Note 16 - Fair Values of Financial Instruments

12 Months Ended

Dec. 31, 2019

Note

. Fair Values of Financial Instruments

The estimated fair values of the Bank’s financial instruments are as follows:

	Carrying		December 31, 2019 using:
	Amount		Level 1		Level 2		Level 3		Total

Financial Assets:
Cash and cash equivalents	$	6,038,411	$	6,038,411	$	-	$	-	$	6,038,411
Time deposits		1,483,500		1,483,500		-		-		1,483,500
Federal funds sold		4,185,000		4,185,000		-		-		4,185,000
Securities		24,515,759		-		24,515,759		-		24,515,759
Net loans		247,775,814		-		-		248,373,122		248,373,122
Loans held for sale		1,225,526		-		1,225,526		-		1,225,526
Accrued interest receivable		875,104		875,104		-		-		875,104
Mortgage servicing rights		534,646		-		-		534,646		534,646
Financial Liabilities:
Non-interest bearing deposits		13,664,986		13,664,986		-		-		13,664,986
Interest bearing deposits		222,648,518		-		-		226,125,337		226,125,337
Accrued interest payable		8,146		8,146		-		-		8,146
FHLB advances		9,068,030		-		9,158,597		-		9,158,597

	Carrying		December 31, 2018 using:
	Amount		Level 1		Level 2		Level 3		Total

Financial Assets:
Cash and cash equivalents	$	8,430,458	$	8,430,458	$	-	$	-	$	8,430,458
Time deposits		250,000		250,000		-		-		250,000
Federal funds sold		5,663,000		5,663,000		-		-		5,663,000
Securities		26,302,888		-		26,302,888		-		26,302,888
Net loans		235,926,419		-		-		232,996,807		232,996,807
Accrued interest receivable		824,542		824,542		-		-		824,542
Mortgage servicing rights		446,375		-		-		446,375		446,375
Financial Liabilities:
Non-interest bearing deposits		14,057,719		14,057,719		-		-		14,057,719
Interest bearing deposits		209,390,810		-		-		209,576,569		209,576,569
Accrued interest payable		5,648		5,648		-		-		5,648
FHLB advances		12,087,152		-		12,136,386		-		12,136,386

In addition, other assets and liabilities of the Bank that are

not

defined as financial instruments are

not

included in the above disclosures, such as property and equipment. Also, non-financial instruments typically

not

recognized in financial statements nevertheless

may

have value but are

not

included in the above disclosures. These include, among other items, the estimated earnings power of core deposit accounts, the trained work force, customer goodwill and similar items.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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