Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

INCOME TAXES [Abstract]

Schedule of Allocation of Federal and State Income Taxes

Allocation of federal and state income taxes between current and deferred portions is as follows:

	Years Ended December 31,
(dollars in thousands)	2013	2012
Current
Federal	$                    3,043	$                    2,827
State	845	678
	3,888	3,505
Deferred
Federal	(94)	(631)
State	(23)	(98)
	(117)	(729)
Total income tax expense	$                    3,771	$                    2,776

Schedule of Effective Income Tax Rate Reconciliation

The reasons for the differences between the statutory federal income tax rate and the effective tax rates are summarized as follows:

	Years Ended December 31,
	2013		2012
(dollars in thousands)	Amount	Percent of Pre-Tax  Income	Amount	Percent of Pre-Tax  Income
Expected income tax expense at
federal tax rate	$                3,544	34.00%	$                2,640	34.00%
State taxes net of federal benefit	577	5.53%	178	2.29%
Nondeductible expenses	35	0.33%	29	0.37%
Nontaxable income	(340)	(3.26%)	(320)	(4.12%)
Other	(45)	(0.42%)	249	3.21%
	$                3,771	36.18%	$                2,776	35.75%

Schedule of Deferred Tax Assets and Liabilities

The net deferred tax assets in the accompanying balance sheets include the following components:

	December 31,
(dollars in thousands)	2013	2012
Deferred tax assets
Allowance for loan losses	$                    3,283	$                    3,253
Deferred compensation	1,971	1,860
OREO valuation allowance & expenses	1,748	1,511
Unrealized loss on investment securities	545	-
Other	208	438
	7,755	7,062
Deferred tax liabilities
Unrealized gain on investment securities	-	72
FHLB stock dividends	156	156
Depreciation	60	29
	216	257
Net deferred tax assets	$                    7,539	$                    6,805