10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x Quarterly Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2018

Or

¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File No. 000-55652

Best Hometown Bancorp, Inc.

(Exact name of registrant as specified in its charter) 

Maryland	81-1959486
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)
100 East Clay Street, Collinsville, Illinois	62234
(Address of Principal Executive Offices)	Zip Code

(618) 345-1121

(Registrant’s telephone number)

Not Applicable

(Former name or former address, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days.

YES x     NO ¨.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

YES x     NO ¨.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and emerging growth company in Rule 12b-2 of the Exchange Act. (Check one)

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
		Emerging Growth Company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨ NO x

As of August 10, 2018, there were 826,208 shares of the Registrant’s common stock issued and outstanding.

BEST HOMETOWN BANCORP, INC.

Form 10-Q Quarterly Report

Table of Contents

PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	2
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION	27
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	35
ITEM 4.	CONTROLS AND PROCEDURES	35
PART II. OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	35
ITEM 1A.	RISK FACTORS	35
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	35
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	36
ITEM 4.	MINE SAFETY DISCLOSURES	36
ITEM 5.	OTHER INFORMATION	36
ITEM 6.	EXHIBITS	36
SIGNATURES		36
INDEX TO EXHIBITS		37

1

BEST HOMETOWN BANCORP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share and per share data)

(Unaudited)

ITEM 1. FINANCIAL STATEMENTS

	June 30,			December 31,
	2018			2017
ASSETS
Cash and due from banks	$	1,744		$	1,331
Interest-earning deposits in banks		2,082			3,859
Total cash and cash equivalents		3,826			5,190
Available-for-sale securities		14,302			16,211
Loans		84,961			82,343
Allowance for loan losses		(1,219	)		(1,215	)
Net loans		83,742			81,128
Premises and equipment, net		3,212			3,312
Bank owned life insurance		3,534			3,482
Real estate owned, net		81			81
Accrued interest receivable
Investment securities		250			249
Loans receivable		46			51
Deferred tax asset		124			80
Restricted equity securities		563			405
Other assets		82			104
Total assets	$	109,762		$	110,293
LIABILITIES
Deposits
Noninterest-bearing	$	5,204		$	5,082
Interest-bearing		78,298			81,744
Total deposits		83,502			86,826
Federal Home Loan Bank ("FHLB") advances		12,500			9,000
Accrued defined benefit pension and postretirement plans		1,175			1,785
Other liabilities		448			219
Total liabilities		97,625			97,830
Commitments and contingencies
Redeemable common stock held by ESOP plan		96			77
SHAREHOLDERS' EQUITY
Preferred stock, $0.01 par value, 1,000,000 shares authorized; none issued and outstanding		-			-
Common stock, $0.01 par value, 30,000,000 shares authorized, 826,208 shares issued and outstanding		8			8
Additional paid-in capital		6,851			6,847
Retained earnings - substantially restricted		7,320			8,096
Unearned Employee Stock Ownership Plan ("ESOP") common stock, 57,887 and 59,539 shares		(579	)		(595	)
Accumulated other comprehensive loss, net of tax:
Net unrealized losses on available-for-sale securities		(465	)		(302	)
Net unrealized losses on defined benefit pension plan and postretirement medical plans, net		(998	)		(1,591	)
Total accumulated other comprehensive loss, net of tax		(1,463	)		(1,893	)
Less maximum cash obligation related to ESOP shares		(96	)		(77	)
Total shareholders' equity		12,041			12,386
Total liabilities and shareholders' equity	$	109,762		$	110,293

See accompanying notes to the condensed consolidated financial statements

2

BEST HOMETOWN BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except share and per share data)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
Interest income:
Loans receivable	$	908		$	859		$	1,778		$	1,694
Investment securities, taxable		67			106			141			207
Other interest-earning assets		9			7			20			16
Total interest income		984			972			1,939			1,917
Interest expense:
Deposits		268			266			522			527
Advances from FHLB		62			51			105			89
Total interest expense		330			317			627			616
Net interest income		654			655			1,312			1,301
Provision for loan losses		-			-			-			-
Net interest income after provision for loan losses		654			655			1,312			1,301
Noninterest income:
Service charges on deposit accounts		22			22			48			39
Income on bank owned life insurance		25			26			51			28
Loss on sales of securities		-			(19	)		-			(19	)
Gain (loss) on sale of real estate owned		(10	)		1			(10	)		1
Other		9			4			16			8
Total noninterest income		46			34			105			57
Noninterest expense:
Salaries and employee benefits		954			425			1,385			852
Occupancy and equipment		117			116			240			234
Data processing		86			50			157			106
Professional and supervisory fees		113			133			212			225
Office expense		12			10			24			24
Advertising		13			17			25			33
FDIC deposit insurance		6			8			14			15
Provision for real estate owned and related expenses		4			14			10			15
Other		70			53			126			107
Total noninterest expense		1,375			826			2,193			1,611
Loss before income taxes		(675	)		(137	)		(776	)		(252	)
Income tax expense		-			-			-			-
Net loss	$	(675	)	$	(137	)	$	(776	)	$	(252	)
Basic net loss per share	$	(0.88	)	$	(0.18	)	$	(1.01	)		(0.33	)

See accompanying notes to the condensed consolidated financial statements

3

BEST HOMETOWN BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Amounts in thousands, except share and per share data)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
Net loss	$	(675	)	$	(137	)	$	(776	)	$	(252	)
Other comprehensive income:
Unrealized gain (loss) on available-for-sale securities:
Unrealized holding gain (loss) arising during the period		(49	)	$	18			(205	)		36
Reclassification adjustment for gains (losses) included in net income		-			19			-			19
Tax effect		10			(12	)		42			(18	)
Net of tax		(39	)		25			(163	)		37
Defined benefit pension and post retirement medical plans:
Net gain (loss) arising during the period on plans		-			-			-			-
Reclassification adjustment for settlement of portion of accumulated benefit obligation		561						561
Reclassification adjustment for amortization of prior service cost and net gain/loss included in net periodic pension cost		8			24			32			49
Tax effect		-			-			-			-
Net of tax		569			24			593			49
Total other comprehensive income		530			49			430		$	86
Comprehensive loss	$	(145	)	$	(88	)	$	(346	)	$	(166	)

See accompanying notes to the condensed consolidated financial statements  

4

BEST HOMETOWN BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(Amounts in thousands, except share and per share data)

(Unaudited)

														Net Unrealized
														Losses
											Net Unrealized			On Defined			Maximum
			Additional					Unearned			Losses			Benefit Pension and			Cash Obligation
	Common		Paid-In		Retained			ESOP			On Available-for-sale			Postretirement			Related to
	Stock		Capital		Earnings			Shares			Securities, Net			Medical Plans, Net			ESOP Shares			Total
Balance at December 31, 2016	$	8	$	6,839	$	8,330		$	(628	)	$	(269	)	$	(1,481	)	$	(41	)	$	12,758
Net loss		-		-		(252	)		-			-			-			-			(252	)
Other comprehensive loss		-		-		-			-			37			49			-			86
ESOP shares earned		-		4		-			16			-			-			-			20
Change related to ESOP shares cash obligation		-		-					-			-						(21	)		(21	)
Balance at June 30, 2017	$	8	$	6,843	$	8,078		$	(612	)	$	(232	)	$	(1,432	)	$	(62	)	$	12,591
Balance at December 31, 2017		8		6,847		8,096			(595	)		(302	)		(1,591	)		(77	)		12,386
Net loss		-		-		(776	)		-			-			-			-			(776	)
Other comprehensive income		-		-		-			-			(163	)		593			-			430
ESOP shares earned		-		4		-			16			-			-			-			20
Change related to ESOP shares cash obligation		-		-		-			-			-			-			(19	)		(19	)
Balance at June 30, 2018	$	8	$	6,851	$	7,320		$	(579	)	$	(465	)	$	(998	)	$	(96	)	$	12,041

See accompanying notes to the condensed consolidated financial statements

5

BEST HOMETOWN BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

(Amounts in thousands, except share and per share data)

	Six Months Ended
	June 30,
	2018			2017
Cash flows from operating activities:
Net loss	$	(776	)	$	(252	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization, net		282			368
Income on bank owned life insurance		(51	)		(28	)
(Gain) loss on sale of real estate owned		10			(1	)
(Gain) loss on sales of securities		-			19
ESOP compensation expense		20			20
Net change in operating assets and liabilities:
Accrued interest receivable		4			-
Accrued interest payable		6			(4	)
Other		225			(67	)
Net cash provided by (used in) operating activities		(280	)		55
Cash flows from investing activities:
Loan originations and repayments, net		(2,672	)		(5,141	)
Purchases of available-for-sale securities		-			(1,816	)
Proceeeds from maturities, paydowns and calls of available-for-sale securities		1,562			2,710
Proceeds from sales of available-for-sale securities		-			2,998
Purchase of bank owned life insurance		-			(3,400	)
Redemptions (purchases) of FHLB stock, net		(158	)		432
Purchases of premises and equipment		(20	)		(430	)
Proceeds from sale of foreclosed real estate		28			32
Net cash (used in) investing activities		(1,260	)		(4,615	)
Cash flows from financing activities:
Net change in deposits		(3,324	)		689
Borrowings of FHLB advances		9,500			3,000
Repayments of FHLB advances		(6,000	)		-
Net cash provided by financing activities		176			3,689
Change in cash and cash equivalents		(1,364	)		(871	)
Cash and cash equivalents at beginning of period		5,190			5,459
Cash and cash equivalents at end of period	$	3,826		$	4,588
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest on deposits	$	522		$	527
Interest on advances from FHLB		98			92
Real estate acquired in settlement of loans	$	38		$	113

See accompanying notes to the condensed consolidated financial statements

6

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

(1) BASIS OF PRESENTATION

General

On June 29, 2016, Best Hometown Bank (the “Bank”) (formerly known as Home Federal Savings and Loan Association of Collinsville) completed its conversion (the “Conversion”) from a federally-chartered mutual savings association to the capital stock form of organization, including the establishment of a stock holding company, Best Hometown Bancorp, Inc. (referred to herein as “the Company,” “we,” “us,” or “our”), as parent of the Bank. The stock holding company is organized under the laws of the State of Maryland and owns all of the outstanding common stock of the Bank. In connection with the Conversion, the Company sold 826,208 shares of its common stock, including 66,096 shares (8% of shares sold) that were purchased by the Bank’s employee stock ownership plan (“ESOP”), at a price of $10.00 per share, for gross offering proceeds of $8.3 million. The cost of the conversion and issuance of common stock was $1.4 million, which was deducted from the gross offering proceeds. The Company contributed $5.0 million of the net proceeds from the offering by the Company to the Bank, and $1.2 million was retained by the Company. In addition, $661,000 of the net proceeds were used to fund a loan to the ESOP, with which the ESOP purchased Company shares.

Voting rights are held and exercised exclusively by the shareholders of the holding company. Deposit account holders continue to be insured by the FDIC up to the applicable limits. A liquidation account was established in an amount equal to the Bank’s total equity as of the latest balance sheet date in the final offering circular used in the conversion. Each eligible account holder or supplemental account holder are entitled to a proportionate share of this account in the event of a complete liquidation of the Bank, and only in such event. This share will be reduced if the eligible account holder’s or supplemental account holder’s deposit balance falls below the amounts on the date of record and will cease to exist if the account is closed. The liquidation account will never be increased despite any increase after conversion in the related deposit balance.

The Bank may not pay a dividend on its capital stock, if the effect thereof would cause retained earnings to be reduced below the liquidation account amount or regulatory capital requirements. In addition, the stock holding company is subject to certain regulations related to the repurchase of its capital stock.

The Conversion was accounted for as a change in corporate form with the historic basis of the Bank’s assets, liabilities and equity unchanged as a result.

The accompanying unaudited consolidated financial statements of Best Hometown Bancorp, Inc., which include the accounts of its wholly owned subsidiary Best Hometown Bank have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Intercompany accounts and transactions are eliminated during consolidation.

In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included to present fairly the financial position as of June 30, 2018 and December 31, 2017 and the results of operations and cash flows for the six months ended June 30, 2018 and 2017. All interim amounts have not been audited and the results of operations for the three and six months ended June 30, 2018, herein are not necessarily indicative of the results of operations to be expected for the entire year.

Cash and cash equivalents include cash on hand, federal funds sold, overnight interest-bearing deposits and amounts due from other depository institutions.

7

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of foreclosed real estate, fair values of financial instruments, measurement of defined benefit pension and postretirement medical plans and valuation of deferred tax assets.

Contingencies

The Company is involved in certain legal actions arising from normal business activities. Management believes that the outcome of such proceedings will not have any material adverse effect on the financial statements of the Company.

(2) NEW ACCOUNTING STANDARDS

The Company is an emerging growth company and as such will be subject to the effective dates noted for the private companies if they differ from the effective dates noted for public companies.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326) — Measurement of Credit Losses on Financial Instruments. The provisions of ASU 2016-13 were issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other commitments to extend credit held by a reporting entity at each reporting date. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 eliminate the probable incurred loss recognition in current GAAP and reflect an entity’s current estimate of all expected credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the financial assets.

For purchased financial assets with a more-than-insignificant amount of credit deterioration since origination (“PCD assets”) that are measured at amortized cost, the initial allowance for credit losses is added to the purchase price rather than being reported as a credit loss expense. Subsequent changes in the allowance for credit losses on PCD assets are recognized through the statement of income as a credit loss expense.

Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a direct write-down to the security.

As an emerging growth company, ASU 2016-13 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years beginning after December 15, 2021. The Company is reviewing the technology required to source and models data for the purposes of meeting this standard. While the Company generally expects to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, the Company cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial statements.

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016 the FASB issued ASU 2016-08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in determining revenue recognition as principal versus agent. In April 2016, the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In May 2016, the FASB issued ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

8

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

As an emerging growth company, these amendments are effective for annual reporting periods beginning after December 15, 2018, and for interim periods within annual periods beginning after December 15, 2019. The Company’s revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09.    The Company is continuing to evaluate the impact of adopting ASU 2014-09, but does not expect the impact to have a material impact on the Company’s financial position or results of operation.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update provides guidance on the classification of certain cash receipts and cash payments for presentation in the statement of cash flows. As an emerging growth company, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. The Company believes that the adoption of this ASU will not have a material effect to our consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. The portion of ASU 2016-01 that is likely to have an effect on our financial statements and disclosures relates a clarification of accounting standards with respect to deferred tax assets arising from unrealized losses on available-for-sale securities. This ASU 2016-01 requires an entity to evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.

As an emerging growth company, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within years beginning after December 15, 2019.  Early adoption of the amendments in the update is not permitted, except that early application by public business entities to financial statements of fiscal years or interim periods that have not yet been issued or, by all other entities, that have not yet been made available for issuance, are permitted as of the beginning of the fiscal year of adoption for the following amendment: An entity should present separately in other comprehensive income the portion of the total change in the fair value of a liability at fair value in accordance with the fair value option for financial instruments.  An entity should apply the amendments to this update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption.  The Company is continuing to evaluate the impact of adopting this new guidance on its consolidated financial statements, but the adoption of ASU 2016-01 is not expected to have a material impact on the Company’s financial position or results of operation.

Adoption of New Accounting Pronouncement

Effective December 31, 2017, the Company early adopted guidance related to income taxes. The new guidance was applied in the period of adoption. Current accounting principles require that the effect of a change in tax laws or rates on deferred tax liabilities or assets to be included in income from continuing operations in the reporting period that includes the enactment date, even if the related income tax effects were originally charged or credited directly to accumulated other comprehensive income (“AOCI”). The Company’s accounting policy for the release of stranded tax effects in AOCI in on an aggregate portfolio basis. The new guidance allows a reclassification of AOCI to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“US Tax Reform”). The Company early adopted this standard effective December 31, 2017 and reclassified $300 from AOCI to retained earnings due to re-measuring from 35% to 21% the federal deferred taxes on the accumulated other comprehensive income components related to available for sale securities, and the defined benefit and postretirement medical plans.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

9

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

(3) EARNINGS (LOSS) PER SHARE

Basic EPS or loss per common share is determined by dividing net earnings or loss available to common shareholders by the weighted average number of common shares outstanding for the period. ESOP shares are considered outstanding for this calculation unless unearned. The factors used in the earnings per common share computation follow:

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2018
Loss per share
Net loss	$	(675	)	$	(137	)	$	(776	)	$	(252	)
Weighted average common shares outstanding		826,208			826,208			826,208			826,208
Less: average unearned ESOP shares		(58,300	)		(61,466	)		(58,713	)		(62,017	)
Weighted average common shares outstanding		767,908			764,742			767,495			764,191
Basic loss per share	$	(0.88	)	$	(0.18	)	$	(1.01	)	$	(0.33	)

Given a net loss for the three and six months ended June 30, 2018 and 2017, only basic loss per share is applicable.

(4) SECURITIES AVAILABLE FOR SALE

Debt and mortgage-backed securities have been classified in the condensed consolidated balance sheets according to management’s intent. U.S. Government agency mortgage-backed securities consist of securities issued by U.S. Government agencies and U.S. Government sponsored enterprises. Investment securities at June 30, 2018 and December 31, 2017 are as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
June 30, 2018	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	678	$	-	$	(33	)	$	645
U.S. Government agency mortgage-backed securities - residential		14,212		-		(555	)		13,657
	$	14,890	$	-	$	(588	)	$	14,302

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
December 31, 2017	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	786	$	-	$	(24	)	$	762
U.S. Government agency mortgage-backed securities - residential		15,808		-		(359	)		15,449
	$	16,594	$	-	$	(383	)	$	16,211

As of June 30, 2018 and December 31, 2017, no investment securities were pledged for public deposits.

10

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The following tables show the fair value and unrealized loss of securities that have been in unrealized loss positions for less than twelve months and for more than twelve months at June 30, 2018 and December 31, 2017. The tables also show the number of securities in an unrealized loss position for each category of investment security as of the respective dates.

Because the actual cash flows for the Small Business Administration Program (“SBAP”) asset backed security and mortgage-backed securities may differ from their contractual maturities, a maturity table is not shown.

	Less than 12 Months						12 Months or Longer
					Number in							Number in
	Fair		Unrealized		Unrealized		Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss		Loss (1)		Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	-	$	-		-	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		-		-		-		13,657		(555	)		27
	$	-	$	-		-	$	14,302	$	(588	)		28

	Total
						Number in
	Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		13,657		(555	)		27
Total	$	14,302	$	(588	)		28

	Less than 12 Months							12 Months or Longer
						Number in							Number in
	Fair		Unrealized			Unrealized		Market		Unrealized			Unrealized
December 31, 2017	Value		loss			Loss (1)		Value		loss			Loss (1)
U.S. Government agency bonds	$	-	$	-			-	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		1,607		(15	)		3		13,842		(344	)		24
Total	$	1,607	$	(15	)		3	$	14,604	$	(368	)		25

	Total
						Number in
	Fair		Unrealized			Unrealized
December 31, 2017	Value		Loss			Loss (1)
U.S. Government agency bonds	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		15,449		(359	)		27
Total	$	16,211	$	(383	)		28

(1) Represents actual number of securities in an unrealized loss position.

11

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The SBAP agency security is an investment comprised of a pool of loans issued under the Small Business Administration, which come with an unconditional guarantee by the U.S. government for the timely payment of principal and interest.

The Company evaluates securities for other-than-temporary impairments (“OTTI”) at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. The Company considers the length of time and the extent to which the fair value has been less than cost and the financial condition and near-term prospects of the issuer. Additionally, the Company considers its intent to sell or whether it will be more likely than not it will be required to sell the security prior to the security's anticipated recovery in fair value. In analyzing an issuer's financial condition, the Company may consider whether the securities are issued by Federal Government agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuer's financial condition.

Total fair value securities with unrealized losses at June 30, 2018 and December 31, 2017, was $14,302 and $16,211, which was 100% at June 30, 2018 and December 31, 2017, respectively, of the Company’s available-for-sale securities. None of the unrealized losses at June 30, 2018 were recognized into net income for the three or six months ended June 30, 2018 because the issuers’ bonds are of high credit quality, management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates. The fair value of these securities is expected to recover as they approach their maturity date or reset date. None of the unrealized losses at December 31, 2017 were recognized as having OTTI during the three or six months ended June 30, 2018.

There were no sales of securities for the three or six months ended June 30, 2018. For the three and six months ended June 20, 2017, proceeds and gross losses on sales of securities were $2,998 and $19, respectively.

(5) LOANS

The components of loans at June 30, 2018 and December 31, 2017 were as follows:

	June 30,		December 31,
	2018		2017
Real estate loans:
One-to four-family, owner occupied	$	42,480	$	44,660
One-to four-family, non-owner occupied		6,306		6,651
Commercial and multi-family		21,808		23,790
Construction and land		4,369		3,619
Commercial business loans		8,271		2,048
Consumer loans		1,716		1,584
		84,950		82,352
Net deferred loan (fees) costs		11		(9	)
Total	$	84,961	$	82,343

12

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The following tables present the activity in the allowance for loan losses for the three and six months ended June 30, 2018 and 2017 by portfolio segment:

	Beginning									Ending
Three Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	513	$	(73	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		79		(4	)		-		2		77
Commercial and multi-family		401		(27	)		-		-		374
Construction and land		38		5			-		-		43
Commercial business loans		59		106			-		-		165
Consumer loans		43		1			-		-		44
Unallocated		84		(8	)		-		-		76
	$	1,217	$	-		$	-	$	2	$	1,219

	Beginning										Ending
Three Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	647	$	(60	)	$	(6	)	$	37	$	618
One-to-four family, non-owner occupied		109		(3	)		-			2		108
Commercial and multi-family		317		72			-			-		389
Construction and land		44		(8	)		-			7		43
Commercial business loans		41		(7	)		-			-		34
Consumer loans		34		6			-			-		40
Unallocated		-		-			-			-		-
	$	1,192	$	-		$	(6	)	$	46	$	1,232

	Beginning									Ending
Six Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	525	$	(85	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		81		(8	)		-		4		77
Commercial and multi-family		407		(33	)		-		-		374
Construction and land		34		9			-		-		43
Commercial business loans		41		124			-		-		165
Consumer loans		39		5			-		-		44
Unallocated		88		(12	)		-		-		76
	$	1,215	$	-		$	-	$	4	$	1,219

13

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

	Beginning										Ending
Six Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	657	$	(48	)	$	(34	)	$	43	$	618
One-to-four family, non-owner occupied		113		(8	)		-			3		108
Commercial and multi-family		309		80			-			-		389
Construction and land		42		(5	)		-			6		43
Commercial business loans		18		16			-			-		34
Consumer loans		26		14			-			-		40
Unallocated		49		(49	)		-			-		-
	$	1,214	$	-		$	(34	)	$	52	$	1,232

The following tables present the recorded balances of loans and amount of allowance allocated based upon impairment method by portfolio segment at June 30, 2018 and December 31, 2017:

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated for		Evaluated for
	Impairment		Impairment		Total		Impairment		Impairment		Total
June 30, 2018
Real estate loans:
One-to four-family, owner occupied	$	-	$	440	$	440	$	575	$	41,905	$	42,480
One-to four-family, non-owner occupied		-		77		77		76		6,190		6,306
Commercial and multi-family		-		374		374		-		21,808		21,808
Construction and land		-		43		43		13		4,356		4,369
Commercial business loans		-		165		165		-		8,271		8,271
Consumer loans		-		44		44		-		1,716		1,716
Unallocated		-		76		76		-		-		-
	$	-	$	1,219	$	1,219	$	664	$	84,246	$	84,950

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated		Evaluated
	Impairment		Impairment		Total		Impairment		Impairment		Total
December 31, 2017
Real estate loans:
One-to four-family, owner occupied	$	-	$	525	$	525	$	635	$	44,025	$	44,660
One-to four-family, non-owner occupied		-		81		81		116		6,535		6,651
Commercial and multi-family		-		407		407		-		23,790		23,790
Construction and land		-		34		34		13		3,606		3,619
Commercial business loans		-		41		41		-		2,048		2,048
Consumer loans		-		39		39		-		1,584		1,584
Unallocated		-		88		88		-		-		-
	$	-	$	1,215	$	1,215	$	764	$	81,588	$	82,352

14

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The Company, at times, will maintain an unallocated allowance for loan losses due to uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance for loan losses is maintained to cover probable and incurred credit losses inherent in the loan portfolio but not captured in the general component, such as historical loss experience data that may not precisely correspond to individual loan portfolio segments and to uncertainties in economic conditions.

The tables below present loans that were individually evaluated for impairment by portfolio segment at June 30, 2018 and December 31, 2017.

	June 30, 2018						December 31, 2017
	Unpaid						Unpaid
	Principal		Recorded		Related		Principal		Recorded		Related
	Balance		Investment		Allowance		Balance		Investment		Allowance
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	729	$	575	$	-	$	800	$	635	$	-
One-to four-family, non-owner occupied		100		76		-		153		116		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		13		13		-		13		13		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	842	$	664	$	-	$	966	$	764	$	-
Commercial loans		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-

Generally, impaired loans with identified losses have been reduced by partial charge-offs and are carried at their estimated net realizable value. The Company believes no further allowance for loan losses were necessary at June 30, 2018 and December 31, 2017.

There were no loans modified as troubled debt restructurings during the three and six months ended June 30, 2018 and 2017 or commitments to lend additional funds to borrowers with loans whose terms have been modified as a troubled debt restructure.

At June 30, 2018 and December 31, 2017, there were no residential real estate loans in the process of foreclosure.

15

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The tables below present the average recorded investment of loans individually evaluated for impairment and the amount of interest earned on those loans for the three and six months ended June 30, 2018 and 2017:

	Three Months Ended								Six Months Ended
	June 30, 2018				June 30, 2017				June 30, 2018				June 30, 2017
	Average		Interest		Average		Interest		Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income
	Investment		Recognized		Investment		Recognized		Investment		Recognized		Investment		Recognized
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	582	$	11	$	647	$	11	$	580	$	22	$	650	$	21
One-to four-family, non-owner occupied		77		1		79		-		77		2		79		3
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		13		-		14		-		13		-		14		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
Commercial business loans		-		-		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24

16

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The following tables present the aging of past due loans as well as nonaccrual loans. Nonaccrual loans and accruing loans past due 90 days or more include both smaller balance homogenous loans and larger balance loans that are evaluated either collectively or individually for impairment.

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
June 30, 2018	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	190	$	-	$	96	$	42,194	$	42,480	$	-	$	96
One-to four-family, non-owner occupied		24		-		-		6,282		6,306		-		-
Commercial and multi-family		-		-		-		21,808		21,808		-		-
Construction and land		-		-		13		4,356		4,369		13		-
Commercial business loans		104		-		-		8,167		8,271		-		-
Consumer loans		-		-		-		1,716		1,716		-		-
	$	318	$	-	$	109	$	84,523	$	84,950	$	13	$	96

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
December 31, 2017	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	620	$	93	$	-	$	43,947	$	44,660	$	-	$	-
One-to four-family, non-owner occupied		24		-		39		6,588		6,651		-		39
Commercial and multi-family		-		-		-		23,790		23,790		-		-
Construction and land		-		-		-		3,619		3,619		13		-
Commercial business loans		-		-		-		2,048		2,048		-		-
Consumer loans		-		-		-		1,584		1,584		-		-
	$	644	$	93	$	39	$	81,576	$	82,352	$	13	$	39

Loan Grades:

Loan Grades:

The Company utilizes a grading system whereby all loans are assigned a grade based on the risk profile of each loan. Loan grades are determined based on an evaluation of relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. All loans, regardless of size, are analyzed and are given a grade based upon the management’s assessment of the ability of borrowers to service their debts.

Pass: Loan assets of this grade conform to a preponderance of our underwriting criteria and are acceptable as a credit risk, based upon the current net worth and paying capacity of the obligor. Loans in this category also include loans secured by liquid assets and secured loans to borrowers with unblemished credit histories.

Pass-Watch: Loan assets of this grade represent our minimum level of acceptable credit risk. This grade may also represent obligations previously rated “Pass”, but with significantly deteriorating trends or previously rated.

Special Mention: Loan assets of this grade have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard: Loan assets of this grade are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

17

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss: Loans classified loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future.

Loan Portfolio Segments:

The Company groups loans of similar type that share common risk characteristics. We segment our loan portfolio along with assigning individual risk grades to each loan as part of our methodology for determining our allowance for loan losses. Those portfolio segments and significant risk characteristics are as follows:

One-to four-family, owner occupied:   One-to four-family, owner occupied loans consist primarily of loans secured by first or second mortgages on primary residences, and are originated as primarily as fixed-rate loans for the construction, purchase or refinancing of a mortgage. These loans are collateralized by owner-occupied properties located in the Company’s market area. Repayment of these loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas, such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties.

The Company currently originates residential mortgage loans for our portfolio with loan-to-value ratios of up to 80% for traditional owner-occupied homes. For traditional homes, the Company may originate loans with loan-to-value ratios in excess of 80% if the borrower provides additional readily marketable collateral.

One-to four-family, non-owner occupied:   One-to four-family, non-owner occupied loans are similar to owner occupied one-to four-family loans in terms of collateral, but they carry greater inherent risks than owner occupied loans, since the repayment ability of the borrower is generally reliant on the success of the income generated from the property. The Company currently originates one-to four-family, non-owner occupied mortgage loans for our portfolio with loan-to-value ratios of up to 80% for traditional owner-occupied homes.

Commercial and multi-family:   Commercial real estate loans are secured primarily by office buildings, churches and various income producing properties. Multi-family real estate loans are secured by generally apartment complexes. Commercial and multifamily real estate loans are underwritten based on the economic viability of the property and creditworthiness of the borrower, with emphasis given to projected cash flow as a percentage of debt service requirements. These loans carry increased risks as they involve larger balances concentrated with single borrowers or groups of related borrowers. Repayment of loans secured by income producing properties depends on the successful operation of the real estate and the economy. The Company generally obtains personal guarantees on these loans.

The Company currently originates commercial and multi-family loans in amounts of up to 80% of the lesser of the appraised value or the purchase price of the property with an appropriate projected debt service coverage ratio.

Construction and Land:   The Company makes construction loans to individuals for the construction of their primary residences and to commercial businesses for their real estate needs. These loans generally have maximum terms of nine months, and upon completion of construction convert to conventional amortizing mortgage loans. Residential construction loans have rates and terms comparable to one-to-four family residential mortgage loans that the Company originates. Commercial construction loans have rates and terms comparable to other commercial real estate loans that we originate. During the construction phase, the borrower generally pays interest only. Generally, the maximum loan-to-value ratio of our owner-occupied construction loans is 80%. Residential construction loans are generally underwritten pursuant to the same guidelines used for originating permanent residential mortgage loans. Commercial construction loans are generally underwritten pursuant to the same guidelines used for originating other commercial real estate loans.

18

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The Company also makes interim construction loans for nonresidential properties. In addition, the Company occasionally makes loans for the construction of homes “on speculation,” but the Company generally permits a borrower to have only two such loans at a time. These loans generally have a maximum term of nine months, and upon completion of construction, borrowers can convert to conventional amortizing nonresidential real estate loans. These construction loans have rates and terms comparable to permanent loans secured by property of the type being constructed that we originate. Generally, the maximum loan-to-value ratio of these construction loans is 85%.

Commercial business loans:  Commercial, non-real estate, loans are offered to businesses and professionals in the Company’s market area. These loans generally have short and medium terms on a collateralized basis. The structure of these loans are largely determined by the loan purpose and collateral. Sources of collateral can include a lien on equipment, inventory, receivables and other assets of the company. A UCC-1 is typically filed to perfect our lien on these assets.

Commercial loans typically are underwritten on the basis of the borrower’s ability to make repayment from the cash flow of its business and generally are collateralized by business assets. As a result, such loans and leases involve additional complexities, variables and risks and require more thorough underwriting and servicing than other types of loans and leases. Repayment of commercial loans largely depends on the successful operation of the business for which and operating loan is utilized.

Consumer loans:  The Company offers installment loans for various consumer purposes, including the purchase of automobiles, boats, and for other legitimate personal purposes. The maximum terms of consumer loans is 12 months for unsecured loans and 12 to 60 months for loans secured by a vehicle, depending on the age of the vehicle. The Company generally only extends consumer loans to existing customers or their immediate family members, and these loans generally have relatively low balances. We also originate floating rate home equity lines of credit and home improvement loans secured by second mortgages.

Consumer loans may entail greater credit risk than a typical residential mortgage loan, particularly in the case of consumer loans that are unsecured or are secured by rapidly depreciable assets, such as automobiles. In addition, consumer loan collections are dependent on the borrower’s continuing financial stability, and thus are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount, which can be recovered on such loans.

19

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The following tables present total loans by risk grade and portfolio segment at June 30, 2018 and December 31, 2017:

					Special
June 30, 2018	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	40,464	$	649	$	144	$	1,223	$	-	$	-	$	42,480
One-to four-family, non-owner occupied		6,230		-		-		76		-		-		6,306
Commercial and multi-family		21,808		-		-		-		-		-		21,808
Construction and land		4,191		165		-		13		-		-		4,369
Commercial business loans		8,080		-		191		-		-		-		8,271
Consumer loans		1,716		-		-		-		-		-		1,716
	$	82,489	$	814	$	335	$	1,312	$	-	$	-	$	84,950

					Special
December 31, 2017	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	42,482	$	740	$	146	$	1,292	$	-	$	-	$	44,660
One-to four-family, non-owner occupied		6,535		-		-		116		-		-		6,651
Commercial and multi-family		23,790		-		-		-		-		-		23,790
Construction and land		3,438		168		-		13		-		-		3,619
Commercial business loans		1,844		-		204		-		-		-		2,048
Consumer loans		1,584		-		-		-		-		-		1,584
	$	79,673	$	908	$	350	$	1,421	$	-	$	-	$	82,352

20

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

(6) FHLB Advances

At June 30, 2018 and December 31, 2017, advances from the Federal Home Loan Bank were as follows:

	Interest			June 30,		December 31,
Maturity Date	Rate			2018		2017
February 12, 2018		1.27	%		-		3,000
March 12, 2018		4.92	%		-		1,000
July 18, 2018		1.84	%		3,000		3,000
July 18, 2019		2.21	%		2,000		2,000
September 18, 2018		2.14	%		2,000		-
January 2, 2019		2.19	%		2,000		-
April 10, 2019		2.38	%		1,500
October 2, 2019		2.46	%		2,000		-
Total				$	12,500	$	9,000

Each advance is payable at its maturity date, with a prepayment penalty if paid earlier than its maturity date. The advances were collateralized by $51,102 and $51,532 of first mortgage loans under a blanket lien arrangement at June 30, 2018 and December 31, 2017. Based on this collateral and the Company’s holdings of FHLB stock, the Company is eligible to borrow up to a total of $35,402 at June 30, 2018.

(7) EMPLOYEE STOCK OWNERSHIP PLAN

Employees participate in an Employee Stock Ownership Plan (“ESOP”). The ESOP borrowed from the Company to purchase 66,096 shares of the Company’s common stock at $10 per share on June 29, 2016. The Bank may make discretionary contributions to the ESOP and pays dividends on unallocated shares to the ESOP. The ESOP uses funds it receives to repay the loan. When loan payments are made, ESOP shares are allocated to participants based on relative compensation and expense is recorded. Any dividends on allocated shares increase participant accounts. Participants receive the shares at the end of employment.

No contributions to the ESOP were made during the three and six months ended June 30, 2018. The expense recognized for the three and six months ended June 30, 2018 and 2017 was $10 and $20, respectively, and is reported in salaries and wages.

ESOP shares at June 30, 2018 and December 31, 2017 are summarized as follows:

	June 30,		December 31,
	2018		2017
Committed to be released to participants		1,652		-
Allocated to participants		6,557		6,557
Unearned		57,887		59,539
Total ESOP shares		66,096		66,096
Fair value of unearned shares	$	677	$	697

21

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

(8) DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS

Net periodic cost for the defined benefit pension plan and postretirement medical plan for the three and six months ended June 30, 2018 and 2017 included the following components:

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Three Months Ended						Three Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		26			33			7			10
Expected return on plan assets		(32	)		(36	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		10			24			1			2
Unrecognized prior service cost		-			-			(2	)		(2	)
Asset (loss) gain deferred		-			-			-			-
Net periodic cost	$	565		$	21		$	6		$	10

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Six Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		56			66			15			18
Expected return on plan assets		(68	)		(72	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		34			49			2			4
Unrecognized prior service cost		-			-			(4	)		(4	)
Net periodic cost	$	583		$	43		$	13		$	18

The following table summarizes plan assets for the defined benefit pension plan, measured at fair value on a recurring basis at June 30, 2018 and December 31, 2017, segregated by the level of the inputs (as defined in Note 9) within the hierarchy used to measure fair value:

							Total
June 30, 2018	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,148	$	-	$	2,148

							Total
December 31, 2017	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,654	$	-	$	2,654

During the three and six months ended June 30, 2018, benefits paid, employer contributions and the actual return on plan assets for the defined benefit pension plan were $1,069, $600 and $8 and $1,185, $600 and $80 respectively. Of the benefits paid, $1,012 was paid as a result of retirement payments made to some of our previous employees. During the three and six months ended June 30, 2017, benefits paid, employer contributions, and the actual return on plan assets were $68, $100, and $55 and $137, $169 and $147, respectively.

22

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The Company’s defined benefit pension plan target allocations and weighted-average allocations by asset category are as follows:

		June 30,			December 31,
	Target Allocation
	2017	2018			2017
Pooled separate accounts
Equity	30%-40%		32	%		40	%
Debt	60%-70%		68	%		60	%

The Company’s investment strategy is to maintain a diversified investment portfolio. Rebalancing occurs on a periodic basis to maintain the target allocations, but normal market activity may result in deviations. As a result of the percentage of equities held, actual return of plan assets for any period may fluctuate significantly due to changes in the stock market.

Changes in accumulated other comprehensive loss associated with the defined benefit and postretirement medical plans are as follows:

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		10	$	24		1			2
Unrecognized prior service cost		-		-		(2	)		(2	)
		571		24		(1	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	571	$	24	$	(1	)	$	-

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		34		49		2			4
Unrecognized prior service cost		-		-		(4	)		(4	)
		595		49		(2	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	595	$	49	$	(2	)	$	-

23

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

(9) FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Investment Securities:

The fair values for investment securities are determined by quoted market prices, if available (Level 1). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).

Impaired Loans:

The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Real Estate Owned:

Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. Fair value is commonly based on recent real estate appraisals, which are updated no less frequently than annually. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Real estate owned properties are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Appraisals for both collateral-dependent impaired loans and real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, management reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics. On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what additional adjustment should be made to the appraisal value to arrive at fair value.

24

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

Assets and liabilities measured at fair value on a recurring basis at June 30, 2018 and December 31, 2017 are summarized below:

	Level 2
	June 30,		December 31,
	2018		2017
Financial Assets
Available-for-sale securities	$	14,302	$	16,211
	$	14,302	$	16,211

There were no financial or nonfinancial assets that required nonrecurring level 3 adjustments for the three and six months ended June 30, 2018 and 2017.

Fair Value of Financial Instruments

Many of the Company’s assets and liabilities are short-term financial instruments whose carrying amounts reported in the consolidated balance sheet approximate fair value and are considered Level 1 assets and liabilities. These items include cash and cash equivalents, accrued interest receivable and accrued interest payable balances. The estimated fair values of the Company’s remaining on-balance sheet financial instruments at June 30, 2018 and December 31, 2017 are summarized below:

	Carrying		Fair Value
	Amount		Level 1		Level 2		Level 3		Total
June 30, 2018
Financial assets
Available-for-sale securities	$	14,302	$	-	$	14,302	$	-	$	14,302
Restricted equity securities (1)		563		NA		NA		NA		NA
Loans, net		83,742		-		-		82,628		82,628
Financial liabilities
Deposits	$	83,502	$	24,184	$	59,353	$	-	$	83,537
FHLB Advances		12,500		-		12,484		-		12,484
December 31, 2017
Financial assets
Available-for-sale securities	$	16,211	$	-	$	16,211	$	-	$	16,211
Restricted equity securities (1)		405		NA		NA		NA		NA
Loans, net		81,128		-		-		81,686		81,686
Financial liabilities
Deposits	$	86,826	$	27,391	$	60,305	$	-	$	87,696
FHLB Advances		9,000		-		9,013		-		9,013

(1) It is not practicable to determine fair value of restricted equity securities due to restrictions placed on transferability.

25

BEST HOMETOWN BANCORP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share data)

The following methods and assumptions were used in estimating the fair values shown above:

Loans:

The fair value of loans is computed for each loan category using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality.

Deposits:

Deposits with no defined maturities, such as checking accounts, savings accounts and money market deposit accounts are, by definition, equal to the amount payable on demand at the balance sheet date. The fair values of certificate accounts are computed using interest rates currently being offered to deposit customers.

FHLB advances:

FHLB advances are valued at current market interest rates of FHLB advances.

Off-balance sheet commitments:

Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to either enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of commitments is not material.

26

PART 1. FINANCIAL INFORMATION

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s discussion and analysis of financial condition and results of operations at June 30, 2018 and for the three and six months ended June 30, 2018 and 2017 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements and the notes thereto, appearing in Part 1, Item 1 of this report.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Form 10-Q contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “will,” “may” and words of similar meaning. These forward-looking statements include, but are not limited to:

· statements of our goals, intentions and expectations;

· statements regarding our business plans, prospects, growth and operating strategies;

· statements regarding the asset quality of our loan and investment portfolios; and

· estimates of our risks and future costs and benefits.

These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this Form 10-Q, except as required by law.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

· general economic conditions, either nationally or in our market areas, that are worse than expected;

· competition among depository and other financial institutions;

· changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments;

· adverse changes in the securities markets;

· changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;

· our ability to enter new markets successfully and capitalize on growth opportunities;

· changes in consumer spending, borrowing and savings habits;

· changes in accounting policies and practices, as may be adopted by the Securities and Exchange Commission, the Financial Accounting Standards Board and the Public Company Accounting Oversight Board;

· changes in our organization, compensation and benefit plans;

· changes in our financial condition or results of operations that reduce capital; and

· changes in the financial condition or future prospects of issuers of securities that we own.

27

Additional factors that may affect our results are discussed in Best Hometown Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2017 as filed with the Securities and Exchange Commission on March 29, 2018, including under the section titled “Risk Factors”. These factors and the other factors listed above should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements.

Critical Accounting Policies

There are no material changes to the critical accounting policies disclosed in the Annual Report on Form 10-K for Best Hometown Bancorp, Inc. for the year ended December 31, 2017.

Comparison of Financial Condition at June 30, 2018 and December 31, 2017

Our total assets decreased by $531,000, or 0.48%, to $109.8 million at June 30, 2018 from $110.3 million at December 31, 2017. The decrease in total assets is primarily due to the net decrease of $1.4 million in total cash and cash equivalents and the decrease of $1.9 million in available-for-sale securities, offset partially by an increase of $2.6 million in gross loans. The decrease in total cash and cash equivalents reflects the use of available cash in originating new loans. The decrease in available-for-sale securities reflects the repayments of principal on available-for-sale securities of $1.6 million and an increase in gross unrealized losses on these securities of $205,000.

Gross loans increased by $2.6 million to $85.0 million at June 30, 2018 from $82.3 million at December 31, 2017. One-to four-family, owner occupied and non-owner in total decreased by $2.5 million to $48.8 million at June 30, 2018 from $51.3 million at December 31, 2017, which reflects normal principal reductions on amortizing loans and our shift in focus toward commercial and multi-family real estate and commercial business lending. Commercial and multi-family loans decreased modestly by $2.0 to $21.8 million at June 30, 2018 from $23.8 million at December 31, 2017. These decreases were offset by increases in construction and land loans, commercial business loans, and consumer loans, which increased in total by $7.1 million to a combined total for these portfolio segments of $14.3 million at June 30, 2018 from $7.2 million at December 31, 2017.

Available-for-sale securities decreased by $1.9 million, or 11.8%, to $14.3 million at June 30, 2018 from $16.2 million at at December 31, 2017. The decrease is attributable to paydowns on our mortgage-backed securities and an increase in unrealized losses on our securities portfolio of $205,000 to $588,000 at June 30, 2018 from $383,000 at December 31, 2017. The increase in total unrealized losses reflects the effects of rising interest rates on bond pricing.

Real estate owned, net remained the same. One foreclosure in the first quarter of 2018 on a one-to four-family loan was sold in the second quarter at a loss of $10,000.

Our deposits decreased $3.3 million, or 3.8%, to $83.5 million at June 30, 2018 from $86.8 million at December 31, 2017. Interest-bearing deposits decreased by $3.4 million, or 4.2%, to $78.3 million at June 30, 2018 from $81.7 million at December 31, 2017. This decrease was partially offset by an increase in our noninterest-bearing deposits of $122,000 or 2.42%, to $5.2 million at June 30, 2018 from $5.1 million at December 31, 2017. The decrease in interest-bearing deposits is attributable to a decrease in certificates of deposits from maturing certificates and customers moving the deposits into the market.

FHLB advances increased to $12.5 million at June 30, 2018 from $9.0 million at December 31, 2017. The increase of $3.5 million in FHLB advances reflects borrowings of $9.5 million of new advances and repayments of $6.0 of advances during the six months ended June 30, 2018. The weighted-average rate of our total outstanding advances is 2.17%.

Shareholders’ equity decreased by $345,000, or 2.8%, to $12.0 million at June 30, 2018 from $12.4 million at December 31, 2017. The decrease in shareholders’ equity reflects our net loss of $776,000 and an increase in net unrealized losses on available-for-sale securities of $163,000, offset partially by the decreases in accumulated other comprehensive losses related to our defined benefit and postretirement medical plans of $593,000, and the combined increase in our unearned ESOP and additional paid-in capital of $16,000 from the recognition of ESOP compensation expense for the six months ended June 30, 2018.

28

Nonperforming Assets

The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated.

	June 30,			December 31,
	2018			2017
	(Dollars in thousands)
Nonaccrual loans:
Real estate mortgage loans:
One- to four-family, owner occupied	$	-		$	-
One- to four-family, non-owner occupied		-			-
Commercial and multi-family		-			-
Construction and land		13			13
Commercial business loans		-			-
Consumer loans		-			-
Total nonaccrual loans		13			13
Accruing loans past due 90 days or more:
One- to four-family, non-owner occupied		-			39
Accruing troubled debt restructured loans:
Real estate mortgage loans:
One- to four-family, owner occupied		83			84
One- to four-family, non-owner occupied		-			-
Commercial and multi-family		-			-
Construction and land		-			-
Commercial business loans		-			-
Consumer loans		-			-
Total accruing troubled debt restructured loans		83			84
Total nonperforming loans		96			136
Foreclosed real estate held for sale:
One- to four-family		81			81
Commercial and multi-family		-			-
Construction and land		-			-
Total foreclosed real estate held for sale		81			81
Total nonperforming assets	$	177		$	217
Total nonperforming loans to total gross loans		0.11	%		0.17	%
Total nonperforming assets to total assets		0.16	%		0.20	%

Interest income that would have been recorded had our non-accruing loans been current in accordance with their original terms was less than $1,000 for the three and six months ended June 30, 2018 and 2017. No interest income was recognized on these loans during these periods.

Interest income that would have been recorded had our trouble debt restructured loan been current in accordance with its original term was $1,000 and $2,000 for both the three and six months ended June 30, 2018 and 2017. Interest income recognized for both the three and six months ended was $1,000 and $2,000 for the three and six months ended June 30, 2018 and 2017.

The decrease in nonperforming assets as a percentage of total gross loans reflection of strong credit quality within our loan portfolio.

29

Analysis of Net Interest Margin

The following table sets forth average balance sheets, average annualized yields and rates, and certain other information at and for the periods indicated. No tax-equivalent yield adjustments were made, as the effect thereof was not material. All average balances are daily average balances. Nonaccrual loans were included in the computation of average balances but have been reflected in the tables as loans carrying a zero yield. The yields set forth below include the effect of net deferred costs, discounts and premiums that are amortized or accreted to income.

	Three Months Ended
	June 30, 2018								June 30, 2017
				Interest								Interest
	Average			and		Yield/			Average			and		Yield/
	Balance			Dividends		Cost			Balance			Dividends		Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Loans	$	84,841		$	908		4.28	%	$	79,878		$	859		4.30	%
Investment securities		14,832			67		1.81			25,001			106		1.70
Interest-bearing deposits		1,631			9		2.21			1,744			7		1.61
Total interest-earning assets		101,304			984		3.89			106,623			972		3.65
Noninterest-earning assets		8,213								19,490
Total assets	$	109,517							$	126,113
Liabilities and equity:
Interest-bearing liabilities:
Checking accounts	$	406		$	1		0.99	%	$	446		$	1		0.90	%
Savings accounts		6,969			1		0.06			7,725			1		0.05
Money market accounts		12,494			17		0.55			14,367			17		0.47
Certificates of deposit		59,395			249		1.68			61,786			247		1.60
Total interest-bearing deposits		79,264			268		1.36			84,324			266		1.27
FHLB advances		8,786			62		2.83			11,074			51		1.85
Total interest-bearing liabilities		88,050			330		1.50			95,398			317		1.33
Noninterest bearing deposits		5,071								4,992
Other noninterest-bearing liabilities		2,168								2,213
Total liabilities		95,289								102,603
Equity		14,228								23,510
Total liabilities and equity	$	109,517							$	126,113
Net interest income				$	654							$	655
Interest rate spread							2.39	%							2.32	%
Net interest margin							2.58	%							2.46	%
Average interest-earning assets to average interest-bearing liabilities		1.15	X							1.12	X

30

	Six Months Ended
	June 30, 2018								March 31, 2017
				Interest								Interest
	Average			and		Yield/			Average			and		Yield/
	Balance			Dividends		Cost			Balance			Dividends		Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Loans	$	83,447		$	1,778		4.26	%	$	77,959		$	1,694		4.35	%
Investment securities		15,306			141		1.84			25,424			207		1.63
Interest-bearing deposits		1,748			20		2.29			2,414			16		1.33
Total interest-earning assets		100,501			1,939		3.86			105,797			1,917		3.62
Noninterest-earning assets		8,200								7,006
Total assets	$	108,701							$	112,803
Liabilities and equity:
Interest-bearing liabilities:
Checking accounts	$	440		$	2		0.92	%	$	444		$	1		0.45	%
Savings accounts		6,958			2		0.06			7,535			2		0.05
Money market accounts		13,407			36		0.54			13,830			31		0.45
Certificates of deposit		59,090			482		1.64			62,302			493		1.60
Total interest-bearing deposits		79,895			522		1.32			84,111			527		1.26
FHLB advances		8,786			105		2.41			8,715			89		2.06
Total interest-bearing liabilities		88,681			627		1.43			92,826			616		1.34
Noninterest bearing deposits		4,919								6,244
Other noninterest-bearing liabilities		4,524								2,213
Total liabilities		98,124								101,283
Equity		10,577								11,520
Total liabilities and equity	$	108,701							$	112,803
Net interest income				$	1,312							$	1,301
Interest rate spread							2.43	%							2.28	%
Net interest margin							2.61	%							2.46	%
Average interest-earning assets to average interest-bearing liabilities		1.13	X							1.14	X

Comparison of Operating Results for the Three Months Ended June 30, 2018 and 2017

General. We recognized a net loss of $675,000 for the three months ended June 30, 2018 compared to a net loss of $137,000 for the three months ended June 30, 2017. The increase in net loss was primarily attributed to a net increase in salaries and employee benefits of $529,000, or 124.5%, to $954,000 for the three months ended June 30, 2018 from $425,000 for the three months ended June 30, 2017. The increase was related to $561,000 in pension expense associated with settlement payments of pension benefits to some of our former employees.

Interest Income. Interest income increased $12,000, or 1.2%, to $984,000 for the three months ended June 30, 2018 from $972,000 for the three months ended June 30, 2017. The increase in interest income reflects the increase in the yield on interest-earning assets of 24.0 basis points to 3.89% for the three months ended June 30, 2018 from 3.65% for the three months ended June 30, 2017, which offset the decrease of $5.3 million, or 5.0%, in the average balances of our interest-earning assets to $101.3 million for the three months ended June 30, 2018 from $106.6 million for the three months ended June 30, 2017.

Interest income on loans increased by $49,000, 5.7%, to $908,000 for the three months ended June 30, 2018 from $859,000 for the three months ended June 30, 2017. The increase in loan interest income reflects the increase in the average balance of our loans of $4.9 million, or 5.7%, to $84.8 million for the three months ended June 30, 2018 from $79.9 million for the three months ended June 30, 2017, which offset the light decrease in the yield on our loans of 2.0 basis points to 4.28% from 4.30% for the same periods.

31

Interest income on investment securities decreased by $39,000, or 36.87% to $67,000 for the three months ended June 30, 2018 from $106,000 for the three months ended June 30, 2017. The decrease reflects a decrease in the average balance of our investment securities of $10.2 million, or 41.0%, to $14.8 million for the three months ended June 30, 2018 from $25.0 million for the three months ended June 30, 2017, which offset the increase in yield on our investment securities of 11 basis points to 1.81% for the three months ended June 30, 2018 from 1.70% for the three months ended June 30, 2017. The decrease in the average balance of our investment securities reflects paydowns on our available-for-sale investment portfolio and no purchases of securities for 2018 as we are investing available funds into new loans.

Interest from interest-bearing deposits increased to $9,000 for the three months ended June 30, 2018 from $7,000 for the three months ended June 30, 2017. The increase in interest income reflects higher rates paid on our excess funds on deposit with other institutions. Our yield on interest-bearing deposits increased to 2.21% for the three months ended June 30, 2018 from 1.61% for the three months ended June 30, 2017.

Interest Expense.  Interest expense increased by $13,000, or 4.10%, to $330,000 for the three months ended June 30, 2018 from $317,000 for the three months ended June 30, 2017. The increase in interest expense reflects both an increase in interest expense on deposits and FHLB advances. Our average cost of funds increased 17 basis points to 1.50 basis points for the three months ended June 30, 2018 from 1.33 basis points for the three months ended June 30, 2017.

Deposit interest expense increased by $2,000, or 0.75%, to $268,000 for the three months ended June 30, 2018 from $266,000. The increase in deposit interest expense reflects the increase in the average rate of our deposits to 1.36% for the three months ended June 30, 2018 from 1.27% for the three months ended June 30, 2017. Most of the increase in our average rate of deposits is attributable to certificates of deposits. Interest expense on certificates of deposit increased $2,000 to $249,000 for the three months ended June 30, 2018 from $247,000 for the three months ended June 30, 2017. The increase in the average rate of our certificates of deposit reflects a larger portion of higher rate, longer-term certificates within our total certificates of deposits. As shorter-term, lower rate certificates mature, depositors are beginning to invest their funds in the market as opposed to rolling their funds over into another certificate of deposit or into one of our other deposit products. This is evidenced by the decrease in the average balance of our deposits of $5.0 million, or 5.9%, to $79.3 million for the three months ended June 30, 2018 from $84.3 million at June 30, 2017.

Interest expense on FHLB advances increased by $11,000 or 21.6%, to $62,000 for the three months ended June 30, 2018 from $51,000 for the three months ended June 30, 2017. The increase in FHLB interest expense reflects the increase in the average cost of advances, which increased to 2.83% for the three months ended June 30, 2018 from 1.85% for the three months ended June 30, 2017. The increase in the average cost of advances offset the decrease in the average balance of FHLB advances to $8.8 million for the three months ended June 30, 2018 from $11.1 million for the three months ended June 30, 2017.

Net Interest Income. Net interest remained relative the same, decreasing slightly to $654,000 for the three months ended June 30, 2018 from $655,000 for the three months ended June 30, 2017.

Provision for Loan Losses. There was no provision for loan losses for the three months ended June 30, 2018 or 2017, which is a reflection of our continued strong credit quality as evidenced by our continued low and decreasing levels of nonperforming loans.

Our total allowance for loans losses was 1.4% of total gross loans at June 30, 2018 and 1.5% at December 31, 2017. We do not have an allowance for specifically identified impaired loans as we generally charge-off identified impairments on impaired loans to the allowance for loan losses to a net realizable value on those loans. As needed, we may have an unallocated portion in our general allowance that we believe represents those probable incurred losses within our loan portfolio not specifically identified with any particular portfolio segment.

Noninterest Income. Noninterest income increased $12,000, or 35.3%, to $46,000 for the three months ended June 30, 2018 from $34,000 for the three months ended June 30, 2017. The increase is primarily related to a loss on sales of securities of $19,000 for the three months ended June 30, 2017. There were no sales of securities or losses for the three months ended June 30, 2018.

Noninterest Expense. Noninterest expense increased $551,000, or 66.7%, to $1.4 million for the three months ended June 30, 2018 from $826,000 for the three months ended June 30, 2017. The increase was largely attributed to increases in salaries and employee benefits and data processing. Salaries and employee benefits increased by $529,000, or 124.5%, to $954,000 for the three months ended June 30, 2018 as compared to $425,000 for the three months ended June 30, 2017. This increase was attributable to $561,000 in pension expense recognized as a result of pension settlement payments to some of our former employees. The increase in data processing expenses reflects certain upgrades to our existing core operating system capabilities.

32

Income Tax Expense. There was no provision for income taxes for the three months ended June 30, 2018 or June 30, 2017. A valuation allowance has been recorded against all components of the net deferred tax asset, except for the unrealized loss on available-for-sale securities, based upon our cumulative operating losses in recent years.

The deferred tax asset will only be recognized in future periods upon the Company’s ability to realize and maintain profitable results of operations.

Comparison of Operating Results for the Six Months Ended June 30, 2018 and 2017

General. We recognized a net loss of $776,000 for the six months ended June 30, 2018 compared to a net loss of $252,000 for the six months ended June 30, 2017. The increase in net loss was primarily attributed to a net increase in noninterest expense of $582,000, or, 36.1%, to $2.2 million for the six months ended June 30, 2018 compared to $1.6 million for the six months ended June 30, 2017. This increase was largely attributed to an increase in salaries and employee benefits of $533,000, or 62.6%, to $1.4 million for the six months ended June 30, 2018 from $852,000 for the six months ended June 30, 2017. The increase was related to $561,000 in pension expense associated with settlement payments of pension benefits to some of our former employees. The increase in noninterest expense was partially offset by increases in net interest income of $11,000 and noninterest income of $48,000 for the three months ended June 30, 2018 as compared to 2017.

Interest Income. Interest income increased by $22,000, or 1.1%, to $1.9 million for the six months ended June 30, 2018. The increase in interest income reflects the increase in the yield on interest-earning assets of 8.0 basis points to 3.86% for the six months ended June 30, 2018 from 3.62% for the six months ended June 30, 2017. The increase in yield offset the decrease in the average balance of our interest-earning assets to $100.5 million for the six months ended June 30, 2018 from $105.8 million for the six months ended June 30, 2017. The increase in the yield on interest-earning assets reflects changes to the asset portfolio mix and a shift towards higher-yielding assets.

Interest income on loans increased by $84,000, or 5.0%, to $1.8 million for the six months ended June 30, 2018 from $1.7 million for the six months ended June 30, 2017. The increase in loan interest income reflects the increase in the average balance of our loans of $5.4 million, or 6.9%, to $83.4 million for the six months ended June 30, 2018 from $78.0 million for the six months ended June 30, 2017, which offset the decrease in yield on our loans of 8.0 basis points to 4.26% from 4.35%. The increase in the average balance of our loans reflects increased loan demand in our market area.

Interest income on investment securities decreased by $66,000, or 31.9% to $141,000 for the six months ended June 30, 2018 from $207,000 for the six months ended June 30, 2017. The decrease reflects a decrease in the average balance of our investment securities to $15.3 million for the six months ended June 30, 2018 compared to $25.4 million for the six months ended June 30, 2017. The decrease in the average balance of our investment securities more than offset the increase in yield of 21 basis points to 1.84% from 1.63% for the same periods. The decrease in the average balance of our investment securities reflects paydowns on our available-for-sale investment portfolio and no purchases of securities for 2018 as we are investing available funds into new loans.

Interest from interest-bearing deposits increased to $20,000 for the six months ended June 30, 2018 from $16,000 for the six months ended June 30, 2017. The increase in interest income reflects higher rates paid on our excess funds on deposit with other institutions. Our yield on interest-bearing deposits increased to 2.29% for the six months ended June 30, 2018 from 1.33% for the six months ended June 30, 2017.

Interest Expense.  Interest expense increased by $11,000, or 1.8%, to $627,000 for the six months ended June 30, 2018 from $616,000 for the six months ended June 30, 2017. The increase in interest expense is primarily related to interest expense on FHLB advances. Our average cost of funds increased 9.0 basis points to 1.43% for the six months ended June 30, 2018 from 1.34% for the six months ended June 30, 2017.

Deposit interest expense decreased by $5,000, or 0.95%, to $522,000 for the six months ended June 30, 2018 from $527,000. The decrease in deposit interest expense reflects the decrease in the average balance of our deposits by $4.2 million, or 5.0%, to $80.0 million for the six months ended June 30, 2018 from $84.1 million for the six months ended June 30, 2017. The decrease in the average balance of our deposits more than offset the increase in the average rate on our deposits of 5.0 basis points to 1.32 from 1.26 for the same periods. The largest decrease in our deposits came from a decrease of $3.2 million, or 5.1%, in certificates of deposit to $59.1 million for the six months ended June 30, 2018 from $62.3 million for the six months ended June 30, 2017. The decrease in the average balance of our deposits is primarily attributed to the decrease in the average balance of our certificates of deposit. As certificates mature, some customers are investing their funds in the market as opposed to rolling their funds into another certificate of deposit or into one of our other deposit products.

33

Interest expense on FHLB advances increased by $16,000 or 18.0%, to $105,000 for the six months ended June 30, 2018 from $89,000 for the six months ended June 30, 2017. The increase in FHLB interest expense reflects the increase in the average rate on advances, which increased to 2.41% for the six months ended June 30, 2018 from 2.06% for the six months ended June 30, 2017. The average balance of our FHLB advances remained relatively the same for the six months ended 2018 and 2017.

Net Interest Income. Net interest income increased $11,000, or 0.85%, to $1.3 million for the six months ended June 30, 2018, which was largely a reflection of the increases in our interest rate spread and net interest margin. The interest rate spread increased to 2.43% for the six months ended June 30, 2018 from 2.29% for the six months ended June 30, 2017, and our net interest margin increased to 2.61% from 2.46% for the same periods.

Provision for Loan Losses. There was no provision for loan losses for the six months ended June 30, 2018 or 2017, which is a reflection of our continued strong credit quality as evidenced by our continued low and decreasing levels of nonperforming loans.

Our total allowance for loans losses was 1.5% of total gross loans at June 30, 2018 and December 31, 2017. We do not have an allowance for specifically identified impaired loans as we generally charge-off identified impairments on impaired loans to the allowance for loan losses to a net realizable value on those loans. As needed, we may have an unallocated portion in our general allowance that we believe represents those probable incurred losses within our loan portfolio not specifically identified with any particular portfolio segment.

Noninterest Income. Noninterest income increased $48,000, or 84.2%, to $105,000 for the six months ended June 30, 2018 from $57,000 for the six months ended June 30, 2017. The increase is primarily related to the increase of $23,000 of income on bank owned life insurance for the six months ended June 30, 2018 to $51,000 from $28,000 for the six months ended June 30, 2017 and to a net loss of $19,000 on sales of investment securities for the six months ended June 30, 2017. In March of 2017, we purchased $3.4 million in bank owned life insurance. Therefore, income on bank owned life insurance for the six months ended June 30, 2017 only reflects approximately 3 months. An additional increase in noninterest income came from deposit service charges, which increased $9,000, or 23.1%, to $48,000 for the six months ended June 30, 2018 from $39,000 for the six months ended June 30, 2017.

Noninterest Expense. Noninterest expense increased $582,000, or 36.1%, to $2.2 million for the six months ended June 30, 2018 from $1.6 million for the six months ended June 30, 2017. The increase was largely attributed to increases in salaries and employee benefits and data processing. Salaries and employee benefits increased by $533,000, or 62.6%, to $1.4 million for the six months ended June 30, 2018 as compared to $852,000 for the six months ended June 30, 2017. This increase was attributable to $561,000 in pension expense recognized as a result of pension settlement payments to some of our former employees. The increase in data processing expenses reflects certain upgrades to our existing core operating system capabilities.

Income Tax Expense. There was no provision for income taxes for the six months ended June 30, 2018 or June 30, 2017. A valuation allowance has been recorded against all components of the net deferred tax asset, except for the unrealized loss on available-for-sale securities, based upon our cumulative operating losses in recent years.

The deferred tax asset will only be recognized in future periods upon the Company’s ability to realize and maintain profitable results of operations.

Liquidity and Capital Resources

Our primary sources of funds consist of deposit inflows, loan repayments, FHLB advances, and repayments, maturities and calls of investment securities. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and mortgage prepayments are greatly influenced by general interest rates, economic conditions and competition. Our Asset/Liability Committee is responsible for establishing and monitoring our liquidity targets and strategies in order to ensure that sufficient liquidity exists for meeting the borrowing needs and deposit withdrawals of our customers as well as unanticipated contingencies. We believe that we have enough sources of liquidity to satisfy our short- and long-term liquidity needs as of June 30, 2018.

We regularly monitor and adjust our investments in liquid assets based upon our assessment of: (i) expected loan demand; (ii) expected deposit flows; (iii) yields available on interest-earning deposits and securities; and (iv) the objectives of our asset/liability management program. Excess liquid assets are invested generally in interest-earning and non interest-earning deposits and short- and medium-term securities.

34

Liquidity management is both a daily and long-term function of business management. If we require funds beyond our ability to generate them internally, we have borrowing agreements with the Federal Home Loan Bank of Chicago (FHLB) that provide an additional source of funds. Our FHLB advances totaled $12.5 million at June 30, 2018. In addition, the Company has an irrevocable standby letter of credit with the FHLB of $3.2 million at June 30, 2018 to secure public deposits. At June 30, 2018, we had the ability to borrow up to an additional $35.4 million from the FHLB, subject to pledging additional collateral. We also have an unused open line of credit at The Independent BankersBank that would allow us to borrow up to $2.5 million at June 30, 2018.

The Company is subject to various regulatory capital requirements, including a risk-based capital measure. The risk-based capital guidelines include both a definition of capital and a framework for calculating risk-weighted assets by assigning balance sheet assets and off-balance sheet items to broad risk categories. At June 30, 2018 and December 31, 2017, the Company exceeded all regulatory capital requirements. The Company is considered “well capitalized” under regulatory guidelines.

The net proceeds from the stock offering significantly increased our liquidity and capital resources. Over time, the initial level of liquidity will be reduced as net proceeds from the stock offering are used for general corporate purposes, including the funding of new loans. Our results of operations will be enhanced by the net proceeds from the stock offering, resulting in increased net interest income. However, due to the increase in equity resulting from the net proceeds raised in the stock offering, our return on equity will be adversely affected.

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable, as the Registrant is a smaller reporting company.

ITEM 4. Controls and Procedures

An evaluation was performed under the supervision and with the participation of the Company’s management, including the President and Chief Executive Officer and the Principal Financial Officer, of the effectiveness of the design and operation of the Bank’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended) as of June 30, 2018. Based on that evaluation, the Company’s management, including the President and Chief Executive Officer and the Principal Financial Officer, concluded that the Registrant’s disclosure controls and procedures were effective.

During the quarter ended June 30, 2018, there have been no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

ITEM 1. LEGAL PROCEEDINGS

The Company is subject to various legal actions arising in the normal course of business. In the opinion of management, the resolution of these legal actions is not expected to have a material adverse effect on the Company’s financial condition or results of operations.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Best Hometown Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2017 (“Form 10-K”) as filed with the Securities and Exchange Commission on March 29, 2018, including under the section titled “Risk Factors, which could materially affect our business, financial condition or future results. Additional risks not presently known to us, or that we currently deem immaterial, may also adversely affect our business, financial condition or results of operations. At June 30, 2018, the risk factors for Best Hometown Bancorp, Inc. have not changed materially from those reported in our Form 10-K. However, the risks described in the Form 10-K are not the only risks that we face.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not applicable.

35

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The exhibits required by Item 601 of Regulation S-K are included with this Form 10-Q and are listed in the “Index to Exhibits” immediately following the Signatures.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BEST HOMETOWN BANCORP, INC.
Date: August 14, 2018	/s/ Ronnie R. Shambaugh
	Ronnie R. Shambaugh
	President and Chief Executive Officer
Date: August 14, 2018	/s/ Jennifer M. Lanzafame
	Jennifer M. Lanzafame
	Principal Financial Officer

36

INDEX TO EXHIBITS

Exhibit number	Description
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes- Oxley Act of 2002
32.1	Certification of Chief Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.0	The following materials from Best Hometown Bancorp, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018, formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Loss, (iv) the Condensed Consolidated Statements of Stockholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Condensed Consolidated Financial Statements

37

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Ronnie R. Shambaugh, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Best Hometown Bancorp, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2018	/s/ Ronnie R. Shambaugh
	Ronnie R. Shambaugh
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Principal Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Jennifer M. Lanzafame, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Best Hometown Bancorp, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiary, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provided reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2018	/s Jennifer M. Lanzafame
	Jennifer M. Lanzafame
	Principal Financial Officer

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Ronnie R. Shambaugh, President and Chief Executive Officer of Best Hometown Bancorp, Inc., (the “Company”) and Jennifer M. Lanzafame, Principal Financial Officer of the Company, each certify in his capacity as an officer of the Company that they have reviewed the quarterly report on Form 10-Q for the quarter ended June 30, 2018 (the “Report”) and that to the best of their knowledge:

1. the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 14, 2018	/s/ Ronnie R. Shambaugh
	Ronnie R. Shambaugh
	President and Chief Executive Officer
Date: August 14, 2018	/s/ Jennifer M. Lanzafame
	Jennifer M. Lanzafame
	Principal Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 10, 2018
Document And Entity Information [Abstract]
Entity Registrant Name	Best Hometown Bancorp, Inc.
Entity Central Index Key	0001667840
Trading Symbol	btht
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		826,208
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
ASSETS
Cash and due from banks	$ 1,744	$ 1,331
Interest-earning deposits in banks	2,082	3,859
Total cash and cash equivalents	3,826	5,190
Available-for-sale securities	14,302	16,211
Loans	84,961	82,343
Allowance for loan losses	(1,219)	(1,215)
Net loans	83,742	81,128
Premises and equipment, net	3,212	3,312
Bank owned life insurance	3,534	3,482
Real estate owned, net	81	81
Accrued interest receivable
Investment securities	250	249
Loans receivable	46	51
Deferred tax asset	124	80
Restricted equity securities	563	405
Other assets	82	104
Total assets	109,762	110,293
Deposits
Noninterest-bearing	5,204	5,082
Interest-bearing	78,298	81,744
Total deposits	83,502	86,826
Federal Home Loan Bank ("FHLB") advances	12,500	9,000
Accrued defined benefit pension and postretirement plans	1,175	1,785
Other liabilities	448	219
Total liabilities	97,625	97,830
Commitments and contingencies
Redeemable common stock held by ESOP plan	96	77
SHAREHOLDERS' EQUITY
Preferred stock, $0.01 par value, 1,000,000 shares authorized; none issued and outstanding
Common stock, $0.01 par value, 30,000,000 shares authorized, 826,208 shares issued and outstanding	8	8
Additional paid-in capital	6,851	6,847
Retained earnings - substantially restricted	7,320	8,096
Unearned Employee Stock Ownership Plan ("ESOP") common stock, 57,887 and 59,539 shares	(579)	(595)
Accumulated other comprehensive loss, net of tax:
Net unrealized losses on available-for-sale securities	(465)	(302)
Net unrealized losses on defined benefit pension plan and postretirement medical plans, net	(998)	(1,591)
Total accumulated other comprehensive loss, net of tax	(1,463)	(1,893)
Less maximum cash obligation related to ESOP shares	(96)	(77)
Total shareholders' equity	12,041	12,386
Total liabilities and shareholders' equity	$ 109,762	$ 110,293

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	30,000,000	30,000,000
Common stock, shares issued	826,208	826,208
Common stock, shares outstanding	826,208	826,208
Number of shares of unearned employee stock ownership plan	57,887	59,539

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Interest income:
Loans receivable	$ 908	$ 859	$ 1,778	$ 1,694
Investment securities, taxable	67	106	141	207
Other interest-earning assets	9	7	20	16
Total interest income	984	972	1,939	1,917
Interest expense:
Deposits	268	266	522	527
Advances from FHLB	62	51	105	89
Total interest expense	330	317	627	616
Net interest income	654	655	1,312	1,301
Provision for loan losses	0	0	0	0
Net interest income after provision for loan losses	654	655	1,312	1,301
Noninterest income:
Service charges on deposit accounts	22	22	48	39
Income on bank owned life insurance	25	26	51	28
Loss on sales of securities		(19)		(19)
Gain (loss) on sale of real estate owned	(10)	1	(10)	1
Other	9	4	16	8
Total noninterest income	46	34	105	57
Noninterest expense:
Salaries and employee benefits	954	425	1,385	852
Occupancy and equipment	117	116	240	234
Data processing	86	50	157	106
Professional and supervisory fees	113	133	212	225
Office expense	12	10	24	24
Advertising	13	17	25	33
FDIC deposit insurance	6	8	14	15
Provision for real estate owned and related expenses	4	14	10	15
Other	70	53	126	107
Total noninterest expense	1,375	826	2,193	1,611
Loss before income taxes	(675)	(137)	(776)	(252)
Income tax expense	0	0	0	0
Net loss	$ (675)	$ (137)	$ (776)	$ (252)
Basic net loss per share (in dollars per share)	$ (0.88)	$ (0.18)	$ (1.01)	$ (0.33)

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Statement of Comprehensive Income [Abstract]
Net loss	$ (675)	$ (137)	$ (776)	$ (252)
Unrealized gain (loss) on available-for-sale securities:
Unrealized holding gain (loss) arising during the period	(49)	18	(205)	36
Reclassification adjustment for gains (losses) included in net income		19		19
Tax effect	10	(12)	42	(18)
Net of tax	(39)	25	(163)	37
Defined benefit pension and post retirement medical plans:
Net gain (loss) arising during the period on plans	0	0	0	0
Reclassification adjustment for settlement of portion of accumulated benefit obligation	561		561
Reclassification adjustment for amortization of prior service cost and net gain/loss included in net periodic pension cost	8	24	32	49
Tax effect	0	0	0	0
Net of tax	569	24	593	49
Total other comprehensive income	530	49	430	86
Comprehensive loss	$ (145)	$ (88)	$ (346)	$ (166)

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CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Common Stock	Additional Paid-In Capital	Retained Earnings	Unearned ESOP Shares	Net Unrealized Losses On Available-for-sale Securities, Net	Net Unrealized Losses On Defined Benefit Pension and Postretirement Medical Plans, Net	Maximum Cash Obligation Related to ESOP Shares	Total
Balance at Dec. 31, 2016	$ 8	$ 6,839	$ 8,330	$ (628)	$ (269)	$ (1,481)	$ (41)	$ 12,758
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss			(252)					(252)
Other comprehensive income					37	49		86
ESOP shares earned		4		16				20
Change related to ESOP shares cash obligation							(21)	(21)
Balance at Jun. 30, 2017	8	6,843	8,078	(612)	(232)	(1,432)	(62)	12,591
Balance at Dec. 31, 2017	8	6,847	8,096	(595)	(302)	(1,591)	(77)	12,386
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss			(776)					(776)
Other comprehensive income					(163)	593		430
ESOP shares earned		4		16				20
Change related to ESOP shares cash obligation							(19)	(19)
Balance at Jun. 30, 2018	$ 8	$ 6,851	$ 7,320	$ (579)	$ (465)	$ (998)	$ (96)	$ 12,041

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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities:
Net loss	$ (776)	$ (252)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization, net	282	368
Income on bank owned life insurance	(51)	(28)
(Gain) loss on sale of real estate owned	10	(1)
(Gain) loss on sales of securities		19
ESOP compensation expense	20	20
Net change in operating assets and liabilities:
Accrued interest receivable	4
Accrued interest payable	6	(4)
Other	225	(67)
Net cash provided by (used in) operating activities	(280)	55
Cash flows from investing activities:
Loan originations and repayments, net	(2,672)	(5,141)
Purchases of available-for-sale securities		(1,816)
Proceeds from maturities, paydowns and calls of available-for-sale securities	1,562	2,710
Proceeds from sales of available-for-sale securities		2,998
Purchase of bank owned life insurance		(3,400)
Redemptions (purchases) of FHLB stock, net	(158)	432
Purchases of premises and equipment	(20)	(430)
Proceeds from sale of foreclosed real estate	28	32
Net cash (used in) investing activities	(1,260)	(4,615)
Cash flows from financing activities:
Net change in deposits	(3,324)	689
Borrowings of FHLB advances	9,500	3,000
Repayments of FHLB advances	(6,000)
Net cash provided by financing activities	176	3,689
Change in cash and cash equivalents	(1,364)	(871)
Cash and cash equivalents at beginning of period	5,190	5,459
Cash and cash equivalents at end of period	3,826	4,588
Cash paid during the period for:
Interest on deposits	522	527
Interest on advances from FHLB	98	92
Real estate acquired in settlement of loans	$ 38	$ 113

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

BASIS OF PRESENTATION

(1) BASIS OF PRESENTATION

General

On June 29, 2016, Best Hometown Bank (the “Bank”) (formerly known as Home Federal Savings and Loan Association of Collinsville) completed its conversion (the “Conversion”) from a federally-chartered mutual savings association to the capital stock form of organization, including the establishment of a stock holding company, Best Hometown Bancorp, Inc. (referred to herein as “the Company,” “we,” “us,” or “our”), as parent of the Bank. The stock holding company is organized under the laws of the State of Maryland and owns all of the outstanding common stock of the Bank. In connection with the Conversion, the Company sold 826,208 shares of its common stock, including 66,096 shares (8% of shares sold) that were purchased by the Bank’s employee stock ownership plan (“ESOP”), at a price of $10.00 per share, for gross offering proceeds of $8.3 million. The cost of the conversion and issuance of common stock was $1.4 million, which was deducted from the gross offering proceeds. The Company contributed $5.0 million of the net proceeds from the offering by the Company to the Bank, and $1.2 million was retained by the Company. In addition, $661,000 of the net proceeds were used to fund a loan to the ESOP, with which the ESOP purchased Company shares.

Voting rights are held and exercised exclusively by the shareholders of the holding company. Deposit account holders continue to be insured by the FDIC up to the applicable limits. A liquidation account was established in an amount equal to the Bank’s total equity as of the latest balance sheet date in the final offering circular used in the conversion. Each eligible account holder or supplemental account holder are entitled to a proportionate share of this account in the event of a complete liquidation of the Bank, and only in such event. This share will be reduced if the eligible account holder’s or supplemental account holder’s deposit balance falls below the amounts on the date of record and will cease to exist if the account is closed. The liquidation account will never be increased despite any increase after conversion in the related deposit balance.

The Bank may not pay a dividend on its capital stock, if the effect thereof would cause retained earnings to be reduced below the liquidation account amount or regulatory capital requirements. In addition, the stock holding company is subject to certain regulations related to the repurchase of its capital stock.

The Conversion was accounted for as a change in corporate form with the historic basis of the Bank’s assets, liabilities and equity unchanged as a result.

The accompanying unaudited consolidated financial statements of Best Hometown Bancorp, Inc., which include the accounts of its wholly owned subsidiary Best Hometown Bank have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Intercompany accounts and transactions are eliminated during consolidation.

In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included to present fairly the financial position as of June 30, 2018 and December 31, 2017 and the results of operations and cash flows for the six months ended June 30, 2018 and 2017. All interim amounts have not been audited and the results of operations for the three and six months ended June 30, 2018, herein are not necessarily indicative of the results of operations to be expected for the entire year.

Cash and cash equivalents include cash on hand, federal funds sold, overnight interest-bearing deposits and amounts due from other depository institutions.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of foreclosed real estate, fair values of financial instruments, measurement of defined benefit pension and postretirement medical plans and valuation of deferred tax assets.

Contingencies

The Company is involved in certain legal actions arising from normal business activities. Management believes that the outcome of such proceedings will not have any material adverse effect on the financial statements of the Company.

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NEW ACCOUNTING STANDARDS

6 Months Ended

Jun. 30, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

NEW ACCOUNTING STANDARDS

(2) NEW ACCOUNTING STANDARDS

The Company is an emerging growth company and as such will be subject to the effective dates noted for the private companies if they differ from the effective dates noted for public companies.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326) — Measurement of Credit Losses on Financial Instruments. The provisions of ASU 2016-13 were issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other commitments to extend credit held by a reporting entity at each reporting date. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 eliminate the probable incurred loss recognition in current GAAP and reflect an entity’s current estimate of all expected credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the financial assets.

For purchased financial assets with a more-than-insignificant amount of credit deterioration since origination (“PCD assets”) that are measured at amortized cost, the initial allowance for credit losses is added to the purchase price rather than being reported as a credit loss expense. Subsequent changes in the allowance for credit losses on PCD assets are recognized through the statement of income as a credit loss expense.

Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a direct write-down to the security.

As an emerging growth company, ASU 2016-13 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years beginning after December 15, 2021. The Company is reviewing the technology required to source and models data for the purposes of meeting this standard. While the Company generally expects to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, the Company cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial statements.

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016 the FASB issued ASU 2016-08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in determining revenue recognition as principal versus agent. In April 2016, the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In May 2016, the FASB issued ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

As an emerging growth company, these amendments are effective for annual reporting periods beginning after December 15, 2018, and for interim periods within annual periods beginning after December 15, 2019. The Company’s revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09.    The Company is continuing to evaluate the impact of adopting ASU 2014-09, but does not expect the impact to have a material impact on the Company’s financial position or results of operation.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update provides guidance on the classification of certain cash receipts and cash payments for presentation in the statement of cash flows. As an emerging growth company, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. The Company believes that the adoption of this ASU will not have a material effect to our consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. The portion of ASU 2016-01 that is likely to have an effect on our financial statements and disclosures relates a clarification of accounting standards with respect to deferred tax assets arising from unrealized losses on available-for-sale securities. This ASU 2016-01 requires an entity to evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.

As an emerging growth company, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within years beginning after December 15, 2019.  Early adoption of the amendments in the update is not permitted, except that early application by public business entities to financial statements of fiscal years or interim periods that have not yet been issued or, by all other entities, that have not yet been made available for issuance, are permitted as of the beginning of the fiscal year of adoption for the following amendment: An entity should present separately in other comprehensive income the portion of the total change in the fair value of a liability at fair value in accordance with the fair value option for financial instruments.  An entity should apply the amendments to this update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption.  The Company is continuing to evaluate the impact of adopting this new guidance on its consolidated financial statements, but the adoption of ASU 2016-01 is not expected to have a material impact on the Company’s financial position or results of operation.

Adoption of New Accounting Pronouncement

Effective December 31, 2017, the Company early adopted guidance related to income taxes. The new guidance was applied in the period of adoption. Current accounting principles require that the effect of a change in tax laws or rates on deferred tax liabilities or assets to be included in income from continuing operations in the reporting period that includes the enactment date, even if the related income tax effects were originally charged or credited directly to accumulated other comprehensive income (“AOCI”). The Company’s accounting policy for the release of stranded tax effects in AOCI in on an aggregate portfolio basis. The new guidance allows a reclassification of AOCI to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“US Tax Reform”). The Company early adopted this standard effective December 31, 2017 and reclassified $300 from AOCI to retained earnings due to re-measuring from 35% to 21% the federal deferred taxes on the accumulated other comprehensive income components related to available for sale securities, and the defined benefit and postretirement medical plans.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

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EARNINGS (LOSS) PER SHARE

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

EARNINGS (LOSS) PER SHARE

(3) EARNINGS (LOSS) PER SHARE

Basic EPS or loss per common share is determined by dividing net earnings or loss available to common shareholders by the weighted average number of common shares outstanding for the period. ESOP shares are considered outstanding for this calculation unless unearned. The factors used in the earnings per common share computation follow:

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2018
Loss per share
Net loss	$	(675	)	$	(137	)	$	(776	)	$	(252	)
Weighted average common shares outstanding		826,208			826,208			826,208			826,208
Less: average unearned ESOP shares		(58,300	)		(61,466	)		(58,713	)		(62,017	)
Weighted average common shares outstanding		767,908			764,742			767,495			764,191
Basic loss per share	$	(0.88	)	$	(0.18	)	$	(1.01	)	$	(0.33	)

Given a net loss for the three and six months ended June 30, 2018 and 2017, only basic loss per share is applicable.

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SECURITIES AVAILABLE FOR SALE

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

SECURITIES AVAILABLE FOR SALE

(4) SECURITIES AVAILABLE FOR SALE

Debt and mortgage-backed securities have been classified in the condensed consolidated balance sheets according to management’s intent. U.S. Government agency mortgage-backed securities consist of securities issued by U.S. Government agencies and U.S. Government sponsored enterprises. Investment securities at June 30, 2018 and December 31, 2017 are as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
June 30, 2018	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	678	$	-	$	(33	)	$	645
U.S. Government agency mortgage-backed securities - residential		14,212		-		(555	)		13,657
	$	14,890	$	-	$	(588	)	$	14,302

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
December 31, 2017	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	786	$	-	$	(24	)	$	762
U.S. Government agency mortgage-backed securities - residential		15,808		-		(359	)		15,449
	$	16,594	$	-	$	(383	)	$	16,211

As of June 30, 2018 and December 31, 2017, no investment securities were pledged for public deposits.

The following tables show the fair value and unrealized loss of securities that have been in unrealized loss positions for less than twelve months and for more than twelve months at June 30, 2018 and December 31, 2017. The tables also show the number of securities in an unrealized loss position for each category of investment security as of the respective dates.

Because the actual cash flows for the Small Business Administration Program (“SBAP”) asset backed security and mortgage-backed securities may differ from their contractual maturities, a maturity table is not shown.

	Less than 12 Months						12 Months or Longer
					Number in							Number in
	Fair		Unrealized		Unrealized		Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss		Loss (1)		Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	-	$	-		-	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		-		-		-		13,657		(555	)		27
	$	-	$	-		-	$	14,302	$	(588	)		28

	Total
						Number in
	Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		13,657		(555	)		27
Total	$	14,302	$	(588	)		28

	Less than 12 Months							12 Months or Longer
						Number in							Number in
	Fair		Unrealized			Unrealized		Market		Unrealized			Unrealized
December 31, 2017	Value		loss			Loss (1)		Value		loss			Loss (1)
U.S. Government agency bonds	$	-	$	-			-	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		1,607		(15	)		3		13,842		(344	)		24
Total	$	1,607	$	(15	)		3	$	14,604	$	(368	)		25

	Total
						Number in
	Fair		Unrealized			Unrealized
December 31, 2017	Value		Loss			Loss (1)
U.S. Government agency bonds	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		15,449		(359	)		27
Total	$	16,211	$	(383	)		28

(1) Represents actual number of securities in an unrealized loss position.

The SBAP agency security is an investment comprised of a pool of loans issued under the Small Business Administration, which come with an unconditional guarantee by the U.S. government for the timely payment of principal and interest.

The Company evaluates securities for other-than-temporary impairments (“OTTI”) at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. The Company considers the length of time and the extent to which the fair value has been less than cost and the financial condition and near-term prospects of the issuer. Additionally, the Company considers its intent to sell or whether it will be more likely than not it will be required to sell the security prior to the security's anticipated recovery in fair value. In analyzing an issuer's financial condition, the Company may consider whether the securities are issued by Federal Government agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuer's financial condition.

Total fair value securities with unrealized losses at June 30, 2018 and December 31, 2017, was $14,302 and $16,211, which was 100% at June 30, 2018 and December 31, 2017, respectively, of the Company’s available-for-sale securities. None of the unrealized losses at June 30, 2018 were recognized into net income for the three or six months ended June 30, 2018 because the issuers’ bonds are of high credit quality, management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates. The fair value of these securities is expected to recover as they approach their maturity date or reset date. None of the unrealized losses at December 31, 2017 were recognized as having OTTI during the three or six months ended June 30, 2018.

There were no sales of securities for the three or six months ended June 30, 2018. For the three and six months ended June 20, 2017, proceeds and gross losses on sales of securities were $2,998 and $19, respectively.

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LOANS

6 Months Ended

Jun. 30, 2018

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

LOANS

(5) LOANS

The components of loans at June 30, 2018 and December 31, 2017 were as follows:

	June 30,		December 31,
	2018		2017
Real estate loans:
One-to four-family, owner occupied	$	42,480	$	44,660
One-to four-family, non-owner occupied		6,306		6,651
Commercial and multi-family		21,808		23,790
Construction and land		4,369		3,619
Commercial business loans		8,271		2,048
Consumer loans		1,716		1,584
		84,950		82,352
Net deferred loan (fees) costs		11		(9	)
Total	$	84,961	$	82,343

The following tables present the activity in the allowance for loan losses for the three and six months ended June 30, 2018 and 2017 by portfolio segment:

	Beginning									Ending
Three Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	513	$	(73	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		79		(4	)		-		2		77
Commercial and multi-family		401		(27	)		-		-		374
Construction and land		38		5			-		-		43
Commercial business loans		59		106			-		-		165
Consumer loans		43		1			-		-		44
Unallocated		84		(8	)		-		-		76
	$	1,217	$	-		$	-	$	2	$	1,219

	Beginning										Ending
Three Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	647	$	(60	)	$	(6	)	$	37	$	618
One-to-four family, non-owner occupied		109		(3	)		-			2		108
Commercial and multi-family		317		72			-			-		389
Construction and land		44		(8	)		-			7		43
Commercial business loans		41		(7	)		-			-		34
Consumer loans		34		6			-			-		40
Unallocated		-		-			-			-		-
	$	1,192	$	-		$	(6	)	$	46	$	1,232

	Beginning									Ending
Six Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	525	$	(85	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		81		(8	)		-		4		77
Commercial and multi-family		407		(33	)		-		-		374
Construction and land		34		9			-		-		43
Commercial business loans		41		124			-		-		165
Consumer loans		39		5			-		-		44
Unallocated		88		(12	)		-		-		76
	$	1,215	$	-		$	-	$	4	$	1,219

	Beginning										Ending
Six Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	657	$	(48	)	$	(34	)	$	43	$	618
One-to-four family, non-owner occupied		113		(8	)		-			3		108
Commercial and multi-family		309		80			-			-		389
Construction and land		42		(5	)		-			6		43
Commercial business loans		18		16			-			-		34
Consumer loans		26		14			-			-		40
Unallocated		49		(49	)		-			-		-
	$	1,214	$	-		$	(34	)	$	52	$	1,232

The following tables present the recorded balances of loans and amount of allowance allocated based upon impairment method by portfolio segment at June 30, 2018 and December 31, 2017:

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated for		Evaluated for
	Impairment		Impairment		Total		Impairment		Impairment		Total
June 30, 2018
Real estate loans:
One-to four-family, owner occupied	$	-	$	440	$	440	$	575	$	41,905	$	42,480
One-to four-family, non-owner occupied		-		77		77		76		6,190		6,306
Commercial and multi-family		-		374		374		-		21,808		21,808
Construction and land		-		43		43		13		4,356		4,369
Commercial business loans		-		165		165		-		8,271		8,271
Consumer loans		-		44		44		-		1,716		1,716
Unallocated		-		76		76		-		-		-
	$	-	$	1,219	$	1,219	$	664	$	84,246	$	84,950

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated		Evaluated
	Impairment		Impairment		Total		Impairment		Impairment		Total
December 31, 2017
Real estate loans:
One-to four-family, owner occupied	$	-	$	525	$	525	$	635	$	44,025	$	44,660
One-to four-family, non-owner occupied		-		81		81		116		6,535		6,651
Commercial and multi-family		-		407		407		-		23,790		23,790
Construction and land		-		34		34		13		3,606		3,619
Commercial business loans		-		41		41		-		2,048		2,048
Consumer loans		-		39		39		-		1,584		1,584
Unallocated		-		88		88		-		-		-
	$	-	$	1,215	$	1,215	$	764	$	81,588	$	82,352

The Company, at times, will maintain an unallocated allowance for loan losses due to uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance for loan losses is maintained to cover probable and incurred credit losses inherent in the loan portfolio but not captured in the general component, such as historical loss experience data that may not precisely correspond to individual loan portfolio segments and to uncertainties in economic conditions.

The tables below present loans that were individually evaluated for impairment by portfolio segment at June 30, 2018 and December 31, 2017.

	June 30, 2018						December 31, 2017
	Unpaid						Unpaid
	Principal		Recorded		Related		Principal		Recorded		Related
	Balance		Investment		Allowance		Balance		Investment		Allowance
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	729	$	575	$	-	$	800	$	635	$	-
One-to four-family, non-owner occupied		100		76		-		153		116		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		13		13		-		13		13		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	842	$	664	$	-	$	966	$	764	$	-
Commercial loans		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-

Generally, impaired loans with identified losses have been reduced by partial charge-offs and are carried at their estimated net realizable value. The Company believes no further allowance for loan losses were necessary at June 30, 2018 and December 31, 2017.

There were no loans modified as troubled debt restructurings during the three and six months ended June 30, 2018 and 2017 or commitments to lend additional funds to borrowers with loans whose terms have been modified as a troubled debt restructure.

At June 30, 2018 and December 31, 2017, there were no residential real estate loans in the process of foreclosure.

The tables below present the average recorded investment of loans individually evaluated for impairment and the amount of interest earned on those loans for the three and six months ended June 30, 2018 and 2017:

	Three Months Ended								Six Months Ended
	June 30, 2018				June 30, 2017				June 30, 2018				June 30, 2017
	Average		Interest		Average		Interest		Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income
	Investment		Recognized		Investment		Recognized		Investment		Recognized		Investment		Recognized
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	582	$	11	$	647	$	11	$	580	$	22	$	650	$	21
One-to four-family, non-owner occupied		77		1		79		-		77		2		79		3
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		13		-		14		-		13		-		14		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
Commercial business loans		-		-		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24

The following tables present the aging of past due loans as well as nonaccrual loans. Nonaccrual loans and accruing loans past due 90 days or more include both smaller balance homogenous loans and larger balance loans that are evaluated either collectively or individually for impairment.

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
June 30, 2018	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	190	$	-	$	96	$	42,194	$	42,480	$	-	$	96
One-to four-family, non-owner occupied		24		-		-		6,282		6,306		-		-
Commercial and multi-family		-		-		-		21,808		21,808		-		-
Construction and land		-		-		13		4,356		4,369		13		-
Commercial business loans		104		-		-		8,167		8,271		-		-
Consumer loans		-		-		-		1,716		1,716		-		-
	$	318	$	-	$	109	$	84,523	$	84,950	$	13	$	96

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
December 31, 2017	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	620	$	93	$	-	$	43,947	$	44,660	$	-	$	-
One-to four-family, non-owner occupied		24		-		39		6,588		6,651		-		39
Commercial and multi-family		-		-		-		23,790		23,790		-		-
Construction and land		-		-		-		3,619		3,619		13		-
Commercial business loans		-		-		-		2,048		2,048		-		-
Consumer loans		-		-		-		1,584		1,584		-		-
	$	644	$	93	$	39	$	81,576	$	82,352	$	13	$	39

Loan Grades:

Loan Grades:

The Company utilizes a grading system whereby all loans are assigned a grade based on the risk profile of each loan. Loan grades are determined based on an evaluation of relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. All loans, regardless of size, are analyzed and are given a grade based upon the management’s assessment of the ability of borrowers to service their debts.

Pass: Loan assets of this grade conform to a preponderance of our underwriting criteria and are acceptable as a credit risk, based upon the current net worth and paying capacity of the obligor. Loans in this category also include loans secured by liquid assets and secured loans to borrowers with unblemished credit histories.

Pass-Watch: Loan assets of this grade represent our minimum level of acceptable credit risk. This grade may also represent obligations previously rated “Pass”, but with significantly deteriorating trends or previously rated.

Special Mention: Loan assets of this grade have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard: Loan assets of this grade are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss: Loans classified loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future.

Loan Portfolio Segments:

The Company groups loans of similar type that share common risk characteristics. We segment our loan portfolio along with assigning individual risk grades to each loan as part of our methodology for determining our allowance for loan losses. Those portfolio segments and significant risk characteristics are as follows:

One-to four-family, owner occupied:   One-to four-family, owner occupied loans consist primarily of loans secured by first or second mortgages on primary residences, and are originated as primarily as fixed-rate loans for the construction, purchase or refinancing of a mortgage. These loans are collateralized by owner-occupied properties located in the Company’s market area. Repayment of these loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas, such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties.

The Company currently originates residential mortgage loans for our portfolio with loan-to-value ratios of up to 80% for traditional owner-occupied homes. For traditional homes, the Company may originate loans with loan-to-value ratios in excess of 80% if the borrower provides additional readily marketable collateral.

One-to four-family, non-owner occupied:   One-to four-family, non-owner occupied loans are similar to owner occupied one-to four-family loans in terms of collateral, but they carry greater inherent risks than owner occupied loans, since the repayment ability of the borrower is generally reliant on the success of the income generated from the property. The Company currently originates one-to four-family, non-owner occupied mortgage loans for our portfolio with loan-to-value ratios of up to 80% for traditional owner-occupied homes.

Commercial and multi-family:   Commercial real estate loans are secured primarily by office buildings, churches and various income producing properties. Multi-family real estate loans are secured by generally apartment complexes. Commercial and multifamily real estate loans are underwritten based on the economic viability of the property and creditworthiness of the borrower, with emphasis given to projected cash flow as a percentage of debt service requirements. These loans carry increased risks as they involve larger balances concentrated with single borrowers or groups of related borrowers. Repayment of loans secured by income producing properties depends on the successful operation of the real estate and the economy. The Company generally obtains personal guarantees on these loans.

The Company currently originates commercial and multi-family loans in amounts of up to 80% of the lesser of the appraised value or the purchase price of the property with an appropriate projected debt service coverage ratio.

Construction and Land:   The Company makes construction loans to individuals for the construction of their primary residences and to commercial businesses for their real estate needs. These loans generally have maximum terms of nine months, and upon completion of construction convert to conventional amortizing mortgage loans. Residential construction loans have rates and terms comparable to one-to-four family residential mortgage loans that the Company originates. Commercial construction loans have rates and terms comparable to other commercial real estate loans that we originate. During the construction phase, the borrower generally pays interest only. Generally, the maximum loan-to-value ratio of our owner-occupied construction loans is 80%. Residential construction loans are generally underwritten pursuant to the same guidelines used for originating permanent residential mortgage loans. Commercial construction loans are generally underwritten pursuant to the same guidelines used for originating other commercial real estate loans.

The Company also makes interim construction loans for nonresidential properties. In addition, the Company occasionally makes loans for the construction of homes “on speculation,” but the Company generally permits a borrower to have only two such loans at a time. These loans generally have a maximum term of nine months, and upon completion of construction, borrowers can convert to conventional amortizing nonresidential real estate loans. These construction loans have rates and terms comparable to permanent loans secured by property of the type being constructed that we originate. Generally, the maximum loan-to-value ratio of these construction loans is 85%.

Commercial business loans:  Commercial, non-real estate, loans are offered to businesses and professionals in the Company’s market area. These loans generally have short and medium terms on a collateralized basis. The structure of these loans are largely determined by the loan purpose and collateral. Sources of collateral can include a lien on equipment, inventory, receivables and other assets of the company. A UCC-1 is typically filed to perfect our lien on these assets.

Commercial loans typically are underwritten on the basis of the borrower’s ability to make repayment from the cash flow of its business and generally are collateralized by business assets. As a result, such loans and leases involve additional complexities, variables and risks and require more thorough underwriting and servicing than other types of loans and leases. Repayment of commercial loans largely depends on the successful operation of the business for which and operating loan is utilized.

Consumer loans:  The Company offers installment loans for various consumer purposes, including the purchase of automobiles, boats, and for other legitimate personal purposes. The maximum terms of consumer loans is 12 months for unsecured loans and 12 to 60 months for loans secured by a vehicle, depending on the age of the vehicle. The Company generally only extends consumer loans to existing customers or their immediate family members, and these loans generally have relatively low balances. We also originate floating rate home equity lines of credit and home improvement loans secured by second mortgages.

Consumer loans may entail greater credit risk than a typical residential mortgage loan, particularly in the case of consumer loans that are unsecured or are secured by rapidly depreciable assets, such as automobiles. In addition, consumer loan collections are dependent on the borrower’s continuing financial stability, and thus are more likely to be affected by adverse personal circumstances. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount, which can be recovered on such loans.

The following tables present total loans by risk grade and portfolio segment at June 30, 2018 and December 31, 2017:

					Special
June 30, 2018	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	40,464	$	649	$	144	$	1,223	$	-	$	-	$	42,480
One-to four-family, non-owner occupied		6,230		-		-		76		-		-		6,306
Commercial and multi-family		21,808		-		-		-		-		-		21,808
Construction and land		4,191		165		-		13		-		-		4,369
Commercial business loans		8,080		-		191		-		-		-		8,271
Consumer loans		1,716		-		-		-		-		-		1,716
	$	82,489	$	814	$	335	$	1,312	$	-	$	-	$	84,950

					Special
December 31, 2017	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	42,482	$	740	$	146	$	1,292	$	-	$	-	$	44,660
One-to four-family, non-owner occupied		6,535		-		-		116		-		-		6,651
Commercial and multi-family		23,790		-		-		-		-		-		23,790
Construction and land		3,438		168		-		13		-		-		3,619
Commercial business loans		1,844		-		204		-		-		-		2,048
Consumer loans		1,584		-		-		-		-		-		1,584
	$	79,673	$	908	$	350	$	1,421	$	-	$	-	$	82,352

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FHLB Advances

6 Months Ended

Jun. 30, 2018

Advances from Federal Home Loan Banks [Abstract]

FHLB Advances

(6) FHLB Advances

At June 30, 2018 and December 31, 2017, advances from the Federal Home Loan Bank were as follows:

	Interest			June 30,		December 31,
Maturity Date	Rate			2018		2017
February 12, 2018		1.27	%		-		3,000
March 12, 2018		4.92	%		-		1,000
July 18, 2018		1.84	%		3,000		3,000
July 18, 2019		2.21	%		2,000		2,000
September 18, 2018		2.14	%		2,000		-
January 2, 2019		2.19	%		2,000		-
April 10, 2019		2.38	%		1,500
October 2, 2019		2.46	%		2,000		-
Total				$	12,500	$	9,000

Each advance is payable at its maturity date, with a prepayment penalty if paid earlier than its maturity date. The advances were collateralized by $51,102 and $51,532 of first mortgage loans under a blanket lien arrangement at June 30, 2018 and December 31, 2017. Based on this collateral and the Company’s holdings of FHLB stock, the Company is eligible to borrow up to a total of $35,402 at June 30, 2018.

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EMPLOYEE STOCK OWNERSHIP PLAN

6 Months Ended

Jun. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

EMPLOYEE STOCK OWNERSHIP PLAN

(7) EMPLOYEE STOCK OWNERSHIP PLAN

Employees participate in an Employee Stock Ownership Plan (“ESOP”). The ESOP borrowed from the Company to purchase 66,096 shares of the Company’s common stock at $10 per share on June 29, 2016. The Bank may make discretionary contributions to the ESOP and pays dividends on unallocated shares to the ESOP. The ESOP uses funds it receives to repay the loan. When loan payments are made, ESOP shares are allocated to participants based on relative compensation and expense is recorded. Any dividends on allocated shares increase participant accounts. Participants receive the shares at the end of employment.

No contributions to the ESOP were made during the three and six months ended June 30, 2018. The expense recognized for the three and six months ended June 30, 2018 and 2017 was $10 and $20, respectively, and is reported in salaries and wages.

ESOP shares at June 30, 2018 and December 31, 2017 are summarized as follows:

	June 30,		December 31,
	2018		2017
Committed to be released to participants		1,652		-
Allocated to participants		6,557		6,557
Unearned		57,887		59,539
Total ESOP shares		66,096		66,096
Fair value of unearned shares	$	677	$	697

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DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS

6 Months Ended

Jun. 30, 2018

Employee Benefits and Share-based Compensation [Abstract]

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS

(8) DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS

Net periodic cost for the defined benefit pension plan and postretirement medical plan for the three and six months ended June 30, 2018 and 2017 included the following components:

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Three Months Ended						Three Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		26			33			7			10
Expected return on plan assets		(32	)		(36	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		10			24			1			2
Unrecognized prior service cost		-			-			(2	)		(2	)
Asset (loss) gain deferred		-			-			-			-
Net periodic cost	$	565		$	21		$	6		$	10

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Six Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		56			66			15			18
Expected return on plan assets		(68	)		(72	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		34			49			2			4
Unrecognized prior service cost		-			-			(4	)		(4	)
Net periodic cost	$	583		$	43		$	13		$	18

The following table summarizes plan assets for the defined benefit pension plan, measured at fair value on a recurring basis at June 30, 2018 and December 31, 2017, segregated by the level of the inputs (as defined in Note 9) within the hierarchy used to measure fair value:

							Total
June 30, 2018	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,148	$	-	$	2,148

							Total
December 31, 2017	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,654	$	-	$	2,654

During the three and six months ended June 30, 2018, benefits paid, employer contributions and the actual return on plan assets for the defined benefit pension plan were $1,069, $600 and $8 and $1,185, $600 and $80 respectively. Of the benefits paid, $1,012 was paid as a result of retirement payments made to some of our previous employees. During the three and six months ended June 30, 2017, benefits paid, employer contributions, and the actual return on plan assets were $68, $100, and $55 and $137, $169 and $147, respectively.

The Company’s defined benefit pension plan target allocations and weighted-average allocations by asset category are as follows:

		June 30,			December 31,
	Target Allocation
	2017	2018			2017
Pooled separate accounts
Equity	30%-40%		32	%		40	%
Debt	60%-70%		68	%		60	%

The Company’s investment strategy is to maintain a diversified investment portfolio. Rebalancing occurs on a periodic basis to maintain the target allocations, but normal market activity may result in deviations. As a result of the percentage of equities held, actual return of plan assets for any period may fluctuate significantly due to changes in the stock market.

Changes in accumulated other comprehensive loss associated with the defined benefit and postretirement medical plans are as follows:

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		10	$	24		1			2
Unrecognized prior service cost		-		-		(2	)		(2	)
		571		24		(1	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	571	$	24	$	(1	)	$	-

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		34		49		2			4
Unrecognized prior service cost		-		-		(4	)		(4	)
		595		49		(2	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	595	$	49	$	(2	)	$	-

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FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

(9) FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Investment Securities:

The fair values for investment securities are determined by quoted market prices, if available (Level 1). For securities where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3).

Impaired Loans:

The fair value of impaired loans with specific allocations of the allowance for loan losses is generally based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. Impaired loans are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Real Estate Owned:

Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. Fair value is commonly based on recent real estate appraisals, which are updated no less frequently than annually. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. Real estate owned properties are evaluated on a quarterly basis for additional impairment and adjusted accordingly.

Appraisals for both collateral-dependent impaired loans and real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, management reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics. On an annual basis, the Company compares the actual selling price of collateral that has been sold to the most recent appraised value to determine what additional adjustment should be made to the appraisal value to arrive at fair value.

Assets and liabilities measured at fair value on a recurring basis at June 30, 2018 and December 31, 2017 are summarized below:

	Level 2
	June 30,		December 31,
	2018		2017
Financial Assets
Available-for-sale securities	$	14,302	$	16,211
	$	14,302	$	16,211

There were no financial or nonfinancial assets that required nonrecurring level 3 adjustments for the three and six months ended June 30, 2018 and 2017.

Fair Value of Financial Instruments

Many of the Company’s assets and liabilities are short-term financial instruments whose carrying amounts reported in the consolidated balance sheet approximate fair value and are considered Level 1 assets and liabilities. These items include cash and cash equivalents, accrued interest receivable and accrued interest payable balances. The estimated fair values of the Company’s remaining on-balance sheet financial instruments at June 30, 2018 and December 31, 2017 are summarized below:

	Carrying		Fair Value
	Amount		Level 1		Level 2		Level 3		Total
June 30, 2018
Financial assets
Available-for-sale securities	$	14,302	$	-	$	14,302	$	-	$	14,302
Restricted equity securities (1)		563		NA		NA		NA		NA
Loans, net		83,742		-		-		82,628		82,628
Financial liabilities
Deposits	$	83,502	$	24,184	$	59,353	$	-	$	83,537
FHLB Advances		12,500		-		12,484		-		12,484
December 31, 2017
Financial assets
Available-for-sale securities	$	16,211	$	-	$	16,211	$	-	$	16,211
Restricted equity securities (1)		405		NA		NA		NA		NA
Loans, net		81,128		-		-		81,686		81,686
Financial liabilities
Deposits	$	86,826	$	27,391	$	60,305	$	-	$	87,696
FHLB Advances		9,000		-		9,013		-		9,013

(1) It is not practicable to determine fair value of restricted equity securities due to restrictions placed on transferability.

The following methods and assumptions were used in estimating the fair values shown above:

Loans:

The fair value of loans is computed for each loan category using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality.

Deposits:

Deposits with no defined maturities, such as checking accounts, savings accounts and money market deposit accounts are, by definition, equal to the amount payable on demand at the balance sheet date. The fair values of certificate accounts are computed using interest rates currently being offered to deposit customers.

FHLB advances:

FHLB advances are valued at current market interest rates of FHLB advances.

Off-balance sheet commitments:

Fair values for off-balance sheet, credit-related financial instruments are based on fees currently charged to either enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of commitments is not material.

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

General

On June 29, 2016, Best Hometown Bank (the “Bank”) (formerly known as Home Federal Savings and Loan Association of Collinsville) completed its conversion (the “Conversion”) from a federally-chartered mutual savings association to the capital stock form of organization, including the establishment of a stock holding company, Best Hometown Bancorp, Inc. (referred to herein as “the Company,” “we,” “us,” or “our”), as parent of the Bank. The stock holding company is organized under the laws of the State of Maryland and owns all of the outstanding common stock of the Bank. In connection with the Conversion, the Company sold 826,208 shares of its common stock, including 66,096 shares (8% of shares sold) that were purchased by the Bank’s employee stock ownership plan (“ESOP”), at a price of $10.00 per share, for gross offering proceeds of $8.3 million. The cost of the conversion and issuance of common stock was $1.4 million, which was deducted from the gross offering proceeds. The Company contributed $5.0 million of the net proceeds from the offering by the Company to the Bank, and $1.2 million was retained by the Company. In addition, $661,000 of the net proceeds were used to fund a loan to the ESOP, with which the ESOP purchased Company shares.

Voting rights are held and exercised exclusively by the shareholders of the holding company. Deposit account holders continue to be insured by the FDIC up to the applicable limits. A liquidation account was established in an amount equal to the Bank’s total equity as of the latest balance sheet date in the final offering circular used in the conversion. Each eligible account holder or supplemental account holder are entitled to a proportionate share of this account in the event of a complete liquidation of the Bank, and only in such event. This share will be reduced if the eligible account holder’s or supplemental account holder’s deposit balance falls below the amounts on the date of record and will cease to exist if the account is closed. The liquidation account will never be increased despite any increase after conversion in the related deposit balance.

The Bank may not pay a dividend on its capital stock, if the effect thereof would cause retained earnings to be reduced below the liquidation account amount or regulatory capital requirements. In addition, the stock holding company is subject to certain regulations related to the repurchase of its capital stock.

The Conversion was accounted for as a change in corporate form with the historic basis of the Bank’s assets, liabilities and equity unchanged as a result.

The accompanying unaudited consolidated financial statements of Best Hometown Bancorp, Inc., which include the accounts of its wholly owned subsidiary Best Hometown Bank have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Intercompany accounts and transactions are eliminated during consolidation.

In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included to present fairly the financial position as of June 30, 2018 and December 31, 2017 and the results of operations and cash flows for the six months ended June 30, 2018 and 2017. All interim amounts have not been audited and the results of operations for the three and six months ended June 30, 2018, herein are not necessarily indicative of the results of operations to be expected for the entire year.

Cash and cash equivalents include cash on hand, federal funds sold, overnight interest-bearing deposits and amounts due from other depository institutions.

Use of Estimates

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of foreclosed real estate, fair values of financial instruments, measurement of defined benefit pension and postretirement medical plans and valuation of deferred tax assets.

Contingencies

Contingencies

The Company is involved in certain legal actions arising from normal business activities. Management believes that the outcome of such proceedings will not have any material adverse effect on the financial statements of the Company.

NEW ACCOUNTING STANDARDS

NEW ACCOUNTING STANDARDS

The Company is an emerging growth company and as such will be subject to the effective dates noted for the private companies if they differ from the effective dates noted for public companies.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326) — Measurement of Credit Losses on Financial Instruments. The provisions of ASU 2016-13 were issued to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments that are not accounted for at fair value through net income, including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other commitments to extend credit held by a reporting entity at each reporting date. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 eliminate the probable incurred loss recognition in current GAAP and reflect an entity’s current estimate of all expected credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the financial assets.

For purchased financial assets with a more-than-insignificant amount of credit deterioration since origination (“PCD assets”) that are measured at amortized cost, the initial allowance for credit losses is added to the purchase price rather than being reported as a credit loss expense. Subsequent changes in the allowance for credit losses on PCD assets are recognized through the statement of income as a credit loss expense.

Credit losses relating to available-for-sale debt securities will be recorded through an allowance for credit losses rather than as a direct write-down to the security.

As an emerging growth company, ASU 2016-13 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years beginning after December 15, 2021. The Company is reviewing the technology required to source and models data for the purposes of meeting this standard. While the Company generally expects to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, the Company cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial statements.

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016 the FASB issued ASU 2016-08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in determining revenue recognition as principal versus agent. In April 2016, the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In May 2016, the FASB issued ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

As an emerging growth company, these amendments are effective for annual reporting periods beginning after December 15, 2018, and for interim periods within annual periods beginning after December 15, 2019. The Company’s revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09.    The Company is continuing to evaluate the impact of adopting ASU 2014-09, but does not expect the impact to have a material impact on the Company’s financial position or results of operation.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update provides guidance on the classification of certain cash receipts and cash payments for presentation in the statement of cash flows. As an emerging growth company, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. The Company believes that the adoption of this ASU will not have a material effect to our consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments. The portion of ASU 2016-01 that is likely to have an effect on our financial statements and disclosures relates a clarification of accounting standards with respect to deferred tax assets arising from unrealized losses on available-for-sale securities. This ASU 2016-01 requires an entity to evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.

As an emerging growth company, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within years beginning after December 15, 2019.  Early adoption of the amendments in the update is not permitted, except that early application by public business entities to financial statements of fiscal years or interim periods that have not yet been issued or, by all other entities, that have not yet been made available for issuance, are permitted as of the beginning of the fiscal year of adoption for the following amendment: An entity should present separately in other comprehensive income the portion of the total change in the fair value of a liability at fair value in accordance with the fair value option for financial instruments.  An entity should apply the amendments to this update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption.  The Company is continuing to evaluate the impact of adopting this new guidance on its consolidated financial statements, but the adoption of ASU 2016-01 is not expected to have a material impact on the Company’s financial position or results of operation.

Adoption of New Accounting Pronouncement

Effective December 31, 2017, the Company early adopted guidance related to income taxes. The new guidance was applied in the period of adoption. Current accounting principles require that the effect of a change in tax laws or rates on deferred tax liabilities or assets to be included in income from continuing operations in the reporting period that includes the enactment date, even if the related income tax effects were originally charged or credited directly to accumulated other comprehensive income (“AOCI”). The Company’s accounting policy for the release of stranded tax effects in AOCI in on an aggregate portfolio basis. The new guidance allows a reclassification of AOCI to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“US Tax Reform”). The Company early adopted this standard effective December 31, 2017 and reclassified $300 from AOCI to retained earnings due to re-measuring from 35% to 21% the federal deferred taxes on the accumulated other comprehensive income components related to available for sale securities, and the defined benefit and postretirement medical plans.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

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EARNINGS (LOSS) PER SHARE (Tables)

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

Schedule of earnings per common share, basic

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2018
Loss per share
Net loss	$	(675	)	$	(137	)	$	(776	)	$	(252	)
Weighted average common shares outstanding		826,208			826,208			826,208			826,208
Less: average unearned ESOP shares		(58,300	)		(61,466	)		(58,713	)		(62,017	)
Weighted average common shares outstanding		767,908			764,742			767,495			764,191
Basic loss per share	$	(0.88	)	$	(0.18	)	$	(1.01	)	$	(0.33	)

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SECURITIES AVAILABLE FOR SALE (Tables)

6 Months Ended

Jun. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Schedule of Investment securities available for sale

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
June 30, 2018	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	678	$	-	$	(33	)	$	645
U.S. Government agency mortgage-backed securities - residential		14,212		-		(555	)		13,657
	$	14,890	$	-	$	(588	)	$	14,302

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
December 31, 2017	Cost		Gains		Losses			Value
Debt securities:
U.S. Government agency SBAP security	$	786	$	-	$	(24	)	$	762
U.S. Government agency mortgage-backed securities - residential		15,808		-		(359	)		15,449
	$	16,594	$	-	$	(383	)	$	16,211

Schedule of unrealized loss position for asset backed security and mortgage-backed securities differ from contractual maturities

	Less than 12 Months						12 Months or Longer
					Number in							Number in
	Fair		Unrealized		Unrealized		Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss		Loss (1)		Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	-	$	-		-	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		-		-		-		13,657		(555	)		27
	$	-	$	-		-	$	14,302	$	(588	)		28

	Total
						Number in
	Fair		Unrealized			Unrealized
June 30, 2018	Value		Loss			Loss (1)
U.S. Government agency SBAP security	$	645	$	(33	)		1
U.S. Government agency mortgage-backed securities - residential		13,657		(555	)		27
Total	$	14,302	$	(588	)		28

	Less than 12 Months							12 Months or Longer
						Number in							Number in
	Fair		Unrealized			Unrealized		Market		Unrealized			Unrealized
December 31, 2017	Value		loss			Loss (1)		Value		loss			Loss (1)
U.S. Government agency bonds	$	-	$	-			-	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		1,607		(15	)		3		13,842		(344	)		24
Total	$	1,607	$	(15	)		3	$	14,604	$	(368	)		25

	Total
						Number in
	Fair		Unrealized			Unrealized
December 31, 2017	Value		Loss			Loss (1)
U.S. Government agency bonds	$	762	$	(24	)		1
U.S. Government agency mortgage-backed securities - residential		15,449		(359	)		27
Total	$	16,211	$	(383	)		28

(1) Represents actual number of securities in an unrealized loss position.

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LOANS (Tables)

6 Months Ended

Jun. 30, 2018

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Schedule of Loans receivable, net

	June 30,		December 31,
	2018		2017
Real estate loans:
One-to four-family, owner occupied	$	42,480	$	44,660
One-to four-family, non-owner occupied		6,306		6,651
Commercial and multi-family		21,808		23,790
Construction and land		4,369		3,619
Commercial business loans		8,271		2,048
Consumer loans		1,716		1,584
		84,950		82,352
Net deferred loan (fees) costs		11		(9	)
Total	$	84,961	$	82,343

Schedule of portfolio segment, the activity in the allowance of loan losses and recorded investment in loans and impairment method

	Beginning									Ending
Three Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	513	$	(73	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		79		(4	)		-		2		77
Commercial and multi-family		401		(27	)		-		-		374
Construction and land		38		5			-		-		43
Commercial business loans		59		106			-		-		165
Consumer loans		43		1			-		-		44
Unallocated		84		(8	)		-		-		76
	$	1,217	$	-		$	-	$	2	$	1,219

	Beginning										Ending
Three Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	647	$	(60	)	$	(6	)	$	37	$	618
One-to-four family, non-owner occupied		109		(3	)		-			2		108
Commercial and multi-family		317		72			-			-		389
Construction and land		44		(8	)		-			7		43
Commercial business loans		41		(7	)		-			-		34
Consumer loans		34		6			-			-		40
Unallocated		-		-			-			-		-
	$	1,192	$	-		$	(6	)	$	46	$	1,232

	Beginning									Ending
Six Months Ended June 30, 2018	Balance		Provision			Charge-offs		Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	525	$	(85	)	$	-	$	-	$	440
One-to-four family, non-owner occupied		81		(8	)		-		4		77
Commercial and multi-family		407		(33	)		-		-		374
Construction and land		34		9			-		-		43
Commercial business loans		41		124			-		-		165
Consumer loans		39		5			-		-		44
Unallocated		88		(12	)		-		-		76
	$	1,215	$	-		$	-	$	4	$	1,219

	Beginning										Ending
Six Months Ended June 30, 2017	Balance		Provision			Charge-offs			Recoveries		Balance
Real estate loans:
One-to-four family, owner occupied	$	657	$	(48	)	$	(34	)	$	43	$	618
One-to-four family, non-owner occupied		113		(8	)		-			3		108
Commercial and multi-family		309		80			-			-		389
Construction and land		42		(5	)		-			6		43
Commercial business loans		18		16			-			-		34
Consumer loans		26		14			-			-		40
Unallocated		49		(49	)		-			-		-
	$	1,214	$	-		$	(34	)	$	52	$	1,232

The following tables present the recorded balances of loans and amount of allowance allocated based upon impairment method by portfolio segment at June 30, 2018 and December 31, 2017:

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated for		Evaluated for
	Impairment		Impairment		Total		Impairment		Impairment		Total
June 30, 2018
Real estate loans:
One-to four-family, owner occupied	$	-	$	440	$	440	$	575	$	41,905	$	42,480
One-to four-family, non-owner occupied		-		77		77		76		6,190		6,306
Commercial and multi-family		-		374		374		-		21,808		21,808
Construction and land		-		43		43		13		4,356		4,369
Commercial business loans		-		165		165		-		8,271		8,271
Consumer loans		-		44		44		-		1,716		1,716
Unallocated		-		76		76		-		-		-
	$	-	$	1,219	$	1,219	$	664	$	84,246	$	84,950

	Ending Allowance on Loans						Loans
	Individually		Collectively				Individually		Collectively
	Evaluated for		Evaluated for				Evaluated		Evaluated
	Impairment		Impairment		Total		Impairment		Impairment		Total
December 31, 2017
Real estate loans:
One-to four-family, owner occupied	$	-	$	525	$	525	$	635	$	44,025	$	44,660
One-to four-family, non-owner occupied		-		81		81		116		6,535		6,651
Commercial and multi-family		-		407		407		-		23,790		23,790
Construction and land		-		34		34		13		3,606		3,619
Commercial business loans		-		41		41		-		2,048		2,048
Consumer loans		-		39		39		-		1,584		1,584
Unallocated		-		88		88		-		-		-
	$	-	$	1,215	$	1,215	$	764	$	81,588	$	82,352

Schedule of loans evaluated for impairment by portfolio segment

	June 30, 2018						December 31, 2017
	Unpaid						Unpaid
	Principal		Recorded		Related		Principal		Recorded		Related
	Balance		Investment		Allowance		Balance		Investment		Allowance
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	729	$	575	$	-	$	800	$	635	$	-
One-to four-family, non-owner occupied		100		76		-		153		116		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		13		13		-		13		13		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	842	$	664	$	-	$	966	$	764	$	-
Commercial loans		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-
Total	$	842	$	664	$	-	$	966	$	764	$	-

	Three Months Ended								Six Months Ended
	June 30, 2018				June 30, 2017				June 30, 2018				June 30, 2017
	Average		Interest		Average		Interest		Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income
	Investment		Recognized		Investment		Recognized		Investment		Recognized		Investment		Recognized
With no recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	582	$	11	$	647	$	11	$	580	$	22	$	650	$	21
One-to four-family, non-owner occupied		77		1		79		-		77		2		79		3
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		13		-		14		-		13		-		14		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
With recorded allowance:
Real estate loans:
One-to four-family, owner occupied	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
One-to four-family, non-owner occupied		-		-		-		-		-		-		-		-
Commercial and multi-family		-		-		-		-		-		-		-		-
Construction and land		-		-		-		-		-		-		-		-
Commercial business loans		-		-		-		-		-		-		-		-
Consumer loans		-		-		-		-		-		-		-		-
Total	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Totals:
Real estate loans	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24
Commercial business loans		-		-		-		-		-		-		-		-
Consumer and other loans		-		-		-		-		-		-		-		-
Total	$	672	$	12	$	740	$	11	$	670	$	24	$	743	$	24

Schedule of past due loans and nonaccrual loans

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
June 30, 2018	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	190	$	-	$	96	$	42,194	$	42,480	$	-	$	96
One-to four-family, non-owner occupied		24		-		-		6,282		6,306		-		-
Commercial and multi-family		-		-		-		21,808		21,808		-		-
Construction and land		-		-		13		4,356		4,369		13		-
Commercial business loans		104		-		-		8,167		8,271		-		-
Consumer loans		-		-		-		1,716		1,716		-		-
	$	318	$	-	$	109	$	84,523	$	84,950	$	13	$	96

					90 Days or								Accruing Loans
	30-59 Days		60-89 Days		More Past						Nonaccrual		Past Due 90
December 31, 2017	Past Due		Past Due		Due		Current		Total		Loans		Days or More
Real estate loans:
One-to four-family, owner occupied	$	620	$	93	$	-	$	43,947	$	44,660	$	-	$	-
One-to four-family, non-owner occupied		24		-		39		6,588		6,651		-		39
Commercial and multi-family		-		-		-		23,790		23,790		-		-
Construction and land		-		-		-		3,619		3,619		13		-
Commercial business loans		-		-		-		2,048		2,048		-		-
Consumer loans		-		-		-		1,584		1,584		-		-
	$	644	$	93	$	39	$	81,576	$	82,352	$	13	$	39

Schedule of credit risk profile of the Bank's loan portfolio

					Special
June 30, 2018	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	40,464	$	649	$	144	$	1,223	$	-	$	-	$	42,480
One-to four-family, non-owner occupied		6,230		-		-		76		-		-		6,306
Commercial and multi-family		21,808		-		-		-		-		-		21,808
Construction and land		4,191		165		-		13		-		-		4,369
Commercial business loans		8,080		-		191		-		-		-		8,271
Consumer loans		1,716		-		-		-		-		-		1,716
	$	82,489	$	814	$	335	$	1,312	$	-	$	-	$	84,950

					Special
December 31, 2017	Pass		Watch		Mention		Substandard		Doubtful		Loss		Total
Real estate loans:
One-to four-family, owner occupied	$	42,482	$	740	$	146	$	1,292	$	-	$	-	$	44,660
One-to four-family, non-owner occupied		6,535		-		-		116		-		-		6,651
Commercial and multi-family		23,790		-		-		-		-		-		23,790
Construction and land		3,438		168		-		13		-		-		3,619
Commercial business loans		1,844		-		204		-		-		-		2,048
Consumer loans		1,584		-		-		-		-		-		1,584
	$	79,673	$	908	$	350	$	1,421	$	-	$	-	$	82,352

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FHLB Advances (Tables)

6 Months Ended

Jun. 30, 2018

Advances from Federal Home Loan Banks [Abstract]

Schedule of advances from the Federal Home Loan Bank

	Interest			June 30,		December 31,
Maturity Date	Rate			2018		2017
February 12, 2018		1.27	%		-		3,000
March 12, 2018		4.92	%		-		1,000
July 18, 2018		1.84	%		3,000		3,000
July 18, 2019		2.21	%		2,000		2,000
September 18, 2018		2.14	%		2,000		-
January 2, 2019		2.19	%		2,000		-
April 10, 2019		2.38	%		1,500
October 2, 2019		2.46	%		2,000		-
Total				$	12,500	$	9,000

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EMPLOYEE STOCK OWNERSHIP PLAN (Tables)

6 Months Ended

Jun. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of ESOP shares

	June 30,		December 31,
	2018		2017
Committed to be released to participants		1,652		-
Allocated to participants		6,557		6,557
Unearned		57,887		59,539
Total ESOP shares		66,096		66,096
Fair value of unearned shares	$	677	$	697

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DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Tables)

6 Months Ended

Jun. 30, 2018

Employee Benefits and Share-based Compensation [Abstract]

Schedule of net periodic cost for the defined benefit pension plan and postretirement medical plan

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Three Months Ended						Three Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		26			33			7			10
Expected return on plan assets		(32	)		(36	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		10			24			1			2
Unrecognized prior service cost		-			-			(2	)		(2	)
Asset (loss) gain deferred		-			-			-			-
Net periodic cost	$	565		$	21		$	6		$	10

	Defined Benefit						Postretirement
	Pension Plan						Medical Plan
	Six Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2018			2017			2018			2017
Service cost	$	-		$	-		$	-		$	-
Interest cost		56			66			15			18
Expected return on plan assets		(68	)		(72	)		-			-
Settlements		561			-			-			-
Amortization:
Unrecognized net loss		34			49			2			4
Unrecognized prior service cost		-			-			(4	)		(4	)
Net periodic cost	$	583		$	43		$	13		$	18

Schedule of plan assets for the defined benefit pension plan, measured at fair value on a recurring basis

							Total
June 30, 2018	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,148	$	-	$	2,148

							Total
December 31, 2017	Level 1		Level 2		Level 3		Fair Value
Pooled separate accounts	$	-	$	2,654	$	-	$	2,654

Schedule of defined benefit pension plan target allocations and weighted-average allocations by asset

		June 30,			December 31,
	Target Allocation
	2017	2018			2017
Pooled separate accounts
Equity	30%-40%		32	%		40	%
Debt	60%-70%		68	%		60	%

Schedule of accumulated other comprehensive loss with defined benefit and postretirement medical plans

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Three Months Ended				Three Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		10	$	24		1			2
Unrecognized prior service cost		-		-		(2	)		(2	)
		571		24		(1	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	571	$	24	$	(1	)	$	-

	Defined Benefit				Postretirement
	Pension Plan				Medical Plan
	Six Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018			2017
Settlements	$	561	$	-	$	-		$	-
Amortization of:
Unrecognized net loss		34		49		2			4
Unrecognized prior service cost		-		-		(4	)		(4	)
		595		49		(2	)		-
Tax effect		-		-		-			-
Unrecognized net (gain) loss, net of tax	$	595	$	49	$	(2	)	$	-

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Schedule of summary of assets and liabilities measured at fair value on a recurring basis

	Level 2
	June 30,		December 31,
	2018		2017
Financial Assets
Available-for-sale securities	$	14,302	$	16,211
	$	14,302	$	16,211

Schedule of estimated fair values of the financial instruments

	Carrying		Fair Value
	Amount		Level 1		Level 2		Level 3		Total
June 30, 2018
Financial assets
Available-for-sale securities	$	14,302	$	-	$	14,302	$	-	$	14,302
Restricted equity securities (1)		563		NA		NA		NA		NA
Loans, net		83,742		-		-		82,628		82,628
Financial liabilities
Deposits	$	83,502	$	24,184	$	59,353	$	-	$	83,537
FHLB Advances		12,500		-		12,484		-		12,484
December 31, 2017
Financial assets
Available-for-sale securities	$	16,211	$	-	$	16,211	$	-	$	16,211
Restricted equity securities (1)		405		NA		NA		NA		NA
Loans, net		81,128		-		-		81,686		81,686
Financial liabilities
Deposits	$	86,826	$	27,391	$	60,305	$	-	$	87,696
FHLB Advances		9,000		-		9,013		-		9,013

(1) It is not practicable to determine fair value of restricted equity securities due to restrictions placed on transferability.

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BASIS OF PRESENTATION (Detail Textuals)	1 Months Ended
	Jun. 29, 2016 USD ($) $ / shares shares
Summary Of Significant Accounting Policies [Line Items]
Stock issuance cost	$ 1,400,000
Net proceeds from issuance of common stock	5,000,000
Net amount retained	$ 1,200,000
Common Stock
Summary Of Significant Accounting Policies [Line Items]
Number of shares sold | shares	826,208
Sale of stock, price per share | $ / shares	$ 10.00
Gross offering proceeds	$ 8,300,000
ESOP
Summary Of Significant Accounting Policies [Line Items]
Number of shares sold | shares	66,096
Net proceeds from issuance of common stock	$ 661,000
Percentage of employee stock ownership plan shares sold	8.00%

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NEW ACCOUNTING STANDARDS (Detail Textuals) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]
Reclassified from AOCI to retained earnings due to re-measuring effective from December 31, 2017	$ 300
Federal deferred taxes rate	21.00%	35.00%

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EARNINGS (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Loss per share
Net loss	$ (675)	$ (137)	$ (776)	$ (252)
Weighted average common shares outstanding	826,208	826,208	826,208	826,208
Less: average unearned ESOP shares	(58,300)	(61,466)	(58,713)	(62,017)
Weighted average common shares outstanding	767,908	764,742	767,495	764,191
Basic loss per share (in dollars per share)	$ (0.88)	$ (0.18)	$ (1.01)	$ (0.33)

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SECURITIES AVAILABLE FOR SALE (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 14,890	$ 16,594
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(588)	(383)
Fair Value	14,302	16,211
U.S. Government agency mortgage-backed securities - residential
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	14,212	15,808
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(555)	(359)
Fair Value	13,657	15,449
U.S. Government agency SBAP security
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	678	786
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(33)	(24)
Fair Value	$ 645	$ 762

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SECURITIES AVAILABLE FOR SALE (Details 1) $ in Thousands		Jun. 30, 2018 USD ($) Security	Dec. 31, 2017 USD ($) Security
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value		$ 0	$ 1,607
Less than 12 months, Unrealized Losses		$ 0	$ (15)
Less than 12 months, Number in Unrealized Loss | Security	[1]	0	3
12 Months or Longer, Fair Value		$ 14,302	$ 14,604
12 Months or Longer, Unrealized Losses		$ (588)	$ (368)
12 Months or Longer, Number in Unrealized Loss | Security	[1]	28	25
Total, Fair Value		$ 14,302	$ 16,211
Total, Unrealized Losses		$ (588)	$ (383)
Total, Number in Unrealized Loss | Security	[1]	28	28
U.S. Government agency SBAP security
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value		$ 0	$ 0
Less than 12 months, Unrealized Losses		$ 0	$ 0
Less than 12 months, Number in Unrealized Loss | Security	[1]	0	0
12 Months or Longer, Fair Value		$ 645	$ 762
12 Months or Longer, Unrealized Losses		$ (33)	$ (24)
12 Months or Longer, Number in Unrealized Loss | Security	[1]	1	1
Total, Fair Value		$ 645	$ 762
Total, Unrealized Losses		$ (33)	$ (24)
Total, Number in Unrealized Loss | Security	[1]	1	1
U.S. Government agency mortgage-backed securities - residential
Debt Securities, Available-for-sale [Line Items]
Less than 12 months, Fair Value		$ 0	$ 1,607
Less than 12 months, Unrealized Losses		$ 0	$ (15)
Less than 12 months, Number in Unrealized Loss | Security	[1]	0	3
12 Months or Longer, Fair Value		$ 13,657	$ 13,842
12 Months or Longer, Unrealized Losses		$ (555)	$ (344)
12 Months or Longer, Number in Unrealized Loss | Security	[1]	27	24
Total, Fair Value		$ 13,657	$ 15,449
Total, Unrealized Losses		$ (555)	$ (359)
Total, Number in Unrealized Loss | Security	[1]	27	27

[1] Represents actual number of securities in an unrealized loss position.

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SECURITIES AVAILABLE FOR SALE (Detail Textuals) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Investments, Debt and Equity Securities [Abstract]
Fair value of securities with unrealized losses		$ 14,302		$ 16,211
Percentage of fair value securities with unrealized losses		100.00%		100.00%
Proceeds from sales of available-for-sale securities	$ 2,998		$ 2,998
Gross losses on sales of securities	$ 19		$ 19

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LOANS (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Total loans	$ 84,950	$ 82,352
Net deferred loan (fees) costs	11	(9)
Total	84,961	82,343
Commercial business loans
Loans and Leases Receivable Disclosure [Line Items]
Total loans	8,271	2,048
Consumer loans
Loans and Leases Receivable Disclosure [Line Items]
Total loans	1,716	1,584
Real Estate | One-to-four family, owner occupied
Loans and Leases Receivable Disclosure [Line Items]
Total loans	42,480	44,660
Real Estate | One-to-four family, non-owner occupied
Loans and Leases Receivable Disclosure [Line Items]
Total loans	6,306	6,651
Real Estate | Commercial and multi-family
Loans and Leases Receivable Disclosure [Line Items]
Total loans	21,808	23,790
Real Estate | Construction and land
Loans and Leases Receivable Disclosure [Line Items]
Total loans	$ 4,369	$ 3,619

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LOANS (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	$ 1,217	$ 1,192	$ 1,215	$ 1,214
Provision	0	0	0	0
Charge-offs	0	(6)	0	(34)
Recoveries	2	46	4	52
Ending Balance	1,219	1,232	1,219	1,232
Commercial business loans
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	59	41	41	18
Provision	106	(7)	124	16
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Ending Balance	165	34	165	34
Consumer loans
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	43	34	39	26
Provision	1	6	5	14
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Ending Balance	44	40	44	40
Unallocated
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	84	0	88	49
Provision	(8)	0	(12)	(49)
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Ending Balance	76	0	76	0
Real Estate | One-to-four family, owner occupied
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	513	647	525	657
Provision	(73)	(60)	(85)	(48)
Charge-offs	0	(6)	0	(34)
Recoveries	0	37	0	43
Ending Balance	440	618	440	618
Real Estate | One-to-four family, non-owner occupied
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	79	109	81	113
Provision	(4)	(3)	(8)	(8)
Charge-offs	0	0	0	0
Recoveries	2	2	4	3
Ending Balance	77	108	77	108
Real Estate | Commercial and multi-family
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	401	317	407	309
Provision	(27)	72	(33)	80
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Ending Balance	374	389	374	389
Real Estate | Construction and land
Allowance for Loan and Lease Losses [Roll Forward]
Beginning Balance	38	44	34	42
Provision	5	(8)	9	(5)
Charge-offs	0	0	0	0
Recoveries	0	7	0	6
Ending Balance	$ 43	$ 43	$ 43	$ 43

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LOANS (Details 2) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	$ 0	$ 0
Allowance on Loans, Collectively Evaluated for Impairment	1,219	1,215
Allowance on Loans, Total	1,219	1,215
Loans, Individually Evaluated for Impairment	664	764
Loans, Collectively Evaluated for Impairment	84,246	81,588
Total loans	84,950	82,352
Commercial business loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	165	41
Allowance on Loans, Total	165	41
Loans, Individually Evaluated for Impairment	0	0
Loans, Collectively Evaluated for Impairment	8,271	2,048
Total loans	8,271	2,048
Consumer loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	44	39
Allowance on Loans, Total	44	39
Loans, Individually Evaluated for Impairment	0	0
Loans, Collectively Evaluated for Impairment	1,716	1,584
Total loans	1,716	1,584
Unallocated
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	76	88
Allowance on Loans, Total	76	88
Loans, Individually Evaluated for Impairment	0	0
Loans, Collectively Evaluated for Impairment	0	0
Total loans	0	0
Real Estate | One-to-four family, owner occupied
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	440	525
Allowance on Loans, Total	440	525
Loans, Individually Evaluated for Impairment	575	635
Loans, Collectively Evaluated for Impairment	41,905	44,025
Total loans	42,480	44,660
Real Estate | One-to-four family, non-owner occupied
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	77	81
Allowance on Loans, Total	77	81
Loans, Individually Evaluated for Impairment	76	116
Loans, Collectively Evaluated for Impairment	6,190	6,535
Total loans	6,306	6,651
Real Estate | Commercial and multi-family
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	374	407
Allowance on Loans, Total	374	407
Loans, Individually Evaluated for Impairment	0	0
Loans, Collectively Evaluated for Impairment	21,808	23,790
Total loans	21,808	23,790
Real Estate | Construction and land
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance on Loans, Individually Evaluated for Impairment	0	0
Allowance on Loans, Collectively Evaluated for Impairment	43	34
Allowance on Loans, Total	43	34
Loans, Individually Evaluated for Impairment	13	13
Loans, Collectively Evaluated for Impairment	4,356	3,606
Total loans	$ 4,369	$ 3,619

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LOANS (Details 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	$ 842		$ 842		$ 966
With recorded allowance, Unpaid Principal Balance	0		0		0
Totals, Unpaid Principal Balance	842		842		966
Recorded Investment
With no recorded allowance, Recorded Investment	664		664		764
With recorded allowance, Recorded Investment	0		0		0
Totals, Recorded Investment	664		664		764
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	672	$ 740	670	$ 743
With recorded allowance, Average Recorded Investment	0	0	0	0
Totals, Average Recorded Investment	672	740	670	743
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	12	11	24	24
With recorded allowance, Interest Income Recognized	0	0	0	0
Totals, Interest Income Recognized	12	11	24	24
Related Allowance
Related Allowance	0		0		0
Commercial business loans
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	0		0		0
With recorded allowance, Unpaid Principal Balance	0		0		0
Totals, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	0		0		0
With recorded allowance, Recorded Investment	0		0		0
Totals, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	0	0	0	0
With recorded allowance, Average Recorded Investment	0	0	0	0
Totals, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	0	0	0	0
With recorded allowance, Interest Income Recognized	0	0	0	0
Totals, Interest Income Recognized	0	0	0	0
Related Allowance
Related Allowance	0		0		0
Consumer loans
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	0		0		0
With recorded allowance, Unpaid Principal Balance	0		0		0
Totals, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	0		0		0
With recorded allowance, Recorded Investment	0		0		0
Totals, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	0	0	0	0
With recorded allowance, Average Recorded Investment	0	0	0	0
Totals, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	0	0	0	0
With recorded allowance, Interest Income Recognized	0	0	0	0
Totals, Interest Income Recognized	0	0	0	0
Related Allowance
Related Allowance	0		0		0
Real Estate
Unpaid Principal Balance
Totals, Unpaid Principal Balance	842		842		966
Recorded Investment
Totals, Recorded Investment	664		664		764
Average Recorded Investment
Totals, Average Recorded Investment	672	740	670	743
Interest Income Recognized
Totals, Interest Income Recognized	12	11	24	24
Related Allowance
Related Allowance	0		0		0
Real Estate | One-to-four family, owner occupied
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	729		729		800
With recorded allowance, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	575		575		635
With recorded allowance, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	582	647	580	650
With recorded allowance, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	11	11	22	21
With recorded allowance, Interest Income Recognized	0	0	0	0
Related Allowance
Related Allowance	0		0		0
Real Estate | One-to-four family, non-owner occupied
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	100		100		153
With recorded allowance, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	76		76		116
With recorded allowance, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	77	79	77	79
With recorded allowance, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	1	0	2	3
With recorded allowance, Interest Income Recognized	0	0	0	0
Related Allowance
Related Allowance	0		0		0
Real Estate | Commercial and multi-family
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	0		0		0
With recorded allowance, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	0		0		0
With recorded allowance, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	0	0	0	0
With recorded allowance, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	0	0	0	0
With recorded allowance, Interest Income Recognized	0	0	0	0
Related Allowance
Related Allowance	0		0		0
Real Estate | Construction and land
Unpaid Principal Balance
With no recorded allowance, Unpaid Principal Balance	13		13		13
With recorded allowance, Unpaid Principal Balance	0		0		0
Recorded Investment
With no recorded allowance, Recorded Investment	13		13		13
With recorded allowance, Recorded Investment	0		0		0
Average Recorded Investment
With no recorded allowance, Average Recorded Investment	13	14	13	14
With recorded allowance, Average Recorded Investment	0	0	0	0
Interest Income Recognized
With no recorded allowance, Interest Income Recognized	0	0	0	0
With recorded allowance, Interest Income Recognized	0	$ 0	0	$ 0
Related Allowance
Related Allowance	$ 0		$ 0		$ 0

XML

LOANS (Details 4) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	$ 84,523	$ 81,576
Total	84,950	82,352
Nonaccrual Loans	13	13
Accruing Loans Past Due 90 Days or More	96	39
30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	318	644
60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	93
90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	109	39
Commercial business loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	8,167	2,048
Total	8,271	2,048
Nonaccrual Loans	0	0
Accruing Loans Past Due 90 Days or More	0	0
Commercial business loans | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	104	0
Commercial business loans | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Commercial business loans | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Consumer loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	1,716	1,584
Total	1,716	1,584
Nonaccrual Loans	0	0
Accruing Loans Past Due 90 Days or More	0	0
Consumer loans | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Consumer loans | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Consumer loans | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | One-to-four family, owner occupied
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	42,194	43,947
Total	42,480	44,660
Nonaccrual Loans	0	0
Accruing Loans Past Due 90 Days or More	96	0
Real Estate | One-to-four family, owner occupied | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	190	620
Real Estate | One-to-four family, owner occupied | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	93
Real Estate | One-to-four family, owner occupied | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	96	0
Real Estate | One-to-four family, non-owner occupied
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	6,282	6,588
Total	6,306	6,651
Nonaccrual Loans	0	0
Accruing Loans Past Due 90 Days or More	0	39
Real Estate | One-to-four family, non-owner occupied | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	24	24
Real Estate | One-to-four family, non-owner occupied | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | One-to-four family, non-owner occupied | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	39
Real Estate | Commercial and multi-family
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	21,808	23,790
Total	21,808	23,790
Nonaccrual Loans	0	0
Accruing Loans Past Due 90 Days or More	0	0
Real Estate | Commercial and multi-family | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | Commercial and multi-family | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | Commercial and multi-family | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | Construction and land
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	4,356	3,619
Total	4,369	3,619
Nonaccrual Loans	13	13
Accruing Loans Past Due 90 Days or More	0	0
Real Estate | Construction and land | 30-59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | Construction and land | 60-89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	0	0
Real Estate | Construction and land | 90 Days or More Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Days Past Due	$ 13	$ 0

XML

LOANS (Details 5) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Financing Receivable, Recorded Investment [Line Items]
Total	$ 84,950	$ 82,352
Pass
Financing Receivable, Recorded Investment [Line Items]
Total	82,489	79,673
Watch
Financing Receivable, Recorded Investment [Line Items]
Total	814	908
Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	335	350
Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	1,312	1,421
Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Commercial business loans
Financing Receivable, Recorded Investment [Line Items]
Total	8,271	2,048
Commercial business loans | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	8,080	1,844
Commercial business loans | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Commercial business loans | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	191	204
Commercial business loans | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Commercial business loans | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Commercial business loans | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Consumer loans
Financing Receivable, Recorded Investment [Line Items]
Total	1,716	1,584
Consumer loans | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	1,716	1,584
Consumer loans | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Consumer loans | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Consumer loans | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Consumer loans | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Consumer loans | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, owner occupied
Financing Receivable, Recorded Investment [Line Items]
Total	42,480	44,660
Real Estate | One-to-four family, owner occupied | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	40,464	42,482
Real Estate | One-to-four family, owner occupied | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	649	740
Real Estate | One-to-four family, owner occupied | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	144	146
Real Estate | One-to-four family, owner occupied | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	1,223	1,292
Real Estate | One-to-four family, owner occupied | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, owner occupied | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, non-owner occupied
Financing Receivable, Recorded Investment [Line Items]
Total	6,306	6,651
Real Estate | One-to-four family, non-owner occupied | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	6,230	6,535
Real Estate | One-to-four family, non-owner occupied | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, non-owner occupied | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, non-owner occupied | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	76	116
Real Estate | One-to-four family, non-owner occupied | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | One-to-four family, non-owner occupied | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Commercial and multi-family
Financing Receivable, Recorded Investment [Line Items]
Total	21,808	23,790
Real Estate | Commercial and multi-family | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	21,808	23,790
Real Estate | Commercial and multi-family | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Commercial and multi-family | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Commercial and multi-family | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Commercial and multi-family | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Commercial and multi-family | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Construction and land
Financing Receivable, Recorded Investment [Line Items]
Total	4,369	3,619
Real Estate | Construction and land | Pass
Financing Receivable, Recorded Investment [Line Items]
Total	4,191	3,438
Real Estate | Construction and land | Watch
Financing Receivable, Recorded Investment [Line Items]
Total	165	168
Real Estate | Construction and land | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Construction and land | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total	13	13
Real Estate | Construction and land | Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total	0	0
Real Estate | Construction and land | Loss
Financing Receivable, Recorded Investment [Line Items]
Total	$ 0	$ 0

XML

LOANS (Detail Textuals)	6 Months Ended
	Jun. 30, 2018
Consumer loans
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	The maximum terms of consumer loans is 12 months for unsecured loans and 12 to 60 months for loans secured by a vehicle, depending on the age of the vehicle.
Real Estate | One-to-four family, owner occupied | Traditional owner-occupied homes | Loan-to-value ratio up to 80 percent
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	loan-to-value ratios of up to 80% for traditional owner-occupied homes.
Real Estate | One-to-four family, non-owner occupied | Traditional owner-occupied homes | Loan-to-value ratio up to 80 percent
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	loan-to-value ratios of up to 80% for traditional owner-occupied homes.
Real Estate | Commercial and multi-family
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	up to 80% of the lesser of the appraised value or the purchase price of the property with an appropriate projected debt service coverage ratio.
Real Estate | Construction and land | Residential construction loans | Loan-to-value ratio up to 80 percent
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	maximum loan-to-value ratio of our owner-occupied construction loans is 80%.
Real Estate | Construction and land | Nonresidential properties | Loan-to-value ratio 80 to 100 percent
Loans and Leases Receivable Disclosure [Line Items]
Description of loan to value ratio	maximum loan-to-value ratio of these construction loans is 85%.
Maturity description of loans	maximum term of nine months

XML

FHLB Advances (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Federal Home Loan Bank, Advances [Line Items]
Advances from the Federal Home Loan Bank,Total	$ 12,500	$ 9,000
Federal Home Loan Bank Advances | February 12, 2018
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	1.27%
Advances from the Federal Home Loan Bank,Total	$ 0	3,000
Federal Home Loan Bank Advances | March 12, 2018
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	4.92%
Advances from the Federal Home Loan Bank,Total	$ 0	1,000
Federal Home Loan Bank Advances | July 18, 2018
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	1.84%
Advances from the Federal Home Loan Bank,Total	$ 3,000	3,000
Federal Home Loan Bank Advances | July 18, 2019
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	2.21%
Advances from the Federal Home Loan Bank,Total	$ 2,000	2,000
Federal Home Loan Bank Advances | September 18, 2018
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	2.14%
Advances from the Federal Home Loan Bank,Total	$ 2,000	0
Federal Home Loan Bank Advances | January 2, 2019
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	2.19%
Advances from the Federal Home Loan Bank,Total	$ 2,000	0
Federal Home Loan Bank Advances | April 10, 2019
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	2.38%
Advances from the Federal Home Loan Bank,Total	$ 1,500	0
Federal Home Loan Bank Advances | October 2, 2019
Federal Home Loan Bank, Advances [Line Items]
Interest Rate	2.46%
Advances from the Federal Home Loan Bank,Total	$ 2,000	$ 0

XML

FHLB Advances (Detail Textuals) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Advances from Federal Home Loan Banks [Abstract]
Advances collateralized of first mortgage loans	$ 51,102	$ 51,532
Maximum amount eligible to borrow	$ 35,402

XML

EMPLOYEE STOCK OWNERSHIP PLAN (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Committed to be released to participants	1,652	0
Allocated to participants	6,557	6,557
Unearned	57,887	59,539
Total ESOP shares	66,096	66,096
Fair value of unearned shares	$ 677	$ 697

XML

EMPLOYEE STOCK OWNERSHIP PLAN (Detail Textuals) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Jun. 29, 2016
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Total ESOP shares	66,096		66,096		66,096
ESOP expenses recognized	$ 10	$ 20	$ 20	$ 20
Employee Stock Ownership Plan
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
Total ESOP shares						66,096
Shares issued, price per share						$ 10

XML

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Defined Benefit Pension Plan
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 0	$ 0	$ 0	$ 0
Interest cost	26	33	56	66
Expected return on plan assets	(32)	(36)	(68)	(72)
Settlements	561	0	561	0
Amortization:
Unrecognized net loss	10	24	34	49
Unrecognized prior service cost	0	0	0	0
Asset (loss) gain deferred	0	0
Net periodic cost	565	21	583	43
Postretirement Medical Plan
Defined Benefit Plan Disclosure [Line Items]
Service cost	0	0	0	0
Interest cost	7	10	15	18
Expected return on plan assets	0	0	0	0
Settlements	0	0	0	0
Amortization:
Unrecognized net loss	1	2	2	4
Unrecognized prior service cost	(2)	(2)	(4)	(4)
Asset (loss) gain deferred	0	0
Net periodic cost	$ 6	$ 10	$ 13	$ 18

XML

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Details 1) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Defined Benefit Plan Disclosure [Line Items]
Pooled separate accounts	$ 2,148	$ 2,654
Level 1
Defined Benefit Plan Disclosure [Line Items]
Pooled separate accounts	0	0
Level 2
Defined Benefit Plan Disclosure [Line Items]
Pooled separate accounts	2,148	2,654
Level 3
Defined Benefit Plan Disclosure [Line Items]
Pooled separate accounts	$ 0	$ 0

XML

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Details 2)	Jun. 30, 2018	Dec. 31, 2017
Equity
Pooled separate accounts
Actual plan asset allocations	32.00%	40.00%
Equity | Minimum
Pooled separate accounts
Target Allocation 2017	30.00%	30.00%
Equity | Maximum
Pooled separate accounts
Target Allocation 2017	40.00%	40.00%
Debt
Pooled separate accounts
Actual plan asset allocations	68.00%	60.00%
Debt | Minimum
Pooled separate accounts
Target Allocation 2017	60.00%	60.00%
Debt | Maximum
Pooled separate accounts
Target Allocation 2017	70.00%	70.00%

XML

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Details 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Defined Benefit Plan Disclosure [Line Items]
Amortization of Unrecognized net loss	$ 0	$ 0	$ 0	$ 0
Tax effect	0	0	0	0
Defined Benefit Pension Plan
Defined Benefit Plan Disclosure [Line Items]
Settlements	561	0	561	0
Amortization of Unrecognized net loss	10	24	34	49
Amortization of Unrecognized prior service cost	0	0	0	0
Unrecognized loss, before taxes	571	24	595	49
Tax effect	0	0	0	0
Unrecognized net (gain) loss, net of tax	571	24	595	49
Postretirement Medical Plan
Defined Benefit Plan Disclosure [Line Items]
Settlements	0	0	0	0
Amortization of Unrecognized net loss	1	2	2	4
Amortization of Unrecognized prior service cost	(2)	(2)	(4)	(4)
Unrecognized loss, before taxes	(1)	0	(2)	0
Tax effect	0	0	0	0
Unrecognized net (gain) loss, net of tax	$ (1)	$ 0	$ (2)	$ 0

XML

DEFINED BENEFIT AND POST RETIREMENT MEDICAL PLANS (Detail Textuals) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Compensation and Retirement Disclosure [Abstract]
Defined benefit plan, benefits paid	$ 1,069	$ 68	$ 1,185	$ 137
Defined benefit plan, contributions by employer	600	100	600	169
Defined benefit plan, actual return on plan assets	$ 8	$ 55	80	$ 147
Amount of retirement payments made previous employees			$ 1,012

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Financial assets
Available-for-sale securities	$ 14,302	$ 16,211
Recurring basis | Level 2
Financial assets
Available-for-sale securities	$ 14,302	$ 16,211

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 1) - Recurring basis - USD ($) $ in Thousands		Jun. 30, 2018	Dec. 31, 2017
Carrying Amount
Financial assets
Available-for-sale securities		$ 14,302	$ 16,211
Restricted equity securities	[1]	563	405
Loans, net		83,742	81,128
Financial liabilities
Deposits		83,502	86,826
FHLB Advances		12,500	9,000
Fair Value
Financial assets
Available-for-sale securities		14,302	16,211
Loans, net		82,628	81,686
Financial liabilities
Deposits		83,537	87,696
FHLB Advances		12,484	9,013
Level 1
Financial assets
Available-for-sale securities		0	0
Loans, net		0	0
Financial liabilities
Deposits		24,184	27,391
FHLB Advances		0	0
Level 2
Financial assets
Available-for-sale securities		14,302	16,211
Loans, net		0	0
Financial liabilities
Deposits		59,353	60,305
FHLB Advances		12,484	9,013
Level 3
Financial assets
Available-for-sale securities		0	0
Loans, net		82,628	81,686
Financial liabilities
Deposits		0	0
FHLB Advances		$ 0	$ 0

[1] It is not practicable to determine fair value of restricted equity securities due to restrictions placed on transferability.