,380
	$ 759,338,802	$ 687,979,819

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Loans receivable, allowance for loans losses	$ 7,009,097	$ 5,742,449
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, authorized (in shares)	10,000,000	10,000,000
Common stock, issued (in shares)	6,875,503	6,875,503
Treasury stock, shares (in shares)	2,453,728	2,465,476

XML

Condensed Consolidated Statements of Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Interest Income
Loans	$ 7,052,544	$ 5,854,069	$ 20,042,667	$ 17,184,094
Investment securities	431,560	461,587	1,361,069	1,445,151
Other	41,083	38,647	134,361	134,417
	7,525,187	6,354,303	21,538,097	18,763,662
Interest Expense
Deposits	893,197	560,168	2,261,752	1,715,179
FHLB and Federal Reserve advancese	419,918	349,575	1,269,543	963,847
Subordinated debentures	160,075	146,438	467,665	429,348
	1,473,190	1,056,181	3,998,960	3,108,374
Net Interest Income	6,051,997	5,298,122	17,539,137	15,655,288
Provision for loan losses	450,000	200,000	1,500,000	950,000
Net Interest Income After Provision for Loan Losses	5,601,997	5,098,122	16,039,137	14,705,288
Noninterest Income
Service charges	311,070	303,958	869,102	849,026
Gain on sale of investment securities	11,199	44,060	73,473	155,465
Gain on sale of mortgage loans held for sale	618,732	528,521	1,550,880	1,260,978
Gain on sale of Small Business Administration loans	228,895	85,624	484,240	237,862
Net gain (loss) on foreclosed assets	47,787	(33,808)	56,051	(53,313)
Other income	353,186	387,146	1,133,548	1,153,718
	1,570,869	1,315,501	4,167,294	3,603,736
Noninterest Expense
Salaries and employee benefits	3,052,417	2,694,069	8,844,836	7,950,867
Occupancy	591,961	465,237	1,563,344	1,343,062
FDIC deposit insurance premiums	63,522	117,311	176,011	362,025
Data processing	268,508	223,618	730,260	650,283
Advertising	131,250	131,250	393,750	393,750
Impairment on investment tax credits	146,857		146,857
Other expense	757,317	686,222	2,144,310	2,036,590
	5,011,832	4,317,707	13,999,368	12,736,577
Income Before Income Taxes	2,161,034	2,095,916	6,207,063	5,572,447
Provision for Income Taxes	443,651	554,009	1,467,866	1,497,783
Net Income Available to Common Shareholders	$ 1,717,383	$ 1,541,907	$ 4,739,197	$ 4,074,664
Basic Income Per Common Share (in dollars per share)	$ 0.39	$ 0.35	$ 1.08	$ 0.93
Diluted Income Per Common Share (in dollars per share)	$ 0.39	$ 0.35	$ 1.07	$ 0.92

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
NET INCOME	$ 1,717,383	$ 1,541,907	$ 4,739,197	$ 4,074,664
OTHER ITEMS OF COMPREHENSIVE INCOME (LOSS):
Change in unrealized gain (loss) on investment securities available-for-sale, before income taxes	(39,661)	(272,470)	1,408,504	2,174,594
Change in unrealized gain (loss) on interest rate swaps, before income taxes	(76,222)		151,420
Less: Reclassification adjustment for realized gains on investment securities included in net income, before income taxes	(11,199)	(44,060)	(73,473)	(155,465)
Total other items of comprehensive income	(127,082)	(316,530)	1,486,451	2,019,129
Income tax expense (benefit) related to other items of comprehensive income	(47,022)	(117,115)	549,986	747,078
Other comprehensive income (loss)	(80,060)	(199,415)	936,465	1,272,051
TOTAL COMPREHENSIVE INCOME	$ 1,637,323	$ 1,342,492	$ 5,675,662	$ 5,346,715

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Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - 9 months ended Sep. 30, 2017 - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Total
Balance at Dec. 31, 2016	$ 687,550	$ 50,552,077	$ (37,303,288)	$ 57,347,282	$ (1,309,241)	$ 69,974,380
Net income				4,739,197		4,739,197
Change in unrealized gain on available-for-sale securities and effect of interest rate swaps, net of income taxes					936,465	936,465
Dividends on common stock				(1,326,483)		(1,326,483)
Stock award plans		153,238	177,747			330,985
Balance at Sep. 30, 2017	$ 687,550	$ 50,705,315	$ (37,125,541)	$ 60,759,996	$ (372,776)	$ 74,654,544

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Condensed Consolidated Statement of Stockholders' Equity (Unaudited) (Parentheticals)	9 Months Ended
	Sep. 30, 2017 $ / shares
Retained Earnings [Member]
Common stock dividends (in dollars per share)	$ 0.30

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 4,739,197	$ 4,074,664
Items not requiring (providing) cash:
Deferred income taxes	(603,683)	(88,504)
Depreciation	791,473	615,224
Provision for loan losses	1,500,000	950,000
Gain on sale of mortgage loans held for sale and investment securities	(1,624,353)	(1,416,443)
(Gain) loss on sale of foreclosed assets	(119,157)	2,798
Gain on sale of Small Business Administration Loans	(484,240)	(237,862)
Amortization of deferred income, premiums and discounts	728,144	469,088
Stock award plan expense	330,985	293,998
Origination of loans held for sale	(52,757,873)	(47,274,120)
Proceeds from sale of loans held for sale	53,975,866	47,873,689
Increase in cash surrender value of bank owned life insurance	(350,826)	(369,695)
Changes in:
Accrued interest receivable	(217,215)	177,712
Prepaid expenses and other assets	44,393	307,528
Accounts payable and accrued expenses	529,150	707,875
Income taxes receivable	232,186	703,175
Net cash provided by operating activities	6,714,047	6,789,127
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of loans receivable		(11,132,508)
Proceeds on sale of loans	24,919,859
Net change in loans	(105,083,322)	(24,782,137)
Principal payments on available-for-sale securities	5,153,878	6,385,019
Principal payments on held-to-maturity securities	9,104	12,736
Proceeds from calls/maturities of available-for-sale securities		535,000
Purchase of premises and equipment	(1,633,608)	(939,191)
Purchase of available-for-sale securities	(13,350,996)	(71,652,913)
Proceeds from sale of available-for-sale securities	18,388,216	67,177,538
Redemption (purchase) of Federal Home Loan Bank stock	473,500	(929,500)
Purchase of tax credit investments	(1,214,781)
Proceeds from sale of foreclosed assets held for sale	2,433,660	463,863
Net cash used in investing activities	(69,904,490)	(34,862,093)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash dividends paid on common stock	(1,325,308)	(1,060,619)
Net increase in demand deposits, NOW accounts and savings accounts	50,768,740	5,344,326
Net increase (decrease) in certificates of deposit	27,957,127	(6,965,873)
Proceeds from Federal Home Loan Bank advances	333,700,000	173,400,000
Repayments of Federal Home Loan Bank and Federal Reserve advances	(346,600,000)	(150,900,000)
Advances from borrowers for taxes and insurance	322,627	343,618
Stock options exercised		85,800
Net cash provided by financing activities	64,823,186	20,247,252
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,632,743	(7,825,714)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	9,088,441	18,774,419
CASH AND CASH EQUIVALENTS, END OF PERIOD	$ 10,721,184	$ 10,948,705

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Note 1 - Basis of Presentation

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Basis of Accounting [Text Block]

Note

1:

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form

10

-Q and Rule

8

-

03

of Regulation S-

X.

Accordingly, they do

not

include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in Guaranty Federal Bancshares, Inc.’s (the “Company”) Annual Report on Form

10

-K for the year ended

December 31, 2016 (

“2016

Annual Report”) filed with the Securities and Exchange Commission (the “SEC”). The results of operations for the periods are

not

necessarily indicative of the results to be expected for the full year. The condensed consolidated balance sheet of the Company as of

December 31, 2016,

has been derived from the audited consolidated balance sheet of the Company as of that date. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted.

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Note 2 - Principles of Consolidation

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Note

2:

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Guaranty Bank (the “Bank”). All significant intercompany transactions and balances have been eliminated in consolidation.

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Note 3 - Securities

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note

3:

Securities

The amortized cost and approximate fair values of securities classified as available-for-sale

were as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Municipals	$	34,012,067	$	210,255	$	(328,991	)	$	33,893,331
Corporates		3,000,000		70,000		-			3,070,000
Government sponsored mortgage-backed securities and SBA loan pools		46,936,147		32,472		(726,755	)		46,241,864
	$	83,948,214	$	312,727	$	(1,055,746	)	$	83,205,195

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2016
Debt Securities:
Municipals	$	39,357,506	$	65,673	$	(1,085,654	)	$	38,337,525
Corporates		7,003,986		54,050		(4,514	)		7,053,522
Government sponsored mortgage-backed securities and SBA loan pools		48,115,793		19,432		(1,127,037	)		47,008,188
	$	94,477,285	$	139,155	$	(2,217,205	)	$	92,399,235

Maturities of available-for-sale debt securities as of

September 30, 2017:

	Amortized Cost		Approximate Fair Value
1-5 years		564,554		581,359
6-10 years		9,254,809		9,317,277
After 10 years		27,192,704		27,064,695
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date		46,936,147		46,241,864
	$	83,948,214	$	83,205,195

The amortized cost and approximate fair values of securities classified as held to maturity are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Government sponsored mortgage-backed securities	$	18,424	$	215	$	(57	)	$	18,582

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Approximate Fair Value
As of December 31, 2016
Debt Securities:
Government sponsored mortgage-backed securities	$	27,528	$	625	$	-	$	28,153

Maturities of held-to-maturity securities as of

September 30, 2017:

	Amortized Cost		Approximate Fair Value
Government sponsored mortgage-backed securities not due on a single maturity date	$	18,424	$	18,582

The book value of securities pledged as collateral, to secure public deposits and for other purposes, amounted to

$48,651,661

and

$48,723,259

as of

September 30, 2017

and

December 31, 2016,

respectively. The approximate fair value of pledged securities amounted to

$48,125,394

and

$47,617,900

as of

September 30, 2017

and

December 31, 2016,

respectively.

Realized gains and losses are recorded as net securit

ies gains. Gains on sales of securities are determined on the specific identification method. Gross gains of

$73,473

and

$155,465

as of

September 30, 2017

and

September 30, 2016,

respectively, were realized from the sale of available-for-sale securities. The tax effect of these net gains was

$27,185

and

$57,522

as of

September 30, 2017

and

September 30, 2016,

respectively.

The Company evaluates all securities quarterly to determine if any unrealized losses are deemed to be other than temporary. Certain investment securities are valued

at less than their historical cost. These declines are primarily the result of the rate for these investments yielding less than current market rates, or declines in stock prices of equity securities. Based on evaluation of available evidence, management believes the declines in fair value for these securities are temporary. It is management’s intent to hold the debt securities to maturity or until recovery of the unrealized loss. Should the impairment of any of these debt securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified, to the extent the loss is related to credit issues, and to other comprehensive income to the extent the decline on debt securities is related to other factors and the Company does

not

intend to sell the security prior to recovery of the unrealized loss.

Certain other investments in debt and equity securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at

September 30, 2017

and

December 31, 2016,

was

$63,471,654

and

$79,361,229,

respectively, which is approximately

76%

and

86%

of the Company’s investment portfolio.

The following table shows gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at

September 30, 2017

and

December 31, 2016.

	September 30, 2017
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	10,507,517	$	(91,926	)	$	10,671,807	$	(237,065	)	$	21,179,324	$	(328,991	)
Government sponsored mortgage-backed securities and SBA loan pools		21,281,498		(219,697	)		21,010,832		(507,115	)		42,292,330		(726,812	)
	$	31,789,015	$	(311,623	)	$	31,682,639	$	(744,180	)	$	63,471,654	$	(1,055,803	)

	December 31, 2016
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	33,084,816	$	(1,082,021	)	$	179,402	$	(3,633	)	$	33,264,218	$	(1,085,654	)
Corporates		1,996,172		(3,828	)		881,100		(686	)		2,877,272		(4,514	)
Government sponsored mortgage-backed securities and SBA loan pools		39,570,463		(1,022,511	)		3,649,276		(104,526	)		43,219,739		(1,127,037	)
	$	74,651,451	$	(2,108,360	)	$	4,709,778	$	(108,845	)	$	79,361,229	$	(2,217,205	)

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Note 4 - Loans and Allowance for Loan Losses

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

Note

4:

Loans and Allowance for Loan Losses

Categories of loans at

September 30, 2017

and

December 31, 2016

include:

	September 30,			December 31,
	2017			2016
Real estate - residential mortgage:
One to four family units	$	107,750,990		$	106,410,559
Multi-family		74,653,469			48,483,523
Real estate - construction		62,046,871			40,912,307
Real estate - commercial		266,292,510			249,580,873
Commercial loans		90,186,600			75,404,732
Consumer and other loans		23,661,618			23,606,306
Total loans		624,592,058			544,398,300
Less:
Allowance for loan losses		(7,009,097	)		(5,742,449	)
Deferred loan fees/costs, net		(698,909	)		(382,211	)
Net loans	$	616,884,052		$	538,273,640

Classes of loans by aging at

September 30, 2017

and

December 31, 2016

were as follows:

As of September 30, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	1,542	$	644	$	249	$	2,435	$	105,316	$	107,751	$	-
Multi-family		783		-		-		783		73,870		74,653		-
Real estate - construction		-		-		-		-		62,047		62,047		-
Real estate - commercial		-		-		215		215		266,077		266,292		-
Commercial loans		-		-		1,384		1,384		88,803		90,187		-
Consumer and other loans		10		4		-		14		23,648		23,662		-
Total	$	2,335	$	648	$	1,848	$	4,831	$	619,761	$	624,592	$	-

As of December 31, 2016
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	367	$	495	$	103	$	965	$	105,446	$	106,411	$	-
Multi-family		-		-		-		-		48,483		48,483		-
Real estate - construction		-		-		-		-		40,912		40,912		-
Real estate - commercial		-		-		-		-		249,581		249,581		-
Commercial loans		-		-		593		593		74,812		75,405		-
Consumer and other loans		-		-		38		38		23,568		23,606		-
Total	$	367	$	495	$	734	$	1,596	$	542,802	$	544,398	$	-

Nonaccruing loans are summarized as follows:

	September 30,		December 31,
	2017		2016
Real estate - residential mortgage:
One to four family units	$	2,274,040	$	2,060,180
Multi-family		-		-
Real estate - construction		5,309,728		5,446,896
Real estate - commercial		376,091		161,491
Commercial loans		1,610,950		925,281
Consumer and other loans		124,161		37,791
Total	$	9,694,970	$	8,631,639

The following tables present the activity in the allowance for loan losses based on portfolio segment for the

three

and

nine

months ended

September 30, 2017

and

2016:

Three months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,739	$	1,954		$	936		$	323	$	1,226		$	335		$	127	$	6,640
Provision charged to expense		524		(116	)		(81	)		52		(99	)		126			44	$	450
Losses charged off		-		(71	)		-			-		-			(46	)		-	$	(117	)
Recoveries		16		-			1			-		7			12			-	$	36
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

Nine months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,377	$	1,687		$	856		$	206	$	1,168		$	337		$	111	$	5,742
Provision charged to expense		847		151			2			169		40			231			60	$	1,500
Losses charged off		-		(71	)		(11	)		-		(85	)		(169	)		-	$	(336	)
Recoveries		55		-			9			-		11			28			-	$	103
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

Three months ended September 30, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,668	$	1,613	$	862	$	157	$	1,366		$	288		$	227		$	6,181
Provision charged to expense		282		86		6		6		(40	)		33			(173	)	$	200
Losses charged off		-		-		-		-		(11	)		(58	)		-		$	(69	)
Recoveries		46		-		17		-		8			14			-		$	85
Balance, end of period	$	1,996	$	1,699	$	885	$	163	$	1,323		$	277		$	54		$	6,397

Nine months ended September 30, 2016	Construction			Commercial Real Estate		One to four family			Multi-family			Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,246		$	1,526	$	821		$	177		$	1,382		$	223		$	437		$	5,812
Provision charged to expense		922			141		80			(14	)		102			102			(383	)	$	950
Losses charged off		(252	)		-		(47	)		-			(170	)		(132	)		-		$	(601	)
Recoveries		80			32		31			-			9			84			-		$	236
Balance, end of period	$	1,996		$	1,699	$	885		$	163		$	1,323		$	277		$	54		$	6,397

The following tables present the recorded investment in loans based on portfolio segment and impairment method as of

September 30, 2017

and

December 31, 2016:

As of September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	830	$	-	$	56	$	-	$	310	$	130	$	-	$	1,326
Ending balance: collectively evaluated for impairment	$	1,449	$	1,767	$	800	$	375	$	824	$	297	$	171	$	5,683
Loans:
Ending balance: individually evaluated for impairment	$	5,310	$	161	$	2,274	$	-	$	931	$	187	$	-	$	8,863
Ending balance: collectively evaluated for impairment	$	56,737	$	266,131	$	105,477	$	74,653	$	89,256	$	23,475	$	-	$	615,729

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	302	$	-	$	14	$	-	$	241	$	45	$	-	$	602
Ending balance: collectively evaluated for impairment	$	1,075	$	1,687	$	842	$	206	$	927	$	292	$	111	$	5,140
Loans:
Ending balance: individually evaluated for impairment	$	5,447	$	161	$	2,060	$	-	$	925	$	106	$	-	$	8,699
Ending balance: collectively evaluated for impairment	$	35,465	$	249,420	$	104,351	$	48,483	$	74,480	$	23,500	$	-	$	535,699

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollect

ability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management

’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that

may

affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows or collateral value of the impaired loan is lower than the carrying value of that loan. The general component covers nonclassified loans and is based on historical charge-off experience and expected loss given default derived from the Bank

’s internal risk rating process. Other adjustments

may

be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are

not

fully reflected in the historical loss or risk rating data.

A loan is considered impaired when, based on current information and events, it is probable that the Bank 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 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.

Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group

’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans.

The following table summarizes the recorded investment in impaired loans at

September 30, 2017

and

December 31, 2016:

	September 30, 2017						December 31, 2016
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Recorded Balance		Unpaid Principal Balance		Specific Allowance
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,815	$	1,815	$	-	$	2,006	$	2,006	$	-
Multi-family		-		-		-		-		-		-
Real estate - construction		2,937		2,937		-		3,017		3,017		-
Real estate - commercial		161		161		-		161		161		-
Commercial loans		500		500		-		622		622		-
Consumer and other loans		4		4		-		3		3		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	459	$	459	$	56	$	54	$	54	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		2,373		3,606		830		2,430		3,663		302
Real estate - commercial		-		72		-		-		-		-
Commercial loans		431		932		310		303		755		241
Consumer and other loans		183		183		130		103		103		45
Total
Real estate - residential mortgage:
One to four family units	$	2,274	$	2,274		56	$	2,060	$	2,060	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		5,310		6,543		830		5,447		6,680		302
Real estate - commercial		161		233		-		161		161		-
Commercial loans		931		1,432		310		925		1,377		241
Consumer and other loans		187		187		130		106		106		45
Total	$	8,863	$	10,669	$	1,326	$	8,699	$	10,384	$	602

The following table summarizes average impaired loans and related interest recognized on impaired loans for the

three

and

nine

months ended

September 30, 2017

and

2016:

	For the Three Months Ended				For the Three Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,946	$	-	$	2,153	$	-
Multi-family		-		-		-		-
Real estate - construction		2,937		-		5,597		-
Real estate - commercial		161		-		244		-
Commercial loans		504		-		657		-
Consumer and other loans		2		-		185		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	183	$	-	$	28	$	-
Multi-family		-		-		-		-
Real estate - construction		2,373		-		2,051		-
Real estate - commercial		-		-		278		-
Commercial loans		431		-		375		-
Consumer and other loans		123		-		110		-
Total
Real estate - residential mortgage:
One to four family units	$	2,129	$	-	$	2,181	$	-
Multi-family		-		-		-		-
Real estate - construction		5,310		-		7,648		-
Real estate - commercial		161		-		522		-
Commercial loans		935		-		1,032		-
Consumer and other loans		125		-		295		-
Total	$	8,660	$	-	$	11,678	$	-

	For the Nine Months Ended				For the Nine Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,886	$	-	$	2,200	$	-
Multi-family		-		-		-		-
Real estate - construction		2,964		-		5,661		-
Real estate - commercial		360		-		657		-
Commercial loans		557		-		960		-
Consumer and other loans		8		-		114		1
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	90	$	-	$	23	$	-
Multi-family		-		-		-		-
Real estate - construction		2,395		-		2,222		-
Real estate - commercial		-		-		93		-
Commercial loans		481		-		489		-
Consumer and other loans		94		-		105		-
Total
Real estate - residential mortgage:
One to four family units	$	1,976	$	-	$	2,223	$	-
Multi-family		-		-		-		-
Real estate - construction		5,359		-		7,883		-
Real estate - commercial		360		-		750		-
Commercial loans		1,038		-		1,449		-
Consumer and other loans		102		-		219		1
Total	$	8,835	$	-	$	12,524	$	1

At

September 30, 2017,

the Bank’s impaired loans shown in the table above included loans that were classified as troubled debt restructurings (“TDR”). The restructuring of a loan is considered a TDR if both (i) the borrower is experiencing financial difficulties and (ii) the creditor has granted a concession.

In assessing whether or

not

a borrower is experiencing financial difficulties, the Bank considers information currently available regarding the financial condition of the borrower. This information includes, but is

not

limited to, whether (i) the debtor is currently in payment default on any of its debt; (ii) a payment default is probable in the foreseeable future without the modification; (iii) the debtor has declared or is in the process of declaring bankruptcy and (iv) the debtor’s projected cash flow is sufficient to satisfy the contractual payments due under the original terms of the loan without a modification.

The Bank considers all aspects of the modification to loan terms to determine whether or

not

a concession has been granted to the borrower. Key factors considered by the Bank include the debtor’s ability to access funds at a market rate for debt with similar risk characteristics, the significance of the modification relative to unpaid principal balance or collateral value of the debt, and the significance of a delay in the timing of payments relative to the original contractual terms of the loan. The most common concessions granted by the Bank generally include

one

or more modifications to the terms of the debt, such as (i) a reduction in the interest rate for the remaining life of the debt, (ii) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (iii) a reduction on the face amount or maturity amount of the debt as stated in the original loan, (iv) a temporary period of interest-only payments, (v) a reduction in accrued interest, and (vi) an extension of amortization.

The following table summarizes, by class, loans that were newly classified as TDRs for the

three

months ended

September 30, 2017:

	Number of Loans		Pre-Modification Outstanding Recorded Balance		Post-Modification Outstanding Recorded Balance
Real estate - residential mortgage:
One to four family units		-	$	-	$	-
Multi-family		-		-		-
Real estate - construction		-		-		-
Real estate - commercial		-		-		-
Commercial loans		-		-		-
Consumer and other loans		1		119,459		119,459
Total		1	$	119,459	$	119,459

The following table summarizes, by type of concession, loans that were newly classified as TDRs for the

three

months ended

September 30, 2017:

	Interest Rate		Term		Combination		Total Modification
Real estate - residential mortgage:
One to four family units	$	-	$	-	$	-	$	-
Multi-family		-		-		-		-
Real estate - construction		-		-		-		-
Real estate - commercial		-		-		-		-
Commercial loans		-		-		-		-
Consumer and other loans		-		119,459		-		119,459
Total	$	-	$	119,459	$	-	$	119,459

The following table presents the carrying balance of TDRs as of

September 30, 2017

and

December 31, 2016:

	September 30, 2017		December 31, 2016
Real estate - residential mortgage:
One to four family units	$	1,313,598	$	1,564,468
Multi-family		-		-
Real estate - construction		5,309,728		5,446,895
Real estate - commercial		5,701,518		5,736,849
Commercial loans		246,150		401,403
Consumer and other loans		119,717		-
Total	$	12,690,711	$	13,149,615

The Bank has allocated

$947,843

and

$329,734

of specific reserves to customers whose loan terms have been modified in TDR as of

September 30, 2017

and

December 31, 2016,

respectively.

There were

no

TDRs for which there was a payment default within

twelve

months following the modification during the

three

and

nine

months ending

September 30, 2017

and

2016.

A loan is considered to be in payment default once it is

90

days contractually past due under the modified terms.

As part of the on-going monitoring of the credit quality of the Bank

’s loan portfolio, management tracks loans by an internal rating system. All loans are assigned an internal credit quality rating based on an analysis of the borrower’s financial condition. The criteria used to assign quality ratings to extensions of credit that exhibit potential problems or well-defined weaknesses are primarily based upon the degree of risk and the likelihood of orderly repayment, and their effect on the Bank’s safety and soundness. The following are the internally assigned ratings:

Pass

: This rating represents loans that have strong asset quality and liquidity along with a multi-year track record of profitability.

Special mention

: This rating represents loans that are currently protected but are potentially weak. The credit risk

may

be relatively minor, yet constitute an increased risk in light of the circumstances surrounding a specific loan.

Substandard

: This rating represents loans that show signs of continuing negative financial trends and unprofitability and therefore, is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any.

Doubtful

: This rating represents loans that have all the weaknesses of substandard classified loans with the additional characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Risk characteristics applicable to each segment of the loan portfolio are described as follows.

Real estate-Residential

1

-

4

family: The residential

1

-

4

family real estate loans are generally secured by owner-occupied

1

-

4

family residences. Repayment of these loans is primarily dependent on the personal income and credit rating of the borrowers. Credit risk in these loans can be impacted by economic conditions within the Bank

’s market areas that might impact either property values or a borrower’s personal income. Risk is mitigated by the fact that the loans are of smaller individual amounts and spread over a large number of borrowers.

Real estate-Construction: Construction and land development real estate loans are usually based upon estimates of costs and estimated value of the completed project and include independent appraisal reviews and a financial analysis of the developers and property owners. Sources of repayment of these loans

may

include permanent loans, sales of developed property or an interim loan commitment from the Bank until permanent financing is obtained. These loans are considered to be higher risk than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, general economic conditions and the availability of long-term financing. Credit risk in these loans

may

be impacted by the creditworthiness of a borrower, property values and the local economies in the Bank

’s market areas.

Real estate-Commercial: Commercial real estate loans typically involve larger principal amounts, and repayment of these loans is generally dependent on the successful operations of the property securing the loan or the business conducted on the property securing the loan. These loans are viewed primarily as cash flow loans and secondarily as loans secured by real estate. Credit risk in these loans

may

be impacted by the creditworthiness of a borrower, property values and the local economies in the Bank

’s market areas.

Commercial: The commercial portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions. The loans in this category are repaid primarily from the cash flow of a borrower

’s principal business operation. Credit risk in these loans is driven by creditworthiness of a borrower and the economic conditions that impact the cash flow stability from business operations.

Consumer: The consumer loan portfolio consists of various term and line of credit loans such as automobile loans and loans for other personal purposes. Repayment for these types of loans will come from a borrower

’s income sources that are typically independent of the loan purpose. Credit risk is driven by consumer economic factors (such as unemployment and general economic conditions in the Bank’s market area) and the creditworthiness of a borrower.

The following tables provide information about the credit quality of the loan portfolio using the Bank’s internal rating system as of

September 30, 2017

and

December 31, 2016:

September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	56,737	$	259,020	$	97,921	$	73,870	$	88,441	$	23,475	$	599,464
Special Mention		-		5,615		6,190		783		200		-		12,788
Substandard		5,310		1,657		3,640		-		862		187		11,656
Doubtful		-		-		-		-		684		-		684
Total	$	62,047	$	266,292	$	107,751	$	74,653	$	90,187	$	23,662	$	624,592

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	35,465	$	242,200	$	100,367	$	48,483	$	69,093	$	23,380	$	518,988
Special Mention		-		5,922		2,591		-		4,503		-		13,016
Substandard		5,447		1,459		3,453		-		1,225		226		11,810
Doubtful		-		-		-		-		584		-		584
Total	$	40,912	$	249,581	$	106,411	$	48,483	$	75,405	$	23,606	$	544,398

For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees net of certain direct origination costs, are deferred and amortized as a level yield adjustment over the respective term of the loan.

The accrual of interest on loans is discontinued at the time the loan is

90

days past due unless the

loan is well-secured and in process of collection. Past due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful.

All interest accrued but

not

collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

XML

Note 5 - Benefit Plans

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note

5:

Benefit Plans

The Company has

stock-based employee compensation plans, which are described in the Company’s

2016

Annual Report.     

The following tables below summarize transactions under the Company’s equity plans for the

nine

months ended

September 30, 2017:

Stock Options
	Number of shares
	Incentive Stock Option			Non- Incentive Stock Option			Weighted Average Exercise Price
Balance outstanding as of January 1, 2017		60,000			52,500		$	20.15
Granted		-			-			-
Exercised		-			-			-
Forfeited		(11,000	)		(25,000	)		29.48
Balance outstanding as of September 30, 2017		49,000			27,500		$	15.75
Options exercisable as of September 30, 2017		49,000			27,500		$	15.75

The total intrinsic value of stock options exercised for the

nine

months ended

September 30, 2017

and

2016

was

$0

and

$169,103,

respectively. The total intrinsic value of outstanding stock options (including exercisable) was

$669,800

and

$438,800

at

September 30, 2017

and

2016,

respectively.

Restricted Stock
	Number of Shares			Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		60,955		$	13.62
Granted		13,386			20.33
Vested		(27,291	)		12.25
Forfeited		-			-
Balance of shares non-vested as of September 30, 2017		47,050		$	16.33

In

February 2017,

the Company granted

6,960

shares of restricted stock to directors pursuant to the

2015

Equity Plan of which

6,195

have a cliff vesting at the end of

one

year and thus, expensed over that same period and

765

shares have a cliff vesting at the end of

three

years, and thus, expensed over that same period. These shares had a grant date market price of

$20.35

per share. The total amount of expense for restricted stock grants to directors (including all previous years grants) during the

nine

months ended

September 30, 2017

and

2016

was

$101,099

and

$94,136,

respectively.

For the

nine

months ended

September 30, 2017

and

2016,

the Company granted

6,426

and

15,343

shares, respectively, of restricted stock to officers that have a cliff vesting at the end of

three

years. The expense is being recognized over the applicable vesting period. The total amount of expense for restricted stock grants to officers (including all previous years grants) during the

nine

months ended

September 30, 2017

and

2016

was

$159,413

and

$209,430,

respectively.

Performance Stock Units
	Performance Stock Units		Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		-	$	-
Granted		55,823		20.48
Vested		-		-
Forfeited		-		-
Balance of shares non-vested as of September 30, 2017		55,823	$	20.48

On

March 29, 2017,

the Company granted restricted stock units representing

55,823

hypothetical shares of common stock to officers. There are

three

possible levels of incentive awards: threshold (

25%

); target (

50%

); and maximum (

100%

). The restricted stock units vest based on

two

financial performance factors over the period from

March 29, 2017

to

December 31, 2019 (

the “Performance Period”). The

two

performance measurements of the Company (and the weight given to each measurement) applicable to each award level are as follows: (i) Total Assets (

50%

) and (ii) Return on Average Assets (

50%

). In determining compensation expense, the fair value of the restricted stock unit awards was determined based on the closing price of the Company’s common stock on the date of grant, which was

$20.48

per share. The expense is being recognized over the applicable vesting period. Due to the fact that the measurements cannot be determined at the time of the grant, the Company estimated that the most likely outcome is the achievement of the target level. If during the Performance Period, additional information becomes available to lead the Company to believe a different level will be achieved for the Performance Period, the Company will reassess the number of units that will vest for the grant and adjust its compensation expense accordingly on a prospective basis. The total amount of expense for restricted stock units during the

nine

months ended

September 30, 2017

was

$102,529.

Total stock-based compensation expense recognized for the

three

months ended

September 30, 2017

and

2016

was

$136,263

and

$100,594,

respectively. Total stock-based compensation expense recognized for the

nine

months ended

September 30, 2017

and

2016

was

$363,041

and

$313,855,

respectively. As of

September 

30,

2017,

there was

$768,224

of unrecognized compensation expense related to nonvested restricted stock awards, which will be recognized over the remaining vesting period.

XML

Note 6 - Income Per Common Share

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Earnings Per Share [Text Block]

Note

6:

Income Per Common Share

	For three months ended September 30, 2017						For nine months ended September 30, 2017
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,717,383		4,374,725	$	0.39	$	4,739,197		4,370,877	$	1.08
Effect of Dilutive Securities				72,841						64,815
Diluted Income Per Common Share	$	1,717,383		4,447,566	$	0.39	$	4,739,197		4,435,692	$	1.07

	For three months ended September 30, 2016						For nine months ended September 30, 2016
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,541,907		4,370,700	$	0.35	$	4,074,664		4,365,835	$	0.93
Effect of Dilutive Securities				56,853						53,553
Diluted Income Per Common Share	$	1,541,907		4,427,553	$	0.35	$	4,074,664		4,419,388	$	0.92

Stock options to purchase

32,500

shares of common stock were outstanding during the

three

and

nine

months ended

September 30, 2017

and stock options to purchase

73,500

shares of common stock were outstanding during the

three

and

nine

months ended

September 30, 2016

but were

not

included in the computation of diluted income per common share because their exercise price was greater than the average market price of the common shares.

XML

Note 7 - New Accounting Pronouncements

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

Note

7:

New Accounting Pronouncements

 

In

May 2014,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

2014

-

09,

(Topic

606

):

Revenue from Contracts with Customers

(“ASU

2014

-

09”

). The scope of the guidance applies to revenue arising from contracts with customers, except for the following: lease contracts, insurance contracts, contractual rights and obligations within the scope of other guidance and nonmonetary exchanges between entities in the same line of business to facilitate sales to customers. The core principle of the new guidance is that an entity should recognize revenue to reflect the transfer of goods and services to customers in an amount equal to the consideration that the entity receives or expects to receive. ASU

2014

-

09

is

not

expected to significantly impact the timing or approach to revenue recognition for financial institutions. Initially, the amendments were effective for public entities for annual reporting periods beginning after

December 15, 2016,

however, the FASB issued ASU

2015

-

14

Revenue from Contracts with Customers (Topic

606

) – Deferral of the Effective Date

” which deferred the effective date of ASU

2014

-

09

by

one

year to annual and interim periods beginning after

December 15, 2017.

The guidance does

not

apply to revenue associated with financial instruments, including loans and securities that are accounted for under GAAP, which comprises a significant portion of our revenue stream. As the Company plans to adopt the new guidance in the

first

quarter of

2018,

it is currently evaluating the impact of adopting ASU

2014

-

09

on its consolidated financial statements, but at this time do

not

believe the standard will have a significant impact on the financial statements, other than the required new disclosures.

In

January 2016,

the FASB issued ASU

2016

-

01,

Financial Instruments- Overall (Subtopic

825

-

10

):

Recognition and Measurement of Financial Assets and Financial Liabilities

(“ASU

2016

-

01”

). ASU

2016

-

01

simplifies the impairment assessment of equity investments, clarifies reporting disclosure requirements for financial instruments measured at amortized cost, and requires the exit price notion be disclosed when measuring fair value of financial instruments. ASU

2016

-

01

details the required separate presentation in other comprehensive income for the change in fair value of a liability related to change in instrument specific credit risk and details the required separate presentation of financial assets and liabilities by measurement category, and clarifies the guidance for a valuation allowance on deferred tax assets related to available-for-sale securities. ASU

2016

-

01

is effective for annual and interim reporting periods beginning after

December 15, 2017.

Adoption of ASU

2016

-

01

is

not

expected to have a material impact on our consolidated financial statements.

In

February 2016,

the FASB issued ASU

2016

-

02,

Leases

(“ASU

2016

-

02”

). ASU

2016

-

02

establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than

12

months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement.  ASU

2016

-

02

is effective for fiscal years beginning after

December 15, 2018,

including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available.

The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements in relation to the Company

’s new leased headquarters that will be put into place during the

fourth

quarter of

2017.

The Company expects to record a right of use asset and related liability for the present value of the lease payments.

In

March 2016,

the FASB issued ASU

2016

-

09,

Compensation-Stock Compensation (Topic

718

):

Improvements to Employee Share-Based Payment Accounting

. The purpose of the update was to simplify the accounting for share-based payment transactions, including the income tax consequences of such transactions. Under the provisions of the update the income tax consequences of excess tax benefits and deficiencies are to be recognized in income tax expense in the reporting period in which the awards vest. Previously, excess tax benefits or deficiencies impact stockholders’ equity directly to the extent there was a cumulative excess tax benefit. In the event that a tax deficiency had occurred during the reporting period and a cumulative excess tax benefit did

not

exist, the tax deficiency was recognized in income tax expense under previous GAAP. The update also provided that entities

may

continue to estimate forfeitures in accounting for stock based compensation or recognize them as they occur. The provisions of this update became effective for interim and annual periods beginning after

December 15, 2016.

The adoption of this amendment did

not

have a material impact on the Company’s financial position, results of operations or cash flows.  

In

June 2016,

the FASB issued ASU

2016

-

13,

Financial Instruments-Credit Losses (Topic

326

):

Measurement of Credit Losses on Financial Instruments

. Among other things, the amendments in this ASU require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. For SEC filers, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2019,

with later effective dates for non-SEC registrant public companies and other organizations. Early adoption will be permitted for all organizations for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2018.

The Company is currently evaluating the provisions of ASU

No.

2016

-

13

to determine the potential impact the new standard will have on the Company’s consolidated financial statements, and it is too early at this time to determine the impact on the financial statements.

In

August 2016,

the FASB issued ASU

2016

-

15,

Statement of Cash Flows (Topic

230

):

Classification of Certain Cash Receipts and Cash Payments.

The update is intended to reduce the diversity in practice around how certain transactions are classified within the statement of cash flows with respect to

eight

types of cash flows. This new accounting guidance will be effective for interim and annual reporting periods beginning after

December 15, 2017.

Adoption of ASU

2016

-

15

is

not

expected to have a material impact on our consolidated financial statements.

In

March 2017,

the FASB issued ASU

2017

-

08,

Receivables-Nonrefundable Fees and Other Costs (Subtopic)

310

-

20

):

Premium Amortization of Purchased Callable Debt Securities

.

The amendments in this ASU shorten the amortization period for certain callable debt securities held at a premium. The amendments require the premium to be amortized to the earliest call date. The amendments do

not

require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The amendment will be effective for interim and annual reporting periods beginning after

December 15, 2018.

The Company elected to early adopt ASU

2017

-

08

during

2017

and it did

not

have a significant effect on our consolidated financial statements.

In

May 2017,

the FASB issued ASU

2017

-

09,

Compensation-Stock Compensation (Subtopic

718

):

Scope of Modification Accounting.

ASU

2017

-

09

clarifies when changes to terms or conditions of a share-based payment award must be accounted for as a modification. Under the new guidance, an entity will

not

apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the fair value of the award, (ii) the vesting conditions of the award, and (iii) the classification of the award as either an equity or liability instrument. ASU

2017

-

09

is effective for the fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2017.

The guidance requires companies to apply the requirements prospectively to awards modified on or after the adoption date. ASU

2017

-

09

is

not

expected to have a significant impact on our consolidated financial statements.

In

July 2017,

the FAS

B issued ASU

2017

-

11,

Earnings Per Share (Topic

260

); Distinguishing Liabilities from Equity (Topic

480

); Derivatives and Hedging (Topic

815

):

(Part

1

) Accounting for certain financial instruments with down round features and (Part II), Replacement of the indefinite deferral for mandatory redeemable financial instruments of certain nonpublic entities and certain mandatory redeemable non-controlling interests with a scope exception

. Part I of the update addresses the complexity of accounting for certain financial instruments with down round features such as warrants or convertible instruments and will be effective for interim and annual reporting periods beginning after

December 15, 2019.

The Company is currently evaluating the impact of our pending adoption of the new standard on our consolidated financial statements, but at this time do

not

believe the standard will have a significant impact on the financial statements.

In

August 2017,

the FASB

issued ASU

2017

-

12,

Derivatives and Hedging (Topic

815

):

Targeted improvements to accounting for hedging activities

.

The purpose

of this updated guidance is to better align financial reporting for hedging activities with the economic objectives of those activities. The amendments in this update are effective for fiscal years beginning after

December 15, 2018,

with early adoption, including adoption in an interim period, permitted.  The standard requires the modified retrospective transition approach as of the date of adoption.  The Company is currently evaluating the impact that this standard will have on its Consolidated Financial Statements.

XML

Note 8 - Derivative Financial Instruments

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Note

8

:

Derivative Financial Instruments

The Company records all derivative financial instruments at fair value in the financial statements. Derivatives are used as a risk management tool to hedge the exposure to changes in interest rates or other identified market risks.

When a derivative is intended to be a qualifying hedged instrument, the Company prepares written hedge documentation that designates the derivative as

1

) a hedge of fair value of a recognized asset or liability (fair value hedge) or

2

) a hedge of a forecasted transaction, such as, the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). The written documentation includes identification of, among other items, the risk management objective, hedging instrument, hedged item, and methodologies for assessing and measuring hedge effectiveness and ineffectiveness, along with support for management’s assertion that the hedge will be highly effective.

In

June 2017,

the Company entered into a forward start interest rate swap agreement totaling

$50

million notional amount to hedge against interest rate risk on FHLB advances. As a cash flow hedge, the portion of the change in the fair value of the derivative that has been deemed highly effective is recognized in other comprehensive income until the related cash flows from the hedged item are recognized in earnings. At

September 30, 2017,

the Company reported a

$95,395

unrealized gain, net of a

$56,025

tax effect, in other comprehensive income related to this cash flow hedge. The Company documents, both at inception and periodically over the life of the hedge, its analysis of actual and expected hedge effectiveness. To the extent that the hedge of future cash flows is deemed ineffective, changes in the fair value of the derivative are recognized in earnings as a component of other noninterest expense. For the quarter ended

September 30, 2017,

there was

no

ineffectiveness attributable to the cash flow hedge.

A summary of the Company’s derivative financial instruments at

September 30, 2017

is shown in the following table:

Forward Start	Termination	Derivative	Notional		Rate			Rate	Estimated Fair Value
Inception Date	Date	Type	Amount		Paid			Hedged	at September 30, 2017
2/28/2018	2/28/2025	Interest rate swap	$	50,000,000		2.12	%	3 month LIBOR Floating	$	151,420

XML

Note 9 - Disclosures About Fair Value of Assets and Liabilities

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

Fair Value Disclosures [Text Block]

Note

9:

Disclosures about Fair Value of Assets and Liabilities

ASC Topic

820,

Fair Value Measurements

, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Topic

820

also specifies a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes

three

levels of inputs that

may

be used to measure fair value:

Level

1

:      Quoted prices in active markets for identical assets or liabilities;

Level

2

: Observable inputs other than Level

1

prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are

not

active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level

3

: Unobservable inputs that are supported by little or

no

market activity and that are significant to the fair value of the assets or liabilities

The following is a description of the inputs and valuation methodologies used for assets measured at fair value on a recurring basis and recognized in the accompanying

condensed consolidated balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy.

Available-for-sale securities:

Where quoted market prices are available in an active market, securities are classified within Level

1

of the valuation hierarchy. Level

1

securities include equity securities. 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 flows. For these investments, the inputs used by the pricing service to determine fair value

may

include

one

or a combination of observable inputs such as benchmark yields, reported trades, broker/dealer quotes, issuer spreads,

two

-sided markets, benchmark securities, bid offers and reference data market research publications and are classified within Level

2

of the valuation hierarchy. Level

2

securities include U.S. government agencies, municipal securities and government sponsored mortgage-backed securities. The Company has

no

Level

3

securities.

Derivative Financial Instruments

:

Derivatives are recorded at fair value on a recurring basis utilizing Level

2

inputs. The Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that

may

include dealer quotes, live trading levels, among other things.

The following table presents the fair value measurements of assets recognized in the accompanying condensed consolidated balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at

September 30, 2017

and

December 31, 2016 (

dollar amounts in thousands):

9/30/2017
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	33,893	$	-	$	33,893
Corporates		-		3,070		-		3,070
Government sponsored mortgage-backed securities and SBA loan pools		-		46,242		-		46,242
Available-for-sale securities	$	-	$	83,205	$	-	$	83,205

	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Interest rate swaps	$	-	$	151	$	-	$	151

12/31/2016
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	38,338	$	-	$	38,338
Corporates		-		7,053		-		7,053
Government sponsored mortgage-backed securities and SBA loan pools		-		47,008		-		47,008
Available-for-sale securities	$	-	$	92,399	$	-	$	92,399

The following is a description of the valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying

statements of financial condition, as well as the general classification of such assets pursuant to the valuation hierarchy.

Foreclosed Assets Held for Sale

:

Fair value is estimated using recent appraisals, comparable sales and other estimates of value obtained principally from independent sources, adjusted for selling costs and discounts based on management’s assessment of the condition and marketability of the collateral. Foreclosed assets held for sale are classified within Level

3

of the valuation hierarchy.

Impaired loans

(Collateral Dependent)

:

   Loans for which it is probable that the Company will

not

collect all principal and interest due according to contractual terms are measured for impairment. Allowable methods for determining the amount of impairment include estimating fair value using the fair value of the collateral for collateral dependent loans.

If the impaired loan is identified as collateral dependent, then the fair value method of measuring the amount of impairment is utilized. This method requires obtaining a current independent appraisal of the collateral and applying a discount factor to the value. Impaired loans that are collateral dependent are classified within Level

3

of the fair value hierarchy when impairment is determined using the fair value method.

The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at

September 30, 2017

and

December 31, 2016 (

dollar amounts in thousands):

Impaired loans:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	1,474	$	1,474
December 31, 2016	$	-	$	-	$	1,006	$	1,006

Foreclosed assets held for sale:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	-	$	-
December 31, 2016	$	-	$	-	$	149	$	149

There were

no

transfers between valuation levels for any asset during the

nine

months ended

September 30, 2017

or

2016.

If valuation techniques are deemed necessary, the Company considers those transfers to occur at the end of the period when the assets are valued.

The following table presents quantitative information about unobservable inputs used in nonrecurring Level

3

fair value measurement (dollar amounts in thousands):

	Fair Value September 30, 2017		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,474	Market Comparable	Discount to reflect realizable value		0%	-	100%	(15%)
Foreclosed assets held for sale	$	-	Market Comparable	Discount to reflect realizable value			0%

	Fair Value December 31, 2016		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,006	Market Comparable	Discount to reflect realizable value		0%	-	100%	(7%)
Foreclosed assets held for sale	$	149	Market Comparable	Discount to reflect realizable value			10%

The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying

condensed consolidated balance sheets at amounts other than fair value.

Cash and cash equivalents, interest-bearing deposits and Federal Home Loan Bank stock

The carrying amounts reported in the

condensed consolidated balance sheets approximate those assets' fair value.

Held-to-maturity securities

Fair value is based on quoted market prices, if available. If a quoted market price is

not

available, fair value is estimated using quoted market prices for similar securities.

Loans

The fair value of loans is estimated by discounting the future cash flows using the market rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Loans with similar characteristics were aggregated for purposes of the calculations. The carrying amount of accrued interest approximates its fair value.

Deposits

Deposits include demand deposits, savings accounts, NOW accounts and certain money market deposits. The carrying amount approximates fair value. The fair value of fixed-maturity certificates of deposit is estimated by discounting the future cash flows using rates currently offered for deposits of similar remaining maturities.

Federal Home Loan Bank advances

The fair value of advances is estimated by using rates on debt with similar terms and remaining maturities.

Subordinated debentures

For these variable rate instruments, the carrying amount is a reasonable estimate of fair value. There is currently a limited market for similar debt instruments and the Company has the option to call the subordinated debentures at an amount close to its par value.

Interest payable

The carrying amount approximates fair value.

Commitments to originate loans, letters of credit and lines of credit

The fair value of commitments to originate loans is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present credit worthiness of the counterparties. For fixed-rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates. The fair value of letters of credit and lines of credit are based on fees currently charged for similar agreements or on the estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date.

The following table

s present estimated fair values of the Company’s financial instruments at

September 30, 2017

and

December 31, 2016.

	September 30, 2017
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	10,721,184	$	10,721,184		1
Held-to-maturity securities		18,424		18,582		2
Federal Home Loan Bank stock		4,137,500		4,137,500		2
Mortgage loans held for sale		2,516,520		2,516,520		2
Loans, net		616,884,052		613,749,211		3
Interest receivable		2,164,278		2,164,278		2
Financial liabilities:
Deposits		584,088,617		583,406,521		2
Federal Home Loan Bank advances		82,800,000		83,002,996		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		253,045		253,045		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

	December 31, 2016
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	9,088,441	$	9,088,441		1
Held-to-maturity securities		27,528		28,153		2
Federal Home Loan Bank stock		4,611,000		4,611,000		2
Mortgage loans held for sale		2,183,633		2,183,633		2
Loans, net		538,273,640		537,645,692		3
Interest receivable		1,947,063		1,947,063		2
Financial liabilities:
Deposits		505,362,750		504,829,161		2
Federal Home Loan Bank advances		95,700,000		95,764,840		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		207,833		207,833		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

XML

Note 3 - Securities (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Schedule of Available-for-sale Securities Reconciliation [Table Text Block]

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Municipals	$	34,012,067	$	210,255	$	(328,991	)	$	33,893,331
Corporates		3,000,000		70,000		-			3,070,000
Government sponsored mortgage-backed securities and SBA loan pools		46,936,147		32,472		(726,755	)		46,241,864
	$	83,948,214	$	312,727	$	(1,055,746	)	$	83,205,195

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2016
Debt Securities:
Municipals	$	39,357,506	$	65,673	$	(1,085,654	)	$	38,337,525
Corporates		7,003,986		54,050		(4,514	)		7,053,522
Government sponsored mortgage-backed securities and SBA loan pools		48,115,793		19,432		(1,127,037	)		47,008,188
	$	94,477,285	$	139,155	$	(2,217,205	)	$	92,399,235

Available-for-sale Securities [Table Text Block]

	Amortized Cost		Approximate Fair Value
1-5 years		564,554		581,359
6-10 years		9,254,809		9,317,277
After 10 years		27,192,704		27,064,695
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date		46,936,147		46,241,864
	$	83,948,214	$	83,205,195

Held-to-maturity Securities [Table Text Block]

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of September 30, 2017
Debt Securities:
Government sponsored mortgage-backed securities	$	18,424	$	215	$	(57	)	$	18,582

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Approximate Fair Value
As of December 31, 2016
Debt Securities:
Government sponsored mortgage-backed securities	$	27,528	$	625	$	-	$	28,153

Schedule of Unrealized Loss on Investments [Table Text Block]

	September 30, 2017
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	10,507,517	$	(91,926	)	$	10,671,807	$	(237,065	)	$	21,179,324	$	(328,991	)
Government sponsored mortgage-backed securities and SBA loan pools		21,281,498		(219,697	)		21,010,832		(507,115	)		42,292,330		(726,812	)
	$	31,789,015	$	(311,623	)	$	31,682,639	$	(744,180	)	$	63,471,654	$	(1,055,803	)

	December 31, 2016
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	33,084,816	$	(1,082,021	)	$	179,402	$	(3,633	)	$	33,264,218	$	(1,085,654	)
Corporates		1,996,172		(3,828	)		881,100		(686	)		2,877,272		(4,514	)
Government sponsored mortgage-backed securities and SBA loan pools		39,570,463		(1,022,511	)		3,649,276		(104,526	)		43,219,739		(1,127,037	)
	$	74,651,451	$	(2,108,360	)	$	4,709,778	$	(108,845	)	$	79,361,229	$	(2,217,205	)

Held-to-maturity Securities [Member]

Notes Tables

Held-to-maturity Securities [Table Text Block]

	Amortized Cost		Approximate Fair Value
Government sponsored mortgage-backed securities not due on a single maturity date	$	18,424	$	18,582

XML

Note 4 - Loans and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

	September 30,			December 31,
	2017			2016
Real estate - residential mortgage:
One to four family units	$	107,750,990		$	106,410,559
Multi-family		74,653,469			48,483,523
Real estate - construction		62,046,871			40,912,307
Real estate - commercial		266,292,510			249,580,873
Commercial loans		90,186,600			75,404,732
Consumer and other loans		23,661,618			23,606,306
Total loans		624,592,058			544,398,300
Less:
Allowance for loan losses		(7,009,097	)		(5,742,449	)
Deferred loan fees/costs, net		(698,909	)		(382,211	)
Net loans	$	616,884,052		$	538,273,640

Past Due Financing Receivables [Table Text Block]

As of September 30, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	1,542	$	644	$	249	$	2,435	$	105,316	$	107,751	$	-
Multi-family		783		-		-		783		73,870		74,653		-
Real estate - construction		-		-		-		-		62,047		62,047		-
Real estate - commercial		-		-		215		215		266,077		266,292		-
Commercial loans		-		-		1,384		1,384		88,803		90,187		-
Consumer and other loans		10		4		-		14		23,648		23,662		-
Total	$	2,335	$	648	$	1,848	$	4,831	$	619,761	$	624,592	$	-

As of December 31, 2016
	30-59 Days Past Due		60-89 Days Past Due		90 Days and more Past Due		Total Past Due		Current		Total Loans Receivable		Total Loans > 90 Days and Accruing
	(In Thousands)
Real estate - residential mortgage:
One to four family units	$	367	$	495	$	103	$	965	$	105,446	$	106,411	$	-
Multi-family		-		-		-		-		48,483		48,483		-
Real estate - construction		-		-		-		-		40,912		40,912		-
Real estate - commercial		-		-		-		-		249,581		249,581		-
Commercial loans		-		-		593		593		74,812		75,405		-
Consumer and other loans		-		-		38		38		23,568		23,606		-
Total	$	367	$	495	$	734	$	1,596	$	542,802	$	544,398	$	-

Schedule of Financing Receivables, Non Accrual Status [Table Text Block]

	September 30,		December 31,
	2017		2016
Real estate - residential mortgage:
One to four family units	$	2,274,040	$	2,060,180
Multi-family		-		-
Real estate - construction		5,309,728		5,446,896
Real estate - commercial		376,091		161,491
Commercial loans		1,610,950		925,281
Consumer and other loans		124,161		37,791
Total	$	9,694,970	$	8,631,639

Allowance for Credit Losses on Financing Receivables [Table Text Block]

Three months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,739	$	1,954		$	936		$	323	$	1,226		$	335		$	127	$	6,640
Provision charged to expense		524		(116	)		(81	)		52		(99	)		126			44	$	450
Losses charged off		-		(71	)		-			-		-			(46	)		-	$	(117	)
Recoveries		16		-			1			-		7			12			-	$	36
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

Nine months ended September 30, 2017	Construction		Commercial Real Estate			One to four family			Multi-family		Commercial			Consumer and Other			Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,377	$	1,687		$	856		$	206	$	1,168		$	337		$	111	$	5,742
Provision charged to expense		847		151			2			169		40			231			60	$	1,500
Losses charged off		-		(71	)		(11	)		-		(85	)		(169	)		-	$	(336	)
Recoveries		55		-			9			-		11			28			-	$	103
Balance, end of period	$	2,279	$	1,767		$	856		$	375	$	1,134		$	427		$	171	$	7,009

Three months ended September 30, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,668	$	1,613	$	862	$	157	$	1,366		$	288		$	227		$	6,181
Provision charged to expense		282		86		6		6		(40	)		33			(173	)	$	200
Losses charged off		-		-		-		-		(11	)		(58	)		-		$	(69	)
Recoveries		46		-		17		-		8			14			-		$	85
Balance, end of period	$	1,996	$	1,699	$	885	$	163	$	1,323		$	277		$	54		$	6,397

Nine months ended September 30, 2016	Construction			Commercial Real Estate		One to four family			Multi-family			Commercial			Consumer and Other			Unallocated			Total
	(In Thousands)
Allowance for loan losses:
Balance, beginning of period	$	1,246		$	1,526	$	821		$	177		$	1,382		$	223		$	437		$	5,812
Provision charged to expense		922			141		80			(14	)		102			102			(383	)	$	950
Losses charged off		(252	)		-		(47	)		-			(170	)		(132	)		-		$	(601	)
Recoveries		80			32		31			-			9			84			-		$	236
Balance, end of period	$	1,996		$	1,699	$	885		$	163		$	1,323		$	277		$	54		$	6,397

As of September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	830	$	-	$	56	$	-	$	310	$	130	$	-	$	1,326
Ending balance: collectively evaluated for impairment	$	1,449	$	1,767	$	800	$	375	$	824	$	297	$	171	$	5,683
Loans:
Ending balance: individually evaluated for impairment	$	5,310	$	161	$	2,274	$	-	$	931	$	187	$	-	$	8,863
Ending balance: collectively evaluated for impairment	$	56,737	$	266,131	$	105,477	$	74,653	$	89,256	$	23,475	$	-	$	615,729

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Unallocated		Total
	(In Thousands)
Allowance for loan losses:
Ending balance: individually evaluated for impairment	$	302	$	-	$	14	$	-	$	241	$	45	$	-	$	602
Ending balance: collectively evaluated for impairment	$	1,075	$	1,687	$	842	$	206	$	927	$	292	$	111	$	5,140
Loans:
Ending balance: individually evaluated for impairment	$	5,447	$	161	$	2,060	$	-	$	925	$	106	$	-	$	8,699
Ending balance: collectively evaluated for impairment	$	35,465	$	249,420	$	104,351	$	48,483	$	74,480	$	23,500	$	-	$	535,699

Impaired Financing Receivables [Table Text Block]

	September 30, 2017						December 31, 2016
	Recorded Balance		Unpaid Principal Balance		Specific Allowance		Recorded Balance		Unpaid Principal Balance		Specific Allowance
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,815	$	1,815	$	-	$	2,006	$	2,006	$	-
Multi-family		-		-		-		-		-		-
Real estate - construction		2,937		2,937		-		3,017		3,017		-
Real estate - commercial		161		161		-		161		161		-
Commercial loans		500		500		-		622		622		-
Consumer and other loans		4		4		-		3		3		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	459	$	459	$	56	$	54	$	54	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		2,373		3,606		830		2,430		3,663		302
Real estate - commercial		-		72		-		-		-		-
Commercial loans		431		932		310		303		755		241
Consumer and other loans		183		183		130		103		103		45
Total
Real estate - residential mortgage:
One to four family units	$	2,274	$	2,274		56	$	2,060	$	2,060	$	14
Multi-family		-		-		-		-		-		-
Real estate - construction		5,310		6,543		830		5,447		6,680		302
Real estate - commercial		161		233		-		161		161		-
Commercial loans		931		1,432		310		925		1,377		241
Consumer and other loans		187		187		130		106		106		45
Total	$	8,863	$	10,669	$	1,326	$	8,699	$	10,384	$	602

	For the Three Months Ended				For the Three Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,946	$	-	$	2,153	$	-
Multi-family		-		-		-		-
Real estate - construction		2,937		-		5,597		-
Real estate - commercial		161		-		244		-
Commercial loans		504		-		657		-
Consumer and other loans		2		-		185		-
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	183	$	-	$	28	$	-
Multi-family		-		-		-		-
Real estate - construction		2,373		-		2,051		-
Real estate - commercial		-		-		278		-
Commercial loans		431		-		375		-
Consumer and other loans		123		-		110		-
Total
Real estate - residential mortgage:
One to four family units	$	2,129	$	-	$	2,181	$	-
Multi-family		-		-		-		-
Real estate - construction		5,310		-		7,648		-
Real estate - commercial		161		-		522		-
Commercial loans		935		-		1,032		-
Consumer and other loans		125		-		295		-
Total	$	8,660	$	-	$	11,678	$	-

	For the Nine Months Ended				For the Nine Months Ended
	September 30, 2017				September 30, 2016
	Average Investment in Impaired Loans		Interest Income Recognized		Average Investment in Impaired Loans		Interest Income Recognized
	(In Thousands)
Loans without a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	1,886	$	-	$	2,200	$	-
Multi-family		-		-		-		-
Real estate - construction		2,964		-		5,661		-
Real estate - commercial		360		-		657		-
Commercial loans		557		-		960		-
Consumer and other loans		8		-		114		1
Loans with a specific valuation allowance
Real estate - residential mortgage:
One to four family units	$	90	$	-	$	23	$	-
Multi-family		-		-		-		-
Real estate - construction		2,395		-		2,222		-
Real estate - commercial		-		-		93		-
Commercial loans		481		-		489		-
Consumer and other loans		94		-		105		-
Total
Real estate - residential mortgage:
One to four family units	$	1,976	$	-	$	2,223	$	-
Multi-family		-		-		-		-
Real estate - construction		5,359		-		7,883		-
Real estate - commercial		360		-		750		-
Commercial loans		1,038		-		1,449		-
Consumer and other loans		102		-		219		1
Total	$	8,835	$	-	$	12,524	$	1

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

	Number of Loans		Pre-Modification Outstanding Recorded Balance		Post-Modification Outstanding Recorded Balance
Real estate - residential mortgage:
One to four family units		-	$	-	$	-
Multi-family		-		-		-
Real estate - construction		-		-		-
Real estate - commercial		-		-		-
Commercial loans		-		-		-
Consumer and other loans		1		119,459		119,459
Total		1	$	119,459	$	119,459

	September 30, 2017		December 31, 2016
Real estate - residential mortgage:
One to four family units	$	1,313,598	$	1,564,468
Multi-family		-		-
Real estate - construction		5,309,728		5,446,895
Real estate - commercial		5,701,518		5,736,849
Commercial loans		246,150		401,403
Consumer and other loans		119,717		-
Total	$	12,690,711	$	13,149,615

Financing Receivable Credit Quality Indicators [Table Text Block]

September 30, 2017	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	56,737	$	259,020	$	97,921	$	73,870	$	88,441	$	23,475	$	599,464
Special Mention		-		5,615		6,190		783		200		-		12,788
Substandard		5,310		1,657		3,640		-		862		187		11,656
Doubtful		-		-		-		-		684		-		684
Total	$	62,047	$	266,292	$	107,751	$	74,653	$	90,187	$	23,662	$	624,592

December 31, 2016	Construction		Commercial Real Estate		One to four family		Multi-family		Commercial		Consumer and Other		Total
	(In Thousands)
Rating:
Pass	$	35,465	$	242,200	$	100,367	$	48,483	$	69,093	$	23,380	$	518,988
Special Mention		-		5,922		2,591		-		4,503		-		13,016
Substandard		5,447		1,459		3,453		-		1,225		226		11,810
Doubtful		-		-		-		-		584		-		584
Total	$	40,912	$	249,581	$	106,411	$	48,483	$	75,405	$	23,606	$	544,398

Modification Type [Member]

Notes Tables

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

	Interest Rate		Term		Combination		Total Modification
Real estate - residential mortgage:
One to four family units	$	-	$	-	$	-	$	-
Multi-family		-		-		-		-
Real estate - construction		-		-		-		-
Real estate - commercial		-		-		-		-
Commercial loans		-		-		-		-
Consumer and other loans		-		119,459		-		119,459
Total	$	-	$	119,459	$	-	$	119,459

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Note 5 - Benefit Plans (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Share-based Compensation, Stock Options, Activity [Table Text Block]

Stock Options
	Number of shares
	Incentive Stock Option			Non- Incentive Stock Option			Weighted Average Exercise Price
Balance outstanding as of January 1, 2017		60,000			52,500		$	20.15
Granted		-			-			-
Exercised		-			-			-
Forfeited		(11,000	)		(25,000	)		29.48
Balance outstanding as of September 30, 2017		49,000			27,500		$	15.75
Options exercisable as of September 30, 2017		49,000			27,500		$	15.75

Nonvested Restricted Stock Shares Activity [Table Text Block]

Restricted Stock
	Number of Shares			Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		60,955		$	13.62
Granted		13,386			20.33
Vested		(27,291	)		12.25
Forfeited		-			-
Balance of shares non-vested as of September 30, 2017		47,050		$	16.33

Schedule of Nonvested Performance-based Units Activity [Table Text Block]

Performance Stock Units
	Performance Stock Units		Weighted Average Grant- Date Fair Value
Balance of shares non-vested as of January 1, 2017		-	$	-
Granted		55,823		20.48
Vested		-		-
Forfeited		-		-
Balance of shares non-vested as of September 30, 2017		55,823	$	20.48

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Note 6 - Income Per Common Share (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	For three months ended September 30, 2017						For nine months ended September 30, 2017
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,717,383		4,374,725	$	0.39	$	4,739,197		4,370,877	$	1.08
Effect of Dilutive Securities				72,841						64,815
Diluted Income Per Common Share	$	1,717,383		4,447,566	$	0.39	$	4,739,197		4,435,692	$	1.07

	For three months ended September 30, 2016						For nine months ended September 30, 2016
	Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share		Income Available to Common Shareholders		Average Common Shares Outstanding		Per Common Share
Basic Income Per Common Share	$	1,541,907		4,370,700	$	0.35	$	4,074,664		4,365,835	$	0.93
Effect of Dilutive Securities				56,853						53,553
Diluted Income Per Common Share	$	1,541,907		4,427,553	$	0.35	$	4,074,664		4,419,388	$	0.92

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Note 8 - Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Schedule of Derivative Instruments [Table Text Block]

Forward Start	Termination	Derivative	Notional		Rate			Rate	Estimated Fair Value
Inception Date	Date	Type	Amount		Paid			Hedged	at September 30, 2017
2/28/2018	2/28/2025	Interest rate swap	$	50,000,000		2.12	%	3 month LIBOR Floating	$	151,420

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Note 9 - Disclosures About Fair Value of Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2017

Notes Tables

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

9/30/2017
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	33,893	$	-	$	33,893
Corporates		-		3,070		-		3,070
Government sponsored mortgage-backed securities and SBA loan pools		-		46,242		-		46,242
Available-for-sale securities	$	-	$	83,205	$	-	$	83,205

	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Interest rate swaps	$	-	$	151	$	-	$	151

12/31/2016
Financial assets:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
Debt securities:
Municipals	$	-	$	38,338	$	-	$	38,338
Corporates		-		7,053		-		7,053
Government sponsored mortgage-backed securities and SBA loan pools		-		47,008		-		47,008
Available-for-sale securities	$	-	$	92,399	$	-	$	92,399

Fair Value Measurements, Nonrecurring [Table Text Block]

Impaired loans:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	1,474	$	1,474
December 31, 2016	$	-	$	-	$	1,006	$	1,006

Foreclosed assets held for sale:
	Level 1 inputs		Level 2 inputs		Level 3 inputs		Total fair value
September 30, 2017	$	-	$	-	$	-	$	-
December 31, 2016	$	-	$	-	$	149	$	149

Fair Value Inputs, Assets, Quantitative Information [Table Text Block]

	Fair Value September 30, 2017		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,474	Market Comparable	Discount to reflect realizable value		0%	-	100%	(15%)
Foreclosed assets held for sale	$	-	Market Comparable	Discount to reflect realizable value			0%

	Fair Value December 31, 2016		Valuation Technique	Unobservable Input	Range (Weighted Average)
Impaired loans (collateral dependent)	$	1,006	Market Comparable	Discount to reflect realizable value		0%	-	100%	(7%)
Foreclosed assets held for sale	$	149	Market Comparable	Discount to reflect realizable value			10%

Fair Value, by Balance Sheet Grouping [Table Text Block]

	September 30, 2017
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	10,721,184	$	10,721,184		1
Held-to-maturity securities		18,424		18,582		2
Federal Home Loan Bank stock		4,137,500		4,137,500		2
Mortgage loans held for sale		2,516,520		2,516,520		2
Loans, net		616,884,052		613,749,211		3
Interest receivable		2,164,278		2,164,278		2
Financial liabilities:
Deposits		584,088,617		583,406,521		2
Federal Home Loan Bank advances		82,800,000		83,002,996		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		253,045		253,045		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

	December 31, 2016
	Carrying Amount		Fair Value		Hierarchy Level
Financial assets:
Cash and cash equivalents	$	9,088,441	$	9,088,441		1
Held-to-maturity securities		27,528		28,153		2
Federal Home Loan Bank stock		4,611,000		4,611,000		2
Mortgage loans held for sale		2,183,633		2,183,633		2
Loans, net		538,273,640		537,645,692		3
Interest receivable		1,947,063		1,947,063		2
Financial liabilities:
Deposits		505,362,750		504,829,161		2
Federal Home Loan Bank advances		95,700,000		95,764,840		2
Subordinated debentures		15,465,000		15,465,000		3
Interest payable		207,833		207,833		2
Unrecognized financial instruments (net of contractual value):
Commitments to extend credit		-		-		-
Unused lines of credit		-		-		-

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Note 3 - Securities (Details Textual) - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Available for Sale Securities Pledged as Collateral Book Value	$ 48,651,661		$ 48,723,259
Available-for-sale Securities Pledged as Collateral	48,125,394		47,617,900
Available-for-sale Securities, Gross Realized Gains	73,473	$ 155,465
Availablefor Sale Securities Gross Realized Gain Loss Tax Effect	27,185	$ 57,522
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	$ 63,471,654		$ 79,361,229
Percentage of Securities in Continuous Unrealized Loss Position to Total Investment Portfolio	76.00%		86.00%

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Note 3 - Securities - Available-for-sale Securities (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Available-for-sale securities, amortized cost	$ 83,948,214	$ 94,477,285
Available-for-sale securities, gross unrealized gains	312,727	139,155
Available-for-sale securities, gross unrealized (losses)	(1,055,746)	(2,217,205)
Available-for-sale securities, approximate fair value	83,205,195	92,399,235
US States and Political Subdivisions Debt Securities [Member]
Available-for-sale securities, amortized cost	34,012,067	39,357,506
Available-for-sale securities, gross unrealized gains	210,255	65,673
Available-for-sale securities, gross unrealized (losses)	(328,991)	(1,085,654)
Available-for-sale securities, approximate fair value	33,893,331	38,337,525
Corporate Debt Securities [Member]
Available-for-sale securities, amortized cost	3,000,000	7,003,986
Available-for-sale securities, gross unrealized gains	70,000	54,050
Available-for-sale securities, gross unrealized (losses)		(4,514)
Available-for-sale securities, approximate fair value	3,070,000	7,053,522
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Available-for-sale securities, amortized cost	46,936,147	48,115,793
Available-for-sale securities, gross unrealized gains	32,472	19,432
Available-for-sale securities, gross unrealized (losses)	(726,755)	(1,127,037)
Available-for-sale securities, approximate fair value	$ 46,241,864	$ 47,008,188

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Note 3 - Securities - Available-for-sale Securities by Maturity (Details)	Sep. 30, 2017 USD ($)
1-5 years, amortized cost	$ 564,554
1-5 years, fair value	581,359
5-10 years, amortized cost	9,254,809
5-10 years, fair value	9,317,277
After ten years, amortized cost	27,192,704
After ten years, fair value	27,064,695
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date, amortized cost	46,936,147
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date, fair value	46,241,864
Amortized cost	83,948,214
Fair value	$ 83,205,195

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Note 3 - Securities - Held-to-maturity Securities (Details) - Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Debt Securities:
Held-to-maturity securities, amortized cost	$ 18,424	$ 27,528
Held-to-maturity securities, gross unrealized gains	215	625
Held-to-maturity securities, gross unrealized losses	(57)	0
Held-to-maturity securities, approximate fair value	$ 18,582	$ 28,153

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Note 3 - Securities - Held-to-maturity Securities by Maturity (Details)	Sep. 30, 2017 USD ($)
Government sponsored mortgage-backed securities not due on a single maturity date, amortized cost	$ 18,424
Government sponsored mortgage-backed securities not due on a single maturity date, approximate fair value	$ 18,582

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Note 3 - Securities - Securities in a Continuous Unrealized Loss Position (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Securities, continuous unrealized loss position, less than 12 months, fair value	$ 31,789,015	$ 74,651,451
Securities, continuous unrealized loss position, less than 12 months, unrealized losses	(311,623)	(2,108,360)
Securities, continuous unrealized loss position, 12 months or more, fair value	31,682,639	4,709,778
Securities, continuous unrealized loss position, 12 months or more, unrealized losses	(744,180)	(108,845)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	63,471,654	79,361,229
Securities, continuous unrealized loss position, unrealized losses	(1,055,803)	(2,217,205)
Securities, continuous unrealized loss position, less than 12 months, fair value	31,789,015	74,651,451
Securities, continuous unrealized loss position, fair value	63,471,654	79,361,229
US States and Political Subdivisions Debt Securities [Member]
Securities, continuous unrealized loss position, less than 12 months, fair value	10,507,517	33,084,816
Securities, continuous unrealized loss position, less than 12 months, unrealized losses	(91,926)	(1,082,021)
Securities, continuous unrealized loss position, 12 months or more, fair value	10,671,807	179,402
Securities, continuous unrealized loss position, 12 months or more, unrealized losses	(237,065)	(3,633)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	21,179,324	33,264,218
Securities, continuous unrealized loss position, unrealized losses	(328,991)	(1,085,654)
Securities, continuous unrealized loss position, less than 12 months, fair value	10,507,517	33,084,816
Securities, continuous unrealized loss position, fair value	21,179,324	33,264,218
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Securities, continuous unrealized loss position, less than 12 months, fair value	21,281,498	39,570,463
Securities, continuous unrealized loss position, less than 12 months, unrealized losses	(219,697)	(1,022,511)
Securities, continuous unrealized loss position, 12 months or more, fair value	21,010,832	3,649,276
Securities, continuous unrealized loss position, 12 months or more, unrealized losses	(507,115)	(104,526)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	42,292,330	43,219,739
Securities, continuous unrealized loss position, unrealized losses	(726,812)	(1,127,037)
Securities, continuous unrealized loss position, less than 12 months, fair value	21,281,498	39,570,463
Securities, continuous unrealized loss position, fair value	$ 42,292,330	43,219,739
Corporate Debt Securities [Member]
Securities, continuous unrealized loss position, less than 12 months, fair value		1,996,172
Securities, continuous unrealized loss position, less than 12 months, unrealized losses		(3,828)
Securities, continuous unrealized loss position, 12 months or more, fair value		881,100
Securities, continuous unrealized loss position, 12 months or more, unrealized losses		(686)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value		2,877,272
Securities, continuous unrealized loss position, unrealized losses		(4,514)
Securities, continuous unrealized loss position, less than 12 months, fair value		1,996,172
Securities, continuous unrealized loss position, fair value		$ 2,877,272

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Note 4 - Loans and Allowance for Loan Losses (Details Textual) xbrli-pure in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017 USD ($)	Sep. 30, 2016	Sep. 30, 2017 USD ($)	Sep. 30, 2016	Dec. 31, 2016 USD ($)
Financing Receivable, Modifications, Subsequent Default, Number of Contracts	0	0	0	0
Troubled Debt Restructurings [Member]
Allowance for Credit Losses, Change in Method of Calculating Impairment	$ 947,843		$ 947,843		$ 329,734

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Note 4 - Loans and Allowance for Loan Losses - Loans by Category (Details) - USD ($)	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Dec. 31, 2015
Loans receivable	$ 624,592,058		$ 544,398,300
Allowance for loan losses	(7,009,097)	$ (6,640,000)	(5,742,449)	$ (6,397,000)	$ (6,181,000)	$ (5,812,000)
Deferred loan fees/costs, net	(698,909)		(382,211)
Net loans	616,884,052		538,273,640
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans receivable	107,750,990		106,410,559
Allowance for loan losses	(856,000)	(936,000)	(856,000)	(885,000)	(862,000)	(821,000)
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans receivable	74,653,469		48,483,523
Allowance for loan losses	(375,000)	(323,000)	(206,000)	(163,000)	(157,000)	(177,000)
Real Estate, Construction [Member]
Loans receivable	62,046,871		40,912,307
Allowance for loan losses	(2,279,000)	(1,739,000)	(1,377,000)	(1,996,000)	(1,668,000)	(1,246,000)
Commercial Real Estate Portfolio Segment [Member]
Loans receivable	266,292,510		249,580,873
Allowance for loan losses	(1,767,000)	(1,954,000)	(1,687,000)	(1,699,000)	(1,613,000)	(1,526,000)
Commercial Portfolio Segment [Member]
Loans receivable	90,186,600		75,404,732
Allowance for loan losses	(1,134,000)	(1,226,000)	(1,168,000)	(1,323,000)	(1,366,000)	(1,382,000)
Consumer and Other Loans [Member]
Loans receivable	23,661,618		23,606,306
Allowance for loan losses	$ (427,000)	$ (335,000)	$ (337,000)	$ (277,000)	$ (288,000)	$ (223,000)

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Note 4 - Loans and Allowance for Loan Losses - Loans by Aging (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Loans receivable, past due	$ 4,831,000	$ 1,596,000
Loans receivable, current	619,761,000	542,802,000
Loans receivable	624,592,058	544,398,300
Loans receivable, past due and accruing
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans receivable, past due	2,435,000	965,000
Loans receivable, current	105,316,000	105,446,000
Loans receivable	107,750,990	106,410,559
Loans receivable, past due and accruing
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans receivable, past due	783,000
Loans receivable, current	73,870,000	48,483,000
Loans receivable	74,653,469	48,483,523
Loans receivable, past due and accruing
Real Estate, Construction [Member]
Loans receivable, past due
Loans receivable, current	62,047,000	40,912,000
Loans receivable	62,046,871	40,912,307
Loans receivable, past due and accruing
Commercial Real Estate Portfolio Segment [Member]
Loans receivable, past due	215,000
Loans receivable, current	266,077,000	249,581,000
Loans receivable	266,292,510	249,580,873
Loans receivable, past due and accruing
Commercial Portfolio Segment [Member]
Loans receivable, past due	1,384,000	593,000
Loans receivable, current	88,803,000	74,812,000
Loans receivable	90,186,600	75,404,732
Loans receivable, past due and accruing
Consumer and Other Loans [Member]
Loans receivable, past due	14,000	38,000
Loans receivable, current	23,648,000	23,568,000
Loans receivable	23,661,618	23,606,306
Loans receivable, past due and accruing
Financing Receivables, 30 to 59 Days Past Due [Member]
Loans receivable, past due	2,335,000	367,000
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans receivable, past due	1,542,000	367,000
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans receivable, past due	783,000
Financing Receivables, 30 to 59 Days Past Due [Member] | Real Estate, Construction [Member]
Loans receivable, past due
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member]
Loans receivable, past due
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Loans receivable, past due
Financing Receivables, 30 to 59 Days Past Due [Member] | Consumer and Other Loans [Member]
Loans receivable, past due	10,000
Financing Receivables, 60 to 89 Days Past Due [Member]
Loans receivable, past due	648,000	495,000
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans receivable, past due	644,000	495,000
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans receivable, past due
Financing Receivables, 60 to 89 Days Past Due [Member] | Real Estate, Construction [Member]
Loans receivable, past due
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member]
Loans receivable, past due
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Loans receivable, past due
Financing Receivables, 60 to 89 Days Past Due [Member] | Consumer and Other Loans [Member]
Loans receivable, past due	4,000
Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans receivable, past due	1,848,000	734,000
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans receivable, past due	249,000	103,000
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans receivable, past due
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Real Estate, Construction [Member]
Loans receivable, past due
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member]
Loans receivable, past due	215,000
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Loans receivable, past due	1,384,000	593,000
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Consumer and Other Loans [Member]
Loans receivable, past due		$ 38,000

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Note 4 - Loans and Allowance for Loan Losses - Nonaccruing Loans (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Nonaccruing loans	$ 9,694,970	$ 8,631,639
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Nonaccruing loans	2,274,040	2,060,180
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Nonaccruing loans
Real Estate, Construction [Member]
Nonaccruing loans	5,309,728	5,446,896
Commercial Real Estate Portfolio Segment [Member]
Nonaccruing loans	376,091	161,491
Commercial Portfolio Segment [Member]
Nonaccruing loans	1,610,950	925,281
Consumer and Other Loans [Member]
Nonaccruing loans	$ 124,161	$ 37,791

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Note 4 - Loans and Allowance for Loan Losses - Allowance for Loan Losses (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Balance, beginning of period	$ 6,640,000	$ 6,181,000	$ 5,742,449	$ 5,812,000
Provision for loan losses	450,000	200,000	1,500,000	950,000
Losses charged off	(117,000)	(69,000)	(336,000)	(601,000)
Recoveries	36,000	85,000	103,000	236,000
Balance, end of period	7,009,097	6,397,000	7,009,097	6,397,000
Ending balance: individually evaluated for impairment	1,326,000		1,326,000		$ 602,000
Ending balance: collectively evaluated for impairment	5,683,000		5,683,000		5,140,000
Loans:
Ending balance: individually evaluated for impairment	8,863,000		8,863,000		8,699,000
Ending balance: collectively evaluated for impairment	615,729,000		615,729,000		535,699,000
Ending balance: individually evaluated for impairment	1,326,000		1,326,000		602,000
Ending balance: collectively evaluated for impairment	5,683,000		5,683,000		5,140,000
Real Estate, Construction [Member]
Balance, beginning of period	1,739,000	1,668,000	1,377,000	1,246,000
Provision for loan losses	524,000	282,000	847,000	922,000
Losses charged off				(252,000)
Recoveries	16,000	46,000	55,000	80,000
Balance, end of period	2,279,000	1,996,000	2,279,000	1,996,000
Ending balance: individually evaluated for impairment	830,000		830,000		302,000
Ending balance: collectively evaluated for impairment	1,449,000		1,449,000		1,075,000
Loans:
Ending balance: individually evaluated for impairment	5,310,000		5,310,000		5,447,000
Ending balance: collectively evaluated for impairment	56,737,000		56,737,000		35,465,000
Ending balance: individually evaluated for impairment	830,000		830,000		302,000
Ending balance: collectively evaluated for impairment	1,449,000		1,449,000		1,075,000
Commercial Real Estate Portfolio Segment [Member]
Balance, beginning of period	1,954,000	1,613,000	1,687,000	1,526,000
Provision for loan losses	(116,000)	86,000	151,000	141,000
Losses charged off	(71,000)		(71,000)
Recoveries				32,000
Balance, end of period	1,767,000	1,699,000	1,767,000	1,699,000
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	1,767,000		1,767,000		1,687,000
Loans:
Ending balance: individually evaluated for impairment	161,000		161,000		161,000
Ending balance: collectively evaluated for impairment	266,131,000		266,131,000		249,420,000
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	1,767,000		1,767,000		1,687,000
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Balance, beginning of period	936,000	862,000	856,000	821,000
Provision for loan losses	(81,000)	6,000	2,000	80,000
Losses charged off			(11,000)	(47,000)
Recoveries	1,000	17,000	9,000	31,000
Balance, end of period	856,000	885,000	856,000	885,000
Ending balance: individually evaluated for impairment	56,000		56,000		14,000
Ending balance: collectively evaluated for impairment	800,000		800,000		842,000
Loans:
Ending balance: individually evaluated for impairment	2,274,000		2,274,000		2,060,000
Ending balance: collectively evaluated for impairment	105,477,000		105,477,000		104,351,000
Ending balance: individually evaluated for impairment	56,000		56,000		14,000
Ending balance: collectively evaluated for impairment	800,000		800,000		842,000
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Balance, beginning of period	323,000	157,000	206,000	177,000
Provision for loan losses	52,000	6,000	169,000	(14,000)
Losses charged off	0		0
Recoveries	0		0
Balance, end of period	375,000	163,000	375,000	163,000
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	375,000		375,000		206,000
Loans:
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	74,653,000		74,653,000		48,483,000
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	375,000		375,000		206,000
Commercial Portfolio Segment [Member]
Balance, beginning of period	1,226,000	1,366,000	1,168,000	1,382,000
Provision for loan losses	(99,000)	(40,000)	40,000	102,000
Losses charged off		(11,000)	(85,000)	(170,000)
Recoveries	7,000	8,000	11,000	9,000
Balance, end of period	1,134,000	1,323,000	1,134,000	1,323,000
Ending balance: individually evaluated for impairment	310,000		310,000		241,000
Ending balance: collectively evaluated for impairment	824,000		824,000		927,000
Loans:
Ending balance: individually evaluated for impairment	931,000		931,000		925,000
Ending balance: collectively evaluated for impairment	89,256,000		89,256,000		74,480,000
Ending balance: individually evaluated for impairment	310,000		310,000		241,000
Ending balance: collectively evaluated for impairment	824,000		824,000		927,000
Consumer and Other Loans [Member]
Balance, beginning of period	335,000	288,000	337,000	223,000
Provision for loan losses	126,000	33,000	231,000	102,000
Losses charged off	(46,000)	(58,000)	(169,000)	(132,000)
Recoveries	12,000	14,000	28,000	84,000
Balance, end of period	427,000	277,000	427,000	277,000
Ending balance: individually evaluated for impairment	130,000		130,000		45,000
Ending balance: collectively evaluated for impairment	297,000		297,000		292,000
Loans:
Ending balance: individually evaluated for impairment	187,000		187,000		106,000
Ending balance: collectively evaluated for impairment	23,475,000		23,475,000		23,500,000
Ending balance: individually evaluated for impairment	130,000		130,000		45,000
Ending balance: collectively evaluated for impairment	297,000		297,000		292,000
Unallocated Financing Receivables [Member]
Balance, beginning of period	127,000	227,000	111,000	437,000
Provision for loan losses	44,000	(173,000)	60,000	(383,000)
Losses charged off	0		0
Recoveries	0		0
Balance, end of period	171,000	$ 54,000	171,000	$ 54,000
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	171,000		171,000		111,000
Loans:
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment
Ending balance: individually evaluated for impairment
Ending balance: collectively evaluated for impairment	$ 171,000		$ 171,000		$ 111,000

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Note 4 - Loans and Allowance for Loan Losses - Impaired Loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Valuation allowance	$ 1,326		$ 1,326		$ 602
Loans recorded balance	8,863		8,863		8,699
Loans unpaid principal	10,669		10,669		10,384
Loans interest income recognized				$ 1
Loans average investment in impaired loans	8,660	11,678	8,835	12,524
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Loans without a specific valuation allowance, recorded balance	1,815		1,815		2,006
Loans without a specific valuation allowance, unpaid principal	1,815		1,815		2,006
Loans with a specific valuation allowance, recorded balance	459		459		54
Loans with a specific valuation allowance, unpaid principal	459		459		54
Valuation allowance	56		56		14
Loans recorded balance	2,274		2,274		2,060
Loans unpaid principal	2,274		2,274		2,060
Loans without a specific valuation allowance, average investment in impaired loans	1,946	2,153	1,886	2,200
Loans interest income recognized
Loans with a specific valuation allowance, average investment in impaired loans	183	28	90	23
Loans average investment in impaired loans	2,129	2,181	1,976	2,223
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Loans without a specific valuation allowance, recorded balance
Loans without a specific valuation allowance, unpaid principal
Valuation allowance
Loans recorded balance
Loans unpaid principal
Loans without a specific valuation allowance, average investment in impaired loans
Loans interest income recognized
Loans with a specific valuation allowance, average investment in impaired loans
Loans average investment in impaired loans
Residential Portfolio Segment [Member] | Construction Loans [Member]
Loans without a specific valuation allowance, average investment in impaired loans	2,937	5,597	2,964	5,661
Loans interest income recognized
Loans with a specific valuation allowance, average investment in impaired loans	2,373	2,051	2,395	2,222
Loans average investment in impaired loans	5,310	7,648	5,359	7,883
Real Estate, Construction [Member]
Loans without a specific valuation allowance, recorded balance	2,937		2,937		3,017
Loans without a specific valuation allowance, unpaid principal	2,937		2,937		3,017
Loans with a specific valuation allowance, recorded balance	2,373		2,373		2,430
Loans with a specific valuation allowance, unpaid principal	3,606		3,606		3,663
Valuation allowance	830		830		302
Loans recorded balance	5,310		5,310		5,447
Loans unpaid principal	6,543		6,543		6,680
Commercial Real Estate Portfolio Segment [Member]
Loans without a specific valuation allowance, recorded balance	161		161		161
Loans without a specific valuation allowance, unpaid principal	161		161		161
Loans with a specific valuation allowance, recorded balance
Loans with a specific valuation allowance, unpaid principal	72		72
Valuation allowance
Loans recorded balance	161		161		161
Loans unpaid principal	233		233		161
Loans without a specific valuation allowance, average investment in impaired loans	161	244	360	657
Loans interest income recognized
Loans with a specific valuation allowance, average investment in impaired loans		278		93
Loans average investment in impaired loans	161	522	360	750
Commercial Portfolio Segment [Member]
Loans without a specific valuation allowance, recorded balance	500		500		622
Loans without a specific valuation allowance, unpaid principal	500		500		622
Loans with a specific valuation allowance, recorded balance	431		431		303
Loans with a specific valuation allowance, unpaid principal	932		932		755
Valuation allowance	310		310		241
Loans recorded balance	931		931		925
Loans unpaid principal	1,432		1,432		1,377
Loans without a specific valuation allowance, average investment in impaired loans	504	657	557	960
Loans interest income recognized
Loans with a specific valuation allowance, average investment in impaired loans	431	375	481	489
Loans average investment in impaired loans	935	1,032	1,038	1,449
Consumer and Other Loans [Member]
Loans without a specific valuation allowance, recorded balance	4		4		3
Loans without a specific valuation allowance, unpaid principal	4		4		3
Loans with a specific valuation allowance, recorded balance	183		183		103
Loans with a specific valuation allowance, unpaid principal	183		183		103
Valuation allowance	130		130		45
Loans recorded balance	187		187		106
Loans unpaid principal	187		187		$ 106
Consumer Portfolio Segment [Member]
Loans without a specific valuation allowance, average investment in impaired loans	2	185	8	114
Loans interest income recognized				1
Loans with a specific valuation allowance, average investment in impaired loans	123	110	94	105
Loans average investment in impaired loans	$ 125	$ 295	$ 102	$ 219

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Note 4 - Loans and Allowance for Loan Losses - Troubled Debt Restructurings (Details)	3 Months Ended
	Sep. 30, 2017 USD ($)	Dec. 31, 2016 USD ($)
Number of loans	1
Pre-modification outstanding recorded balance	$ 119,459
Post-modification outstanding recorded balance	119,459
TDRs, carrying balance	$ 12,690,711	$ 13,149,615
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Number of loans	0
Pre-modification outstanding recorded balance	$ 0
Post-modification outstanding recorded balance	0
TDRs, carrying balance	$ 1,313,598	1,564,468
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Number of loans	0
Pre-modification outstanding recorded balance	$ 0
Post-modification outstanding recorded balance	0
TDRs, carrying balance
Real Estate, Construction [Member]
Number of loans	0
Pre-modification outstanding recorded balance	$ 0
Post-modification outstanding recorded balance	0
TDRs, carrying balance	$ 5,309,728	5,446,895
Commercial Real Estate Portfolio Segment [Member]
Number of loans	0
Pre-modification outstanding recorded balance	$ 0
Post-modification outstanding recorded balance	0
TDRs, carrying balance	$ 5,701,518	5,736,849
Commercial Portfolio Segment [Member]
Number of loans	0
Pre-modification outstanding recorded balance	$ 0
Post-modification outstanding recorded balance	0
TDRs, carrying balance	$ 246,150	401,403
Consumer and Other Loans [Member]
Number of loans	1
Pre-modification outstanding recorded balance	$ 119,459
Post-modification outstanding recorded balance	119,459
TDRs, carrying balance	$ 119,717

XML

Note 4 - Loans and Allowance for Loan Losses - Troubled Debt Restructurings by Modification Type (Details)	3 Months Ended
	Sep. 30, 2017 USD ($)
Post-modification outstanding recorded balance	$ 119,459
Interest Rate [Member]
Post-modification outstanding recorded balance	0
Term [Member]
Post-modification outstanding recorded balance	119,459
Combination [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member] | Term [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member] | Combination [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member] | Term [Member]
Post-modification outstanding recorded balance	0
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member] | Combination [Member]
Post-modification outstanding recorded balance	0
Real Estate, Construction [Member]
Post-modification outstanding recorded balance	0
Real Estate, Construction [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Real Estate, Construction [Member] | Term [Member]
Post-modification outstanding recorded balance	0
Real Estate, Construction [Member] | Combination [Member]
Post-modification outstanding recorded balance	0
Commercial Real Estate Portfolio Segment [Member]
Post-modification outstanding recorded balance	0
Commercial Real Estate Portfolio Segment [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Commercial Real Estate Portfolio Segment [Member] | Term [Member]
Post-modification outstanding recorded balance	0
Commercial Real Estate Portfolio Segment [Member] | Combination [Member]
Post-modification outstanding recorded balance	0
Commercial Portfolio Segment [Member]
Post-modification outstanding recorded balance	0
Commercial Portfolio Segment [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Commercial Portfolio Segment [Member] | Term [Member]
Post-modification outstanding recorded balance	0
Commercial Portfolio Segment [Member] | Combination [Member]
Post-modification outstanding recorded balance	0
Consumer and Other Loans [Member]
Post-modification outstanding recorded balance	119,459
Consumer and Other Loans [Member] | Interest Rate [Member]
Post-modification outstanding recorded balance	0
Consumer and Other Loans [Member] | Term [Member]
Post-modification outstanding recorded balance	119,459
Consumer and Other Loans [Member] | Combination [Member]
Post-modification outstanding recorded balance	$ 0

XML

Note 4 - Loans and Allowance for Loan Losses - Loans by Credit Quality (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Rating:
Loans receivable	$ 624,592,058	$ 544,398,300
Real Estate, Construction [Member]
Rating:
Loans receivable	62,046,871	40,912,307
Commercial Real Estate Portfolio Segment [Member]
Rating:
Loans receivable	266,292,510	249,580,873
Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Rating:
Loans receivable	107,750,990	106,410,559
Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Rating:
Loans receivable	74,653,469	48,483,523
Commercial Portfolio Segment [Member]
Rating:
Loans receivable	90,186,600	75,404,732
Consumer and Other Loans [Member]
Rating:
Loans receivable	23,661,618	23,606,306
Pass [Member]
Rating:
Loans receivable	599,464,000	518,988,000
Pass [Member] | Real Estate, Construction [Member]
Rating:
Loans receivable	56,737,000	35,465,000
Pass [Member] | Commercial Real Estate Portfolio Segment [Member]
Rating:
Loans receivable	259,020,000	242,200,000
Pass [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Rating:
Loans receivable	97,921,000	100,367,000
Pass [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Rating:
Loans receivable	73,870,000	48,483,000
Pass [Member] | Commercial Portfolio Segment [Member]
Rating:
Loans receivable	88,441,000	69,093,000
Pass [Member] | Consumer and Other Loans [Member]
Rating:
Loans receivable	23,475,000	23,380,000
Special Mention [Member]
Rating:
Loans receivable	12,788,000	13,016,000
Special Mention [Member] | Real Estate, Construction [Member]
Rating:
Loans receivable	0	0
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member]
Rating:
Loans receivable	5,615,000	5,922,000
Special Mention [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Rating:
Loans receivable	6,190,000	2,591,000
Special Mention [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Rating:
Loans receivable	783,000	0
Special Mention [Member] | Commercial Portfolio Segment [Member]
Rating:
Loans receivable	200,000	4,503,000
Special Mention [Member] | Consumer and Other Loans [Member]
Rating:
Loans receivable	0	0
Substandard [Member]
Rating:
Loans receivable	11,656,000	11,810,000
Substandard [Member] | Real Estate, Construction [Member]
Rating:
Loans receivable	5,310,000	5,447,000
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member]
Rating:
Loans receivable	1,657,000	1,459,000
Substandard [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Rating:
Loans receivable	3,640,000	3,453,000
Substandard [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Rating:
Loans receivable	0	0
Substandard [Member] | Commercial Portfolio Segment [Member]
Rating:
Loans receivable	862,000	1,225,000
Substandard [Member] | Consumer and Other Loans [Member]
Rating:
Loans receivable	187,000	226,000
Doubtful [Member]
Rating:
Loans receivable	684,000	584,000
Doubtful [Member] | Real Estate, Construction [Member]
Rating:
Loans receivable	0	0
Doubtful [Member] | Commercial Real Estate Portfolio Segment [Member]
Rating:
Loans receivable		0
Doubtful [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, One To Four Family Units [Member]
Rating:
Loans receivable	0	0
Doubtful [Member] | Residential Portfolio Segment [Member] | Real Estate Residential, Multi Family Units [Member]
Rating:
Loans receivable	0	0
Doubtful [Member] | Commercial Portfolio Segment [Member]
Rating:
Loans receivable	684,000	584,000
Doubtful [Member] | Consumer and Other Loans [Member]
Rating:
Loans receivable	$ 0	$ 0

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Note 5 - Benefit Plans (Details Textual) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended
	Mar. 29, 2017	Feb. 28, 2017	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value					$ 0	$ 169,103
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value			$ 669,800	$ 438,800	669,800	438,800
Share Price	$ 20.48
Allocated Share-based Compensation Expense			136,263	$ 100,594	363,041	313,855
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized			$ 768,224		768,224
Officer [Member]
Restricted Stock or Unit Expense					$ 102,529
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period					13,386
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value					$ 20.33
Restricted Stock [Member] | Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		6,960
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 20.35
Restricted Stock or Unit Expense					$ 101,099	$ 94,136
Restricted Stock [Member] | Director [Member] | Share-based Compensation Award, Tranche One [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		6,195
Share-based Compensation Arrangement by Share-based Payment Award Equity Instruments Other Than Options, Cliff Vesting Period		1 year
Restricted Stock [Member] | Director [Member] | Share-based Compensation Award, Tranche Two [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		765
Share-based Compensation Arrangement by Share-based Payment Award Equity Instruments Other Than Options, Cliff Vesting Period		3 years
Restricted Stock Units (RSUs) [Member] | Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period	55,823				6,426	15,343
Share-based Compensation Arrangement by Share-based Payment Award Equity Instruments Other Than Options, Cliff Vesting Period					3 years
Restricted Stock or Unit Expense					$ 159,413	$ 209,430
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Incentive Award Level, Threshold, Percentage	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Incentive Award Level, Target, Percentage	50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Maximum Incentive Award Level, Percentage	100.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Incentive Award Level, Weight, Total Assets, Percentage	50.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Incentive Award Level, Weight, Return on Average Assets, Percentage	50.00%

XML

Note 5 - Benefit Plans - Stock Option Activity (Details)	9 Months Ended
	Sep. 30, 2017 $ / shares shares
Balance outstanding (in dollars per share) | $ / shares	$ 20.15
Granted (in dollars per share) | $ / shares
Exercised (in dollars per share) | $ / shares
Forfeited (in dollars per share) | $ / shares	29.48
Balance outstanding (in dollars per share) | $ / shares	15.75
Options exercisable as of September 30, 2017 (in dollars per share) | $ / shares	$ 15.75
Incentive Stock Options [Member]
Balance outstanding (in shares)	60,000
Granted (in shares)
Exercised (in shares)
Forfeited (in shares)	(11,000)
Balance outstanding (in shares)	49,000
Options exercisable as of September 30, 2017 (in shares)	49,000
Non-Incentive Stock Options [Member]
Balance outstanding (in shares)	52,500
Granted (in shares)
Exercised (in shares)
Forfeited (in shares)	(25,000)
Balance outstanding (in shares)	27,500
Options exercisable as of September 30, 2017 (in shares)	27,500

XML

Note 5 - Benefit Plans - Restricted Stock (Details) - Restricted Stock [Member]	9 Months Ended
	Sep. 30, 2017 $ / shares shares
Balance of shares non-vested (in shares) | shares	60,955
Balance of shares non-vested (in dollars per share) | $ / shares	$ 13.62
Granted (in shares) | shares	13,386
Granted (in dollars per share) | $ / shares	$ 20.33
Vested (in shares) | shares	(27,291)
Vested (in dollars per share) | $ / shares	$ 12.25
Forfeited (in shares) | shares
Forfeited (in dollars per share) | $ / shares
Balance of shares non-vested (in shares) | shares	47,050
Balance of shares non-vested (in dollars per share) | $ / shares	$ 16.33

XML

Note 5 - Benefits Plan - Performance Stock Units (Details) - Performance Shares [Member]	9 Months Ended
	Sep. 30, 2017 $ / shares shares
Balance of shares non-vested (in shares) | shares	0
Balance of shares non-vested (in dollars per share) | $ / shares	$ 0
Granted (in shares) | shares	55,823
Granted (in dollars per share) | $ / shares	$ 20.48
Vested (in shares) | shares	0
Vested (in dollars per share) | $ / shares	$ 0
Forfeited (in shares) | shares	0
Forfeited (in dollars per share) | $ / shares	$ 0
Balance of shares non-vested (in shares) | shares	55,823
Balance of shares non-vested (in dollars per share) | $ / shares	$ 20.48

XML

Note 6 - Income Per Common Share (Details Textual) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Employee Stock Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	32,500	73,500	32,500	73,500

XML

Note 6 - Income Per Common Share - Income Per Share (Details) - USD ($)	3 Months Ended			6 Months Ended	9 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Sep. 30, 2016	Jun. 30, 2017	Sep. 30, 2017	Sep. 30, 2016
Basic Income Per Common Share, Income Available to Common Shareholders	$ 1,717,383	$ 1,541,907	$ 1,541,907	$ 4,074,664	$ 4,739,197	$ 4,074,664
Basic Income Per Common Share, Average Common Shares Outstanding (in shares)	4,374,725	4,370,700		4,365,835	4,370,877
Basic Income Per Common Share (in dollars per share)	$ 0.39	$ 0.35	$ 0.35	$ 0.93	$ 1.08	$ 0.93
Effect of Dilutive Securities, Average Common Shares Outstanding (in shares)	72,841	56,853		53,553	64,815
Diluted Income Per Common Share, Income Available to Common Shareholders	$ 1,717,383	$ 1,541,907		$ 4,074,664	$ 4,739,197
Diluted Income Per Common Share, Average Common Shares Outstanding (in shares)	4,447,566	4,427,553		4,419,388	4,435,692
Diluted Income Per Common Share (in dollars per share)	$ 0.39	$ 0.35	$ 0.35	$ 0.92	$ 1.07	$ 0.92

XML

Note 8 - Derivative Financial Instruments (Details Textual) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Jun. 30, 2017
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax		$ (76,222)		$ 151,420
Interest Rate Swap [Member]
Derivative, Notional Amount	$ 50,000,000	$ 50,000,000		$ 50,000,000		$ 50,000,000
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax	95,395
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax	$ 56,025

XML

Note 8 - Derivative Financial Instruments - Summary of Derivative Financial Instruments (Details) - Interest Rate Swap [Member] - USD ($)	9 Months Ended
	Sep. 30, 2017	Jun. 30, 2017
Termination Date	Feb. 28, 2025
Notional Amount	$ 50,000,000	$ 50,000,000
Rate Paid	2.12%
Estimated Fair Value	$ 151,420

XML

Note 9 - Disclosures About Fair Value of Assets and Liabilities - Fair Value of Assets Measured on Recurring Basis (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Available-for-sale securities	$ 83,205,195	$ 92,399,235
US States and Political Subdivisions Debt Securities [Member]
Available-for-sale securities	33,893,331	38,337,525
Corporate Debt Securities [Member]
Available-for-sale securities	3,070,000	7,053,522
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Available-for-sale securities	46,241,864	47,008,188
Fair Value, Inputs, Level 1 [Member]
Available-for-sale securities
Fair Value, Inputs, Level 1 [Member] | US States and Political Subdivisions Debt Securities [Member]
Available-for-sale securities
Fair Value, Inputs, Level 1 [Member] | Corporate Debt Securities [Member]
Available-for-sale securities
Fair Value, Inputs, Level 1 [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Available-for-sale securities
Fair Value, Inputs, Level 2 [Member]
Available-for-sale securities	83,205,000	92,399,000
Fair Value, Inputs, Level 2 [Member] | US States and Political Subdivisions Debt Securities [Member]
Available-for-sale securities	33,893,000	38,338,000
Fair Value, Inputs, Level 2 [Member] | Corporate Debt Securities [Member]
Available-for-sale securities	3,070,000	7,053,000
Fair Value, Inputs, Level 2 [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Available-for-sale securities	46,242,000	47,008,000
Fair Value, Inputs, Level 3 [Member]
Available-for-sale securities
Fair Value, Inputs, Level 3 [Member] | US States and Political Subdivisions Debt Securities [Member]
Available-for-sale securities
Fair Value, Inputs, Level 3 [Member] | Corporate Debt Securities [Member]
Available-for-sale securities
Fair Value, Inputs, Level 3 [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Available-for-sale securities
Interest Rate Swap [Member]
Interest rate swaps	151,420
Interest Rate Swap [Member] | Fair Value, Inputs, Level 1 [Member]
Interest rate swaps
Interest Rate Swap [Member] | Fair Value, Inputs, Level 2 [Member]
Interest rate swaps	151,000
Interest Rate Swap [Member] | Fair Value, Inputs, Level 3 [Member]
Interest rate swaps

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Note 9 - Disclosures About Fair Value of Assets and Liabilities - Fair Value of Assets Measured on Non-recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Impaired Loans [Member]
Assets measured at fair value on a nonrecurring basis	$ 1,474	$ 1,006
Impaired Loans [Member] | Fair Value, Inputs, Level 1 [Member]
Assets measured at fair value on a nonrecurring basis
Impaired Loans [Member] | Fair Value, Inputs, Level 2 [Member]
Assets measured at fair value on a nonrecurring basis
Impaired Loans [Member] | Fair Value, Inputs, Level 3 [Member]
Assets measured at fair value on a nonrecurring basis	1,474	1,006
Foreclosed Assets Held For Sale [Member]
Assets measured at fair value on a nonrecurring basis		149
Foreclosed Assets Held For Sale [Member] | Fair Value, Inputs, Level 1 [Member]
Assets measured at fair value on a nonrecurring basis
Foreclosed Assets Held For Sale [Member] | Fair Value, Inputs, Level 2 [Member]
Assets measured at fair value on a nonrecurring basis
Foreclosed Assets Held For Sale [Member] | Fair Value, Inputs, Level 3 [Member]
Assets measured at fair value on a nonrecurring basis		$ 149

XML

Note 9 - Disclosures About Fair Value of Assets and Liabilities - Fair Value Quantitative Information (Details) - Fair Value, Inputs, Level 3 [Member] - Market Approach Valuation Technique [Member] - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Impaired Loans [Member]
Assets, fair value	$ 1,474	$ 1,006
Valuation technique	Market Comparable	Market Comparable
Unobservable input	Discount to reflect realizable value	Discount to reflect realizable value
Impaired Loans [Member] | Minimum [Member]
Range	0.00%	0.00%
Impaired Loans [Member] | Maximum [Member]
Range	100.00%	100.00%
Impaired Loans [Member] | Weighted Average [Member]
Range	15.00%	7.00%
Foreclosed Assets Held For Sale [Member]
Assets, fair value		$ 149
Valuation technique	Market Comparable	Market Comparable
Unobservable input	Discount to reflect realizable value	Discount to reflect realizable value
Range	0.00%	10.00%

XML

Note 9 - Disclosures About Fair Value of Assets and Liabilities - Fair Value of Financial Instruments (Details) - USD ($)	Sep. 30, 2017	Dec. 31, 2016
Reported Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member]
Financial assets:
Cash and cash equivalents	$ 10,721,184	$ 9,088,441
Reported Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member]
Financial assets:
Held-to-maturity securities, approximate fair value	18,424	27,528
Federal Home Loan Bank stock	4,137,500	4,611,000
Mortgage loans held for sale	2,516,520	2,183,633
Interest receivable	2,164,278	1,947,063
Financial liabilities:
Deposits	584,088,617	505,362,750
Federal Home Loan Bank advances	82,800,000	95,700,000
Interest payable	253,045	207,833
Reported Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member]
Financial assets:
Loans, net	616,884,052	538,273,640
Financial liabilities:
Subordinated debentures	15,465,000	15,465,000
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member]
Financial assets:
Cash and cash equivalents	10,721,184	9,088,441
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member]
Financial assets:
Held-to-maturity securities, approximate fair value	18,582	28,153
Federal Home Loan Bank stock	4,137,500	4,611,000
Mortgage loans held for sale	2,516,520	2,183,633
Interest receivable	2,164,278	1,947,063
Financial liabilities:
Deposits	583,406,521	504,829,161
Federal Home Loan Bank advances	83,002,996	95,764,840
Interest payable	253,045	207,833
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member]
Financial assets:
Loans, net	613,749,211	537,645,692
Financial liabilities:
Subordinated debentures	$ 15,465,000	$ 15,465,000