Note 3 - Securities

6 Months Ended

Jun. 30, 2016

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note 3: Securities

The amortized cost and approximate fair values of securities classified as available-for-sale were as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of June 30, 2016
Equity Securities	$	102,212	$	1,732	$	(17,593	)	$	86,351
Debt Securities:
Municipals		46,872,094		1,272,166		(17,406	)		48,126,854
Corporates		5,091,733		1,980		(200,907	)		4,892,805
Government sponsored mortgage-backed securities and SBA loan pools		51,550,483		334,049		(124,005	)		51,760,527
	$	103,616,522	$	1,609,927	$	(359,911	)	$	104,866,537

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2015
Equity Securities	$	102,212	$	10,081	$	(12,776	)	$	99,517
Debt Securities:
U. S. government agencies		8,533,885		-		(137,101	)		8,396,784
Municipals		31,132,635		302,335		(85,808	)		31,349,162
Corporates		3,965,719		-		(152,019	)		3,813,700
Government sponsored mortgage-backed securities and SBA loan pools		54,643,681		13,764		(1,024,121	)		53,633,324
	$	98,378,132	$	326,180	$	(1,411,825	)	$	97,292,487

Maturities of available-for-sale debt securities as of June 30, 2016:

	Amortized Cost		Approximate Fair Value
1-5 years		2,358,344		2,369,598
6-10 years		12,192,973		12,442,776
After 10 years		37,412,510		38,207,285
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date		51,550,483		51,760,527
	$	103,514,310	$	104,780,186

The amortized cost and approximate fair values of securities classified as held to maturity are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Approximate Fair Value
As of June 30, 2016
Debt Securities:
Government sponsored mortgage-backed securities	$	33,858	$	844	$	-	$	34,702

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)		Approximate Fair Value
As of December 31, 2015
Debt Securities:
Government sponsored mortgage-backed securities	$	43,099	$	836	$	-	$	43,935

Maturities of held-to-maturity securities as of June 30, 2016:

	Amortized Cost		Approximate Fair Value
Government sponsored mortgage-backed securities not due on a single maturity date	$	33,858	$	34,702

The book value of securities pledged as collateral, to secure public deposits and for other purposes, amounted to $75,458,562 and $52,554,932 as of June 30, 2016 and December 31, 2015, respectively. The approximate fair value of pledged securities amounted to $76,538,351 and $52,095,842 as of June 30, 2016 and December 31, 2015, respectively.

Realized gains and losses are recorded as net securities gains. Gains on sales of securities are determined on the specific identification method. Gross gains of $111,405 and $155,313 as of June 30, 2016 and June 30, 2015, respectively, were realized from the sale of available-for-sale securities. The tax effect of these net gains was $41,220 and $57,466 as of June 30, 2016 and June 30, 2015, respectively.

The Company evaluates all securities quarterly to determine if any unrealized losses are deemed to be other than temporary. Certain investment securities are valued at less than their historical cost. These declines are primarily the result of the rate for these investments yielding less than current market rates, or declines in stock prices of equity securities. Based on evaluation of available evidence, management believes the declines in fair value for these securities are temporary. It is management’s intent to hold the debt securities to maturity or until recovery of the unrealized loss. Should the impairment of any of these debt securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified, to the extent the loss is related to credit issues, and to other comprehensive income to the extent the decline on debt securities is related to other factors and the Company does not intend to sell the security prior to recovery of the unrealized loss.

          Certain other investments in debt and equity securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at June 30, 2016 and December 31, 2015, was $26,399,334 and $68,123,480, respectively, which is approximately 25% and 70% of the Company’s investment portfolio. These declines primarily resulted from changes in market interest rates and failure of certain investments to meet projected earnings targets.

The following table shows gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2016 and December 31, 2015.

	June 30, 2016
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Equity Securities	$	-	$	-		$	30,334	$	(17,593	)	$	30,334	$	(17,593	)
Municipals		2,448,778		(17,125	)		183,530		(281	)		2,632,308		(17,406	)
Corporates		1,379,005		(58,196	)		2,963,750		(142,711	)		4,342,755		(200,907	)
Government sponsored mortgage-backed securities and SBA loan pools		13,970,611		(72,724	)		5,423,326		(51,281	)		19,393,937		(124,005	)
	$	17,798,394	$	(148,045	)	$	8,600,940	$	(211,866	)	$	26,399,334	$	(359,911	)

	December 31, 2015
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Equity Securities	$	-	$	-		$	35,151	$	(12,776	)	$	35,151	$	(12,776	)
U. S. government agencies		6,399,920		(83,965	)		1,996,864		(53,136	)		8,396,784		(137,101	)
Municipals		6,167,019		(70,266	)		715,410		(15,542	)		6,882,429		(85,808	)
Corporates		1,675,500		(79,708	)		2,138,200		(72,311	)		3,813,700		(152,019	)
Government sponsored mortgage-backed securities and SBA loan pools		33,072,102		(493,865	)		15,923,314		(530,256	)		48,995,416		(1,024,121	)
	$	47,314,541	$	(727,804	)	$	20,808,939	$	(684,021	)	$	68,123,480	$	(1,411,825	)