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DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2014

Schedule of fair value measurements of assets and liabilities recognized in the accompanying balance sheets measured at fair value on a recurring basis

			March 31, 2014 Fair Value Measurements Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Available-for-sale securities	(In Thousands)
Federal agencies	$	33,338	$	-	$	33,338	$	-
State and municipal		35,014		-		35,014		-
Government-sponsored enterprise (GSE) residential mortgage-backed and other asset-backed agency securities		45,629		-		45,629		-
Corporate		3,352		-		1,987		1,365
Total	$	117,333	$	-	$	115,968	$	1,365

			December 31, 2013 Fair Value Measurements Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(In Thousands)
Available-for-sale securities
Federal agencies	$	37,213	$	-	$	37,213	$	-
State and municipal		37,122		-		37,122		-
Government-sponsored enterprise (GSE) residential mortgage-backed and other asset-backed agency securities		41,801		-		41,801		-
Corporate		3,751		-		2,483		1,268
Total	$	119,887	$	-	$	118,619	$	1,268

Schedule of reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying balance sheets using significant unobservable (Level 3) inputs

	Available-for-Sale Securities
	Three Months Ended March 31, 2014				Three Months Ended March 31, 2013
	(Unaudited; In Thousands)

Beginning balance	$	1,268		$	1,197
Accretion		2				7
Total realized and unrealized gains and losses
Unrealized gains included in other comprehensive income		102				63
Settlements, including pay downs		(7	)			(59	)

Ending balance	$	1,365			$	1,208
Total gains or losses for the period included in net income attributable to the change in unrealized gains or losses related to assets and liabilities still held at the reporting date	$	-			$	-

Schedule of fair value measurements of assets and liabilities recognized in the accompanying balance sheets measured at fair value on a nonrecurring basis

Fair Value Measurements Using

As of March 31, 2014

Fair Value

Quoted Prices in Active Markets for Identical Assets

(Level 1)

Significant Other Observable Inputs

(Level 2)

Significant Unobservable Inputs

(Level 3)

(In Thousands)

Impaired loans

$ 12

$ -

$ 12

		Fair Value Measurements Using
As of December 31, 2013	Fair Value	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
	(In Thousands)

Impaired loans	$5,987	$ -	$ -	$5,987

Real estate held for sale	$ 65	$ -	$ -	$ 65

Schedule of quantitative information about level 3 fair value measurements

Fair Value at March 31, 2014	Valuation Techniques	Unobservable Input	Range (Weighted Average)
	(Unaudited; In Thousands)

Impaired loans	$ 12	Comparative sales based on independent appraisal	Marketability Discount	10%-20%


Securities available for sale

Corporate	$1,365	Discounted cash flows	*Default probability	0.85%-100%
			*Loss, given default	85%-100%
			*Discount rate	4.29%-9.50%
			*Recovery rate	0%-90%
			*Prepayment rate	0%-100%

	Fair Value at December 31, 2013	Valuation Techniques	Unobservable Input	Range (Weighted Average)
	(Unaudited; In Thousands)

Impaired loans	$5,987	Comparative sales based on independent appraisal	Marketability Discount	10%-20	%

Real estate held for sale	$ 65	Comparative sales based on independent appraisal	Marketability Discount	10	%

Securities available for sale

Corporate	$1,268	Discounted cash flows	*Default probability	1.04%-100	%
			*Loss, given default	85%-100	%
			*Discount rate	4.41%-9.50	%
			*Recovery rate	0%-90	%
			*Prepayment rate	0%-100	%

Schedule of estimated fair values of the company's financial instruments

	Fair Value Measurements Using
		Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
		(Unaudited; In Thousands)
March 31, 2014:
Assets
Cash and cash equivalents		$	17,855	$	17,855	$	-	$	-
Interest-bearing deposits			1,984		1,984		-		-
Loans, held for sale			-		-		-		-
Loans, net of allowance for losses			312,610		-	324,870			-
Stock in Federal Home Loan Bank			4,595		-		4,595		-
Interest receivable			2,107		-		2,107		-
Liabilities
Deposits			401,246		-	401,979			-
Borrowings			42,717		-	37,386		7,220
Interest payable			246		-		246		-

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(Unaudited; In Thousands)
December 31, 2013:
Assets
Cash and cash equivalents	$	10,244	$	10,244	$	-	$	-
Interest-bearing deposits		1,984		1,984		-		-
Loans, held for sale		341		-		341		-
Loans, net of allowance for losses		316,228		-		330,073		-
Stock in Federal Home Loan Bank		4,595		-		4,595		-
Interest receivable		2,178		-		2,178		-
Liabilities
Deposits		395,015		-		395,924		-
Borrowings		49,717		-		44,538		7,218
Interest payable		270		-		270		-

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

+ References+ Details

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References+ Details