Concentration of Credit Risk

12 Months Ended

Dec. 31, 2018

NOTE 12 — Concentration of Credit Risk

Financial instruments that potentially subject the Bank to credit risk consist primarily of cash and cash equivalents, investments, and loans. The Bank’s cash and cash equivalents are held in demand accounts with various institutions. The Bank’s investments are held in a variety of interest-bearing investments including obligations from the U.S. government and government sponsored agencies and certificates of deposit. Such deposits are generally in excess of insured limits. The Bank has not experienced any historical losses on its deposits of cash and cash equivalents. Practically all of the Bank’s loans and commitments have been granted to customers in the Bank’s market area. Although the Bank has a diversified loan portfolio, the ability of their debtors to honor their contracts is dependent on the economic conditions of the counties surrounding the Bank. The concentration of credit by type of loan is set forth in Note 4.