FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2015

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2015 and December 31, 2014 are summarized below:

			Fair Value Hierarchy
	Total		Level 1		Level 2		Level 3
	(Dollars in Thousands)
March 31, 2015
Assets:
Securities available-for-sale:
U.S. Government-sponsored enterprises	$	4,882	$	-	$	4,882	$	-
State and municipal		5,127		-		5,127		-
Mortgage-backed securities – residential		95,936		-		95,936		-
Collateralized mortgage obligations – U.S. Government		9,946		-		9,946		-
Total	$	115,891	$	-	$	115,891	$	-

December 31, 2014
Assets:
Securities available-for-sale:
U.S. Government-sponsored enterprises	$	4,738	$	-	$	4,738	$	-
State and municipal		5,083		-		5,083		-
Mortgage-backed securities – residential		98,514		-		98,514		-
Collateralized mortgage obligations – U.S. Government		10,364		-		10,364		-
Total	$	118,699	$	-	$	118,699	$	-

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Table Text Block]

Assets and liabilities measured at fair value on a nonrecurring basis as of March 31, 2015 and December 31, 2014 are summarized below:

			Fair Value Hierarchy
	Total		Level 1		Level 2		Level 3
	(Dollars in Thousands)
March 31, 2015
Assets:
Other real estate owned	$	4,248	$	-	$	-	$	4,248

December 31, 2014
Assets:
Other real estate owned	$	3,908		-		-	$	3,908

Fair Value Measurements, Recurring and Nonrecurring [Table Text Block]

Quantitative information about Level 3 fair value measurements as of March 31, 2015 and December 31, 2014 is summarized below:

	Fair Value Estimate		Valuation Techniques	Unobservable Input	Range (Weighted Average) (1)
	(Dollars in Thousands)

March 31, 2015
Assets:
Other real estate owned	$	4,248	Broker price opinions, appraisal of collateral (2), (3)	Appraisal adjustments (4)	0.0% to 38.8% (4.6%)

				Liquidation expenses	10.0% (10.0%)

December 31, 2014
Assets:
Other real estate owned	$	3,908	Broker price opinions, appraisal of collateral (2), (3)	Appraisal adjustments (4)	0.0% to 38.8% (4.4%)

				Liquidation expenses	10.0% (10.0%)

____________

(1)

The range and weighted average of other appraisal adjustments and liquidation expenses are presented as a percent of the appraised value.

(2)

Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various level 3 inputs which are not identifiable.

(3)

Includes qualitative adjustments by management and estimated liquidation expenses.

(4)

Appraisals may be adjusted by management for qualitative factors such as economic conditions.

- Definition

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

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