10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C.  20549

___________________

FORM 10-Q

(Mark One)

[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2015

[  ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________to ________

Commission File Number 0-29030

SUSSEX BANCORP

(Exact name of registrant as specified in its charter)   

New Jersey	22-3475473
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

100 Enterprise Drive, Suite 700,  Rockaway, NJ	07866
(Address of principal executive offices)	(Zip Code)

(844) 256-7328

(Registrant’s telephone number, including area code)

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 filing requirements for the past 90 days.  

Yes ☒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 ☒No ☐

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

Large accelerated filer ☐	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company ☒
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).Yes ☐No ☒

As of May 7, 2015 there were 4,674,997 shares of common stock, no par value, outstanding.

SUSSEX BANCORP

FORM 10-Q

INDEX

FORWARD-LOOKING STATEMENTS	i
PART I – FINANCIAL INFORMATION	1
Item 1 - Financial Statements	1
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3 - Quantitative and Qualitative Disclosures about Market Risk	29
Item 4 - Controls and Procedures	29
PART II – OTHER INFORMATION	30
Item 1 - Legal Proceedings	30
Item 1A - Risk Factors	30
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3 - Defaults Upon Senior Securities	30
Item 4 - Mine Safety Disclosures	30
Item 5 - Other Information	30
Item 6 - Exhibits	30

FORWARD-LOOKING STATEMENTS

We may, from time to time, make written or oral “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements contained in our filings with the Securities and Exchange Commission (the “SEC”), our reports to shareholders and in other communications by us. This Report on Form 10-Q contains “forward-looking statements” which may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated” and “potential.”  Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition, results of operation and business that are subject to various factors which could cause actual results to differ materially from these estimates.  These factors include, but are not limited to:

§ changes in the interest rate environment that reduce margins;

§ changes in the regulatory environment;

§ the highly competitive industry and market area in which we operate;

§ general economic conditions, either nationally or regionally, resulting in, among other things, a deterioration in credit quality;

§ changes in business conditions and inflation;

§ changes in credit market conditions;

§ changes in the securities markets which affect investment management revenues;

§ increases in Federal Deposit Insurance Corporation (“FDIC”) deposit insurance premiums and assessments could adversely affect our financial condition;

§ changes in technology used in the banking business;

§ the soundness of other financial services institutions which may adversely affect our credit risk;

§ our controls and procedures may fail or be circumvented;

§ new lines of business or new products and services which may subject us to additional risks;

§ changes in key management personnel which may adversely impact our operations;

§ the effect on our operations of recent legislative and regulatory initiatives that were or may be enacted in response to the ongoing financial crisis;

§ severe weather, natural disasters, acts of war or terrorism and other external events which could significantly impact our business; and

§ other factors detailed from time to time in our filings with the SEC.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from the results discussed in these forward-looking statements.  You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.  We do not undertake any obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

SUSSEX BANCORP
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in Thousands)	March 31, 2015		December 31, 2014
ASSETS
Cash and due from banks	$	2,606	$	2,953
Interest-bearing deposits with other banks		4,360		2,906
Cash and cash equivalents		6,966		5,859
Interest bearing time deposits with other banks		100		100
Securities available for sale, at fair value		84,573		77,976
Securities held to maturity, at amortized cost (fair value of $6,704 and $6,190 at March 31, 2015 and December 31, 2014, respectively)		6,491		6,006
Federal Home Loan Bank Stock, at cost		3,539		3,908
Loans receivable, net of unearned income		473,303		471,973
Less:  allowance for loan losses		5,763		5,641
Net loans receivable		467,540		466,332
Foreclosed real estate		2,852		4,449
Premises and equipment, net		8,750		8,650
Accrued interest receivable		1,908		1,796
Goodwill		2,820		2,820
Bank-owned life insurance		12,289		12,211
Other assets		6,423		5,808
Total Assets	$	604,251	$	595,915
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits:
Non-interest bearing	$	76,765	$	70,490
Interest bearing		396,747		387,780
Total deposits		473,512		458,270
Short-term borrowings		5,200		23,500
Long-term borrowings		56,000		46,000
Accrued interest payable and other liabilities		4,683		4,029
Junior subordinated debentures		12,887		12,887
Total Liabilities		552,282		544,686
Stockholders' Equity:
Preferred stock, no par value, 1,000,000 shares authorized; none issued		-		-
Common stock, no par value, 10,000,000 shares authorized; 4,700,230 and 4,673,789 shares issued and 4,669,597 and 4,662,606 shares outstanding at March 31, 2015 and December 31, 2014, respectively		35,644		35,553
Treasury stock, at cost; 30,633 and 11,183 shares at March 31, 2015 and December 31, 2014, respectively		(263)		(59)
Retained earnings		16,331		15,566
Accumulated other comprehensive income		257		169
Total Stockholders' Equity		51,969		51,229
Total Liabilities and Stockholders' Equity	$	604,251	$	595,915
See Notes to Unaudited Consolidated Financial Statements

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SUSSEX BANCORP
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Unaudited)
	Three Months Ended March 31,
(Dollars in thousands except per share data)		2015		2014
INTEREST INCOME
Loans receivable, including fees	$	5,172	$	4,623
Securities:
Taxable		267		217
Tax-exempt		208		254
Interest bearing deposits		4		3
Total Interest Income		5,651		5,097
INTEREST EXPENSE
Deposits		416		390
Borrowings		380		348
Junior subordinated debentures		53		53
Total Interest Expense		849		791
Net Interest Income		4,802		4,306
PROVISION FOR LOAN LOSSES		305		453
Net Interest Income after Provision for Loan Losses		4,497		3,853
OTHER INCOME
Service fees on deposit accounts		213		264
ATM and debit card fees		174		167
Bank-owned life insurance		78		83
Insurance commissions and fees		1,155		973
Investment brokerage fees		22		31
Net gain on sales of securities		168		-
Other		91		73
Total Other Income		1,901		1,591
OTHER EXPENSES
Salaries and employee benefits		2,780		2,418
Occupancy, net		477		453
Data processing		354		380
Furniture and equipment		210		164
Advertising and promotion		70		44
Professional fees		146		153
Director fees		166		137
FDIC assessment		124		176
Insurance		52		76
Stationary and supplies		56		55
Loan collection costs		97		77
Net expenses and write-downs related to foreclosed real estate		164		100
Other		374		235
Total Other Expenses		5,070		4,468
Income before Income Taxes		1,328		976
EXPENSE FOR INCOME TAXES		376		298
Net Income		952		678
OTHER COMPREHENSIVE INCOME:
Unrealized gains on available for sale securities arising during the period		316		1,717
Reclassification adjustment for net gain on securities transactions included in net income		(168)		-
Income tax related to items of other comprehensive income		(60)		(687)
Other comprehensive income, net of income taxes		88		1,030
Comprehensive income	$	1,040	$	1,708
EARNINGS PER SHARE
Basic	$	0.21	$	0.15
Diluted	$	0.21	$	0.15
See Notes to Unaudited Consolidated Financial Statements

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SUSSEX BANCORP
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Three Months Ended March 31, 2015 and 2014
(Unaudited)
							Accumulated
	Number of						Other				Total
	Shares		Common		Retained		Comprehensive		Treasury		Stockholders'
(Dollars in Thousands)	Outstanding		Stock		Earnings		Income (Loss)		Stock		Equity
Balance December 31, 2013	4,629,113	$	35,249	$	13,386	$	(2,151)	$	(59)	$	46,425
Net income	-		-		678		-		-		678
Other comprehensive loss	-		-		-		1,030		-		1,030
Restricted stock granted	29,043		-		-		-		-		-
Restricted stock forfeited	(300)		-		-		-		-		-
Compensation expense related to stock option and restricted stock grants	-		80		-		-		-		80
Balance March 31, 2014	4,657,856	$	35,329	$	14,064	$	(1,121)	$	(59)	$	48,213
Balance December 31, 2014	4,662,606	$	35,553	$	15,566	$	169	$	(59)	$	51,229
Net income	-		-		952		-		-		952
Other comprehensive income	-		-		-		88		-		88
Treasury shares purchased	(19,450)		-		-		-		(204)		(204)
Restricted stock granted	26,441		-		-		-		-		-
Compensation expense related to stock option and restricted stock grants	-		91		-		-		-		91
Dividends declared on common stock	-		-		(187)		-		-		(187)
Balance March 31, 2015	4,669,597	$	35,644	$	16,331	$	257	$	(263)	$	51,969
See Notes to Unaudited Consolidated Financial Statements

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SUSSEX BANCORP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended March 31,
(Dollars in thousands)	2015		2014
Cash Flows from Operating Activities
Net income	$	952	$	678
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		305		453
Depreciation and amortization		243		163
Net amortization of securities premiums and discounts		428		489
Net realized gain on sale of securities		(168)		-
Net realized gain on sale of foreclosed real estate		(27)		(13)
Write-downs of and provisions for foreclosed real estate		97		-
Deferred income tax (benefit) expense		(111)		251
Earnings on bank-owned life insurance		(78)		(83)
Compensation expense for stock options and stock awards		91		80
(Increase) decrease in assets:
Accrued interest receivable		(112)		(130)
Other assets		(563)		55
Increase in accrued interest payable and other liabilities		654		733
Net Cash Provided by Operating Activities		1,711		2,676
Cash Flows from Investing Activities
Securities available for sale:
Purchases		(21,632)		(4)
Sales		12,767		-
Maturities, calls and principal repayments		2,161		3,646
Securities held to maturity:
Purchases		(491)		-
Maturities, calls and principal repayments		-		262
Net increase in loans		(1,552)		(21,202)
Proceeds from the sale of foreclosed real estate		1,566		242
Purchases of bank premises and equipment		(343)		(874)
Decrease (increase) in Federal Home Loan Bank stock		369		(720)
Net Cash Used in Investing Activities		(7,155)		(18,650)
Cash Flows from Financing Activities
Net increase (decrease) in deposits		15,242		(4,460)
(Decrease) increase in short-term borrowed funds		(18,300)		15,000
Proceeds of long-term borrowings		15,000		-
Repayment of long-term borrowings		(5,000)		-
Purchase of treasury stock		(204)		-
Dividends paid		(187)		-
Net Cash Provided by Financing Activities		6,551		10,540
Net Increase (Decrease) in Cash and Cash Equivalents		1,107		(5,434)
Cash and Cash Equivalents - Beginning		5,859		13,246
Cash and Cash Equivalents - Ending	$	6,966	$	7,812
Supplementary Cash Flows Information
Interest paid	$	827	$	772
Income taxes paid	$	250	$	-
Supplementary Schedule of Noncash Investing and Financing Activities
Foreclosed real estate acquired in settlement of loans	$	39	$	443
See Notes to Unaudited Consolidated Financial Statements

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NOTE 1  –  SUMMARY OF SIGNIFICANT ACOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated financial statements include the accounts of Sussex Bancorp (“we,” “us,” “our” or the “company”) and our whollyowned subsidiary Sussex Bank (the “Bank”).  The Bank’s whollyowned subsidiaries are SCB Investment Company, Inc., SCBNY Company, Inc., ClassicLake Enterprises, LLC, Wheatsworth Properties Corp., PPD Holding Company, LLC, and Tri-State Insurance Agency, Inc. (“Tri-State”), a full service insurance agency located in Sussex County, New Jersey with a satellite office located in Bergen County, New Jersey.  Tri-State’s operations are considered a separate segment for financial disclosure purposes.  All inter-company transactions and balances have been eliminated in consolidation.  The Bank operates eleven banking offices, eight located in Sussex County, New Jersey,  one located in Warren County, New Jersey,  one in Queens County, New Yorkand one in Orange County, New York.

We are subject to the supervision and regulation of the Board of Governors of the Federal Reserve System (the “FRB”).  The Bank’s deposits are insured by the Deposit Insurance Fund (“DIF”) of the FDIC up to applicable limits.  The operations of the company and the Bank are subject to the supervision and regulation of the FRB, the FDIC and the New Jersey Department of Banking and Insurance (the “Department”) and the operations of Tri-State are subject to supervision and regulation by the Department.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information.  Accordingly, they do not include all of the information and footnotes required by the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for full year financial statements.  In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal, recurring nature.  Operating results for the threemonth period ended March  31, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.  These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto that are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.  

New Accounting Standards

In January 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-04, Receivables - Troubled Debt Restructurings by Creditors.  This ASU clarifies that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  For public entities, the guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014.  The adoption of this guidance did not have a material impact on our consolidated financial statements.

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers. The ASU’s core principle is built on the contract between a vendor and a customer for the provision of goods and services. It attempts to depict the exchange of rights and obligations between the parties in the pattern of revenue recognition based on the consideration to which the vendor is entitled. To accomplish this objective, the standard requires five basic steps: i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. For public entities, the guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2016.  However, on April 1, 2015, FASB proposed to defer the effective date by one year. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-11, Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures, to change the accounting for repurchase-to-maturity transactions and certain linked repurchase financings.  This will result in accounting for both types of arrangements as secured borrowings on the balance sheet, rather than sales.  Additionally, the ASU introduces new disclosures to (i) increase transparency about the types of collateral pledged in secured borrowing transactions and (ii) enable users to better understand transactions in which the transferor retains substantially all of the exposure to the economic return on the transferred financial asset throughout the term of the transaction. For public entities, the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. All other

5

accounting and disclosure amendments in the ASU are effective for public business entities for the first interim or annual period beginning after December 15, 2014. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force), to clarify that a performance target in a share-based compensation award that could be achieved after an employee completes the requisite service period should be treated as a performance condition that affects the vesting of the award.  As such, the performance target should not be reflected in estimating the grant-date fair value of the award. For all entities, the amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements

NOTE 2 – SECURITIES

Available for Sale

The amortized cost and approximate fair value of securities available for sale as of March 31, 2015 and December 31, 2014 are summarized as follows:

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
U.S. government agencies	$	11,428	$	25	$	(47)	$	11,406
State and political subdivisions		32,145		276		(220)		32,201
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,563		435		(43)		40,955
Equity securities-financial services industry and other		8		3		-		11
	$	84,144	$	739	$	(310)	$	84,573
December 31, 2014
U.S. government agencies	$	7,873	$	17	$	(32)	$	7,858
State and political subdivisions		26,432		158		(206)		26,384
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,382		500		(158)		43,724
Equity securities-financial services industry and other		8		2		-		10
	$	77,695	$	677	$	(396)	$	77,976

Securities with a carrying value of approximately $32.1 million and $32.8 million at March 31, 2015 and December 31, 2014, respectively, were pledged to secure public deposits and for other purposes required or permitted by applicable laws and regulations.

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The amortized cost and fair value of securities available for sale at March 31, 2015 are shown below by contractual maturity.  Actual maturities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Fair
(Dollars in thousands)	Cost		Value
Due in one year or less	$	-	$	-
Due after one year through five years		-		-
Due after five years through ten years		2,301		2,333
Due after ten years		29,844		29,868
Total bonds and obligations		32,145		32,201
U.S. government agencies		11,428		11,406
Mortgage-backed securities:
U.S. government-sponsored enterprises		40,563		40,955
Equity securities-financial services industry and other		8		11
Total available for sale securities	$	84,144	$	84,573

Gross realized gains on sales of securities available for sale were $216 thousand and gross realized losses were $48 thousand for the three months ended March 31, 2015. There were no sales of securities available for sale for the three months ended March 31, 2014. 

Temporarily Impaired Securities

The following table shows gross unrealized losses and fair value of securities with unrealized losses that are not deemed to be other than temporarily impaired, aggregated by category and length of time that individual available for sale securities have been in a continuous unrealized loss position at March 31, 2015 and December 31, 2014.

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
U.S. government agencies	$	5,677	$	(16)	$	2,784	$	(31)	$	8,461	$	(47)
State and political subdivisions		15,522		(179)		1,859		(41)		17,381		(220)
Mortgage-backed securities -
U.S. government-sponsored enterprises		9,624		(30)		2,024		(13)		11,648		(43)
Total temporarily impaired securities	$	30,823	$	(225)	$	6,667	$	(85)	$	37,490	$	(310)
December 31, 2014
U.S. government agencies	$	-	$	-	$	2,905	$	(32)	$	2,905	$	(32)
State and political subdivisions		7,603		(112)		5,713		(94)		13,316		(206)
Mortgage-backed securities -
U.S. government-sponsored enterprises		15,679		(94)		3,432		(64)		19,111		(158)
Total temporarily impaired securities	$	23,282	$	(206)	$	12,050	$	(190)	$	35,332	$	(396)

For each security whose fair value is less than their amortized cost basis, a review is conducted to determine if an other-than-temporary impairment has occurred. As of March 31, 2015, we reviewed our available for sale securities portfolio for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and the intent and likelihood of selling the security.  The intent and likelihood of sale of debt and equity securities are evaluated based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position. 

U.S. Government Agencies

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At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our U.S. government agencies securities were primarily due to changes in spreads and market conditions and not credit quality.  At March 31, 2015, there werefive securities with a fair value of $8.5 million that had an unrealized loss that amounted to $47 thousand.  As of March 31, 2015, we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of the U.S. government agency securities at March 31, 2015, were deemed to be other-than-temporarily impaired (“OTTI”).

At December 31, 2014, there were two securities with a fair value of $2.9 million that had an unrealized loss that amounted to $32 thousand.

State and Political Subdivisions

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our state and political subdivisions securities were caused by changes in interest rates and spreads and were not the result of credit quality.  At March 31, 2015, there were 28securities with a fair value of $17.4 million that had an unrealized loss that amounted to $220 thousand.  These securities typically have maturity dates greater than 10 years and the fair values are more sensitive to changes in market interest rates.  As of March 31, 2015,  we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our state and political subdivision securities at March 31, 2015, were deemed to be OTTI.  

At December 31, 2014, there were 22 securities with a fair value of $13.3 million that had an unrealized loss that amounted to $206 thousand. 

Mortgage-Backed Securities

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our mortgage-backed securities guaranteed by U.S. government-sponsored enterprises were primarily due to changes in spreads and market conditions and not credit quality.  At March 31, 2015, there were sevensecurities with a fair value of $11.6 million that had an unrealized loss that amounted to $43thousand.  As of March 31, 2015,  we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our mortgage-backed securities at March 31, 2015, were deemed to be OTTI.  

At December 31, 2014, there were 13 securities with a fair value of $19.1 million that had an unrealized loss that amounted to $158 thousand. 

Equity Securities

Our marketable equity securities portfolio consists primarily of common stock of entities in the financial services industry.  At March 31, 2015, we did not have any securities in an unrealized loss position.

At December 31, 2014,  we did not have any securities in an unrealized loss position.

We continue to closely monitor the performance of the securities we own as well as the impact from any further deterioration in the economy or in the banking industry that may adversely affect these securities. We will continue to evaluate them for other-than-temporary impairment, which could result in a future non-cash charge to earnings.

Held to Maturity Securities

The amortized cost and approximate fair value of securities held to maturity as of March 31, 2015 and December 31, 2014, are summarized as follows:

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
State and political subdivisions	$	6,491	$	214	$	(1)	$	6,704
December 31, 2014
State and political subdivisions	$	6,006	$	189	$	(5)	$	6,190

The amortized cost and carrying value of securities held to maturity at March 31, 2015 are shown below by contractual maturity.  Actual maturities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

8

		Amortized		Fair
(Dollars in thousands)		Cost		Value
Due in one year or less	$	2,590	$	2,590
Due after one year through five years		-		-
Due after five years through ten years		2,846		2,937
Due after ten years		1,055		1,177
Total held to maturity securities	$	6,491	$	6,704

Temporarily Impaired Securities

The following table shows gross unrealized losses and fair value of held to maturity securities with unrealized losses that are not deemed to be other than temporarily impaired, aggregated by category and length of time that individual held to maturity securities have been in a continuous unrealized loss position at March 31, 2015 and December 31, 2014:

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
State and political subdivisions	$	261	$	(1)	$	-	$	-	$	261	$	(1)
December 31, 2014
State and political subdivisions	$	-	$	-	$	811	$	(5)	$	811	$	(5)

For each security whose fair value is less than their amortized cost basis, a review is conducted to determine if an other-than-temporary impairment has occurred. As of March 31, 2015, we reviewed our held to maturity securities portfolio for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and the intent and likelihood of selling the security.  The intent and likelihood of sale of debt and equity securities are evaluated based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position.

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our state and political subdivisions securities were caused by changes in interest rates and spreads and were not the result of credit quality.  At March 31, 2015, there wasonesecurity with a fair value of $261 thousand that had an unrealized loss that amounted to $1 thousand.  These securities typically have maturity dates greater than 10years and the fair values are more sensitive to changes in market interest rates.  As of March 31, 2015,  we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our state and political subdivision securities at March 31, 2015 were deemed to be OTTI.

At December 31, 2014, there were two securities with a fair value of $811 thousand that had an unrealized loss that amounted to $5 thousand. 

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NOTE 3 – LOANS

The composition of net loans receivable at March 31, 2015 and December 31, 2014 is as follows:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	18,822	$	20,549
Construction		13,239		12,379
Commercial real estate		325,742		326,370
Residential real estate		114,663		111,498
Consumer and other		1,324		1,665
Total loans receivable		473,790		472,461
Unearned net loan origination fees		(487)		(488)
Allowance for loan losses		(5,763)		(5,641)
Net loans receivable	$	467,540	$	466,332

Mortgage loans serviced for others are not included in the accompanying balance sheets.  The total amount of loans serviced for the benefit of others was approximately $470 thousand and $475 thousand at March 31, 2015 and December 31, 2014, respectively. Mortgage servicing rights were immaterial at March 31, 2015 and December 31, 2014.

NOTE 4 – ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY OF FINANCING RECEIVABLES

The following table presents changes in the allowance for loan losses disaggregated by the class of loans receivable for the three months ended March 31, 2015 and 2014:  

	Commercial				Commercial		Residential		Consumer
	and				Real		Real		and
(Dollars in thousands)	Industrial		Construction		Estate		Estate		Other		Unallocated		Total
Three Months Ended:
March 31, 2015
Beginning balance	$	231	$	383	$	3,491	$	903	$	19	$	614	$	5,641
Charge-offs		(19)		-		(188)		-		(7)		-		(214)
Recoveries		4		-		12		12		3		-		31
Provision		(78)		5		472		(74)		73		(93)		305
Ending balance	$	138	$	388	$	3,787	$	841	$	88	$	521	$	5,763
March 31, 2014
Beginning balance	$	222		308	$	3,399	$	941	$	16	$	535	$	5,421
Charge-offs		-		-		(358)		(86)		(13)		-		(457)
Recoveries		12		-		4		1		3		-		20
Provision		55		7		642		6		13		(270)		453
Ending balance	$	289	$	315	$	3,687	$	862	$	19	$	265	$	5,437

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The following table presents the balance of the allowance of loan losses and loans receivable by class at March 31, 2015 and December 31, 2014 disaggregated on the basis of our impairment methodology.

	Allowance for Loan Losses						Loans Receivable
			Balance		Balance
			Related to		Related to
			Loans		Loans
			Individually		Collectively				Individually		Collectively
			Evaluated for		Evaluated for				Evaluated for		Evaluated for
(Dollars in thousands)	Balance		Impairment		Impairment		Balance		Impairment		Impairment
March 31, 2015
Commercial and industrial	$	138	$	1	$	137	$	18,822	$	21	$	18,801
Construction		388		-		388		13,239		-		13,239
Commercial real estate		3,787		334		3,453		325,742		5,944		319,798
Residential real estate		841		108		733		114,663		1,974		112,689
Consumer and other loans		88		73		15		1,324		138		1,186
Unallocated		521		-		-		-		-		-
Total	$	5,763	$	516	$	4,726	$	473,790	$	8,077	$	465,713
December 31, 2014
Commercial and industrial	$	231	$	51	$	180	$	20,549	$	94	$	20,455
Construction		383		-		383		12,379		-		12,379
Commercial real estate		3,491		136		3,355		326,370		5,105		321,265
Residential real estate		903		101		802		111,498		2,314		109,184
Consumer and other loans		19		-		19		1,665		-		1,665
Unallocated		614		-		-		-		-		-
Total	$	5,641	$	288	$	4,739	$	472,461	$	7,513	$	464,948

An age analysis of loans receivable, which were past due as of March 31, 2015 and December 31, 2014, is as follows:

													Recorded
													Investment
					Greater						Total		> 90 Days
	30-59 Days		60-89 days		Than		Total Past				Financing		and
(Dollars in thousands)	Past Due		Past Due		90 Days (a)		Due		Current		Receivables		Accruing
March 31, 2015
Commercial and industrial	$	10	$	15	$	20	$	45	$	18,777	$	18,822	$	-
Construction		-		-		-		-		13,239		13,239		-
Commercial real estate		2,165		1,107		4,917		8,189		317,553		325,742		-
Residential real estate		879		-		1,557		2,436		112,227		114,663		-
Consumer and other		2		-		139		141		1,183		1,324		1
Total	$	3,056	$	1,122	$	6,633	$	10,811	$	462,979	$	473,790	$	1
December 31, 2014
Commercial and industrial	$	9	$	-	$	94	$	103	$	20,446	$	20,549	$	-
Construction		1,354		-		-		1,354		11,025		12,379		-
Commercial real estate		2,395		1,209		3,936		7,540		318,830		326,370		-
Residential real estate		555		108		1,978		2,641		108,857		111,498		85
Consumer and other		5		-		1		6		1,659		1,665		-
Total	$	4,318	$	1,317	$	6,009	$	11,644	$	460,817	$	472,461	$	85
(a) includes loans greater than 90 days past due and still accruing and non-accrual loans.

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Loans for which the accrual of interest has been discontinued at March 31, 2015 and December 31, 2014 were:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	20	$	94
Commercial real estate		4,917		3,936
Residential real estate		1,557		1,893
Consumer and other		138		1
Total	$	6,632	$	5,924

In determining the adequacy of the allowance for loan losses, we estimate losses based on the identification of specific problem loans through our credit review process and also estimate losses inherent in other loans on an aggregate basis by loan type.  The credit review process includes the independent evaluation of the loan officer assigned risk ratings by the Chief Credit Officer and a third party loan review company.  Such risk ratings are assigned loss component factors that reflect our loss estimate for each group of loans.  It is management’s and the Board of Directors’ responsibility to oversee the lending process to ensure that all credit risks are properly identified, monitored, and controlled, and that loan pricing, terms and other safeguards against non-performance and default are commensurate with the level of risk undertaken and is rated as such based on a risk-rating system.  Factors considered in assigning risk ratings and loss component factors include: borrower specific information related to expected future cash flows and operating results, collateral values, financial condition, payment status and other information; levels of and trends in portfolio charge-offs and recoveries; levels in portfolio delinquencies; effects of changes in loan concentrations and observed trends in the economy and other qualitative measurements.

Our risk-rating system is consistent with the classification system used by regulatory agencies and with industry practices. Loan classifications of Substandard, Doubtful or Loss are consistent with the regulatory definitions of classified assets.  The classification system is as follows:

· Pass: This category represents loans performing to contractual terms and conditions and the primary source of repayment is adequate to meet the obligation.  We have five categories within the Pass classification depending on strength of repayment sources, collateral values and financial condition of the borrower. 

· Special Mention:  This category represents loans performing to contractual terms and conditions; however the primary source of repayment or the borrower is exhibiting some deterioration or weaknesses in financial condition that could potentially threaten the borrowers’ future ability to repay our loan principal and interest or fees due.

· Substandard: This category represents loans that the primary source of repayment has significantly deteriorated or weakened which has or could threaten the borrowers’ ability to make scheduled payments.  The weaknesses require close supervision by management and there is a distinct possibility that we could sustain some loss if the deficiencies are not corrected.  Such weaknesses could jeopardize the timely and ultimate collection of our loan principal and interest or fees due.  Loss may not be expected or evident, however, loan repayment is inadequately supported by current financial information or pledged collateral.

· Doubtful: Loans so classified have all the inherent weaknesses of a substandard loan with the added provision that collection or liquidation in full is highly questionable and not reasonably assured.  The probability of at least partial loss is high, but extraneous factors might strengthen the asset to prevent loss. The validity of the extraneous factors must be continuously monitored. Once these factors are questionable the loan should be considered for full or partial charge-off.

· Loss: Loans so classified are considered uncollectible, and of such little value that their continuance as active assets is not warranted.  Such loans are fully charged off.

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The following tables illustrate our corporate credit risk profile by creditworthiness category as of March 31, 2015 and December 31, 2014: 

			Special
(Dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
March 31, 2015
Commercial and industrial	$	18,794	$	8	$	20	$	-	$	18,822
Construction		13,239		-		-		-		13,239
Commercial real estate		311,692		7,519		6,531		-		325,742
Residential real estate		112,100		451		2,112		-		114,663
Consumer and other		1,186		-		138		-		1,324
	$	457,011	$	7,978	$	8,801	$	-	$	473,790
December 31, 2014
Commercial and industrial	$	20,446	$	9	$	94	$	-	$	20,549
Construction		12,379		-		-		-		12,379
Commercial real estate		312,172		8,257		5,941		-		326,370
Residential real estate		108,587		457		2,454		-		111,498
Consumer and other		1,527		138		-		-		1,665
	$	455,111	$	8,861	$	8,489	$	-	$	472,461

The following table reflects information about our impaired loans by class as of March 31, 2015 and December 31, 2014:

		March 31, 2015						December 31, 2014
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
(Dollars in thousands)	Investment		Balance		Allowance		Investment		Balance		Allowance
With no related allowance recorded:
Commercial and industrial	$	20	$	20	$	-	$	-	$	-	$	-
Commercial real estate		2,351		2,351		-		3,167		3,736		-
Residential real estate		1,433		1,432		-		1,829		1,835		-
With an allowance recorded:
Commercial and industrial		1		1		1		94		94		51
Commercial real estate		3,593		4,162		334		1,938		1,938		136
Residential real estate		541		552		108		485		489		101
Consumer and other		138		138		73		-		-		-
Total:
Commercial and industrial		21		21		1		94		94		51
Commercial real estate		5,944		6,513		334		5,105		5,674		136
Residential real estate		1,974		1,984		108		2,314		2,324		101
Consumer and other		138		138		73		-		-		-
	$	8,077	$	8,656	$	516	$	7,513	$	8,092	$	288

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The following table presents the average recorded investment and income recognized for the three months ended March 31, 2015 and 2014:

	For the Three Months Ended March 31, 2015				For the Three Months Ended March 31, 2014
	Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income
(Dollars in thousands)	Investment		Recognized		Investment		Recognized
With no related allowance recorded:
Commercial and industrial	$	10	$	-	$	-	$	-
Commercial real estate		2,759		5		4,968		8
Residential real estate		1,631		1		1,845		20
Total impaired loans without a related allowance		4,400		6		6,813		28
With an allowance recorded:
Commercial and industrial		47		-		-		-
Commercial real estate		2,766		8		5,319		1
Residential real estate		513		3		849		4
Consumer and other		69		-		1		-
Total impaired loans with an allowance		3,395		11		6,169		5
Total impaired loans	$	7,795	$	17	$	12,982	$	33

We recognize interest income on performing impaired loans as payments are received.  On non-performing impaired loans we do not recognize interest income as all payments are recorded as a reduction of principal on such loans.

Impaired loans include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.  These concessions could include a reduction in the interest rate on the loan, payment extensions, postponement or forgiveness of principal, forbearance or other actions intended to maximize collection.  The concessions rarely result in the forgiveness of principal or accrued interest.  In addition, we attempt to obtain additional collateral or guarantor support when modifying such loans.  Non-accruing restructured loans may be returned to accrual status when there has been a sustained period of repayment performance (generally six consecutive months of payments) and both principal and interest are deemed collectible.

The following table presents the recorded investment in troubled debt restructured loans, based on payment performance status:

(Dollars in thousands)		Commercial Real Estate	Residential Real Estate		Total
March 31, 2015
Performing	$	1,162	$	418	$	1,580
Non-performing		2,725		223		2,948
Total	$	3,887	$	641	$	4,528
December 31, 2014
Performing	$	1,169	$	421	$	1,590
Non-performing		2,730		224		2,954
Total	$	3,899	$	645	$	4,544

Troubled debt restructured loans are considered impaired and are included in the previous impaired loans disclosures in this footnote.  As of March 31, 2015, we have not committed to lend additional amounts to customers with outstanding loans that are classified as troubled debt restructurings.

There wereno troubled debt restructurings that occurred during the three months ended March 31, 2015 and 2014. 

There were no troubled debt restructurings for which there was a payment default within twelve months following the date of the restructuring for the three months ended March 31, 2015 and 2014.

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We may obtain physical possession of residential real estate collateralizing a consumer mortgage loan via foreclosure on an in-substance repossession. As of March 31, 2015, we held foreclosed residential real estate properties with a carrying value of $281 thousand as a result of obtaining physical possession. In addition, as of March 31, 2015, we had consumer loans with a carrying value of $1.3 million collateralized by residential real estate property for which formal foreclosure proceedings were in process.

NOTE 5 – EARNINGS PER SHARE

Basic earnings per share are calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period.  Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares (unvested restricted stock grants and stock options) had been issued, as well as any adjustment to income that would result from the assumed issuance of potential common shares that may be issued by us. Potential common shares related to stock options are determined using the treasury stock method.

	Three Months Ended March 31, 2015					Three Months Ended March 31, 2014
(In thousands, except share and	Income		Shares	Per Share		Income		Shares	Per Share
per share data)	(Numerator)		(Denominator)	Amount		(Numerator)		(Denominator)	Amount
Basic earnings per share:
Net earnings applicable to common stockholders	$	952	4,571,142	$	0.21	$	678	4,526,506	$	0.15
Effect of dilutive securities:
Unvested stock awards		-	31,768				-	38,094
Diluted earnings per share:
Net income applicable to common stockholders and assumed conversions	$	952	4,602,910	$	0.21	$	678	4,564,600	$	0.15

There were 21,224 and 7,734 shares of unvested restricted stock awards and options outstanding duringthe quarter ended March 31,  2015 and 2014, respectively, which were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive. 

NOTE 6 – OTHER COMPREHENSIVEINCOME

Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income.  Although certain changes in assets and liabilities, such as unrealized gains and losses on available for sale securities, are reported as a separate component of the equity section of the balance sheet, such items, along with net income, are components of comprehensive income.

15

The components of other comprehensive income, both before tax and net of tax, are as follows:

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Before Tax		Tax Effect		Net of Tax		Before Tax		Tax Effect		Net of Tax
(Dollars in thousands)
Other comprehensive income:
Unrealized gains on available for sale securities	$	316	$	127	$	189	$	1,717	$	687	$	1,030
Reclassification adjustment for net gains on securities transactions included in net income		(168)		(67)		(101)		-		-		-
Total other comprehensive income	$	148	$	60	$	88	$	1,717	$	687	$	1,030

Reclassification adjustments for gains on securities transactions of $168thousand for the threemonths ended March 31, 2015are presented in the income statement on the line item for net gain on securities transactions.  There were noreclassification adjustments for gains on securities transactions for the three months ended March 31, 2014.

NOTE 7 – SEGMENT INFORMATION

Our insurance agency operations are managed separately from the traditional banking and related financial services that we also offer.  The insurance agency operation provides commercial, individual, and group benefit plans and personal coverage.

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Banking and						Banking and
	Financial		Insurance				Financial		Insurance
	Services		Services		Total		Services		Services		Total
(Dollars in thousands)
Net interest income from external sources	$	4,802	$	-	$	4,802	$	4,305	$	1	$	4,306
Other income from external sources		743		1,158		1,901		606		985		1,591
Depreciation and amortization		239		4		243		158		5		163
Income before income taxes		928		400		1,328		622		354		976
Income tax expense (1)		216		160		376		156		142		298
Total assets		598,265		5,986		604,251		543,151		3,821		546,972

(1) Insurance Services calculated at statutory tax rate of 40%

NOTE 8–  STOCK-BASED COMPENSATION

We currently have stock-based compensation plans in place for our directors, officers, employees, consultants and advisors.  Under the terms of these plans we may grant restricted shares and stock options for the purchase of our common stock.  The stock-based compensation is granted under terms determined by our Compensation Committee.Our standard stock option grants have a maximum term of 10 years, generally vest over periods ranging between one and four years, and are granted with an exercise price equal to the fair market value of the common stock on the date of grant.  Restricted stock is valued at the market value of the common stock on the date of grant and generally vests over periods oftwo toseven years.  All dividends paid on restricted stock, whether vested or unvested, are paid to the shareholder.

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Information regarding our stock option plans for the three months endedMarch 31, 2015 is as follows:

			Weighted
			Average	Weighted
			Exercise	Average		Aggregate
	Number of		Price per	Contractual		Intrinsic
	Shares		Share	Term		Value
Options outstanding, beginning of year	46,525	$	10.63
Options granted	15,985		10.25
Options expired	(3,817)		13.39
Options outstanding, end of quarter	58,693	$	10.35	8.6	$	62,065
Options exercisable, end of quarter	6,708	$	12.63	0.6	$	-
Option price range at end of quarter	$9.97 to $12.63
Option price of exercisable shares	$ 12.63

The following table summarizes information about stock option assumptions:

	March 31, 2015
Expected dividend yield		1.56%
Expected volatility		34.32%
Risk-free interest rate		1.37%
Expected option life		10.0 Years

During the three months ended March 31, 2015, we expensed $9 thousand in stock-based compensation under stock option awards.  There was no stock-based compensation expensed under stock option awards during the three months ended March 31, 2014.

The weighted average grant date fair value of options granted during the quarter ended March 31, 2015 was $3.56 per share. Expected future expense relating to the unvested options outstanding as of March 31, 2015 is $179 thousand over a weighted average period of 4.7 years. Upon exercise of vested options, management expects to draw on treasury stock as the source of the shares.

The summary of changes in unvested restricted stock awards for the three months endedMarch 31, 2015, is as follows:

			Weighted
			Average
	Number of		Grant Date
	Shares		Fair Value
Unvested restricted stock, beginning of year	112,545	$	6.06
Granted	26,441		10.34
Vested	(36,991)		5.80
Unvested restricted stock, end of period	101,995	$	7.27

During the three months ended March 31, 2015 and 2014, we expensed$82 thousand and $80 thousand, respectively, in stock-based compensation under restricted stock awards.

At March  31, 2015, unrecognized compensation expense for unvested restricted stock was $630 thousand, which is expected to be recognized over an average period of 2.0years. 

NOTE 9 – GUARANTEES

We do not issue any guarantees that would require liability recognition or disclosure, other than standby letters of credit.  Standby letters of credit are conditional commitments issued by us to guarantee the performance of a customer to a third party.  Generally, all letters of credit, when issued, have expiration dates within one year.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.  Generally, we hold collateral and/or personal guarantees supporting these commitments.  As of March 31, 2015, we had $910 thousand of outstanding letters of credit.  Management believes that the proceeds obtained through a liquidation of

17

collateral and the enforcement of guarantees would be sufficient to cover the potential amount of future payments required under the corresponding guarantees.  The amount of the liability as of March 31, 2015, for guarantees under standby letters of credit issued is not material.

NOTE 10–  FAIR VALUE OF FINANCIAL INSTRUMENTS

Management uses its best judgment in estimating the fair value of our financial instruments; however, there are inherent weaknesses in any estimation technique.  Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts we could have realized in a sale transaction on the dates indicated.  The fair value amounts have been measured as of their respective period ends, and have not been re-evaluated or updated for purposes of these financial statements subsequent to those respective dates.  As such, the fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each period end.

In accordance with U.S. GAAP, we use a hierarchical disclosure framework associated with the level of pricing observability utilized in measuring assets and liabilities at fair value.  The three broad levels defined by the hierarchy are as follows:

· Level I - Quoted prices are available in active markets for identical assets or liabilities as of the reported date.

· Level II - Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these asset and liabilities include items for which quoted prices are available but traded less frequently, and items that are fair valued using other financial instruments, the parameters of which can be directly observed.

· Level III - Assets and liabilities that have little to no pricing observability as of reported date.  These items do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.

The following table summarizes the fair value of our financial assets measured on a recurring basis by the above pricing observability levels as of March 31, 2015 and December 31, 2014:

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
U.S. government agencies	$	11,406	$	-	$	11,406	$	-
State and political subdivisions		32,201		-		32,201		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,955		-		40,955		-
Equity securities-financial services industry and other		11		11		-		-
December 31, 2014
U.S. government agencies	$	7,858	$	-	$	7,858	$	-
State and political subdivisions		26,384		-		26,384		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,724		-		43,724		-
Equity securities-financial services industry and other		10		10		-		-

Our available for sale and held to maturity securities portfolios contain investments, which were all rated within our investment policy guidelines at time of purchase and upon review of the entire portfolio all securities are marketable and have observable pricing inputs.

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For financial assets measured at fair value on a nonrecurring basis the fair value measurements by level within the fair value hierarchy used at March 31, 2015 and December 31, 2014are as follows:

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
Impaired loans	$	1,784	$	-	$	-	$	1,784
December 31, 2014
Impaired loans	$	1,087	$	-	$	-	$	1,087
Foreclosed real estate		761		-		-		761

The following table presents additional qualitative information about assets measured at fair value on a nonrecurring basis and for which Level 3 inputs were used to determine fair value:

	Qualitative Information about Level III Fair Value Measurements
	Fair				Range
	Value		Valuation	Unobservable	(Weighted
(Dollars in thousands)	Estimate		Techniques	Input	Average)
March 31, 2015
Impaired loans	$	1,784	Appraisal of	Appraisal	0% to -74.8%
			collateral	adjustments (1)	(-7.5%)
December 31, 2014
Impaired loans	$	1,087	Appraisal of	Appraisal	0% to -67.9%
			collateral	adjustments (1)	(-7.8%)
Foreclosed real estate		761	Appraisal of	Selling
			collateral	expenses (1)	-7.0%(-7.0%)
(1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated selling expenses.  The range and weighted average of selling expenses and other appraisal adjustments are presented as a percentage of the appraisal.

The following information should not be interpreted as an estimate of the fair value of the entire company since a fair value calculation is only provided for a limited portion of our assets and liabilities.  Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between our disclosures and those of other companies may not be meaningful.  The following methods and assumptions were used to estimate the fair value of our financial instruments at March 31, 2015 and December 31, 2014:  

Cash and Cash Equivalents (Carried at Cost): The carrying amounts reported in the balance sheet for cash and cash equivalents approximate those assets’ fair value.

Deposits (Carried at Cost): Fair value for fixed-rate time certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits.  We generally purchase amounts below the insured limit, limiting the amount of credit risk on these time deposits.  

Securities: The fair value of securities, available for sale (carried at fair value) and securities held to maturity (carried at amortized cost) are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level I), or matrix pricing (Level II), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’

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relationship to other benchmark quoted prices.  For certain securities which are not traded in active markets or are subject to transfer restrictions, valuations are adjusted to reflect illiquidity and/or non-transferability, and such adjustments are generally based on available market evidence (Level III).  In the absence of such evidence, management’s best estimate is used.  Management’s best estimate consists of both internal and external support on certain Level III measurements.  Internal cash flow models using a present value formula that includes assumptions market participants would use along with indicative exit pricing obtained from broker/dealers (where available) were used to support fair values of certain Level III investments.

Federal Home Loan Bank Stock (Carried at Cost):  The carrying amount of restricted investment in bank stock approximates fair value and considers the limited marketability of such securities.

Loans Receivable (Carried at Cost): The fair values of non-impaired loans are estimated using discounted cash flow analyses, using the market rates at the balance sheet date that reflect the credit and interest rate-risk inherent in the loans.  Projected future cash flows are calculated based upon contractual maturity or call dates, projected repayments and prepayments of principal.  Generally, for variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values.

Impaired Loans (Carried at Lower of Cost or Fair Value): Fair value of impaired loans is generally determined based upon independent third-party appraisals of the properties, or discounted cash flows based upon the expected proceeds.  These assets are included in Level III fair values, based upon the lowest level of input that is significant to the fair value measurements.  The fair value of impaired loans  totaled  $1.8 million and $1.1 million at March 31, 2015 and December 31, 2014,respectively.  These balances consist of loans that were written down or required additional reserves during the periods ended March 31, 2015 and December 31, 2014, respectively.

Deposit Liabilities (Carried at Cost): The fair values disclosed for demand, savings and money market accounts are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts).  Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. 

Borrowings (Carried at Cost): Fair values of Federal Home Loan Bank (“FHLB”) advances are estimated using discounted cash flow analysis, based on quoted prices for new FHLB advances with similar credit risk characteristics, terms and remaining maturity.  These prices obtained from this active market represent a market value that is deemed to represent the transfer price if the liability were assumed by a third party. 

Junior Subordinated Debentures (Carried at Cost): Fair values of junior subordinated debt are estimated using discounted cash flow analysis, based on market rates currently offered on such debt with similar credit risk characteristics, terms and remaining maturity. 

Accrued Interest Receivable and Accrued Interest Payable (Carried at Cost): The carrying amounts of accrued interest receivable and payable approximate its fair value.

Off-Balance Sheet Instruments (Disclosed at Cost): Fair values for our off-balance sheet financial instruments (lending commitments and letters of credit) are based on fees currently charged in the market to enter into similar agreements, taking into account, the remaining terms of the agreements and the counterparties’ credit standing. 

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The fair values of our financial instruments at March 31, 2015 and December 31, 2014, were as follows:

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	March 31, 2015				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	6,966	$	6,966	$	6,966	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		84,573		84,573		11		84,562		-
Securities held to maturity		6,491		6,704		-		6,704		-
Federal Home Loan Bank stock		3,539		3,539		-		3,539		-
Loans receivable, net of allowance		467,540		467,313		-		-		467,313
Accrued interest receivable		1,908		1,908		-		1,908		-
Financial liabilities:
Non-maturity deposits		357,007		357,007		-		357,007		-
Time deposits		116,505		107,011		-		116,918		-
Short-term borrowings		5,200		5,200		5,200		-		-
Long-term borrowings		56,000		57,738		-		57,738		-
Junior subordinated debentures		12,887		9,970		-		9,970		-
Accrued interest payable		265		265		-		265		-

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	December 31, 2014				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	5,859	$	5,859	$	5,859	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		77,976		77,976		-		-		-
Securities held to maturity		6,006		6,190		-		6,190		-
Federal Home Loan Bank stock		3,908		3,908		-		3,908		-
Loans receivable, net of allowance		466,332		462,984		-		-		462,984
Accrued interest receivable		1,796		1,796		-		1,796		-
Financial liabilities:
Non-maturity deposits		351,653		351,653		-		351,653		-
Time deposits		106,617		107,011		-		107,011		-
Short-term borrowings		23,500		23,500		23,500		-		-
Long-term borrowings		46,000		47,766		-		47,766		-
Junior subordinated debentures		12,887		9,361		-		9,361		-
Accrued interest payable		243		243		-		243		-

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Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations

MANAGEMENT STRATEGY

We are a community-oriented financial institution serving northern New Jersey, northeastern Pennsylvania, New York City, New York and Orange County, New York.  While offering traditional community bank loan and deposit products and services, we obtain non-interest income through our insurance brokerage operations and the sale of non-deposit products. 

We continue to focus on strengthening our core operating performance by improving our net interest income and margin by closely monitoring our yield on earning assets and adjusting the rates offered on deposit products.  The economic downturn continues to impact our level of non-performing assets (“NPAs”).  We have beenfocused on building for the future and strengthening our core operating results within our risk management framework. 

CRITICAL ACCOUNTING POLICIES

Our consolidated financial statements are prepared in accordance with U.S. GAAP and practices within the banking industry.  Application of these principles requires management to make estimates, assumptions, and judgments that affect the amounts reported in our consolidated financial statements and accompanying notes.  These estimates, assumptions, and judgments are based on information available as of the date of the financial statements; accordingly, as this information changes, the financial statements could reflect different estimates, assumptions, and judgments.  Actual results could differ from those estimates.

Critical accounting estimates are necessary in the application of certain accounting policies and procedures, and are particularly susceptible to significant change. Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties, and could potentially result in materially different results under different assumptions and conditions.  There have been no material changes to our critical accounting policies during the three months ended March 31, 2015.  For additional information on our critical accounting policies, please refer to Note 1 of the consolidated financial statements included in our 2014 Annual Report on Form 10-K.

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COMPARISION OF OPERATING RESULTS FOR THREE MONTHS ENDED MARCH 31, 2015 AND 2014

Overview -  For the quarter ended March 31,  2015, we reported net income of $952 thousand, or $0.21 per basic and diluted share,as compared to net income of $678 thousand, or $0.15 per basic and diluted share, for the same period last year.The increase in net income for the quarter ended March 31, 2015 was primarily due to increases in net interest income of $496 thousand, other income of $310 thousand and a decline in the provision for loan losses of $148 thousand.  The aforementioned were partially offset by an increase in non-interest expenses of $602 thousand.

Comparative Average Balances and Average Interest Rates - The following table presents, on a fully tax equivalent basis, a summary of our interest-earning assets and their average yields, and interest-bearing liabilities and their average costs for the three month periods ended March 31, 2015 and 2014:

	Three Months Ended March 31,
(Dollars in thousands)	2015					2014
		Average			Average		Average			Average
Earning Assets:		Balance		Interest	Rate (2)		Balance		Interest	Rate (2)
Securities:
Tax exempt (3)	$	31,339	$	312	4.04%	$	30,767	$	383	5.05%
Taxable		54,267		267	2.00%		70,451		217	1.25%
Total securities		85,606		579	2.74%		101,218		600	2.40%
Total loans receivable (1) (4)		470,870		5,172	4.45%		402,757		4,623	4.66%
Other interest-earning assets		7,118		4	0.23%		5,420		3	0.22%
Total earning assets		563,594	$	5,755	4.14%	$	509,395	$	5,226	4.16%
Non-interest earning assets		41,353					35,608
Allowance for loan losses		(5,742)					(5,650)
Total Assets	$	599,205					539,353
Sources of Funds:
Interest bearing deposits:
NOW	$	128,160	$	50	0.16%	$	115,661	$	39	0.14%
Money market		14,511		5	0.14%		12,573		4	0.13%
Savings		140,497		71	0.20%		146,082		75	0.21%
Time		112,067		290	1.05%		98,931		272	1.12%
Total interest bearing deposits		395,235		416	0.43%		373,247		390	0.42%
Borrowed funds		63,715		380	2.42%		46,222		348	3.05%
Junior subordinated debentures		12,887		53	1.67%		12,887		53	1.67%
Total interest bearing liabilities		471,837	$	849	0.73%	$	432,356	$	791	0.74%
Non-interest bearing liabilities:
Demand deposits		71,695					57,541
Other liabilities		3,595					2,194
Total non-interest bearing liabilities		75,290					59,735
Stockholders' equity		52,078					47,262
Total Liabilities and Stockholders' Equity	$	599,205				$	539,353
Net Interest Income and Margin (5)				4,906	3.53%				4,435	3.53%
Tax-equivalent basis adjustment				(104)					(129)
Net Interest Income			$	4,802				$	4,306
(1) Includes loan fee income
(2) Average rates on securities are calculated on amortized costs
(3) Full tax equivalent basis, using a 39% effective tax rate and adjusted for TEFRA (Tax and Equity Fiscal Responsibility Act) interest expense disallowance
(4) Loans outstanding include non-accrual loans
(5) Represents the difference between interest earned and interest paid, divided by average total interest-earning assets

Net Interest Income – Net interest income is the difference between interest and fees on loans and other interest-earning assets and interest paid on interest-bearing liabilities.  Net interest income is directly affected by changes in volume and mix of interest-earning assets and interest-bearing liabilities that support those assets, as well as changing interest rates when differences exist in repricing dates of assets and liabilities.

Net interest income on a fully tax equivalent basis increased $471 thousand, or 10.6%, to $4.9 million for the first quarter of 2015, as compared to $4.4 million for the same period in 2014.  The increase in net interest income was largely due to a $54.2 million, or 10.6%, increase in average interest earning assets, principally loans receivable, which

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increased $68.1 million, or 16.9%, and was partially offset by a decrease in the average balance on the securities portfolio of $15.6 million, or 15.4%.

Interest Income – Our total interest income, on a fully tax equivalent basis, increased $529 thousand, or 10.1%, to $5.8 million for the quarter ended March 31, 2015, as compared to the same period last year.  The increase was due to higher average earning assets, which increased $54.2 million for the quarter ended March 31, 2015, as compared to the same period in 2014.

Our total interest income earned on loans receivable increased $549 thousand, or 11.9%, to $5.2 million for the first quarter of 2015, as compared to the same period in 2014.  The increase was driven by an increase in average balance of loans receivable of $68.1 million, or 16.9%, for the three months ended March  31, 2015, as compared to the same period last year.  The increase in interest income earned on loans receivable was partially offset by a 21 basis point decline in average yields to 4.45% for the quarter ended March 31, 2015, as compared to the same period in 2014. 

Our total interest income earned on securities, on a fully tax equivalent basis, decreased $21 thousand, to $579 thousand for the quarter ended March 31, 2015 from $600 thousand for the same period in 2014.  This decrease was largely due to a decrease in the average balances on securities, which decreased $15.6 million to $85.6 million for the quarter ended March 31, 2015, as compared to the same period last year. 

Other interest-earning assets include federal funds sold and interest bearing deposits in other banks. Our interest earned on total other interest-earning assets increased $1 thousand for the first quarter of 2015, as compared to the same period in 2014, due to an increase in average balances.  The average balances in other interest-earning assets increased $1.7 million to $7.1 million in the first quarter of 2015 from $5.4 million during the first quarter a year earlier.

Interest Expense – Our interest expense for the three months ended March 31, 2015 increased $58 thousand, or 7.3%, to $849 thousand from $791 thousand for the same period in 2014.  The increase was principally due to higher average balances in interest-bearing liabilities, which increased $39.5 million, or 9.1%, to $471.8 million for the first quarter of 2015 from $432.4 million for the same period in 2014.

Our interest expense on deposits increased $26 thousand, or 6.7%, for the quarter ended March 31, 2015, as compared to the same period last year.  The increase was largely attributed to the increase inthe average balance of total interest bearing deposits, which increased $22.0 millionduring the first quarter of 2015, as compared to the same period in 2014.

Provision for Loan Losses – Provision for loan losses decreased $148 thousand, or 32.7%, to $305 thousand for the first quarter of 2015, as compared to $453 thousand for the same period in 2014.The decrease in the provision for loan losses for the quarter ended March 31, 2015 was largely attributed to the resolution of problem loans.  The provision for loan losses reflects management’s judgment concerning the risks inherent in our existing loan portfolio and the size of the allowance necessary to absorb the risks, as well as the activity in the allowance during the periods.  Management reviews the adequacy of its allowance on an ongoing basis and will provide additional provisions, as management may deem necessary. 

Non-Interest Income – We reported an increase in non-interest income of$310 thousand, or 19.5%, to $1.9 million for the first quarter of 2015, as compared to the same period last year.  For the first quarter of 2015, insurance commissions and fees and gains on securities transactions increased $182 thousand and $168 thousand, respectively, as compared to the same period in 2014.  The increases were partially offset by a decline in service fees on deposit accounts of $51 thousand for the first quarter of 2015, as compared to the same period in 2014.

Non-Interest Expense – Our non-interest expenses increased$602 thousand, or 13.5%, to $5.1 million for the first quarter of 2015, as compared to the same period last year.  The increase for the first quarter of 2015, as compared to the same period in 2014, was largely due to increases in salaries and employee benefits expenses of $362 thousand, other expenses of $139 thousand, expenses and write-downs related to foreclosed real estate of $64 thousand and furniture and equipment expenses of $46 thousand, which were partially offset by a decrease in FDIC fees of $52 thousand.  The increase in salaries and employee benefits expense was partially due to an increase in personnel to support our growth initiative in new markets, including the opening of our Astoria branch in the first quarter of 2015 and the addition of commercial lending staff.

Income Taxes –  Our income tax expense, which includes both federal and state tax expenses, was $376 thousand for the three months ended March 31, 2015, compared to $298 thousand for the three months ended March 31, 2014.

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COMPARISION OF FINANCIAL CONDITION AT MARCH 31, 2015 TO DECEMBER 31, 2014

Total Assets – At March 31, 2015, our total assets were $604.3 million, an increase of $8.3 million, or 1.4%, as compared to total assets of $595.9 million at December 31, 2014.  The increase in total assets was largely driven by growth in the securities portfolio of $7.1 million, or 8.4%, which was partially offset by a decline in foreclosed real estate of $1.6 million, or 35.9%. 

Cash and Cash Equivalents – Our cash and cash equivalents increased by $1.1 million to $7.0 million at March 31, 2015, or 1.2% of total assets, from $5.9 million, or 1.0% of total assets, at December 31, 2014.

Securities Portfolio – At March 31, 2015, the securities portfolio, which includes available for sale and held to maturity securities, was $91.1 million, compared to $84.0 million at December 31, 2014. Available for sale securities were $84.6 million at March 31, 2015, compared to $78.0 million at December 31, 2014. The available for sale securities are held primarily for liquidity, interest rate risk management and profitability. Accordingly, our investment policy is to invest in securities with low credit risk, such as U.S. government agency obligations, state and political obligations and mortgage-backed securities. Held to maturity securities were $6.4 million at March 31, 2015 and $6.0 million at December 31, 2014.

Net unrealized gains in the available for sale securities portfolio were $429 thousand and $281 thousand at March 31, 2015 and December 31, 2014, respectively.

We conduct a regular assessment of our investment securities to determine whether any securities are OTTI.  Further detail of the composition of the securities portfolio and discussion of the results of the most recent OTTI assessment are in Note 2 –  Securities to our unaudited consolidated financial statements.

The unrealized losses in our securities portfolio are mostly driven by changes in spreads and market interest rates.  All of our debt and equity securities in an unrealized loss position have been evaluated for other-than-temporary impairment as of March 31, 2015 and we do not consider any security OTTI.  We evaluated the prospects of the issuers in relation to the severity and the duration of the unrealized losses.  In addition, we do not intend to sell, and it is more likely than not that we will not have to sell, any of our securities before recovery of their cost basis. 

Other investments totaled $3.5 million at March  31, 2015, as compared to $3.9 million at December 31, 2014,  which consisted primarily of FHLB stock. We also held $100 thousand in time deposits with other financial institutions at March 31, 2015 and December 31, 2014. 

Loans – The loan portfolio comprises our largest class of earning assets.Total loans receivable, net of unearned income, increased $1.3 million, or 0.3%, to $473.3 million at March 31, 2015, as compared to $472.0 million at December 31, 2014.  The increase in loans was primarily in the residential real estate portfolio, which increased $3.2 million, or 2.8%, to $114.7 million at March 31, 2015, as compared to $111.5 million at December 31, 2014. The aforementioned increase was partially offset by a decrease in the commercial and industrial portfolio of $1.7 million, or 8.4%, to $18.8 million at March 31, 2015, as compared to $20.5 million at December 31, 2014.In addition, during the first quarter of 2015, we had $6.2 million in prepayments within the commercial loan portfolio.

The following table summarizes the composition of our gross loan portfolio by type:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial loans	$	18,822	$	20,549
Construction		13,239		12,379
Commercial real estate		325,742		326,370
Residential real estate		114,663		111,498
Consumer and other		1,324		1,665
Total gross loans	$	473,790	$	472,461

Loan and Asset Quality – Our overall credit quality continued to improve through March 31, 2015, as our total problem assets, which is composed of foreclosed real estate, criticized assets and classified assets, were down 9.8% from December 31, 2014, and the ratio of NPAs to total assets improved to 1.83% at March 31, 2015 from 2.02% at December 31, 2014. 

NPAs, which include non-accrual loans, loans 90 days past due and still accruing, troubled debt restructured loans currently performing in accordance with renegotiated terms and foreclosed real estate, decreased $983 thousand, or 8.2%, to $11.1 million at March 31, 2015, as compared to $12.0 million at December 31, 2014.  Non-accrual loans increased $708 thousand, or 12.0%, to $6.6 million at March 31, 2015, as compared to $5.9 million at December 31, 2014.  The top five non-accrual loan relationships total $3.8 million, which equates to 56.6% of total non-accrual loans

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and 33.9% of total NPAs at March 31, 2015.  The remaining non-accrual loans at March 31, 2015 have an average loan balance of $93 thousand.  Loans past due 30 to 89 days decreased $1.5 million, or 25.9%, to $4.2 million at March 31, 2015, as compared to $5.6 million at December 31, 2014. 

We continue to actively market our foreclosed real estate properties, which decreased $1.6 million to $2.9 million at March 31, 2015, as compared to $4.4 million at December 31, 2014.  The decrease was primarily due to the sale of $1.5 million in foreclosed real estate properties and write-downs of $97 thousand during 2015, which were partially offset by $39 thousand in new foreclosed real estate properties.  At March 31, 2015, our foreclosed real estate properties had an average carrying value of approximately $259 thousand per property.

The allowance for loan losses increased $122 thousand, or 2.2%, to $5.8 million, or 1.22% of total loans, at March 31, 2015, compared to $5.6 million, or 1.20% of total loans, at December 31, 2014. We recorded $305 thousand in provision for loan losses, which was partially offset by $183 thousand in net charge-offs for the quarter ended March 31, 2015. The allowance for loan losses as a percentage of non-accrual loans decreased to 86.9% at March 31, 2015 from 95.2% at December 31, 2014.

Management continues to monitor our asset quality and believes that the NPAs are adequately collateralized and anticipated material losses have been adequately reserved for in the allowance for loan losses.  However, given the uncertainty of the current real estate market, additional provisions for losses may be deemed necessary in future periods.  The following table provides information regarding risk elements in the loan portfolio at each of the periods presented:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Non-accrual loans	$	6,632	$	$ 5,924
Non-accrual loans to total loans		1.40%		1.26%
Non-performing assets	$	11,065	$	$ 12,048
Non-performing assets to total assets		1.83%		2.02%
Allowance for loan losses as a % of non-accrual loans		86.90%		95.22%
Allowance for loan losses to total loans		1.22%		1.20%

A loan is considered impaired, in accordance with the impairment accounting guidance, when based on current information and events, it is probable that we will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan.  Total impaired loans at March 31, 2015were $8.1 million and at December 31, 2014were $7.5 million.  Impaired loans measured at fair value on a non-recurring basis increased to $1.8 million onMarch 31, 2015from $1.1 million at December 31, 2014.   These balances consist of loans that were written down or required additional reserves during the periods ended March 31, 2015 and December 31, 2014, respectively.  Impaired loans include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.  These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection.  Not all impaired loans and restructured loans are on non-accrual, and therefore not all are considered non-performing loans.  Restructured loans still accruing totaled $1.6 million at March 31, 2015 and December 31, 2014.

We also continue to monitor our portfolio for potential problem loans. Potential problem loans are defined as loans which cause management to have serious concerns as to the ability of such borrowers to comply with the present loan repayment terms and which may cause the loan to be placed on non-accrual status. As of March 31, 2015,  we had fiveloan relationships totaling $1.4 million that we deemed potential problem loans. Management is actively monitoring these loans.

Further detail of the credit quality of the loan portfolio is included in Note 4 –  Allowance for Loan Losses and Credit Quality of Financing Receivables to our unaudited consolidated financial statements.

Allowance for Loan Losses – The allowance for loan losses consists of general, allocated and unallocated components.  The allocated component relates to loans that are classified as impaired.  For those loans that are classified as impaired, an allowance is established when the discounted cash flows, collateral value or observable market price of the impaired loan is lower than the carrying value of that loan. The general component covers non-impaired loans and is based on historical charge-off experience and expected losses derived from our internal risk rating process.  The unallocated component covers the potential for other adjustments that may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. 

Management regularly assesses the appropriateness and adequacy of the loan loss reserve in relation to credit exposure associated with individual borrowers, overall trends in the loan portfolio and other relevant factors, and believes the reserve is reasonable and adequate for each of the periods presented.

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At March 31, 2015, the total allowance for loan losses increased $122 thousand, or 2.2%, to $5.8 million, as compared to $5.6 million at December 31, 2014.  The components of this increase were a provision for loan losses of $305 thousand and net charge-offs totaling $183 thousand in the quarter ended March 31, 2015.  The provision also reflects the continued weakness in current real estate values in our market area and reduced cash flows to support the repayment of loans.  The allowance for loan losses as a percentage of total loans was 1.22% and 1.20% at March 31, 2015 and December 31, 2014, respectively. 

The table below presents information regarding our provision and allowance for loan losses for the three months ended March 31, 2015 and 2014:

(Dollars in thousands)	March 31, 2015		March 31, 2014
Balance, beginning of period	$	5,641	$	5,421
Provision		305		453
Charge-offs		(214)		(457)
Recoveries		31		20
Balance, end of period	$	5,763	$	5,437

The table below presents details concerning the allocation of the allowance for loan losses to the various categories for each of the periods presented.  The allocation is made for analytical purposes and it is not necessarily indicative of the categories in which future credit losses may occur.  The total allowance is available to absorb losses from any category of loans.

	March 31, 2015			December 31, 2014
			Percentage of			Percentage of
			Loans In Each			Loans In Each
			Category To			Category To
(Dollars in thousands)	Amount		Gross Loans		Amount	Gross Loans
Commercial and industrial	$	138	4.0%	$	231	4.3%
Construction		388	2.8%		383	2.6%
Commercial real estate		3,787	68.7%		3,491	69.1%
Residential real estate		841	24.2%		903	23.6%
Consumer and other loans		88	0.3%		19	0.4%
Unallocated		521	-		614	-
Total	$	5,763	100.0%	$	5,641	100.0%

Bank-Owned Life Insurance (“BOLI”)  –  Our BOLI carrying value amounted to $12.3 million at March 31, 2015 and $12.2 million at December 31, 2014.

Goodwill and Other Intangibles – Goodwill represents the excess of the purchase price over the fair market value of net assets acquired.  At March 31, 2015 and December 31, 2014, we had recorded goodwill totaling $2.8 million, primarily as a result of the acquisition of Tri-State in 2001.  In accordance with U.S. GAAP, goodwill is not amortized, but evaluated at least annually for impairment.  Any impairment of goodwill results in a charge to income.  We periodically assess whether events and changes in circumstances indicate that the carrying amounts of goodwill and intangible assets may be impaired.  The estimated fair value of the reporting segment exceeded its book value; therefore, no write-down of goodwill was required.  The goodwill related to the insurance agency is not deductible for tax purposes.

Deposits – Our total deposits increased $15.2 million, or 3.3%, to $473.5 million at March 31, 2015, from $458.3 million at December 31, 2014.  The increase in deposits was due to increases in both non-interest bearing deposits of $6.3 million, or 8.9%, and interest bearing deposits of $9.0 million, or 2.3%, for March 31, 2015,  as compared to December 31, 2014.  Our funding mix continues to improve as low cost deposits grow. Included in the aforementioned increase is approximately $5.0 million in new deposits attributed to the opening of our Astoria branch.

Borrowings – Borrowings consist of short-term and long-term advances from the FHLB.  The advances are secured under terms of a blanket collateral agreement by a pledge of qualifying mortgage loans.  We had $61.2 million and$69.5 million in borrowings, at a weighted average interest rate of 2.49% at March  31, 2015 and 2.13% at December 31, 2014.  The long-term borrowings at March 31, 2015 consisted of $45.0 million of fixed rate advances and $11.0 million of advances with quarterly convertible options that allow the FHLB to change the note rate to a then current market rate.

27

Junior Subordinated Debentures – On June 28, 2007, Sussex Capital Trust II (the “Trust”), a Delaware statutory business trust and our non-consolidated wholly owned subsidiary, issued $12.5 million of variable rate capital trust pass-through securities to investors.  The Trust purchased $12.9 million of variable rate junior subordinated deferrable interest debentures from us.  The debentures are the sole asset of the Trust.  The terms of the junior subordinated debentures are the same as the terms of the capital securities.  We have also fully and unconditionally guaranteed the obligations of the Trust under the capital securities.  The interest rate is based on the three-month LIBOR plus 144 basis points and adjusts quarterly.  The rate at March 31, 2015, was 1.71%.  The capital securities are currently redeemable by us at par in whole or in part.  The capital securities must be redeemed upon final maturity of the subordinated debentures on September 15, 2037.  The proceeds of these trust preferred securities, which have been contributed to the Bank, are included in the Bank’s capital ratio calculations and treated as Tier I capital.

In accordance with FASB ASC 810, Consolidations, our wholly owned subsidiary, the Trust, is not included in our consolidated financial statements.

Equity–Stockholders’ equity, inclusive of accumulated other comprehensive income, net of income taxes, was $52.0 million at March 31, 2015, an increase of $740 thousand when compared to December 31, 2014.  The increase was largely due to net income for the quarter ended March 31, 2015. 

LIQUIDITY AND CAPITAL RESOURCES

A fundamental component of our business strategy is to manage liquidity to ensure the availability of sufficient resources to meet all financial obligations and to finance prospective business opportunities. Liquidity management is critical to our stability. Our liquidity position over any given period of time is a product of our operating, financing and investing activities. The extent of such activities is often shaped by such external factors as competition for deposits and loan demand.

Traditionally, financing for our loans and investments is derived primarily from deposits, along with interest and principal payments on loans and investments.  At March 31, 2015, total deposits amounted to $473.5 million, an increase of $15.2 million, or 3.3%, from December 31, 2014. At March 31, 2015 and December 31, 2014, advances from FHLB and subordinated debentures totaled $74.1 million and $82.4 million, respectively, and represented 12.3% and 13.8% of total assets, respectively. 

Loan production continued to be our principal investing activity. Total loans receivable, net of unearned income, at March  31, 2015, amounted to $473.3million, an increase of $1.3 million, or 0.3%, compared to December 31, 2014.

Our most liquid assets are cash and due from banks and federal funds sold.  At March 31, 2015, the total of such assets amounted to $7.0 million, or 1.2%, of total assets, compared to $5.9 million, or 1.0%, of total assets at December 31, 2014. Another significant liquidity source is our available for sale securities portfolio.  At March 31, 2015, available for sale securities amounted to $84.6 million, compared to $78.0 million at December 31, 2014.

In addition to the aforementioned sources of liquidity, we have available various other sources of liquidity, including federal funds purchased from other banks and the FRB discount window.  The Bank also has the capacity to borrow an additional $56.8 millionthrough its membership in the FHLB and $10.0 million at Atlantic Community Bankers Bank at March 31, 2015.  Management believes that our sources of funds are sufficient to meet our present funding requirements.

The Bank’s regulators have implemented risk based guidelines that require banks to maintain Tier I capital as a percentage of risk-adjusted assets of 4.0% and Tier II capital as a percentage of risk-adjusted assets of 8.0% at a minimum.  At March 31, 2015, the Bank’s Tier I,  Tier II and Common Equity Tier I capital ratios were 12.67%, 13.90% and 12.67%, respectively.  In addition to the risk-based guidelines, the Bank’s regulators require that banks which meet the regulators’ highest performance and operational standards maintain a minimum leverage ratio (Tier I capital as a percentage of tangible assets) of 4.0%.  As of March 31, 2015, the Bank had a leverage ratio of 9.97%.  The Bank’s risk based and leverage ratios are in excess of those required to be considered “well-capitalized” under FDIC regulations.

The FRB also imposes similar capital requirements on bank holding companies with consolidated assets of $500 million or more. Under FRB reporting requirements, a bank holding company that reaches $500 million or more in total consolidated assets as of June 30 of the preceding year must begin reporting its consolidated capital beginning in March of the following year.  The Bank began reporting its consolidated capital in March 2013.

We have no investment or financial relationship with any unconsolidated entities that are reasonably likely to have a material effect on liquidity or the availability of capital resources, except for the trust preferred securities of the Trust.  We are not aware of any known trends or any known demands, commitments, events or uncertainties, which would

28

result in any material increase or decrease in liquidity.  Management believes that any amounts actually drawn upon can be funded in the normal course of operations.

Off-Balance Sheet Arrangements – Our consolidated financial statements do not reflect off-balance sheet arrangements that are made in the normal course of business.  These off-balance sheet arrangements consist of unfunded loans and letters of credit made under the same standards as on-balance sheet instruments.  These unused commitments, at March 31, 2015,  totaled $86.2 millionand consisted of $40.7 million in commitments to grant commercial real estate, construction and land development loans, $20.9 million in home equity lines of credit, $23.7 million in other unused commitments and $910 thousand in letters of credit.  These instruments have fixed maturity dates, and because many of them will expire without being drawn upon, they do not generally present any significant liquidity risk to us.  Management believes that any amounts actually drawn upon can be funded in the normal course of operations.

Item 3 - Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4 - Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Management, including our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based upon the evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is (i) recorded, processed, summarized and reported as and when required and (ii) accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely discussion regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting identified in connection with the evaluation that occurred during our last fiscal quarter that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

29

PART II – OTHER INFORMATION

Item 1 - Legal Proceedings

We are not involved in any legal proceedings other than routine legal proceedings occurring in the ordinary course of business.  Management believes that such proceedings are, in the aggregate, immaterial to our financial condition and results of operations.

Item 1A - Risk Factors

For a summary of risk factors relevant to our operations, see Part 1, Item 1A, “Risk Factors” in our 2014 Annual Report on Form 10-K.  There are no material changes in the risk factors relevant to our operations.

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information with respect to any purchase of shares of our common stock made by or on behalf of us or any “affiliated purchaser,” as defined in Rule 10b-18(a)(3) under the Exchange Act, during the three months ended March 31, 2015:

					Maximum
				Total Number	Number of
				of Shares	Shares that
				Purchased as	May Yet Be
	Total Number			Part of Publicly	Purchased
	of Shares		Average Price	Announced	Under the
Period	Purchased		Paid per Share	Program	Program(1)
January 1, 2015 through January 31, 2015	-	$	-	-	-
February 1, 2015 through February 28, 2015	17,900		10.46	17,900	215,100
March 1, 2015 through March 31, 2015	1,550		10.54	1,550	213,550
Total	19,450	$	10.47	19,450

(1) On February 25, 2015, the Board of Directors authorized a stock repurchase program, under which we may repurchase up to 233,000 shares.  The stock repurchase program expires on February 26, 2016, unless completed sooner or otherwise extended.

There were no sales by us of unregistered securities during the three months ended March 31, 2015.

Item 3 - Defaults Upon Senior Securities

Not applicable.

Item 4 - Mine Safety Disclosures

Not applicable.

Item 5 - Other Information

Not applicable.

Item 6 - Exhibits

The exhibits required to be filed as part of this Quarterly Report on Form 10-Q are listed in the Exhibit Index attached hereto and are incorporated herein by reference.

30

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, as amended, the registrant caused this report to be signed on its behalf by the undersigned,thereunto duly authorized.

Date: May 13, 2015		SUSSEX BANCORP
	By:	/s/ Steven M. Fusco
		Steven M. Fusco
		Chief Financial Officer and Senior Executive Vice President
		(Principal Financial and Accounting Officer)

31

EXHIBIT INDEX

Exhibit Number	Description
*
3.1	Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Quarterly Report on 10-Q filed with the SEC on August 15, 2011).
3.2	Amended and Restated By-laws (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on June 3, 2014).
4.1	Specimen common stock certificate (incorporated by reference to Exhibit 4.1 to Amendment No. 1 to the Registration Statement on Form S-1 filed with the SEC on June 3, 2013).
31.1*	Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer.
31.2*	Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer.
32.1*	Section 1350 Certifications of the Chief Executive Officer and Chief Financial Officer.
101	Financial statements from the Quarterly Report on Form 10-Q of Sussex Bancorp for the quarter ended March 31, 2015, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income and Comprehensive Income; (iii) the Consolidated Statements of Stockholders’ Equity; (iv) the Consolidated Statements of Cash Flows and (v) Notes to Unaudited Consolidated Financial Statements.

_______________________________

*  Furnished herewith and not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.

32

EX-31.1

Exhibit 31.1

I, Anthony Labozzetta, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Sussex Bancorp;

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(s) 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) 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 subsidiaries, 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 provide 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(s) 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: May 13, 2015	By:	/s/ Anthony Labozzetta
		Anthony Labozzetta
		President and Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

I, Steven M. Fusco, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sussex Bancorp;

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(s) 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) 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 subsidiaries, 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 provide 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(s) 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: May 13, 2015	By:	/s/ Steven M. Fusco
		Steven M. Fusco
		Chief Financial Officer and Senior Executive Vice President
		(Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

Statement Furnished PURSUANT TO SECTION 906 of the

SARBANES-OXLEY ACT OF 2002, 18 U.S.C. SECTION 1350

In connection with the Quarterly Report on Form 10-Q of Sussex Bancorp (the “Company”) for the quarter ended March 31, 2015 (the “Report”), I, Anthony Labozzetta, President and Chief Executive Officer, and I, Steven M. Fusco, Chief Financial Officer and Senior Executive Vice President, each certify as follows:

A) the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m or 78o(d)), and

B) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.

This statement is authorized to be attached as an exhibit to the Report so that this statement will accompany the Report at such time as the Report is filed with the Securities and Exchange Commission, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350. Pursuant to Securities and Exchange Commission Release 33-8238, dated June 5, 2003, this certification is being furnished and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference in any registration statement of the Company filed under the Securities Act of 1933, as amended, except to the extent that the Company specifically incorporates it by reference. 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.

Date: May 13, 2015	By: /s/ Anthony Labozzetta           .
	Anthony Labozzetta
	President and Chief Executive Officer
	(Principal Executive Officer)

By: /s/ Steven M. Fusco                .

Steven M. Fusco

Chief Financial Officer and

Senior Executive Vice President

(Principal Financial and Accounting Officer)

XML

Allowance For Loan Losses And Credit Quality Of Financing Receivables (Loans Which The Accrual Of Interest Has Been Discontinued) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	$ 6,632	$ 5,924
Commercial And Industrial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	20	94
Commercial Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	4,917	3,936
Residential Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	1,557	1,893
Consumer And Other [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total	$ 138	$ 1

XML

Fair Value Of Financial Instruments (Qualitative Information About Level 3 Fair Value Measurements) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		12 Months Ended
	Mar. 31, 2015		Dec. 31, 2014
Impaired Loans [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Fair Value Estimate	$ 1,784		$ 1,087
Impaired Loans [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Fair Value Estimate	1,784		1,087
Valuation Techniques	Appraisal of collateral		Appraisal of collateral
Unobservable Input	Appraisal adjustments	[1]	Appraisal adjustments	[1]
Impaired Loans [Member] | Minimum [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Range (Weighted Average)	0.00%		0.00%
Impaired Loans [Member] | Maximum [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Range (Weighted Average)	(74.80%)		(67.90%)
Impaired Loans [Member] | Weighted Average [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Range (Weighted Average)	(7.50%)		(7.80%)
Foreclosed Real Estate [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Fair Value Estimate			761
Foreclosed Real Estate [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Fair Value Estimate			$ 761
Valuation Techniques			Appraisal of collateral
Unobservable Input			Selling expenses	[1]
Range (Weighted Average)			(7.00%)
Foreclosed Real Estate [Member] | Weighted Average [Member] | Significant Unobservable Inputs (Level III) [Member]
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items]
Range (Weighted Average)			(7.00%)

[1] Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated selling expenses. The range and weighted average of selling expenses and other appraisal adjustments are presented as a percentage of the appraisal.

XML

Stock-Based Compensation (Summary Of Stock Option Assumptions) (Details)	3 Months Ended
	Mar. 31, 2015
Stock Incentive Plans [Abstract]
Expected dividend yield	1.56%
Expected volatility	34.32%
Risk-free interest rate	1.37%
Expected option life	10 years

XML

Fair Value Of Financial Instruments (Estimated Fair Values Of Financial Instruments) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	$ 84,573	$ 77,976
Securities held to maturity	6,704	6,190
Carrying Amount [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	6,966	5,859
Time deposits with other banks	100	100
Securities available for sale	84,573	77,976
Securities held to maturity	6,491	6,006
Federal Home Loan Bank stock	3,539	3,908
Loans receivable, net of allowance	467,540	466,332
Accrued interest receivable	1,908	1,796
Non-maturity deposits	357,007	351,653
Time deposits	116,505	106,617
Short-term borrowings	5,200	23,500
Long-term borrowings	56,000	46,000
Junior subordinated debentures	12,887	12,887
Accrued interest payable	265	243
Fair Value [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	6,966	5,859
Time deposits with other banks	100	100
Securities available for sale	84,573	77,976
Securities held to maturity	6,704	6,190
Federal Home Loan Bank stock	3,539	3,908
Loans receivable, net of allowance	467,313	462,984
Accrued interest receivable	1,908	1,796
Non-maturity deposits	357,007	351,653
Time deposits	107,011	107,011
Short-term borrowings	5,200	23,500
Long-term borrowings	57,738	47,766
Junior subordinated debentures	9,970	9,361
Accrued interest payable	265	243
Quoted Prices In Active Markets For Identical Assets (Level I) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	6,966	5,859
Securities available for sale	11
Short-term borrowings	5,200	23,500
Significant Other Observable Inputs (Level II) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Time deposits with other banks	100	100
Securities available for sale	84,562
Securities held to maturity	6,704	6,190
Federal Home Loan Bank stock	3,539	3,908
Accrued interest receivable	1,908	1,796
Non-maturity deposits	357,007	351,653
Time deposits	116,918	107,011
Long-term borrowings	57,738	47,766
Junior subordinated debentures	9,970	9,361
Accrued interest payable	265	243
Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans receivable, net of allowance	$ 467,313	$ 462,984

XML

Stock-Based Compensation (Narrative) (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option grants, maximum term, in years	10 years
Stock-based compensation expense	$ 9	$ 0
Weighted average grant date fair value of options granted per share	$ 3.56
Stock options expected future expense	179
Restricted stock awards expense	82	80
Unrecognized compensation expense for non-vested restricted stock	$ 630
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, period for recognition	4 years 8 months 12 days
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense, period for recognition	2 years
Minimum [Member] | Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period, years	1 year
Minimum [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period, years	2 years
Maximum [Member] | Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period, years	4 years
Maximum [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period, years	7 years

XML

Securities (Temporarily Impaired Gross Unrealized Losses And Fair Value Of Held-To-Maturity Securities) (Details) (State And Political Subdivisions [Member], USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
State And Political Subdivisions [Member]
Schedule of Held-to-maturity Securities [Line Items]
Less Than Twelve Months, Fair Value	$ 261
Less Than Twelve Months, Gross Unrealized Losses	(1)
Twelve Months or More, Fair Value		811
Twelve Months or More, Gross Unrealized Losses		(5)
Total, Fair Value	261	811
Total, Gross Unrealized Losses	$ (1)	$ (5)

XML

Fair Value Of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Of Financial Instruments [Abstract]

Summary Of Financial Assets Measured On A Recurring Basis

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
U.S. government agencies	$	11,406	$	-	$	11,406	$	-
State and political subdivisions		32,201		-		32,201		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,955		-		40,955		-
Equity securities-financial services industry and other		11		11		-		-
December 31, 2014
U.S. government agencies	$	7,858	$	-	$	7,858	$	-
State and political subdivisions		26,384		-		26,384		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,724		-		43,724		-
Equity securities-financial services industry and other		10		10		-		-

Summary Of Financial Assets Measured On A Nonrecurring Basis

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
Impaired loans	$	1,784	$	-	$	-	$	1,784
December 31, 2014
Impaired loans	$	1,087	$	-	$	-	$	1,087
Foreclosed real estate		761		-		-		761

Qualitative Information About Level 3 Fair Value Measurements

	Qualitative Information about Level III Fair Value Measurements
	Fair				Range
	Value		Valuation	Unobservable	(Weighted
(Dollars in thousands)	Estimate		Techniques	Input	Average)
March 31, 2015
Impaired loans	$	1,784	Appraisal of	Appraisal	0% to -74.8%
			collateral	adjustments (1)	(-7.5%)
December 31, 2014
Impaired loans	$	1,087	Appraisal of	Appraisal	0% to -67.9%
			collateral	adjustments (1)	(-7.8%)
Foreclosed real estate		761	Appraisal of	Selling
			collateral	expenses (1)	-7.0%(-7.0%)
(1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated selling expenses.  The range and weighted average of selling expenses and other appraisal adjustments are presented as a percentage of the appraisal.

Estimated Fair Values Of Financial Instruments

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	March 31, 2015				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	6,966	$	6,966	$	6,966	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		84,573		84,573		11		84,562		-
Securities held to maturity		6,491		6,704		-		6,704		-
Federal Home Loan Bank stock		3,539		3,539		-		3,539		-
Loans receivable, net of allowance		467,540		467,313		-		-		467,313
Accrued interest receivable		1,908		1,908		-		1,908		-
Financial liabilities:
Non-maturity deposits		357,007		357,007		-		357,007		-
Time deposits		116,505		107,011		-		116,918		-
Short-term borrowings		5,200		5,200		5,200		-		-
Long-term borrowings		56,000		57,738		-		57,738		-
Junior subordinated debentures		12,887		9,970		-		9,970		-
Accrued interest payable		265		265		-		265		-

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	December 31, 2014				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	5,859	$	5,859	$	5,859	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		77,976		77,976		-		-		-
Securities held to maturity		6,006		6,190		-		6,190		-
Federal Home Loan Bank stock		3,908		3,908		-		3,908		-
Loans receivable, net of allowance		466,332		462,984		-		-		462,984
Accrued interest receivable		1,796		1,796		-		1,796		-
Financial liabilities:
Non-maturity deposits		351,653		351,653		-		351,653		-
Time deposits		106,617		107,011		-		107,011		-
Short-term borrowings		23,500		23,500		23,500		-		-
Long-term borrowings		46,000		47,766		-		47,766		-
Junior subordinated debentures		12,887		9,361		-		9,361		-
Accrued interest payable		243		243		-		243		-

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Guarantees (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015
Guarantees [Abstract]
Letter of credit, expiration term	1 year
Undrawn standby letters of credit outstanding	$ 910

XML

Allowance For Loan Losses And Credit Quality Of Financing Receivables (Troubled Debt Restructured On Recorded Investment) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Financing Receivable, Modifications [Line Items]
Total	$ 4,528	$ 4,544
Commercial Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	3,887	3,899
Residential Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	641	645
Performing [Member]
Financing Receivable, Modifications [Line Items]
Total	1,580	1,590
Performing [Member] | Commercial Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	1,162	1,169
Performing [Member] | Residential Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	418	421
Non-performing [Member]
Financing Receivable, Modifications [Line Items]
Total	2,948	2,954
Non-performing [Member] | Commercial Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	2,725	2,730
Non-performing [Member] | Residential Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Total	$ 223	$ 224

XML

Allowance For Loan Losses And Credit Quality Of Financing Receivables (Allowances Of Loan Losses And Loans Receivable By Class Disaggregated) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014	Mar. 31, 2014	Dec. 31, 2013
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	$ 5,763	$ 5,641	$ 5,437	$ 5,421
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment	516	288
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	4,726	4,739
Balance, Loans Receivable	473,790	472,461
Loans Receivable, Individually Evaluated for Impairment	8,077	7,513
Loans Receivable, Collectively Evaluated for Impairment	465,713	464,948
Commercial And Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	138	231	289	222
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment	1	51
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	137	180
Balance, Loans Receivable	18,822	20,549
Loans Receivable, Individually Evaluated for Impairment	21	94
Loans Receivable, Collectively Evaluated for Impairment	18,801	20,455
Construction [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	388	383	315	308
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	388	383
Balance, Loans Receivable	13,239	12,379
Loans Receivable, Individually Evaluated for Impairment
Loans Receivable, Collectively Evaluated for Impairment	13,239	12,379
Commercial Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	3,787	3,491	3,687	3,399
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment	334	136
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	3,453	3,355
Balance, Loans Receivable	325,742	326,370
Loans Receivable, Individually Evaluated for Impairment	5,944	5,105
Loans Receivable, Collectively Evaluated for Impairment	319,798	321,265
Residential Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	841	903	862	941
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment	108	101
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	733	802
Balance, Loans Receivable	114,663	111,498
Loans Receivable, Individually Evaluated for Impairment	1,974	2,314
Loans Receivable, Collectively Evaluated for Impairment	112,689	109,184
Consumer And Other [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	88	19	19	16
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment	73
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment	15	19
Balance, Loans Receivable	1,324	1,665
Loans Receivable, Individually Evaluated for Impairment	138
Loans Receivable, Collectively Evaluated for Impairment	1,186	1,665
Unallocated [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, Allowance for Loan Losses	521	614	265	535
Allowance for Loan Losses, Balance Related to Loans Individually Evaluated for Impairment
Allowance for Loan Losses, Balance Related to Loans Collectively Evaluated for Impairment
Balance, Loans Receivable
Loans Receivable, Individually Evaluated for Impairment
Loans Receivable, Collectively Evaluated for Impairment

XML

Fair Value Of Financial Instruments (Summary Of Financial Assets Measured On A Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	$ 84,573	$ 77,976
Quoted Prices In Active Markets For Identical Assets (Level I) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	11
Significant Other Observable Inputs (Level II) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	84,562
U.S. Government Agencies [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	11,406	7,858
U.S. Government Agencies [Member] | Significant Other Observable Inputs (Level II) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	11,406	7,858
U.S. Government Agencies [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale
State And Political Subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	32,201	26,384
State And Political Subdivisions [Member] | Significant Other Observable Inputs (Level II) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	32,201	26,384
State And Political Subdivisions [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale
U.S. Government-Sponsored Enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	40,955	43,724
U.S. Government-Sponsored Enterprises [Member] | Significant Other Observable Inputs (Level II) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	40,955	43,724
U.S. Government-Sponsored Enterprises [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale
Equity Securities-Financial Services Industry And Other [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	11	10
Equity Securities-Financial Services Industry And Other [Member] | Quoted Prices In Active Markets For Identical Assets (Level I) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	11	10
Equity Securities-Financial Services Industry And Other [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale

XML

Stock-Based Compensation (Summary Of Information Regarding Stock Option Plans) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Shares, Outstanding, beginning of year	46,525
Number of Shares, Options granted	15,985
Number of Shares, Options expired	(3,817)
Number of Shares, Outstanding, end of period	58,693
Number of Shares, Exercisable, end of period	6,708
Weighted Average Exercise Price per Share, Outstanding, beginning of year	$ 10.63
Weighted Average Exercise Price per Share, Options granted	$ 10.25
Weighted Average Exercise Price per Share, Options expired	$ 13.39
Weighted Average Exercise Price per Share, Outstanding, end of period	$ 10.35
Weighted Average Exercise Price per Share, Exercisable, end of period	$ 12.63
Weighted Average Contractual Term, Outstanding, end of period	8 years 7 months 6 days
Weighted Average Contractual Term, Exercisable, end of period	7 months 6 days
Aggregate Intrinsic Value, Outstanding, end of period	$ 62,065
Aggregate Intrinsic Value, Exercisable, end of period
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option price range at end of quarter	$ 9.97
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option price range at end of quarter	$ 12.63
Option price of exercisable shares	$ 12.63

XML

Loans

3 Months Ended

Mar. 31, 2015

Loans [Abstract]

Loans

NOTE 3 – LOANS

The composition of net loans receivable at March 31, 2015 and December 31, 2014 is as follows:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	18,822	$	20,549
Construction		13,239		12,379
Commercial real estate		325,742		326,370
Residential real estate		114,663		111,498
Consumer and other		1,324		1,665
Total loans receivable		473,790		472,461
Unearned net loan origination fees		(487)		(488)
Allowance for loan losses		(5,763)		(5,641)
Net loans receivable	$	467,540	$	466,332

Mortgage loans serviced for others are not included in the accompanying balance sheets.  The total amount of loans serviced for the benefit of others was approximately $470 thousand and $475 thousand at March 31, 2015 and December 31, 2014, respectively. Mortgage servicing rights were immaterial at March 31, 2015 and December 31, 2014.

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Earnings Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Earnings Per Share [Abstract]
Net earnings applicable to common stockholders (Numerator)	$ 952	$ 678
Net income applicable to common stockholders and assumed conversions (Numerator)	$ 952	$ 678
Basic, Shares (Denominator)	4,571,142	4,526,506
Unvested stock awards, Shares (Denominator)	31,768	38,094
Diluted, Shares (Denominator)	4,602,910	4,564,600
Basic, Per Share Amount	$ 0.21	$ 0.15
Diluted, Per Share Amount	$ 0.21	$ 0.15
Shares of common stock outstanding not included in the computation of diluted EPS	21,224	7,734

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Securities (Amortized Cost And Fair Value Of Securities By Contractual Maturity Of Available-For-Sale Securities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Due in one year or less, Amortized Cost
Due after one year through five years, Amortized Cost
Due after five years through ten years, Amortized Cost	2,301
Due after ten years, Amortized Cost	29,844
Total bonds and obligations, Amortized Cost	32,145
Due in one year or less, Fair Value
Due after one year through five years, Fair Value
Due after five years through ten years, Fair Value	2,333
Due after ten years, Fair Value	29,868
Total bonds and obligations, Fair Value	32,201
Amortized Cost	84,144	77,695
Fair Value	84,573	77,976
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	11,428	7,873
Fair Value	11,406	7,858
U.S. Government-Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	40,563	43,382
Fair Value	40,955	43,724
Equity Securities-Financial Services Industry And Other [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	8	8
Fair Value	$ 11	$ 10

XML

Securities (Amortized Cost And Approximate Fair Value Of Securities Available For Sale) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 84,144	$ 77,695
Gross Unrealized Gains	739	677
Gross Unrealized Losses	(310)	(396)
Fair Value	84,573	77,976
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	11,428	7,873
Gross Unrealized Gains	25	17
Gross Unrealized Losses	(47)	(32)
Fair Value	11,406	7,858
State And Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	32,145	26,432
Gross Unrealized Gains	276	158
Gross Unrealized Losses	(220)	(206)
Fair Value	32,201	26,384
U.S. Government-Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	40,563	43,382
Gross Unrealized Gains	435	500
Gross Unrealized Losses	(43)	(158)
Fair Value	40,955	43,724
Equity Securities-Financial Services Industry And Other [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	8	8
Gross Unrealized Gains	3	2
Fair Value	$ 11	$ 10

XML

Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Other Comprehensive Income [Abstract]
Unrealized gains on available for sale securities, Before Tax	$ 316	$ 1,717
Reclassification adjustment for net gains on securities transactions included in net income, Before Tax	(168)
Total other comprehensive income, Before Tax	148	1,717
Unrealized gains on available for sale securities, Tax Effect	127	687
Reclassification adjustment for net gains on securities transactions included in net income, Tax Effect	(67)
Total other comprehensive income, Tax Effect	60	687
Unrealized gains on available for sale securities, Net of Tax	189	1,030
Reclassification adjustment for net gains on securities transactions included in net income, Net of Tax	(101)
Other comprehensive income, net of income taxes	88	1,030
Net gain on sales of securities	$ 168

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Securities (Temporarily Impaired Gross Unrealized Losses And Fair Value Of Available-For-Sale Securities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Less Than Twelve Months, Fair Value	$ 30,823	$ 23,282
Less Than Twelve Months, Gross Unrealized Losses	(225)	(206)
Twelve Months or More, Fair Value	6,667	12,050
Twelve Months or More, Gross Unrealized Losses	(85)	(190)
Total, Fair Value	37,490	35,332
Total, Gross Unrealized Losses	(310)	(396)
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Less Than Twelve Months, Fair Value	5,677
Less Than Twelve Months, Gross Unrealized Losses	(16)
Twelve Months or More, Fair Value	2,784	2,905
Twelve Months or More, Gross Unrealized Losses	(31)	(32)
Total, Fair Value	8,461	2,905
Total, Gross Unrealized Losses	(47)	(32)
State And Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Less Than Twelve Months, Fair Value	15,522	7,603
Less Than Twelve Months, Gross Unrealized Losses	(179)	(112)
Twelve Months or More, Fair Value	1,859	5,713
Twelve Months or More, Gross Unrealized Losses	(41)	(94)
Total, Fair Value	17,381	13,316
Total, Gross Unrealized Losses	(220)	(206)
U.S. Government-Sponsored Enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Less Than Twelve Months, Fair Value	9,624	15,679
Less Than Twelve Months, Gross Unrealized Losses	(30)	(94)
Twelve Months or More, Fair Value	2,024	3,432
Twelve Months or More, Gross Unrealized Losses	(13)	(64)
Total, Fair Value	11,648	19,111
Total, Gross Unrealized Losses	$ (43)	$ (158)

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Securities (Amortized Cost And Approximate Fair Value Of Securities Held-To-Maturity) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	$ 6,491
Securities held to maturity, fair value	6,704	6,190
State And Political Subdivisions [Member]
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	6,491	6,006
Gross Unrealized Gains	214	189
Gross Unrealized Losses	(1)	(5)
Securities held to maturity, fair value	$ 6,704	$ 6,190

XML

Securities

3 Months Ended

Mar. 31, 2015

Securities [Abstract]

Securities

NOTE 2 – SECURITIES

Available for Sale

The amortized cost and approximate fair value of securities available for sale as of March 31, 2015 and December 31, 2014 are summarized as follows:

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
U.S. government agencies	$	11,428	$	25	$	(47)	$	11,406
State and political subdivisions		32,145		276		(220)		32,201
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,563		435		(43)		40,955
Equity securities-financial services industry and other		8		3		-		11
	$	84,144	$	739	$	(310)	$	84,573
December 31, 2014
U.S. government agencies	$	7,873	$	17	$	(32)	$	7,858
State and political subdivisions		26,432		158		(206)		26,384
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,382		500		(158)		43,724
Equity securities-financial services industry and other		8		2		-		10
	$	77,695	$	677	$	(396)	$	77,976

Securities with a carrying value of approximately $32.1 million and $32.8 million at March 31, 2015 and December 31, 2014, respectively, were pledged to secure public deposits and for other purposes required or permitted by applicable laws and regulations.

The amortized cost and fair value of securities available for sale at March 31, 2015 are shown below by contractual maturity.  Actual maturities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Fair
(Dollars in thousands)	Cost		Value
Due in one year or less	$	-	$	-
Due after one year through five years		-		-
Due after five years through ten years		2,301		2,333
Due after ten years		29,844		29,868
Total bonds and obligations		32,145		32,201
U.S. government agencies		11,428		11,406
Mortgage-backed securities:
U.S. government-sponsored enterprises		40,563		40,955
Equity securities-financial services industry and other		8		11
Total available for sale securities	$	84,144	$	84,573

Gross realized gains on sales of securities available for sale were $216 thousand and gross realized losses were $48 thousand for the three months ended March 31, 2015. There were no sales of securities available for sale for the three months ended March 31, 2014. 

Temporarily Impaired Securities

The following table shows gross unrealized losses and fair value of securities with unrealized losses that are not deemed to be other than temporarily impaired, aggregated by category and length of time that individual available for sale securities have been in a continuous unrealized loss position at March 31, 2015 and December 31, 2014.

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
U.S. government agencies	$	5,677	$	(16)	$	2,784	$	(31)	$	8,461	$	(47)
State and political subdivisions		15,522		(179)		1,859		(41)		17,381		(220)
Mortgage-backed securities -
U.S. government-sponsored enterprises		9,624		(30)		2,024		(13)		11,648		(43)
Total temporarily impaired securities	$	30,823	$	(225)	$	6,667	$	(85)	$	37,490	$	(310)
December 31, 2014
U.S. government agencies	$	-	$	-	$	2,905	$	(32)	$	2,905	$	(32)
State and political subdivisions		7,603		(112)		5,713		(94)		13,316		(206)
Mortgage-backed securities -
U.S. government-sponsored enterprises		15,679		(94)		3,432		(64)		19,111		(158)
Total temporarily impaired securities	$	23,282	$	(206)	$	12,050	$	(190)	$	35,332	$	(396)

For each security whose fair value is less than their amortized cost basis, a review is conducted to determine if an other-than-temporary impairment has occurred. As of March 31, 2015, we reviewed our available for sale securities portfolio for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and the intent and likelihood of selling the security.  The intent and likelihood of sale of debt and equity securities are evaluated based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position. 

U.S. Government Agencies

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our U.S. government agencies securities were primarily due to changes in spreads and market conditions and not credit quality.  At March 31, 2015, there were five securities with a fair value of $8.5 million that had an unrealized loss that amounted to $47 thousand.  As of March 31, 2015, we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of the U.S. government agency securities at March 31, 2015, were deemed to be other-than-temporarily impaired (“OTTI”).

At December 31, 2014, there were two securities with a fair value of $2.9 million that had an unrealized loss that amounted to $32 thousand.

State and Political Subdivisions

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our state and political subdivisions securities were caused by changes in interest rates and spreads and were not the result of credit quality.  At March 31, 2015, there were 28 securities with a fair value of $17.4 million that had an unrealized loss that amounted to $220 thousand.  These securities typically have maturity dates greater than 10 years and the fair values are more sensitive to changes in market interest rates.  As of March 31, 2015, we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our state and political subdivision securities at March 31, 2015, were deemed to be OTTI.  

At December 31, 2014, there were 22 securities with a fair value of $13.3 million that had an unrealized loss that amounted to $206 thousand. 

Mortgage-Backed Securities

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our mortgage-backed securities guaranteed by U.S. government-sponsored enterprises were primarily due to changes in spreads and market conditions and not credit quality.  At March 31, 2015, there were seven securities with a fair value of $11.6 million that had an unrealized loss that amounted to $43 thousand.  As of March 31, 2015, we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our mortgage-backed securities at March 31, 2015, were deemed to be OTTI.  

At December 31, 2014, there were 13 securities with a fair value of $19.1 million that had an unrealized loss that amounted to $158 thousand. 

Equity Securities

Our marketable equity securities portfolio consists primarily of common stock of entities in the financial services industry.  At March 31, 2015, we did not have any securities in an unrealized loss position. 

At December 31, 2014, we did not have any securities in an unrealized loss position.

We continue to closely monitor the performance of the securities we own as well as the impact from any further deterioration in the economy or in the banking industry that may adversely affect these securities. We will continue to evaluate them for other-than-temporary impairment, which could result in a future non-cash charge to earnings.

Held to Maturity Securities

The amortized cost and approximate fair value of securities held to maturity as of March 31, 2015 and December 31, 2014, are summarized as follows:

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
State and political subdivisions	$	6,491	$	214	$	(1)	$	6,704
December 31, 2014
State and political subdivisions	$	6,006	$	189	$	(5)	$	6,190

The amortized cost and carrying value of securities held to maturity at March 31, 2015 are shown below by contractual maturity.  Actual maturities may differ from contractual maturities as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

		Amortized		Fair
(Dollars in thousands)		Cost		Value
Due in one year or less	$	2,590	$	2,590
Due after one year through five years		-		-
Due after five years through ten years		2,846		2,937
Due after ten years		1,055		1,177
Total held to maturity securities	$	6,491	$	6,704

Temporarily Impaired Securities

The following table shows gross unrealized losses and fair value of held to maturity securities with unrealized losses that are not deemed to be other than temporarily impaired, aggregated by category and length of time that individual held to maturity securities have been in a continuous unrealized loss position at March 31, 2015 and December 31, 2014:

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
State and political subdivisions	$	261	$	(1)	$	-	$	-	$	261	$	(1)
December 31, 2014
State and political subdivisions	$	-	$	-	$	811	$	(5)	$	811	$	(5)

For each security whose fair value is less than their amortized cost basis, a review is conducted to determine if an other-than-temporary impairment has occurred. As of March 31, 2015, we reviewed our held to maturity securities portfolio for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and the intent and likelihood of selling the security.  The intent and likelihood of sale of debt and equity securities are evaluated based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position.

At March 31, 2015 and December 31, 2014, the decline in fair value and the unrealized losses for our state and political subdivisions securities were caused by changes in interest rates and spreads and were not the result of credit quality.  At March 31, 2015, there wasone security with a fair value of $261 thousand that had an unrealized loss that amounted to $1 thousand.  These securities typically have maturity dates greater than 10 years and the fair values are more sensitive to changes in market interest rates.  As of March 31, 2015, we did not intend to sell and it was not more-likely-than-not that we would be required to sell any of these securities before recovery of their amortized cost basis.  Therefore, none of our state and political subdivision securities at March 31, 2015 were deemed to be OTTI.

At December 31, 2014, there were two securities with a fair value of $811 thousand that had an unrealized loss that amounted to $5 thousand. 

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Securities (Amortized Cost And Fair Value Of Securities By Contractual Maturity Of Held-To-Maturity Securities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Securities [Abstract]
Due in one year or less, Amortized Cost	$ 2,590
Due after one year through five years, Amortized Cost
Due after five years through ten years, Amortized Cost	2,846
Due after ten years, Amortized Cost	1,055
Amortized Cost	6,491
Due in one year or less, Fair Value	2,590
Due after one year through five years, Fair Value
Due after five years through ten years, Fair Value	2,937
Due after ten years, Fair Value	1,177
Total held to maturity securities, Fair Value	$ 6,704	$ 6,190

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (Credit Risk Profile By Creditworthiness) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	$ 473,790	$ 472,461
Commercial And Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	18,822	20,549
Construction [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	13,239	12,379
Commercial Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	325,742	326,370
Residential Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	114,663	111,498
Consumer And Other [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	1,324	1,665
Pass [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	457,011	455,111
Pass [Member] | Commercial And Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	18,794	20,446
Pass [Member] | Construction [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	13,239	12,379
Pass [Member] | Commercial Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	311,692	312,172
Pass [Member] | Residential Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	112,100	108,587
Pass [Member] | Consumer And Other [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	1,186	1,527
Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	7,978	8,861
Special Mention [Member] | Commercial And Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	8	9
Special Mention [Member] | Commercial Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	7,519	8,257
Special Mention [Member] | Residential Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	451	457
Special Mention [Member] | Consumer And Other [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable		138
Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	8,801	8,489
Substandard [Member] | Commercial And Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	20	94
Substandard [Member] | Commercial Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	6,531	5,941
Substandard [Member] | Residential Real Estate [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	2,112	2,454
Substandard [Member] | Consumer And Other [Member]
Financing Receivable, Recorded Investment [Line Items]
Total loans receivable	$ 138

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Fair Value Of Financial Instruments (Summary Of Financial Assets Measured On A Nonrecurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Impaired Loans [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial Assets	$ 1,784	$ 1,087
Impaired Loans [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial Assets	1,784	1,087
Foreclosed Real Estate [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial Assets		761
Foreclosed Real Estate [Member] | Significant Unobservable Inputs (Level III) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial Assets		$ 761

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
ASSETS
Cash and due from banks	$ 2,606	$ 2,953
Interest-bearing deposits with other banks	4,360	2,906
Cash and cash equivalents	6,966	5,859
Interest bearing time deposits with other banks	100	100
Securities available for sale, at fair value	84,573	77,976
Securities held to maturity, at amortized cost (fair value of $6,704 and $6,190 at March 31, 2015 and December 31, 2014, respectively)	6,491	6,006
Federal Home Loan Bank Stock, at cost	3,539	3,908
Loans receivable, net of unearned income	473,303	471,973
Less: allowance for loan losses	5,763	5,641
Net loans receivable	467,540	466,332
Foreclosed real estate	2,852	4,449
Premises and equipment, net	8,750	8,650
Accrued interest receivable	1,908	1,796
Goodwill	2,820	2,820
Bank-owned life insurance	12,289	12,211
Other assets	6,423	5,808
Total Assets	604,251	595,915
Deposits:
Non-interest bearing	76,765	70,490
Interest bearing	396,747	387,780
Total deposits	473,512	458,270
Short-term borrowings	5,200	23,500
Long-term borrowings	56,000	46,000
Accrued interest payable and other liabilities	4,683	4,029
Junior subordinated debentures	12,887	12,887
Total Liabilities	552,282	544,686
Stockholders' Equity:
Preferred stock, no par value, 1,000,000 shares authorized; none issued
Common stock, no par value, 10,000,000 shares authorized; 4,700,230 and 4,673,789 shares issued and 4,669,597 and 4,662,606 shares outstanding at March 31, 2015 and December 31, 2014, respectively	35,644	35,553
Treasury stock, at cost; 30,633 and 11,183 shares at March 31, 2015 and December 31, 2014, respectively	(263)	(59)
Retained earnings	16,331	15,566
Accumulated other comprehensive income	257	169
Total Stockholders' Equity	51,969	51,229
Total Liabilities and Stockholders' Equity	$ 604,251	$ 595,915

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Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014		Dec. 31, 2014
Segment Reporting Information [Line Items]
Net interest income from external sources	$ 4,802		$ 4,306
Other income from external sources	1,901		1,591
Depreciation and amortization	243		163
Income before income taxes	1,328		976
Income tax expense	376	[1]	298	[1]
Total assets	604,251		546,972		595,915
Banking And Financial Services [Member]
Segment Reporting Information [Line Items]
Net interest income from external sources	4,802		4,305
Other income from external sources	743		606
Depreciation and amortization	239		158
Income before income taxes	928		622
Income tax expense	216	[1]	156	[1]
Total assets	598,265		543,151
Insurance Services [Member]
Segment Reporting Information [Line Items]
Net interest income from external sources			1
Other income from external sources	1,158		985
Depreciation and amortization	4		5
Income before income taxes	400		354
Income tax expense	160	[1]	142	[1]
Total assets	$ 5,986		$ 3,821
Statutory tax rate	40.00%		40.00%

[1] Insurance Services calculated at statutory tax rate of 40%

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Consolidated Statements Of Cash Flows (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash Flows from Operating Activities
Net income	$ 952	$ 678
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	305	453
Depreciation and amortization	243	163
Net amortization of securities premiums and discounts	428	489
Net realized gain on sale of securities	(168)
Net realized gain on sale of foreclosed real estate	(27)	(13)
Write-downs of and provisions for foreclosed real estate	97
Deferred income tax (benefit) expense	(111)	251
Earnings on bank-owned life insurance	(78)	(83)
Compensation expense for stock options and stock awards	91	80
(Increase) decrease in assets:
Accrued interest receivable	(112)	(130)
Other assets	(563)	55
Increase in accrued interest payable and other liabilities	654	733
Net Cash Provided by Operating Activities	1,711	2,676
Securities available for sale:
Purchases	(21,632)	(4)
Sales	12,767
Maturities, calls and principal repayments	2,161	3,646
Securities held to maturity:
Purchases	(491)
Maturities, calls and principal repayments		262
Net increase in loans	(1,552)	(21,202)
Proceeds from the sale of foreclosed real estate	1,566	242
Purchases of bank premises and equipment	(343)	(874)
Decrease (increase) in Federal Home Loan Bank stock	369	(720)
Net Cash Used in Investing Activities	(7,155)	(18,650)
Cash Flows from Financing Activities
Net increase (decrease) in deposits	15,242	(4,460)
(Decrease) increase in short-term borrowed funds	(18,300)	15,000
Proceeds of long-term borrowings	15,000
Repayment of long-term borrowings	(5,000)
Purchase of treasury stock	(204)
Dividends paid	(187)
Net Cash Provided by Financing Activities	6,551	10,540
Net (Increase) Decrease in Cash and Cash Equivalents	1,107	(5,434)
Cash and Cash Equivalents - Beginning	5,859	13,246
Cash and Cash Equivalents - Ending	6,966	7,812
Supplementary Cash Flows Information
Interest paid	827	772
Income taxes paid	250
Supplementary Schedule of Noncash Investing and Financing Activities
Foreclosed real estate acquired in settlement of loans	$ 39	$ 443

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015 loan	Mar. 31, 2014 loan
Allowance For Loan Losses And Credit Quality Of Financing Receivables [Abstract]
Number of loans modified by troubled debt restructuring	0	0
Number of loans with subsequent default	0	0
Carrying value of foreclosed residential real estate properties	$ 281,000
Carrying value of collateralized consumer loans	$ 1,300,000

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Other Comprehensive Income (Tables)

3 Months Ended

Mar. 31, 2015

Other Comprehensive Income [Abstract]

Components Of Other Comprehensive Income And Related Tax Effects

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Before Tax		Tax Effect		Net of Tax		Before Tax		Tax Effect		Net of Tax
(Dollars in thousands)
Other comprehensive income:
Unrealized gains on available for sale securities	$	316	$	127	$	189	$	1,717	$	687	$	1,030
Reclassification adjustment for net gains on securities transactions included in net income		(168)		(67)		(101)		-		-		-
Total other comprehensive income	$	148	$	60	$	88	$	1,717	$	687	$	1,030

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (Changes In The Allowance For Loan Losses) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	$ 5,641	$ 5,421
Charge-offs	(214)	(457)
Recoveries	31	20
Provision	305	453
Ending balance	5,763	5,437
Commercial And Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	231	222
Charge-offs	(19)
Recoveries	4	12
Provision	(78)	55
Ending balance	138	289
Construction [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	383	308
Provision	5	7
Ending balance	388	315
Commercial Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	3,491	3,399
Charge-offs	(188)	(358)
Recoveries	12	4
Provision	472	642
Ending balance	3,787	3,687
Residential Real Estate [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	903	941
Charge-offs		(86)
Recoveries	12	1
Provision	(74)	6
Ending balance	841	862
Consumer And Other [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	19	16
Charge-offs	(7)	(13)
Recoveries	3	3
Provision	73	13
Ending balance	88	19
Unallocated [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning balance	614	535
Provision	(93)	(270)
Ending balance	$ 521	$ 265

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Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2015

Stock-Based Compensation [Abstract]

Summary Of Information Regarding Stock Option Plans

			Weighted
			Average	Weighted
			Exercise	Average		Aggregate
	Number of		Price per	Contractual		Intrinsic
	Shares		Share	Term		Value
Options outstanding, beginning of year	46,525	$	10.63
Options granted	15,985		10.25
Options expired	(3,817)		13.39
Options outstanding, end of quarter	58,693	$	10.35	8.6	$	62,065
Options exercisable, end of quarter	6,708	$	12.63	0.6	$	-
Option price range at end of quarter	$9.97 to $12.63
Option price of exercisable shares	$ 12.63

Summary Of Stock Option Assumptions

	March 31, 2015
Expected dividend yield		1.56%
Expected volatility		34.32%
Risk-free interest rate		1.37%
Expected option life		10.0 Years

Summary Of Information Regarding Restricted Stock Activity

			Weighted
			Average
	Number of		Grant Date
	Shares		Fair Value
Unvested restricted stock, beginning of year	112,545	$	6.06
Granted	26,441		10.34
Vested	(36,991)		5.80
Unvested restricted stock, end of period	101,995	$	7.27

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Summary Of Significant Accounting Policies

3 Months Ended

Mar. 31, 2015

Summary Of Significant Accounting Policies [Abstract]

Summary Of Significant Accounting Policies

NOTE 1 – SUMMARY OF SIGNIFICANT ACOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated financial statements include the accounts of Sussex Bancorp (“we,” “us,” “our” or the “company”) and our wholly owned subsidiary Sussex Bank (the “Bank”).  The Bank’s wholly owned subsidiaries are SCB Investment Company, Inc., SCBNY Company, Inc., ClassicLake Enterprises, LLC, Wheatsworth Properties Corp., PPD Holding Company, LLC, and Tri-State Insurance Agency, Inc. (“Tri-State”), a full service insurance agency located in Sussex County, New Jersey with a satellite office located in Bergen County, New Jersey.  Tri-State’s operations are considered a separate segment for financial disclosure purposes.  All inter-company transactions and balances have been eliminated in consolidation.  The Bank operates eleven banking offices, eight located in Sussex County, New Jersey, one located in Warren County, New Jersey, one in Queens County, New York and one in Orange County, New York.

We are subject to the supervision and regulation of the Board of Governors of the Federal Reserve System (the “FRB”).  The Bank’s deposits are insured by the Deposit Insurance Fund (“DIF”) of the FDIC up to applicable limits.  The operations of the company and the Bank are subject to the supervision and regulation of the FRB, the FDIC and the New Jersey Department of Banking and Insurance (the “Department”) and the operations of Tri-State are subject to supervision and regulation by the Department.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information.  Accordingly, they do not include all of the information and footnotes required by the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for full year financial statements.  In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal, recurring nature.  Operating results for the three month period ended March 31, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.  These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto that are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

New Accounting Standards

In January 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-04, Receivables - Troubled Debt Restructurings by Creditors.  This ASU clarifies that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  For public entities, the guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014.  The adoption of this guidance did not have a material impact on our consolidated financial statements.

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers. The ASU’s core principle is built on the contract between a vendor and a customer for the provision of goods and services. It attempts to depict the exchange of rights and obligations between the parties in the pattern of revenue recognition based on the consideration to which the vendor is entitled. To accomplish this objective, the standard requires five basic steps: i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. For public entities, the guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2016.  However, on April 1, 2015, FASB proposed to defer the effective date by one year. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-11, Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures, to change the accounting for repurchase-to-maturity transactions and certain linked repurchase financings.  This will result in accounting for both types of arrangements as secured borrowings on the balance sheet, rather than sales.  Additionally, the ASU introduces new disclosures to (i) increase transparency about the types of collateral pledged in secured borrowing transactions and (ii) enable users to better understand transactions in which the transferor retains substantially all of the exposure to the economic return on the transferred financial asset throughout the term of the transaction. For public entities, the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. All other accounting and disclosure amendments in the ASU are effective for public business entities for the first interim or annual period beginning after December 15, 2014. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force), to clarify that a performance target in a share-based compensation award that could be achieved after an employee completes the requisite service period should be treated as a performance condition that affects the vesting of the award.  As such, the performance target should not be reflected in estimating the grant-date fair value of the award. For all entities, the amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements

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Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Consolidated Balance Sheets [Abstract]
Securities held to maturity, fair value	$ 6,704	$ 6,190
Preferred stock, par value
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Common stock, par value
Common stock, shares authorized	10,000,000	10,000,000
Common stock, shares issued	4,700,230	4,673,789
Common stock, shares outstanding	4,669,597	4,662,606
Treasury stock, shares	30,633	11,183

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Summary Of Significant Accounting Policies (Policy)

3 Months Ended

Mar. 31, 2015

Summary Of Significant Accounting Policies [Abstract]

Basis Of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements include the accounts of Sussex Bancorp (“we,” “us,” “our” or the “company”) and our wholly owned subsidiary Sussex Bank (the “Bank”).  The Bank’s wholly owned subsidiaries are SCB Investment Company, Inc., SCBNY Company, Inc., ClassicLake Enterprises, LLC, Wheatsworth Properties Corp., PPD Holding Company, LLC, and Tri-State Insurance Agency, Inc. (“Tri-State”), a full service insurance agency located in Sussex County, New Jersey with a satellite office located in Bergen County, New Jersey.  Tri-State’s operations are considered a separate segment for financial disclosure purposes.  All inter-company transactions and balances have been eliminated in consolidation.  The Bank operates eleven banking offices, eight located in Sussex County, New Jersey, one located in Warren County, New Jersey, one in Queens County, New York and one in Orange County, New York.

We are subject to the supervision and regulation of the Board of Governors of the Federal Reserve System (the “FRB”).  The Bank’s deposits are insured by the Deposit Insurance Fund (“DIF”) of the FDIC up to applicable limits.  The operations of the company and the Bank are subject to the supervision and regulation of the FRB, the FDIC and the New Jersey Department of Banking and Insurance (the “Department”) and the operations of Tri-State are subject to supervision and regulation by the Department.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information.  Accordingly, they do not include all of the information and footnotes required by the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for full year financial statements.  In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal, recurring nature.  Operating results for the three month period ended March 31, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.  These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto that are included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

New Accounting Standards

New Accounting Standards

In January 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-04, Receivables - Troubled Debt Restructurings by Creditors.  This ASU clarifies that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  For public entities, the guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014.  The adoption of this guidance did not have a material impact on our consolidated financial statements.

In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers. The ASU’s core principle is built on the contract between a vendor and a customer for the provision of goods and services. It attempts to depict the exchange of rights and obligations between the parties in the pattern of revenue recognition based on the consideration to which the vendor is entitled. To accomplish this objective, the standard requires five basic steps: i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. For public entities, the guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2016.  However, on April 1, 2015, FASB proposed to defer the effective date by one year. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-11, Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures, to change the accounting for repurchase-to-maturity transactions and certain linked repurchase financings.  This will result in accounting for both types of arrangements as secured borrowings on the balance sheet, rather than sales.  Additionally, the ASU introduces new disclosures to (i) increase transparency about the types of collateral pledged in secured borrowing transactions and (ii) enable users to better understand transactions in which the transferor retains substantially all of the exposure to the economic return on the transferred financial asset throughout the term of the transaction. For public entities, the disclosure for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions accounted for as secured borrowings is required to be presented for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. All other accounting and disclosure amendments in the ASU are effective for public business entities for the first interim or annual period beginning after December 15, 2014. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In June 2014, FASB issued ASU 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force), to clarify that a performance target in a share-based compensation award that could be achieved after an employee completes the requisite service period should be treated as a performance condition that affects the vesting of the award.  As such, the performance target should not be reflected in estimating the grant-date fair value of the award. For all entities, the amendments are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements

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Document And Entity Information	3 Months Ended
	Mar. 31, 2015	May 07, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2015
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2015
Entity Registrant Name	SUSSEX BANCORP
Entity Central Index Key	0001028954
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	sbbx
Entity Common Stock, Shares Outstanding		4,674,997

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Securities (Tables)

3 Months Ended

Mar. 31, 2015

Securities [Abstract]

Amortized Cost And Approximate Fair Value Of Securities Available For Sale

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
U.S. government agencies	$	11,428	$	25	$	(47)	$	11,406
State and political subdivisions		32,145		276		(220)		32,201
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,563		435		(43)		40,955
Equity securities-financial services industry and other		8		3		-		11
	$	84,144	$	739	$	(310)	$	84,573
December 31, 2014
U.S. government agencies	$	7,873	$	17	$	(32)	$	7,858
State and political subdivisions		26,432		158		(206)		26,384
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,382		500		(158)		43,724
Equity securities-financial services industry and other		8		2		-		10
	$	77,695	$	677	$	(396)	$	77,976

Amortized Cost And Fair Value Of Securities By Contractual Maturity Of Available-For-Sale Securities

	Amortized		Fair
(Dollars in thousands)	Cost		Value
Due in one year or less	$	-	$	-
Due after one year through five years		-		-
Due after five years through ten years		2,301		2,333
Due after ten years		29,844		29,868
Total bonds and obligations		32,145		32,201
U.S. government agencies		11,428		11,406
Mortgage-backed securities:
U.S. government-sponsored enterprises		40,563		40,955
Equity securities-financial services industry and other		8		11
Total available for sale securities	$	84,144	$	84,573

Temporarily Impaired Gross Unrealized Losses And Fair Value Of Available-For-Sale Securities

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
U.S. government agencies	$	5,677	$	(16)	$	2,784	$	(31)	$	8,461	$	(47)
State and political subdivisions		15,522		(179)		1,859		(41)		17,381		(220)
Mortgage-backed securities -
U.S. government-sponsored enterprises		9,624		(30)		2,024		(13)		11,648		(43)
Total temporarily impaired securities	$	30,823	$	(225)	$	6,667	$	(85)	$	37,490	$	(310)
December 31, 2014
U.S. government agencies	$	-	$	-	$	2,905	$	(32)	$	2,905	$	(32)
State and political subdivisions		7,603		(112)		5,713		(94)		13,316		(206)
Mortgage-backed securities -
U.S. government-sponsored enterprises		15,679		(94)		3,432		(64)		19,111		(158)
Total temporarily impaired securities	$	23,282	$	(206)	$	12,050	$	(190)	$	35,332	$	(396)

Amortized Cost And Approximate Fair Value Of Securities Held-To-Maturity

				Gross		Gross
		Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)		Cost		Gains		Losses		Value
March 31, 2015
State and political subdivisions	$	6,491	$	214	$	(1)	$	6,704
December 31, 2014
State and political subdivisions	$	6,006	$	189	$	(5)	$	6,190

Amortized Cost And Fair Value Of Securities By Contractual Maturity Of Held-To-Maturity Securities

		Amortized		Fair
(Dollars in thousands)		Cost		Value
Due in one year or less	$	2,590	$	2,590
Due after one year through five years		-		-
Due after five years through ten years		2,846		2,937
Due after ten years		1,055		1,177
Total held to maturity securities	$	6,491	$	6,704

Temporarily Impaired Gross Unrealized Losses And Fair Value Of Held-To-Maturity Securities

	Less Than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
March 31, 2015
State and political subdivisions	$	261	$	(1)	$	-	$	-	$	261	$	(1)
December 31, 2014
State and political subdivisions	$	-	$	-	$	811	$	(5)	$	811	$	(5)

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Consolidated Statements Of Income And Comprehensive Income (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
INTEREST INCOME
Loans receivable, including fees	$ 5,172		$ 4,623
Securities:
Taxable	267		217
Tax-exempt	208		254
Interest bearing deposits	4		3
Total Interest Income	5,651		5,097
INTEREST EXPENSE
Deposits	416		390
Borrowings	380		348
Junior subordinated debentures	53		53
Total Interest Expense	849		791
Net Interest Income	4,802		4,306
PROVISION FOR LOAN LOSSES	305		453
Net Interest Income after Provision for Loan Losses	4,497		3,853
OTHER INCOME
Service fees on deposit accounts	213		264
ATM and debit card fees	174		167
Bank-owned life insurance	78		83
Insurance commissions and fees	1,155		973
Investment brokerage fees	22		31
Net gain on sales of securities	168
Other	91		73
Total Other Income	1,901		1,591
OTHER EXPENSES
Salaries and employee benefits	2,780		2,418
Occupancy, net	477		453
Data processing	354		380
Furniture and equipment	210		164
Advertising and promotion	70		44
Professional fees	146		153
Director fees	166		137
FDIC assessment	124		176
Insurance	52		76
Stationary and supplies	56		55
Loan collection costs	97		77
Net expenses and write-downs related to foreclosed real estate	164		100
Other	374		235
Total Other Expenses	5,070		4,468
Income before Income Taxes	1,328		976
EXPENSE FOR INCOME TAXES	376	[1]	298	[1]
Net Income	952		678
OTHER COMPREHENSIVE INCOME:
Unrealized gains on available for sale securities arising during the period	316		1,717
Reclassification adjustment for net gain on securities transactions included in net income	(168)
Income tax related to items of other comprehensive income	(60)		(687)
Other comprehensive income, net of income taxes	88		1,030
Comprehensive income	$ 1,040		$ 1,708
EARNINGS PER SHARE
Basic	$ 0.21		$ 0.15
Diluted	$ 0.21		$ 0.15

[1] Insurance Services calculated at statutory tax rate of 40%

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Other Comprehensive Income

3 Months Ended

Mar. 31, 2015

Other Comprehensive Income [Abstract]

Other Comprehensive Income

NOTE 6 – OTHER COMPREHENSIVE INCOME

Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income.  Although certain changes in assets and liabilities, such as unrealized gains and losses on available for sale securities, are reported as a separate component of the equity section of the balance sheet, such items, along with net income, are components of comprehensive income.

The components of other comprehensive income, both before tax and net of tax, are as follows:

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Before Tax		Tax Effect		Net of Tax		Before Tax		Tax Effect		Net of Tax
(Dollars in thousands)
Other comprehensive income:
Unrealized gains on available for sale securities	$	316	$	127	$	189	$	1,717	$	687	$	1,030
Reclassification adjustment for net gains on securities transactions included in net income		(168)		(67)		(101)		-		-		-
Total other comprehensive income	$	148	$	60	$	88	$	1,717	$	687	$	1,030

Reclassification adjustments for gains on securities transactions of $168 thousand for the three months ended March 31, 2015 are presented in the income statement on the line item for net gain on securities transactions.  There were no reclassification adjustments for gains on securities transactions for the three months ended March 31, 2014.

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Earnings Per Share

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 5 – EARNINGS PER SHARE

Basic earnings per share are calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period.  Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares (unvested restricted stock grants and stock options) had been issued, as well as any adjustment to income that would result from the assumed issuance of potential common shares that may be issued by us. Potential common shares related to stock options are determined using the treasury stock method.

	Three Months Ended March 31, 2015					Three Months Ended March 31, 2014
(In thousands, except share and	Income		Shares	Per Share		Income		Shares	Per Share
per share data)	(Numerator)		(Denominator)	Amount		(Numerator)		(Denominator)	Amount
Basic earnings per share:
Net earnings applicable to common stockholders	$	952	4,571,142	$	0.21	$	678	4,526,506	$	0.15
Effect of dilutive securities:
Unvested stock awards		-	31,768				-	38,094
Diluted earnings per share:
Net income applicable to common stockholders and assumed conversions	$	952	4,602,910	$	0.21	$	678	4,564,600	$	0.15

There were 21,224 and 7,734 shares of unvested restricted stock awards and options outstanding during the quarter ended March 31, 2015 and 2014, respectively, which were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive. 

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2015

Segment Information [Abstract]

Schedule Of Segment Information

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Banking and						Banking and
	Financial		Insurance				Financial		Insurance
	Services		Services		Total		Services		Services		Total
(Dollars in thousands)
Net interest income from external sources	$	4,802	$	-	$	4,802	$	4,305	$	1	$	4,306
Other income from external sources		743		1,158		1,901		606		985		1,591
Depreciation and amortization		239		4		243		158		5		163
Income before income taxes		928		400		1,328		622		354		976
Income tax expense (1)		216		160		376		156		142		298
Total assets		598,265		5,986		604,251		543,151		3,821		546,972

(1) Insurance Services calculated at statutory tax rate of 40%

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Loans (Tables)

3 Months Ended

Mar. 31, 2015

Loans [Abstract]

Composition Of Net Loans Receivable

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	18,822	$	20,549
Construction		13,239		12,379
Commercial real estate		325,742		326,370
Residential real estate		114,663		111,498
Consumer and other		1,324		1,665
Total loans receivable		473,790		472,461
Unearned net loan origination fees		(487)		(488)
Allowance for loan losses		(5,763)		(5,641)
Net loans receivable	$	467,540	$	466,332

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Guarantees

3 Months Ended

Mar. 31, 2015

Guarantees [Abstract]

Guarantees

NOTE 9 – GUARANTEES

We do not issue any guarantees that would require liability recognition or disclosure, other than standby letters of credit.  Standby letters of credit are conditional commitments issued by us to guarantee the performance of a customer to a third party.  Generally, all letters of credit, when issued, have expiration dates within one year.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.  Generally, we hold collateral and/or personal guarantees supporting these commitments.  As of March 31, 2015, we had $910 thousand of outstanding letters of credit.  Management believes that the proceeds obtained through a liquidation of collateral and the enforcement of guarantees would be sufficient to cover the potential amount of future payments required under the corresponding guarantees.  The amount of the liability as of March 31, 2015, for guarantees under standby letters of credit issued is not material.

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Segment Information

3 Months Ended

Mar. 31, 2015

Segment Information [Abstract]

Segment Information

NOTE 7 – SEGMENT INFORMATION

Our insurance agency operations are managed separately from the traditional banking and related financial services that we also offer.  The insurance agency operation provides commercial, individual, and group benefit plans and personal coverage.

	Three Months Ended March 31, 2015						Three Months Ended March 31, 2014
	Banking and						Banking and
	Financial		Insurance				Financial		Insurance
	Services		Services		Total		Services		Services		Total
(Dollars in thousands)
Net interest income from external sources	$	4,802	$	-	$	4,802	$	4,305	$	1	$	4,306
Other income from external sources		743		1,158		1,901		606		985		1,591
Depreciation and amortization		239		4		243		158		5		163
Income before income taxes		928		400		1,328		622		354		976
Income tax expense (1)		216		160		376		156		142		298
Total assets		598,265		5,986		604,251		543,151		3,821		546,972

(1) Insurance Services calculated at statutory tax rate of 40%

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Stock-Based Compensation

3 Months Ended

Mar. 31, 2015

Stock-Based Compensation [Abstract]

Stock-Based Compensation

NOTE 8 – STOCK-BASED COMPENSATION

We currently have stock-based compensation plans in place for our directors, officers, employees, consultants and advisors.  Under the terms of these plans we may grant restricted shares and stock options for the purchase of our common stock.  The stock-based compensation is granted under terms determined by our Compensation Committee.  Our standard stock option grants have a maximum term of 10 years, generally vest over periods ranging between one and four years, and are granted with an exercise price equal to the fair market value of the common stock on the date of grant.  Restricted stock is valued at the market value of the common stock on the date of grant and generally vests over periods of two to seven years.  All dividends paid on restricted stock, whether vested or unvested, are paid to the shareholder.

Information regarding our stock option plans for the three months ended March 31, 2015 is as follows:

			Weighted
			Average	Weighted
			Exercise	Average		Aggregate
	Number of		Price per	Contractual		Intrinsic
	Shares		Share	Term		Value
Options outstanding, beginning of year	46,525	$	10.63
Options granted	15,985		10.25
Options expired	(3,817)		13.39
Options outstanding, end of quarter	58,693	$	10.35	8.6	$	62,065
Options exercisable, end of quarter	6,708	$	12.63	0.6	$	-
Option price range at end of quarter	$9.97 to $12.63
Option price of exercisable shares	$ 12.63

The following table summarizes information about stock option assumptions:

	March 31, 2015
Expected dividend yield		1.56%
Expected volatility		34.32%
Risk-free interest rate		1.37%
Expected option life		10.0 Years

During the three months ended March 31, 2015, we expensed $9 thousand in stock-based compensation under stock option awards.  There was no stock-based compensation expensed under stock option awards during the three months ended March 31, 2014.

The weighted average grant date fair value of options granted during the quarter ended March 31, 2015 was $3.56 per share. Expected future expense relating to the unvested options outstanding as of March 31, 2015 is $179 thousand over a weighted average period of 4.7 years. Upon exercise of vested options, management expects to draw on treasury stock as the source of the shares.

The summary of changes in unvested restricted stock awards for the three months ended March 31, 2015, is as follows:

			Weighted
			Average
	Number of		Grant Date
	Shares		Fair Value
Unvested restricted stock, beginning of year	112,545	$	6.06
Granted	26,441		10.34
Vested	(36,991)		5.80
Unvested restricted stock, end of period	101,995	$	7.27

During the three months ended March 31, 2015 and 2014, we expensed $82 thousand and $80 thousand, respectively, in stock-based compensation under restricted stock awards.

At March 31, 2015, unrecognized compensation expense for unvested restricted stock was $630 thousand, which is expected to be recognized over an average period of 2.0 years. 

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Fair Value Of Financial Instruments

3 Months Ended

Mar. 31, 2015

Fair Value Of Financial Instruments [Abstract]

Fair Value Of Financial Instruments

NOTE 10 – FAIR VALUE OF FINANCIAL INSTRUMENTS

Management uses its best judgment in estimating the fair value of our financial instruments; however, there are inherent weaknesses in any estimation technique.  Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts we could have realized in a sale transaction on the dates indicated.  The fair value amounts have been measured as of their respective period ends, and have not been re-evaluated or updated for purposes of these financial statements subsequent to those respective dates.  As such, the fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each period end.

In accordance with U.S. GAAP, we use a hierarchical disclosure framework associated with the level of pricing observability utilized in measuring assets and liabilities at fair value.  The three broad levels defined by the hierarchy are as follows:

· Level I - Quoted prices are available in active markets for identical assets or liabilities as of the reported date.

· Level II - Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these asset and liabilities include items for which quoted prices are available but traded less frequently, and items that are fair valued using other financial instruments, the parameters of which can be directly observed.

· Level III - Assets and liabilities that have little to no pricing observability as of reported date.  These items do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.

The following table summarizes the fair value of our financial assets measured on a recurring basis by the above pricing observability levels as of March 31, 2015 and December 31, 2014:

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
U.S. government agencies	$	11,406	$	-	$	11,406	$	-
State and political subdivisions		32,201		-		32,201		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		40,955		-		40,955		-
Equity securities-financial services industry and other		11		11		-		-
December 31, 2014
U.S. government agencies	$	7,858	$	-	$	7,858	$	-
State and political subdivisions		26,384		-		26,384		-
Mortgage-backed securities -
U.S. government-sponsored enterprises		43,724		-		43,724		-
Equity securities-financial services industry and other		10		10		-		-

Our available for sale and held to maturity securities portfolios contain investments, which were all rated within our investment policy guidelines at time of purchase and upon review of the entire portfolio all securities are marketable and have observable pricing inputs.

For financial assets measured at fair value on a nonrecurring basis the fair value measurements by level within the fair value hierarchy used at March 31, 2015 and December 31, 2014 are as follows:

			Quoted Prices in		Significant
			Active Markets		Other		Significant
	Fair		for Identical		Observable		Unobservable
	Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level I)		(Level II)		(Level III)
March 31, 2015
Impaired loans	$	1,784	$	-	$	-	$	1,784
December 31, 2014
Impaired loans	$	1,087	$	-	$	-	$	1,087
Foreclosed real estate		761		-		-		761

The following table presents additional qualitative information about assets measured at fair value on a nonrecurring basis and for which Level 3 inputs were used to determine fair value:

	Qualitative Information about Level III Fair Value Measurements
	Fair				Range
	Value		Valuation	Unobservable	(Weighted
(Dollars in thousands)	Estimate		Techniques	Input	Average)
March 31, 2015
Impaired loans	$	1,784	Appraisal of	Appraisal	0% to -74.8%
			collateral	adjustments (1)	(-7.5%)
December 31, 2014
Impaired loans	$	1,087	Appraisal of	Appraisal	0% to -67.9%
			collateral	adjustments (1)	(-7.8%)
Foreclosed real estate		761	Appraisal of	Selling
			collateral	expenses (1)	-7.0%(-7.0%)
(1) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated selling expenses.  The range and weighted average of selling expenses and other appraisal adjustments are presented as a percentage of the appraisal.

The following information should not be interpreted as an estimate of the fair value of the entire company since a fair value calculation is only provided for a limited portion of our assets and liabilities.  Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between our disclosures and those of other companies may not be meaningful.  The following methods and assumptions were used to estimate the fair value of our financial instruments at March 31, 2015 and December 31, 2014:  

Cash and Cash Equivalents (Carried at Cost): The carrying amounts reported in the balance sheet for cash and cash equivalents approximate those assets’ fair value.

Deposits (Carried at Cost): Fair value for fixed-rate time certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits.  We generally purchase amounts below the insured limit, limiting the amount of credit risk on these time deposits.  

Securities: The fair value of securities, available for sale (carried at fair value) and securities held to maturity (carried at amortized cost) are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level I), or matrix pricing (Level II), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices.  For certain securities which are not traded in active markets or are subject to transfer restrictions, valuations are adjusted to reflect illiquidity and/or non-transferability, and such adjustments are generally based on available market evidence (Level III).  In the absence of such evidence, management’s best estimate is used.  Management’s best estimate consists of both internal and external support on certain Level III measurements.  Internal cash flow models using a present value formula that includes assumptions market participants would use along with indicative exit pricing obtained from broker/dealers (where available) were used to support fair values of certain Level III investments.

Federal Home Loan Bank Stock (Carried at Cost):  The carrying amount of restricted investment in bank stock approximates fair value and considers the limited marketability of such securities.

Loans Receivable (Carried at Cost): The fair values of non-impaired loans are estimated using discounted cash flow analyses, using the market rates at the balance sheet date that reflect the credit and interest rate-risk inherent in the loans.  Projected future cash flows are calculated based upon contractual maturity or call dates, projected repayments and prepayments of principal.  Generally, for variable rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values.

Impaired Loans (Carried at Lower of Cost or Fair Value): Fair value of impaired loans is generally determined based upon independent third-party appraisals of the properties, or discounted cash flows based upon the expected proceeds.  These assets are included in Level III fair values, based upon the lowest level of input that is significant to the fair value measurements.  The fair value of impaired loans totaled $1.8 million and $1.1 million at March 31, 2015 and December 31, 2014,respectively.  These balances consist of loans that were written down or required additional reserves during the periods ended March 31, 2015 and December 31, 2014, respectively.

Deposit Liabilities (Carried at Cost): The fair values disclosed for demand, savings and money market accounts are, by definition, equal to the amount payable on demand at the reporting date (i.e., their carrying amounts).  Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. 

Borrowings (Carried at Cost): Fair values of Federal Home Loan Bank (“FHLB”) advances are estimated using discounted cash flow analysis, based on quoted prices for new FHLB advances with similar credit risk characteristics, terms and remaining maturity.  These prices obtained from this active market represent a market value that is deemed to represent the transfer price if the liability were assumed by a third party. 

Junior Subordinated Debentures (Carried at Cost): Fair values of junior subordinated debt are estimated using discounted cash flow analysis, based on market rates currently offered on such debt with similar credit risk characteristics, terms and remaining maturity. 

Accrued Interest Receivable and Accrued Interest Payable (Carried at Cost): The carrying amounts of accrued interest receivable and payable approximate its fair value.

Off-Balance Sheet Instruments (Disclosed at Cost): Fair values for our off-balance sheet financial instruments (lending commitments and letters of credit) are based on fees currently charged in the market to enter into similar agreements, taking into account, the remaining terms of the agreements and the counterparties’ credit standing. 

The fair values of our financial instruments at March 31, 2015 and December 31, 2014, were as follows:

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	March 31, 2015				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	6,966	$	6,966	$	6,966	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		84,573		84,573		11		84,562		-
Securities held to maturity		6,491		6,704		-		6,704		-
Federal Home Loan Bank stock		3,539		3,539		-		3,539		-
Loans receivable, net of allowance		467,540		467,313		-		-		467,313
Accrued interest receivable		1,908		1,908		-		1,908		-
Financial liabilities:
Non-maturity deposits		357,007		357,007		-		357,007		-
Time deposits		116,505		107,011		-		116,918		-
Short-term borrowings		5,200		5,200		5,200		-		-
Long-term borrowings		56,000		57,738		-		57,738		-
Junior subordinated debentures		12,887		9,970		-		9,970		-
Accrued interest payable		265		265		-		265		-

					Quoted Prices in		Significant
					Active Markets		Other		Significant
	December 31, 2014				for Identical		Observable		Unobservable
	Carrying		Fair		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		Value		(Level I)		(Level II)		(Level III)
Financial assets:
Cash and cash equivalents	$	5,859	$	5,859	$	5,859	$	-	$	-
Time deposits with other banks		100		100		-		100		-
Securities available for sale		77,976		77,976		-		-		-
Securities held to maturity		6,006		6,190		-		6,190		-
Federal Home Loan Bank stock		3,908		3,908		-		3,908		-
Loans receivable, net of allowance		466,332		462,984		-		-		462,984
Accrued interest receivable		1,796		1,796		-		1,796		-
Financial liabilities:
Non-maturity deposits		351,653		351,653		-		351,653		-
Time deposits		106,617		107,011		-		107,011		-
Short-term borrowings		23,500		23,500		23,500		-		-
Long-term borrowings		46,000		47,766		-		47,766		-
Junior subordinated debentures		12,887		9,361		-		9,361		-
Accrued interest payable		243		243		-		243		-

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Loans (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	$ 473,790	$ 472,461
Unearned net loan origination fees	(487)	(488)
Allowance for loan losses	(5,763)	(5,641)
Net loans receivable	467,540	466,332
Mortgage loans serviced for the benefit of others	470	475
Commercial And Industrial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	18,822	20,549
Construction [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	13,239	12,379
Commercial Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	325,742	326,370
Residential Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	114,663	111,498
Consumer And Other [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans receivable	$ 1,324	$ 1,665

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Fair Value Of Financial Instruments (Narrative) (Details) (Impaired Loans [Member], USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Impaired Loans [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Impaired loans, fair value	$ 1,784	$ 1,087

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Calculation Methods Of Earnings Per Share

	Three Months Ended March 31, 2015					Three Months Ended March 31, 2014
(In thousands, except share and	Income		Shares	Per Share		Income		Shares	Per Share
per share data)	(Numerator)		(Denominator)	Amount		(Numerator)		(Denominator)	Amount
Basic earnings per share:
Net earnings applicable to common stockholders	$	952	4,571,142	$	0.21	$	678	4,526,506	$	0.15
Effect of dilutive securities:
Unvested stock awards		-	31,768				-	38,094
Diluted earnings per share:
Net income applicable to common stockholders and assumed conversions	$	952	4,602,910	$	0.21	$	678	4,564,600	$	0.15

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Summary Of Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2015 site
Banking offices	11
Sussex County, New Jersey [Member]
Banking offices	8
Warren County, New Jersey [Member]
Banking offices	1
Queens County, New York [Member]
Banking offices	1
Orange County, New York [Member]
Banking offices	1

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Stock-Based Compensation (Summary Of Information Regarding Restricted Stock Activity) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015
Stock-Based Compensation [Abstract]
Unvested restricted stock, beginning of year, Number of Shares	112,545
Granted, Number of Shares	26,441
Vested, Number of Shares	(36,991)
Unvested restricted stock, end of period, Number of Shares	101,995
Unvested restricted stock, beginning of year, Weighted Average Grant Date Fair Value	$ 6.06
Granted, Weighted Average Grant Date Fair Value	$ 10.34
Vested, Weighted Average Grant Date Fair Value	$ 5.80
Unvested restricted stock, end of period, Weighted Average Grant Date Fair Value	$ 7.27

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (Impaired Loans) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Financing Receivable, Impaired [Line Items]
Recorded Investment, Total	$ 8,077		$ 7,513
Unpaid Principal Balance, Total	8,656		8,092
Related Allowance	516		288
Average Recorded Investment, With no related allowance recorded	4,400	6,813
Average Recorded Investment, With an allowance recorded	3,395	6,169
Average Recorded Investment, Total	7,795	12,982
Interest Income Recognized, With no related allowance recorded	6	28
Interest Income Recognized, With an allowance recorded	11	5
Interest Income Recognized, Total	17	33
Commercial And Industrial [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment, With no related allowance recorded	20
Recorded Investment, With an allowance recorded	1		94
Recorded Investment, Total	21		94
Unpaid Principal Balance, With no related allowance recorded	20
Unpaid Principal Balance, With an allowance recorded	1		94
Unpaid Principal Balance, Total	21		94
Related Allowance	1		51
Average Recorded Investment, With no related allowance recorded	10
Average Recorded Investment, With an allowance recorded	47
Commercial Real Estate [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment, With no related allowance recorded	2,351		3,167
Recorded Investment, With an allowance recorded	3,593		1,938
Recorded Investment, Total	5,944		5,105
Unpaid Principal Balance, With no related allowance recorded	2,351		3,736
Unpaid Principal Balance, With an allowance recorded	4,162		1,938
Unpaid Principal Balance, Total	6,513		5,674
Related Allowance	334		136
Average Recorded Investment, With no related allowance recorded	2,759	4,968
Average Recorded Investment, With an allowance recorded	2,766	5,319
Interest Income Recognized, With no related allowance recorded	5	8
Interest Income Recognized, With an allowance recorded	8	1
Residential Real Estate [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment, With no related allowance recorded	1,433		1,829
Recorded Investment, With an allowance recorded	541		485
Recorded Investment, Total	1,974		2,314
Unpaid Principal Balance, With no related allowance recorded	1,432		1,835
Unpaid Principal Balance, With an allowance recorded	552		489
Unpaid Principal Balance, Total	1,984		2,324
Related Allowance	108		101
Average Recorded Investment, With no related allowance recorded	1,631	1,845
Average Recorded Investment, With an allowance recorded	513	849
Interest Income Recognized, With no related allowance recorded	1	20
Interest Income Recognized, With an allowance recorded	3	4
Consumer And Other [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment, With an allowance recorded	138
Recorded Investment, Total	138
Unpaid Principal Balance, With an allowance recorded	138
Unpaid Principal Balance, Total	138
Related Allowance	73
Average Recorded Investment, With an allowance recorded	$ 69	$ 1

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Consolidated Statements Of Stockholders' Equity (USD $) In Thousands, except Share data	Common Stock [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Total
Balance at Dec. 31, 2013	$ 35,249	$ 13,386	$ (2,151)	$ (59)	$ 46,425
Balance, shares at Dec. 31, 2013	4,629,113
Net income		678			678
Other comprehensive income (loss)			1,030		1,030
Restricted stock granted	29,043
Restricted stock forfeited	(300)
Compensation expense related to stock option and restricted stock grants	80				80
Balance at Mar. 31, 2014	35,329	14,064	(1,121)	(59)	48,213
Balance, shares at Mar. 31, 2014	4,657,856
Balance at Dec. 31, 2014	35,553	15,566	169	(59)	51,229
Balance, shares at Dec. 31, 2014	4,662,606				4,662,606
Net income		952			952
Other comprehensive income (loss)			88		88
Treasury shares purchased				(204)	(204)
Treasury shares purchased, shares	(19,450)
Restricted stock granted	26,441
Compensation expense related to stock option and restricted stock grants	91				91
Dividends declared on common stock		(187)			(187)
Balance at Mar. 31, 2015	$ 35,644	$ 16,331	$ 257	$ (263)	$ 51,969
Balance, shares at Mar. 31, 2015	4,669,597				4,669,597

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Allowance For Loan Losses And Credit Quality Of Financing Receivables

3 Months Ended

Mar. 31, 2015

Allowance For Loan Losses And Credit Quality Of Financing Receivables [Abstract]

Allowance For Loan Losses And Credit Quality Of Financing Receivables

NOTE 4 – ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY OF FINANCING RECEIVABLES

The following table presents changes in the allowance for loan losses disaggregated by the class of loans receivable for the three months ended March 31, 2015 and 2014:  

	Commercial				Commercial		Residential		Consumer
	and				Real		Real		and
(Dollars in thousands)	Industrial		Construction		Estate		Estate		Other		Unallocated		Total
Three Months Ended:
March 31, 2015
Beginning balance	$	231	$	383	$	3,491	$	903	$	19	$	614	$	5,641
Charge-offs		(19)		-		(188)		-		(7)		-		(214)
Recoveries		4		-		12		12		3		-		31
Provision		(78)		5		472		(74)		73		(93)		305
Ending balance	$	138	$	388	$	3,787	$	841	$	88	$	521	$	5,763
March 31, 2014
Beginning balance	$	222		308	$	3,399	$	941	$	16	$	535	$	5,421
Charge-offs		-		-		(358)		(86)		(13)		-		(457)
Recoveries		12		-		4		1		3		-		20
Provision		55		7		642		6		13		(270)		453
Ending balance	$	289	$	315	$	3,687	$	862	$	19	$	265	$	5,437

The following table presents the balance of the allowance of loan losses and loans receivable by class at March 31, 2015 and December 31, 2014 disaggregated on the basis of our impairment methodology.

	Allowance for Loan Losses						Loans Receivable
			Balance		Balance
			Related to		Related to
			Loans		Loans
			Individually		Collectively				Individually		Collectively
			Evaluated for		Evaluated for				Evaluated for		Evaluated for
(Dollars in thousands)	Balance		Impairment		Impairment		Balance		Impairment		Impairment
March 31, 2015
Commercial and industrial	$	138	$	1	$	137	$	18,822	$	21	$	18,801
Construction		388		-		388		13,239		-		13,239
Commercial real estate		3,787		334		3,453		325,742		5,944		319,798
Residential real estate		841		108		733		114,663		1,974		112,689
Consumer and other loans		88		73		15		1,324		138		1,186
Unallocated		521		-		-		-		-		-
Total	$	5,763	$	516	$	4,726	$	473,790	$	8,077	$	465,713
December 31, 2014
Commercial and industrial	$	231	$	51	$	180	$	20,549	$	94	$	20,455
Construction		383		-		383		12,379		-		12,379
Commercial real estate		3,491		136		3,355		326,370		5,105		321,265
Residential real estate		903		101		802		111,498		2,314		109,184
Consumer and other loans		19		-		19		1,665		-		1,665
Unallocated		614		-		-		-		-		-
Total	$	5,641	$	288	$	4,739	$	472,461	$	7,513	$	464,948

An age analysis of loans receivable, which were past due as of March 31, 2015 and December 31, 2014, is as follows:

													Recorded
													Investment
					Greater						Total		> 90 Days
	30-59 Days		60-89 days		Than		Total Past				Financing		and
(Dollars in thousands)	Past Due		Past Due		90 Days (a)		Due		Current		Receivables		Accruing
March 31, 2015
Commercial and industrial	$	10	$	15	$	20	$	45	$	18,777	$	18,822	$	-
Construction		-		-		-		-		13,239		13,239		-
Commercial real estate		2,165		1,107		4,917		8,189		317,553		325,742		-
Residential real estate		879		-		1,557		2,436		112,227		114,663		-
Consumer and other		2		-		139		141		1,183		1,324		1
Total	$	3,056	$	1,122	$	6,633	$	10,811	$	462,979	$	473,790	$	1
December 31, 2014
Commercial and industrial	$	9	$	-	$	94	$	103	$	20,446	$	20,549	$	-
Construction		1,354		-		-		1,354		11,025		12,379		-
Commercial real estate		2,395		1,209		3,936		7,540		318,830		326,370		-
Residential real estate		555		108		1,978		2,641		108,857		111,498		85
Consumer and other		5		-		1		6		1,659		1,665		-
Total	$	4,318	$	1,317	$	6,009	$	11,644	$	460,817	$	472,461	$	85
(a) includes loans greater than 90 days past due and still accruing and non-accrual loans.

Loans for which the accrual of interest has been discontinued at March 31, 2015 and December 31, 2014 were:

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	20	$	94
Commercial real estate		4,917		3,936
Residential real estate		1,557		1,893
Consumer and other		138		1
Total	$	6,632	$	5,924

In determining the adequacy of the allowance for loan losses, we estimate losses based on the identification of specific problem loans through our credit review process and also estimate losses inherent in other loans on an aggregate basis by loan type.  The credit review process includes the independent evaluation of the loan officer assigned risk ratings by the Chief Credit Officer and a third party loan review company.  Such risk ratings are assigned loss component factors that reflect our loss estimate for each group of loans.  It is management’s and the Board of Directors’ responsibility to oversee the lending process to ensure that all credit risks are properly identified, monitored, and controlled, and that loan pricing, terms and other safeguards against non-performance and default are commensurate with the level of risk undertaken and is rated as such based on a risk-rating system.  Factors considered in assigning risk ratings and loss component factors include: borrower specific information related to expected future cash flows and operating results, collateral values, financial condition, payment status and other information; levels of and trends in portfolio charge-offs and recoveries; levels in portfolio delinquencies; effects of changes in loan concentrations and observed trends in the economy and other qualitative measurements.

Our risk-rating system is consistent with the classification system used by regulatory agencies and with industry practices. Loan classifications of Substandard, Doubtful or Loss are consistent with the regulatory definitions of classified assets.  The classification system is as follows:

· Pass: This category represents loans performing to contractual terms and conditions and the primary source of repayment is adequate to meet the obligation.  We have five categories within the Pass classification depending on strength of repayment sources, collateral values and financial condition of the borrower. 

· Special Mention:  This category represents loans performing to contractual terms and conditions; however the primary source of repayment or the borrower is exhibiting some deterioration or weaknesses in financial condition that could potentially threaten the borrowers’ future ability to repay our loan principal and interest or fees due.

· Substandard: This category represents loans that the primary source of repayment has significantly deteriorated or weakened which has or could threaten the borrowers’ ability to make scheduled payments.  The weaknesses require close supervision by management and there is a distinct possibility that we could sustain some loss if the deficiencies are not corrected.  Such weaknesses could jeopardize the timely and ultimate collection of our loan principal and interest or fees due.  Loss may not be expected or evident, however, loan repayment is inadequately supported by current financial information or pledged collateral.

· Doubtful: Loans so classified have all the inherent weaknesses of a substandard loan with the added provision that collection or liquidation in full is highly questionable and not reasonably assured.  The probability of at least partial loss is high, but extraneous factors might strengthen the asset to prevent loss. The validity of the extraneous factors must be continuously monitored. Once these factors are questionable the loan should be considered for full or partial charge-off.

· Loss: Loans so classified are considered uncollectible, and of such little value that their continuance as active assets is not warranted.  Such loans are fully charged off.

The following tables illustrate our corporate credit risk profile by creditworthiness category as of March 31, 2015 and December 31, 2014: 

			Special
(Dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
March 31, 2015
Commercial and industrial	$	18,794	$	8	$	20	$	-	$	18,822
Construction		13,239		-		-		-		13,239
Commercial real estate		311,692		7,519		6,531		-		325,742
Residential real estate		112,100		451		2,112		-		114,663
Consumer and other		1,186		-		138		-		1,324
	$	457,011	$	7,978	$	8,801	$	-	$	473,790
December 31, 2014
Commercial and industrial	$	20,446	$	9	$	94	$	-	$	20,549
Construction		12,379		-		-		-		12,379
Commercial real estate		312,172		8,257		5,941		-		326,370
Residential real estate		108,587		457		2,454		-		111,498
Consumer and other		1,527		138		-		-		1,665
	$	455,111	$	8,861	$	8,489	$	-	$	472,461

The following table reflects information about our impaired loans by class as of March 31, 2015 and December 31, 2014:

		March 31, 2015						December 31, 2014
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
(Dollars in thousands)	Investment		Balance		Allowance		Investment		Balance		Allowance
With no related allowance recorded:
Commercial and industrial	$	20	$	20	$	-	$	-	$	-	$	-
Commercial real estate		2,351		2,351		-		3,167		3,736		-
Residential real estate		1,433		1,432		-		1,829		1,835		-
With an allowance recorded:
Commercial and industrial		1		1		1		94		94		51
Commercial real estate		3,593		4,162		334		1,938		1,938		136
Residential real estate		541		552		108		485		489		101
Consumer and other		138		138		73		-		-		-
Total:
Commercial and industrial		21		21		1		94		94		51
Commercial real estate		5,944		6,513		334		5,105		5,674		136
Residential real estate		1,974		1,984		108		2,314		2,324		101
Consumer and other		138		138		73		-		-		-
	$	8,077	$	8,656	$	516	$	7,513	$	8,092	$	288

The following table presents the average recorded investment and income recognized for the three months ended March 31, 2015 and 2014:

	For the Three Months Ended March 31, 2015				For the Three Months Ended March 31, 2014
	Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income
(Dollars in thousands)	Investment		Recognized		Investment		Recognized
With no related allowance recorded:
Commercial and industrial	$	10	$	-	$	-	$	-
Commercial real estate		2,759		5		4,968		8
Residential real estate		1,631		1		1,845		20
Total impaired loans without a related allowance		4,400		6		6,813		28
With an allowance recorded:
Commercial and industrial		47		-		-		-
Commercial real estate		2,766		8		5,319		1
Residential real estate		513		3		849		4
Consumer and other		69		-		1		-
Total impaired loans with an allowance		3,395		11		6,169		5
Total impaired loans	$	7,795	$	17	$	12,982	$	33

We recognize interest income on performing impaired loans as payments are received.  On non-performing impaired loans we do not recognize interest income as all payments are recorded as a reduction of principal on such loans.

Impaired loans include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.  These concessions could include a reduction in the interest rate on the loan, payment extensions, postponement or forgiveness of principal, forbearance or other actions intended to maximize collection.  The concessions rarely result in the forgiveness of principal or accrued interest.  In addition, we attempt to obtain additional collateral or guarantor support when modifying such loans.  Non-accruing restructured loans may be returned to accrual status when there has been a sustained period of repayment performance (generally six consecutive months of payments) and both principal and interest are deemed collectible.

The following table presents the recorded investment in troubled debt restructured loans, based on payment performance status:

(Dollars in thousands)		Commercial Real Estate	Residential Real Estate		Total
March 31, 2015
Performing	$	1,162	$	418	$	1,580
Non-performing		2,725		223		2,948
Total	$	3,887	$	641	$	4,528
December 31, 2014
Performing	$	1,169	$	421	$	1,590
Non-performing		2,730		224		2,954
Total	$	3,899	$	645	$	4,544

Troubled debt restructured loans are considered impaired and are included in the previous impaired loans disclosures in this footnote.  As of March 31, 2015, we have not committed to lend additional amounts to customers with outstanding loans that are classified as troubled debt restructurings.

There wereno troubled debt restructurings that occurred during the three months ended March 31, 2015 and 2014. 

There were no troubled debt restructurings for which there was a payment default within twelve months following the date of the restructuring for the three months ended March 31, 2015 and 2014.

We may obtain physical possession of residential real estate collateralizing a consumer mortgage loan via foreclosure on an in-substance repossession. As of March 31, 2015, we held foreclosed residential real estate properties with a carrying value of $281 thousand as a result of obtaining physical possession. In addition, as of March 31, 2015, we had consumer loans with a carrying value of $1.3 million collateralized by residential real estate property for which formal foreclosure proceedings were in process.

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Securities (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Available for sale securities carrying value pledged to secure public deposits	$ 32,100,000	$ 32,800,000
Gains on sales of securities available for sale	216,000
Gross losses on sales of securities avaiable for sale	48,000
Sales of available for sale securities	12,767,000
Fair value of available-for-sale securities	37,490,000	35,332,000
Unrealized loss of available-for-sale securities	310,000	396,000
State And Political Subdivisions [Member]
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Number of securities with unrealized losses from state and political subdivisions maturity minimum number of years	10 years
Number of securities with unrealized losses, held-to-maturity	1	2
Fair value of held-to maturity securities	261,000	811,000
Unrealized loss of held-to-maturity securities	1,000	5,000
U.S. Government Agencies [Member]
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Number of securities with unrealized losses, available-for-sale	5	2
Fair value of available-for-sale securities	8,461,000	2,905,000
Unrealized loss of available-for-sale securities	47,000	32,000
State And Political Subdivisions [Member]
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Number of securities with unrealized losses, available-for-sale	28	22
Fair value of available-for-sale securities	17,381,000	13,316,000
Unrealized loss of available-for-sale securities	220,000	206,000
Number of securities with unrealized losses from state and political subdivisions maturity minimum number of years	10 years
U.S. Government-Sponsored Enterprises [Member]
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Number of securities with unrealized losses, available-for-sale	7	13
Fair value of available-for-sale securities	11,648,000	19,111,000
Unrealized loss of available-for-sale securities	$ 43,000	$ 158,000
Equity Securities-Financial Services Industry And Other [Member]
Schedule Of Available-For-Sale And Held-To-Maturity [Line Items]
Number of securities with unrealized losses, available-for-sale	0	0

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (An Age Analysis Of Loans Receivable) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due	$ 3,056		$ 4,318
Loans Receivable 60-89 Days Past Due	1,122		1,317
Loans Receivable Greater Than 90 Days Past Due	6,633	[1]	6,009	[1]
Total Past Due	10,811		11,644
Loans Receivable Current	462,979		460,817
Balance, Loans Receivable	473,790		472,461
Recorded Investment Greater Than 90 Days And Accruing	1		85
Commercial And Industrial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due	10		9
Loans Receivable 60-89 Days Past Due	15
Loans Receivable Greater Than 90 Days Past Due	20	[1]	94	[1]
Total Past Due	45		103
Loans Receivable Current	18,777		20,446
Balance, Loans Receivable	18,822		20,549
Construction [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due			1,354
Total Past Due			1,354
Loans Receivable Current	13,239		11,025
Balance, Loans Receivable	13,239		12,379
Commercial Real Estate [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due	2,165		2,395
Loans Receivable 60-89 Days Past Due	1,107		1,209
Loans Receivable Greater Than 90 Days Past Due	4,917	[1]	3,936	[1]
Total Past Due	8,189		7,540
Loans Receivable Current	317,553		318,830
Balance, Loans Receivable	325,742		326,370
Residential Real Estate [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due	879		555
Loans Receivable 60-89 Days Past Due			108
Loans Receivable Greater Than 90 Days Past Due	1,557	[1]	1,978	[1]
Total Past Due	2,436		2,641
Loans Receivable Current	112,227		108,857
Balance, Loans Receivable	114,663		111,498
Recorded Investment Greater Than 90 Days And Accruing			85
Consumer And Other [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable 30-59 Days Past Due	2		5
Loans Receivable Greater Than 90 Days Past Due	139	[1]	1	[1]
Total Past Due	141		6
Loans Receivable Current	1,183		1,659
Balance, Loans Receivable	1,324		1,665
Recorded Investment Greater Than 90 Days And Accruing	$ 1

[1] includes loans greater than 90 days past due and still accruing and non-accrual loans.

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Allowance For Loan Losses And Credit Quality Of Financing Receivables (Tables)

3 Months Ended

Mar. 31, 2015

Allowance For Loan Losses And Credit Quality Of Financing Receivables [Abstract]

Changes In The Allowance For Loan Losses

	Commercial				Commercial		Residential		Consumer
	and				Real		Real		and
(Dollars in thousands)	Industrial		Construction		Estate		Estate		Other		Unallocated		Total
Three Months Ended:
March 31, 2015
Beginning balance	$	231	$	383	$	3,491	$	903	$	19	$	614	$	5,641
Charge-offs		(19)		-		(188)		-		(7)		-		(214)
Recoveries		4		-		12		12		3		-		31
Provision		(78)		5		472		(74)		73		(93)		305
Ending balance	$	138	$	388	$	3,787	$	841	$	88	$	521	$	5,763
March 31, 2014
Beginning balance	$	222		308	$	3,399	$	941	$	16	$	535	$	5,421
Charge-offs		-		-		(358)		(86)		(13)		-		(457)
Recoveries		12		-		4		1		3		-		20
Provision		55		7		642		6		13		(270)		453
Ending balance	$	289	$	315	$	3,687	$	862	$	19	$	265	$	5,437

Allowances Of Loan Losses And Loans Receivable By Class Disaggregated

	Allowance for Loan Losses						Loans Receivable
			Balance		Balance
			Related to		Related to
			Loans		Loans
			Individually		Collectively				Individually		Collectively
			Evaluated for		Evaluated for				Evaluated for		Evaluated for
(Dollars in thousands)	Balance		Impairment		Impairment		Balance		Impairment		Impairment
March 31, 2015
Commercial and industrial	$	138	$	1	$	137	$	18,822	$	21	$	18,801
Construction		388		-		388		13,239		-		13,239
Commercial real estate		3,787		334		3,453		325,742		5,944		319,798
Residential real estate		841		108		733		114,663		1,974		112,689
Consumer and other loans		88		73		15		1,324		138		1,186
Unallocated		521		-		-		-		-		-
Total	$	5,763	$	516	$	4,726	$	473,790	$	8,077	$	465,713
December 31, 2014
Commercial and industrial	$	231	$	51	$	180	$	20,549	$	94	$	20,455
Construction		383		-		383		12,379		-		12,379
Commercial real estate		3,491		136		3,355		326,370		5,105		321,265
Residential real estate		903		101		802		111,498		2,314		109,184
Consumer and other loans		19		-		19		1,665		-		1,665
Unallocated		614		-		-		-		-		-
Total	$	5,641	$	288	$	4,739	$	472,461	$	7,513	$	464,948

An Age Analysis Of Loans Receivable

													Recorded
													Investment
					Greater						Total		> 90 Days
	30-59 Days		60-89 days		Than		Total Past				Financing		and
(Dollars in thousands)	Past Due		Past Due		90 Days (a)		Due		Current		Receivables		Accruing
March 31, 2015
Commercial and industrial	$	10	$	15	$	20	$	45	$	18,777	$	18,822	$	-
Construction		-		-		-		-		13,239		13,239		-
Commercial real estate		2,165		1,107		4,917		8,189		317,553		325,742		-
Residential real estate		879		-		1,557		2,436		112,227		114,663		-
Consumer and other		2		-		139		141		1,183		1,324		1
Total	$	3,056	$	1,122	$	6,633	$	10,811	$	462,979	$	473,790	$	1
December 31, 2014
Commercial and industrial	$	9	$	-	$	94	$	103	$	20,446	$	20,549	$	-
Construction		1,354		-		-		1,354		11,025		12,379		-
Commercial real estate		2,395		1,209		3,936		7,540		318,830		326,370		-
Residential real estate		555		108		1,978		2,641		108,857		111,498		85
Consumer and other		5		-		1		6		1,659		1,665		-
Total	$	4,318	$	1,317	$	6,009	$	11,644	$	460,817	$	472,461	$	85
(a) includes loans greater than 90 days past due and still accruing and non-accrual loans.

Loans Which The Accrual Of Interest Has Been Discontinued

(Dollars in thousands)	March 31, 2015		December 31, 2014
Commercial and industrial	$	20	$	94
Commercial real estate		4,917		3,936
Residential real estate		1,557		1,893
Consumer and other		138		1
Total	$	6,632	$	5,924

Credit Risk Profile By Creditworthiness

			Special
(Dollars in thousands)	Pass		Mention		Substandard		Doubtful		Total
March 31, 2015
Commercial and industrial	$	18,794	$	8	$	20	$	-	$	18,822
Construction		13,239		-		-		-		13,239
Commercial real estate		311,692		7,519		6,531		-		325,742
Residential real estate		112,100		451		2,112		-		114,663
Consumer and other		1,186		-		138		-		1,324
	$	457,011	$	7,978	$	8,801	$	-	$	473,790
December 31, 2014
Commercial and industrial	$	20,446	$	9	$	94	$	-	$	20,549
Construction		12,379		-		-		-		12,379
Commercial real estate		312,172		8,257		5,941		-		326,370
Residential real estate		108,587		457		2,454		-		111,498
Consumer and other		1,527		138		-		-		1,665
	$	455,111	$	8,861	$	8,489	$	-	$	472,461

Impaired Loans

		March 31, 2015						December 31, 2014
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
(Dollars in thousands)	Investment		Balance		Allowance		Investment		Balance		Allowance
With no related allowance recorded:
Commercial and industrial	$	20	$	20	$	-	$	-	$	-	$	-
Commercial real estate		2,351		2,351		-		3,167		3,736		-
Residential real estate		1,433		1,432		-		1,829		1,835		-
With an allowance recorded:
Commercial and industrial		1		1		1		94		94		51
Commercial real estate		3,593		4,162		334		1,938		1,938		136
Residential real estate		541		552		108		485		489		101
Consumer and other		138		138		73		-		-		-
Total:
Commercial and industrial		21		21		1		94		94		51
Commercial real estate		5,944		6,513		334		5,105		5,674		136
Residential real estate		1,974		1,984		108		2,314		2,324		101
Consumer and other		138		138		73		-		-		-
	$	8,077	$	8,656	$	516	$	7,513	$	8,092	$	288

The following table presents the average recorded investment and income recognized for the three months ended March 31, 2015 and 2014:

	For the Three Months Ended March 31, 2015				For the Three Months Ended March 31, 2014
	Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income
(Dollars in thousands)	Investment		Recognized		Investment		Recognized
With no related allowance recorded:
Commercial and industrial	$	10	$	-	$	-	$	-
Commercial real estate		2,759		5		4,968		8
Residential real estate		1,631		1		1,845		20
Total impaired loans without a related allowance		4,400		6		6,813		28
With an allowance recorded:
Commercial and industrial		47		-		-		-
Commercial real estate		2,766		8		5,319		1
Residential real estate		513		3		849		4
Consumer and other		69		-		1		-
Total impaired loans with an allowance		3,395		11		6,169		5
Total impaired loans	$	7,795	$	17	$	12,982	$	33

Troubled Debt Restructured On Recorded Investment

(Dollars in thousands)		Commercial Real Estate	Residential Real Estate		Total
March 31, 2015
Performing	$	1,162	$	418	$	1,580
Non-performing		2,725		223		2,948
Total	$	3,887	$	641	$	4,528
December 31, 2014
Performing	$	1,169	$	421	$	1,590
Non-performing		2,730		224		2,954
Total	$	3,899	$	645	$	4,544