FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2016

Recorded Amount of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis.

(in thousands)
June 30, 2016	Total		Level 1		Level 2		Level 3
Government-sponsored enterprises	$	4,003	$	-	$	4,003	$	-
Mortgage-backed securities		17		-		17		-
Corporate bonds		300		-		-		300
Total assets at fair value	$	4,320	$	-	$	4,020	$	300

(in thousands)
December 31, 2015	Total		Level 1		Level 2		Level 3
Government-sponsored enterprises	$	4,491	$	-	$	4,491	$	-
Mortgage-backed securities		21		-		21		-
Corporate bonds		300		-		-		300
Equities and mutual funds		529		529		-		-
Total assets at fair value	$	5,341	$	529	$	4,512	$	300

Change in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis

For the six months ended June 30, 2016 and 2015, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:

	Level 3
	2016		2015
(in thousands)	Fair Value		Fair Value
Corporate Bonds – Available for Sale
Balance, January 1	$	300	$	255
Total unrealized gain (loss) included in income		-		-
Total unrealized gain (loss) included in other comprehensive income		-		30
Bonds called		-		-
Balance, June 30	$	300	$	285

Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis

Assets and liabilities measured at fair value on a nonrecurring basis are included in the table below.

(in thousands)
June 30, 2016	Total		Level 1		Level 2		Level 3

Foreclosed assets	$	203	$	-	$	-	$	203
Servicing assets		335		-		-		335
Total assets at fair value	$	538	$	-	$	-	$	538

(in thousands)
December 31, 2015	Total		Level 1		Level 2		Level 3

Impaired loans:
Commercial and industrial	$	548	$	-	$	-	$	548
Foreclosed assets		384		-		-		384
Servicing assets		340		-		-		340
Total assets at fair value	$	1,272	$	-	$	-	$	1,272

Estimated Fair Values of Financial Instruments

The following presents the carrying amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments as of June 30, 2016 and December 31, 2015. This table excludes financial instruments for which the carrying amount approximates fair value.

					Fair Value Measurements
(dollars in thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2016
Financial Instruments – Assets
Loans, net	$	207,918	$	214,128	$	-	$	-	$	214,128

Financial Instruments-Liabilities
Deposits		216,689		209,838		-		73,022		136,816
Long-Term Debt		1,750		1,750		-		-		1,818

December 31, 2015
Financial Instruments – Assets
Loans, net	$	197,905	$	203,047		-		-	$	203,047

Financial Instruments-Liabilities
Deposits		212,688		205,778		-		74,693		131,085
Long-Term Debt		2,750		2,865		-		-		2,865