Note 10 - Lines of Credit and Federal Home Loan Bank Advances

3 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Federal Home Loan Bank Advances, Disclosure [Text Block]

Note 10: Lines of Credit and Federal Home Loan Bank Advances

The Bank

may

borrow up to

$5,000,000

from a correspondent bank under a secured federal funds line of credit and

$1,000,000

under an unsecured federal funds line of credit. The Bank would be required to pledge investment securities to draw upon the secured line of credit. There were

no

borrowings under these lines of credit at

June 30, 2017

and

March 31, 2017.

The Bank also maintains a note payable on an automobile purchased during fiscal

2017.

The original amount of the note was

$28,805

with an interest rate of

1.95%

for

36

months. The balance of the note at

June 30, 2017

and

March 31, 2017

is

$24,139

and

$27,250,

respectively.

Borrowings consist of advances from the Federal Home Loan Bank (FHLB). The Bank

may

borrow up to

25

percent of its assets under a line of credit agreement with the FHLB. Advances under the line of credit are secured by investments and certain loans owned by the Bank. As of

June 30, 2017

and

March 31, 2017,

the Bank had

$91.9

million and

$88.2

million, respectively, of available credit from the FHLB. Advances are limited by the balance of loans available for pledge. The amount of loans that were deemed eligible to pledge as collateral totaled

$157.8

million at

June 30, 2017

and

$159.1

million at

March 31, 2017.

As a condition of obtaining the line of credit from the FHLB, the FHLB also requires the Bank purchase shares of capital stock in the FHLB. Information relating to borrowings at

June 30, 2017

and

March 31, 2017

is presented below.

	June 30, 2017						March 31, 2017
	Amount		Rate			Maturity Date	Amount		Rate			Maturity Date
FHLB advance (1)	$	5,550,000		1.17	%	9/11/2017	$	5,550,000		0.94	%	6/9/2017
FHLB advance (2)		6,000,000		1.18	%	9/29/2017		6,000,000		0.93	%	6/29/2017
FHLB advance		1,000,000		4.24	%	7/31/2017		1,000,000		4.24	%	7/31/2017
FHLB advance		5,000,000		4.28	%	7/31/2017		5,000,000		4.28	%	7/31/2017
FHLB advance		1,000,000		4.01	%	8/21/2017		1,000,000		4.01	%	8/21/2017
FHLB advance		1,000,000		0.91	%	8/31/2017		1,000,000		0.91	%	8/31/2017
FHLB advance		1,500,000		3.23	%	11/24/2017		1,500,000		3.23	%	11/24/2017
FHLB advance		1,500,000		3.40	%	11/27/2017		1,500,000		3.40	%	11/27/2017
FHLB advance		1,000,000		2.60	%	7/2/2018		1,000,000		2.60	%	7/2/2018
FHLB advance		1,000,000		3.05	%	7/3/2018		1,000,000		3.05	%	7/3/2018
FHLB advance		5,000,000		3.94	%	7/23/2018		5,000,000		3.94	%	7/23/2018
FHLB advance		5,000,000		3.38	%	9/19/2018		5,000,000		3.38	%	9/19/2018
FHLB advance		1,000,000		2.60	%	10/2/2018		1,000,000		2.60	%	10/2/2018
Note payable - auto		24,139		1.95	%	2/17/2020		27,250		1.95	%	2/17/2020
		35,574,139						35,577,250
Premium on borrowings assumed		401,089						547,649
Total FHLB borrowings	$	35,975,228					$	36,124,899

( 1 ) -

FHLB Advance is tied to three derivative cash flow hedges in increments of $1.85 million each. The three individual cash flow hedges are for a term of five , seven and ten years, respectively and are tied to the 3 -month LIBOR rate. In order for the cash flow hedges to remain effective, the corresponding FHLB Advance will have to be renewed every three months until the respective cash flow hedge matures.

( 2 ) -

FHLB Advance is tied to three derivative cash flow hedges in increments of $2.0 million each. The three individual cash flow hedges are for a term of five , seven and ten years, respectively and are tied to the 3 -month LIBOR rate. In order for the cash flow hedges to remain effective, the corresponding FHLB Advance will have to be renewed every three months until the respective cash flow hedge matures.