Note 7 - Other Real Estate Owned

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Real Estate Owned [Text Block]

7.

OTHER REAL ESTATE OWNED

The following table reflects changes in other real estate owned (“OREO”) during the years ended

December

31,

2016

and

2015.

	Balance							Fair Value			Balance
	12/31/2015		Additions		Sales, net			Adjustments			12/31/2016
	(In thousands)
Other Real Estate Owned	$	6,125	$	648	$	(3,293	)	$	(251	)	$	3,229

	Balance							Fair Value			Balance
	12/31/2014		Additions		Sales, net			Adjustments			12/31/2015
	(In thousands)
Other Real Estate Owned	$	7,756	$	991	$	(2,427	)	$	(195	)	$	6,125

Fair value adjustments are recorded in order to adjust the carrying values of OREO to estimated fair market values. In most cases, estimated fair market values are derived from an initial appraisal, an updated appraisal or other forms of internal evaluations. In certain instances when a listing agreement is renewed for a lesser amount, carrying values will be adjusted to the lesser fair value amount. Additionally, in certain instances when an offer to purchase is received near the end of a quarterly accounting period for less than the carrying value, and the sale does not close until the next accounting period, the carrying value will adjust to the lesser fair value offer amount. At

December

31,

2016,

OREO consisted of residential and commercial properties, developed lots and raw land.