14. Accumulated Other Comprehensive Loss (“AOCL”)

A summary of changes in AOCL follows:

	Unrealized Gains (Losses) on Securities Available for Sale			Dispropor- tionate Tax Effects from Securities Available for Sale			Unrealized Gains on Cash Flow Hedges			Total
	(In thousands)
For the three months ended September 30,
2018
Balances at beginning of period	$	(4,437	)	$	(5,798	)	$	1,021		$	(9,214	)
Other comprehensive income (loss) before reclassifications		(925	)		-			307			(618	)
Amounts reclassified from AOCL		-			-			(57	)		(57	)
Net current period other comprehensive income (loss)		(925	)		-			250			(675	)
Balances at end of period	$	(5,362	)	$	(5,798	)	$	1,271		$	(9,889	)

2017
Balances at beginning of period	$	1,986		$	(5,798	)	$	-		$	(3,812	)
Other comprehensive income before reclassifications		95			-			62			157
Amounts reclassified from AOCL		(5	)		-			3			(2	)
Net current period other comprehensive income		90			-			65			155
Balances at end of period	$	2,076		$	(5,798	)	$	65		$	(3,657	)

For the nine months ended September 30,
2018
Balances at beginning of period	$	(470	)	$	(5,798	)	$	269		$	(5,999	)
Other comprehensive income (loss) before reclassifications		(4,928	)		-			1,106			(3,822	)
Amounts reclassified from AOCL		36			-			(104	)		(68	)
Net current period other comprehensive income (loss)		(4,892	)		-			1,002			(3,890	)
Balances at end of period	$	(5,362	)	$	(5,798	)	$	1,271		$	(9,889	)

2017
Balances at beginning of period	$	(3,310	)	$	(5,798	)	$	-		$	(9,108	)
Cumulative effect of change in accounting		300			-			-			300
Balances at beginning of period, as adjusted		(3,010	)		(5,798	)		-			(8,808	)
Other comprehensive income before reclassifications		5,167			-			62			5,229
Amounts reclassified from AOCL		(81	)		-			3			(78	)
Net current period other comprehensive income		5,086			-			65			5,151
Balances at end of period	$	2,076		$	(5,798	)	$	65		$	(3,657	)

The disproportionate tax effects from securities available for sale arose due to tax effects of other comprehensive income (“OCI”) in the presence of a valuation allowance against our deferred tax assets and a pretax loss from operations. Generally, the amount of income tax expense or benefit allocated to operations is determined without regard to the tax effects of other categories of income or loss, such as OCI. However, an exception to the general rule is provided when, in the presence of a valuation allowance against deferred tax assets, there is a pretax loss from operations and pretax income from other categories in the current period. In such instances, income from other categories must offset the current loss from operations, the tax benefit of such offset being reflected in operations. Release of material disproportionate tax effects from other comprehensive income to earnings is done by the portfolio method whereby the effects will remain in AOCL as long as we carry a more than insubstantial portfolio of securities available for sale.

A summary of reclassifications out of each component of AOCL for the three months ended September 30 follows:

AOCL Component	Amount Reclassified From AOCL			Affected Line Item in Condensed Consolidated Statements of Operations
	(In thousands)
2018
Unrealized losses on securities available for sale
	$	-		Net gains (losses) on securities
		-		Net impairment loss recognized in earnings
		-		Total reclassifications before tax
		-		Income tax expense
	$	-		Reclassifications, net of tax
Unrealized gains on cash flow hedges

	$	(73	)	Interest expense
		(16	)	Income tax expense
	$	(57	)	Reclassification, net of tax

	$	57		Total reclassifications for the period, net of tax

2017
Unrealized gains on securities available for sale
	$	8		Net gains (losses) on securities
		-		Net impairment loss recognized in earnings
		8		Total reclassifications before tax
		3		Income tax expense
	$	5		Reclassifications, net of tax

Unrealized gains on cash flow hedges
	$	(5	)	Interest expense
		(2	)	Income tax expense
	$	(3	)	Reclassification, net of tax

	$	2		Total reclassifications for the period, net of tax

A summary of reclassifications out of each component of AOCL for the nine months ended September 30 follows:

AOCL Component	Amount Reclassified From AOCL			Affected Line Item in Condensed Consolidated Statements of Operations
	(In thousands)
2018
Unrealized losses on securities available for sale
	$	(45	)	Net gains (losses) on securities
		-		Net impairment loss recognized in earnings
		(45	)	Total reclassifications before tax
		(9	)	Income tax expense
	$	(36	)	Reclassifications, net of tax

Unrealized gains on cash flow hedges
	$	(132	)	Interest expense
		(28	)	Income tax expense
	$	(104	)	Reclassification, net of tax

	$	68		Total reclassifications for the period, net of tax

2017
Unrealized gains on securities available for sale
	$	125		Net gains (losses) on securities
		-		Net impairment loss recognized in earnings
		125		Total reclassifications before tax
		44		Income tax expense
	$	81		Reclassifications, net of tax

Unrealized gains on cash flow hedges
	$	(5	)	Interest expense
		(2	)	Income tax expense
	$	(3	)	Reclassification, net of tax

	$	78		Total reclassifications for the period, net of tax