10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2012

OR

¨ 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: 001-15375

CITIZENS HOLDING COMPANY

(Exact name of registrant as specified in its charter)

MISSISSIPPI	64-0666512
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
521 Main Street, Philadelphia, MS	39350
(Address of principal executive offices)	(Zip Code)

601-656-4692

(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.    x  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 such shorter period that the registrant was required to submit and post such files).    x  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 definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

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

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

Number of shares outstanding of each of the issuer’s classes of common stock, as of August 8, 2012:

Title	Outstanding
Common Stock, $0.20 par value		4,861,411

CITIZENS HOLDING COMPANY

INTERIM FINANCIAL STATEMENTS FOR QUARTER ENDED JUNE 30, 2012

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION	1
Item 1. Consolidated Financial Statements (Unaudited).	1
Consolidated Statements of Condition June 30, 2012 and December 31, 2011	1
Consolidated Statements of Income Three and six months ended June 30, 2012 and 2011	2
Consolidated Statements of Comprehensive Income Three and six months ended June 30, 2012 and 2011	3
Condensed Consolidated Statements of Cash Flows Six months ended June 30, 2012 and 2011	4
Notes to Consolidated Financial Statements	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	24
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	35
Item 4. Controls and Procedures.	38
PART II.OTHER INFORMATION	39
Item 1. Legal Proceedings.*
Item 1A. Risk Factors.	39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.*
Item 3. Defaults Upon Senior Securities.*
Item 4. Mine Safety Disclosures.*
Item 5. Other Information.*
Item 6. Exhibits.	40
*        None or Not Applicable
SIGNATURES	41

PART I. FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (Unaudited).

CITIZENS HOLDING COMPANY

CONSOLIDATED STATEMENTS OF CONDITION (Unaudited)

	June 30 , 2012		December 31, 2011
ASSETS
Cash and due from banks	$	44,363,414	$	35,407,715
Interest bearing deposits with other banks		67,957,333		3,990,521
Investment securities available for sale, at fair value		299,928,467		374,507,805
Loans, net of allowance for loan losses of $7,210,717 in 2012 and $6,681,412 in 2011		377,012,459		382,580,529
Premises and equipment, net		19,737,642		20,278,443
Other real estate owned, net		4,461,177		4,868,653
Accrued interest receivable		3,920,561		4,445,384
Cash value of life insurance		20,745,332		20,382,063
Intangible assets, net		3,149,657		3,226,612
Other assets		3,412,985		4,257,729
TOTAL ASSETS	$	844,689,027	$	853,945,454
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Deposits:
Noninterest-bearing demand	$	114,043,397	$	116,894,676
Interest-bearing NOW and money market accounts		180,465,762		172,585,498
Savings deposits		45,297,712		41,876,977
Certificates of deposit		251,765,014		240,980,984
Total deposits		591,571,885		572,338,135
Securities sold under agreement to repurchase		79,103,790		120,220,433
Federal Home Loan Bank advances		78,500,000		68,500,000
Accrued interest payable		351,756		372,374
Deferred compensation payable		5,560,842		5,085,935
Other liabilities		1,204,088		1,349,360
Total liabilities		756,292,361		767,866,237
STOCKHOLDERS’ EQUITY
Common stock; $.20 par value, 22,500,000 shares authorized, 4,861,411 shares outstanding at June 30, 2012 and 4,843,911 shares outstanding at December 31, 2011		972,282		968,782
Additional paid-in capital		3,561,050		3,247,208
Retained earnings		78,697,821		77,420,318
Accumulated other comprehensive income, net of applicable taxes of $3,072,945 in 2012 and $2,643,070 in 2011		5,165,513		4,442,909
Total stockholders’ equity		88,396,666		86,079,217
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	844,689,027	$	853,945,454

The accompanying notes are an integral part of these financial statements.

1

CITIZENS HOLDING COMPANY

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2012		2011		2012		2011
INTEREST INCOME
Loans, including fees	$	6,038,190	$	6,398,678	$	12,010,427	$	12,947,609
Investment securities		2,956,655		3,038,701		5,874,050		5,823,247
Other interest		8,323		6,472		17,681		18,267
Total interest income		9,003,168		9,443,851		17,902,158		18,789,123
INTEREST EXPENSE
Deposits		703,728		802,618		1,428,434		1,689,617
Other borrowed funds		753,525		879,750		1,539,408		1,759,704
Total interest expense		1,457,253		1,682,368		2,967,842		3,449,321
NET INTEREST INCOME		7,545,915		7,761,483		14,934,316		15,339,802
PROVISION FOR LOAN LOSSES		330,097		682,773		865,777		926,834
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		7,215,818		7,078,710		14,068,539		14,412,968
OTHER INCOME
Service charges on deposit accounts		897,920		855,986		1,745,570		1,730,383
Other service charges and fees		437,473		415,174		866,069		829,133
Other income		301,763		245,306		635,116		541,345
Total other income		1,637,156		1,516,466		3,246,755		3,100,861
OTHER EXPENSES
Salaries and employee benefits		3,473,956		3,524,103		7,033,660		7,043,712
Occupancy expense		1,097,856		1,018,542		2,129,165		2,107,489
Other operating expense		2,102,189		1,703,394		3,921,443		3,495,119
Total other expenses		6,674,001		6,246,039		13,084,268		12,646,320
INCOME BEFORE PROVISION FOR INCOME TAXES		2,178,973		2,349,137		4,231,026		4,867,509
PROVISION FOR INCOME TAXES		427,375		494,865		816,262		1,058,351
NET INCOME	$	1,751,598	$	1,854,272	$	3,414,764	$	3,809,158
NET INCOME PER SHARE
-Basic	$	0.36	$	0.38	$	0.70	$	0.79
-Diluted	$	0.36	$	0.38	$	0.70	$	0.79
DIVIDENDS PAID PER SHARE	$	0.22	$	0.22	$	0.44	$	0.44

The accompanying notes are an integral part of these financial statements.

2

CITIZENS HOLDING COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months						For the Six Months
	Ended June 30,						Ended June 30,
	2012			2011			2012			2011
Net income	$	1,751,598		$	1,854,272		$	3,414,764		$	3,809,158
Other comprehensive income
Unrealized holding gains		4,631,065			5,816,380			1,190,231			8,351,093
Income tax effect		(1,727,387	)		(2,169,510	)		(443,956	)		(3,114,958	)
		2,903,678			3,646,870			746,275			5,236,135
Reclassification adjustment for gains included in net income		(9,061	)		(5,357	)		(37,753	)		(5,789	)
Income tax effect		3,380			1,998			14,082			2,159
		(5,681	)		(3,359	)		(23,671	)		(3,630	)
Total other comprehensive income		2,897,997			3,643,511			722,604			5,232,505
Comprehensive income	$	4,649,595		$	5,497,783		$	4,137,368		$	9,041,663

The accompanying notes are an integral part of these financial statements.

3

CITIZENS HOLDING COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months
	Ended June 30,
	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net cash provided by operating activities	$	6,065,086		$	5,419,819
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and calls of securities available for sale		190,899,754			73,203,384
Purchases of investment securities available for sale		(115,075,780	)		(88,813,259	)
Purchases of bank premises and equipment		(30,889	)		(1,035,486	)
Increase in interest bearing deposits with other banks		(63,966,812	)		(10,466,534	)
Purchase of Federal Home Loan Bank Stock		(282,700	)		(108,000	)
Proceeds from sale of other real estate		1,235,367			338,080
Net decrease in loans		3,874,402			8,072,260
Net cash provided by (used by) investing activities		16,653,342			(18,809,555	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposits		19,233,750			9,720,050
Net change in securities sold under agreement to repurchase		(41,116,643	)		3,572,364
Proceeds from exercising stock options		257,425			63,385
Increase in Federal Home Loan Bank advances		10,000,000			10,000,000
Decrease in federal funds purchased		—			(2,500,000	)
Payment of dividends		(2,137,261	)		(2,130,331	)
Net cash provided by financing activities		(13,762,729	)		18,725,468
Net increase in cash and due from banks		8,955,699			5,335,732
Cash and due from banks, beginning of period		35,407,715			16,963,393
Cash and due from banks, end of period	$	44,363,414		$	22,299,125

The accompanying notes are an integral part of these financial statements.

4

CITIZENS HOLDING COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of and for the six months ended June 30, 2012

(Unaudited)

Note 1. Basis of Presentation

These interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). However, these financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. The interim consolidated financial statements are unaudited and reflect all adjustments and reclassifications, which, in the opinion of management, are necessary for a fair presentation of the results of operations and financial condition as of and for the interim periods presented. All adjustments and reclassifications are of a normal and recurring nature. Results for the period ended June 30, 2012, are not necessarily indicative of the results that may be expected for any other interim periods or for the year as a whole.

The interim consolidated financial statements of Citizens Holding Company include the accounts of its wholly-owned subsidiary, The Citizens Bank of Philadelphia (the “Bank” and collectively with Citizens Holding Company, the “Corporation”). All significant intercompany transactions have been eliminated in consolidation.

For further information and significant accounting policies of the Corporation, see the Notes to Consolidated Financial Statements of Citizens Holding Company included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011, filed with the Securities and Exchange Commission on March 14, 2012.

Note 2. Commitments and Contingent Liabilities

In the ordinary course of business, the Corporation enters into commitments to extend credit to its customers. The unused portion of these commitments is not reflected in the accompanying financial statements. As of June 30, 2012, the Corporation had entered into loan commitments with certain customers with an aggregate unused balance of $34,798,961compared to an aggregate unused balance of $37,703,387 at December 31, 2011. There were $2,956,725 of letters of credit outstanding at June 30, 2012 and $3,113,225 at December 31, 2011. The fair value of such contracts is not considered material because letters of credit and loan commitments often are not used in their entirety, if at all, before they expire. The balances of such letters and commitments should not be used to project actual future liquidity requirements. However, the Corporation does incorporate expectations about the level of draws under its credit-related commitments into its asset and liability management program.

The Corporation is a party to lawsuits and other claims that arise in the ordinary course of business, all of which are being vigorously contested. In the regular course of business, management evaluates estimated losses or costs related to litigation, and provisions are made for anticipated losses whenever management believes that such losses are probable and can be reasonably estimated. At the present time, management believes, based on the advice of legal counsel, that the final resolution of pending legal proceedings will not have a material impact on the Corporation’s consolidated financial condition or results of operations.

5

Note 3. Net Income per Share

Net income per share - basic has been computed based on the weighted average number of shares outstanding during each period. Net income per share - diluted has been computed based on the weighted average number of shares outstanding during each period plus the dilutive effect of outstanding stock options using the treasury stock method. Earnings per share was computed as follows:

	For the Three Months				For the Six Months
	Ended June 30,				Ended June 30,
	2012		2011		2012		2011
Basic weighted average shares outstanding		4,859,125		4,841,438		4,854,145		4,840,770
Dilutive effect of granted options		6,881		12,799		8,654		9,056
Diluted weighted average shares outstanding		4,866,006		4,854,237		4,862,799		4,849,826
Net income	$	1,751,598	$	1,854,272	$	3,414,764	$	3,809,158
Net income per share-basic	$	0.36	$	0.38	$	0.70	$	0.79
Net income per share-diluted	$	0.36	$	0.38	$	0.70	$	0.79

Note 4. Stock Option Plan

At June 30, 2012, the Corporation had one stock-based compensation plan, which is the 1999 Directors’ Stock Compensation Plan (the “Directors’ Plan”). Prior to its expiration, the Corporation also had the 1999 Employees’ Long-Term Incentive Plan, or the Employees’ Plan.

On April 25, 2012, the non-management members of the Board of Directors were granted a total of 13,500 options as specified in the Directors’ Plan. These options were granted at an exercise price of $18.76 per option, which was the closing price of Citizens Holding Company stock on that day. These options are first exercisable on October 26, 2012, and must be exercised no later than April 25, 2022.

The fair value of each option granted is estimated on the date of the grant using the Black-Scholes option-pricing model. The following assumptions were used in estimating the fair value of the options granted to the directors in the second quarter of 2012:

6

Assumption	Directors
Dividend Yield		4.70	%
Risk-Free Interest Rate		0.78	%
Expected Life		8.2 years
Expected Volatility		78.29	%
Calculated Value per Option	$	8.88
Forfeitures		0.00	%

Using the Black-Scholes option-pricing model with the foregoing assumptions, it was determined that the cost of options granted under the Directors’ Plan on April 25, 2012 was $119,834 and should be recognized as an expense of $19,972 per month over the six-month requisite service period, beginning on April 25, 2012. This was recorded as salary expense with a credit to paid-in capital. A deferred tax on these options was recorded in the aggregate amount of $44,698, or $7,450 per month, over the six-month requisite service period, beginning on April 25, 2012.

The following table below is a summary of the stock option activity for the six months ended June 30, 2012.

	Directors’ Plan					Employees’ Plan
				Weighted					Weighted
	Number			Average		Number			Average
	of			Exercise		of			Exercise
	Shares			Price		Shares			Price
Outstanding at December 31, 2011		102,000		$	21.00		135,500		$	19.96
Granted		13,500			18.76		—			—
Exercised		(3,000	)		15.00		(14,500	)		14.65
Expired		(1,500	)		15.00		(13,000	)		18.09
Outstanding at June 30, 2012		111,000		$	20.97		108,000		$	20.90

The intrinsic value of options granted under the Directors’ Plan at June 30, 2012, was $60,000 and the intrinsic value of options granted under the Employees’ Plan at June 30, 2012, was $107,160 for a total intrinsic value at June 30, 2012, of $167,160.

Note 5. Income Taxes

The income tax topic of the ASC defines the threshold for recognizing the benefits of tax return positions in the financial statements as “more-likely-than-not” to be sustained by the taxing authority. This topic also provides guidance on the derecognition, measurement and classification of income tax uncertainties, along with any related interest and penalties, and includes guidance concerning accounting for income tax uncertainties in interim periods. As of June 30, 2012, the Corporation had no unrecognized tax benefits related to federal and state income tax matters. Therefore, the Corporation does not anticipate any material increase or decrease in the effective tax rate during 2012 relative to any tax positions taken. It is the Corporation’s policy to recognize interest and/or penalties related to income tax matters in income tax expense.

7

The Corporation files a consolidated United States federal income tax return. The Corporation is currently open to audit under the statute of limitations by the Internal Revenue Service for all tax years after 2009. The Corporation consolidated state income tax returns are also open to audit under the statute of limitations for the same period.

Note 6. Loans

The composition of net loans at June 30, 2012 and December 31, 2011 is as follows:

	June 30, 2012			December 31, 2011
	(In Thousands)
Real Estate:
Land Development and Construction	$	11,394		$	13,480
Farmland		34,204			35,912
1-4 Family Mortgages		122,119			133,987
Commercial Real Estate		136,010			129,387
Total Real Estate Loans		303,727			312,766
Business Loans:
Commercial and Industrial Loans		47,101			36,581
Farm Production and Other Farm Loans		1,537			1,579
Total Business Loans		48,638			38,160
Consumer Loans:
Credit Cards		971			995
Other Consumer Loans		31,163			37,545
Total Consumer Loans		32,134			38,540
Total Gross Loans		384,499			389,466
Unearned income		(276	)		(204	)
Allowance for loan losses		(7,211	)		(6,681	)
Loans, net	$	377,012		$	382,581

Loans are considered to be past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on non-accrual status, when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. Loans may be placed on non-accrual status regardless of whether such loans are considered past due. When interest accruals are discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

8

Period-end non-accrual loans, segregated by class of loans, were as follows:

	June 30, 2012		December 31, 2011
	(in thousands)
Real Estate:
Land Development and Construction	$	252	$	1,134
Farmland		469		641
1-4 Family Mortgages		2,151		1,966
Commercial Real Estate		7,251		6,818
Total Real Estate Loans		10,123		10,559
Business Loans:
Commercial and Industrial Loans		218		284
Farm Production and Other Farm Loans		10		21
Total Business Loans		228		305
Consumer Loans:
Credit Cards		—		—
Other Consumer Loans		281		435
Total Consumer Loans		281		435
Total Non-Accrual Loans	$	10,632	$	11,299

9

An aging analysis of past due loans, segregated by class of loans, as of June 30, 2012, was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	176	$	—	$	176	$	11,218	$	11,394	$	—
Farmland		786		—		786		33,418		34,204		—
1-4 Family Mortgages		5,620		994		6,614		115,505		122,119		536
Commercial Real Estate		6,882		1,089		7,971		128,039		136,010		—
Total Real Estate Loans		13,464		2,083		15,547		288,180		303,727		536
Business Loans:
Commercial and Industrial Loans		704		19		723		46,378		47,101		—
Farm Production and Other Farm Loans		16		—		16		1,521		1,537		—
Total Business Loans		720		19		739		47,899		48,638		—
Consumer Loans:
Credit Cards		16		13		29		942		971		13
Other Consumer Loans		1,386		26		1,412		29,751		31,163		3
Total Consumer Loans		1,402		39		1,441		30,693		32,134		16
Total Loans	$	15,586	$	2,141	$	17,727	$	366,772	$	384,499	$	552

10

An aging analysis of past due loans, segregated by class of loans, as of December 31, 2011 was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	30	$	562	$	592	$	12,888	$	13,480	$	39
Farmland		1,061		139		1,200		34,712		35,912		—
1-4 Family Mortgages		5,774		822		6,596		127,391		133,987		80
Commercial Real Estate		4,941		4,855		9,796		119,591		129,387		109
Total Real Estate Loans		11,806		6,378		18,184		294,582		312,766		228
Business Loans:
Commercial and Industrial Loans		294		99		393		36,188		36,581		—
Farm Production and Other Farm Loans		13		6		19		1,560		1,579		—
Total Business Loans		307		105		412		37,748		38,160		—
Consumer Loans:
Credit Cards		20		17		37		958		995		17
Other Consumer Loans		1,858		252		2,110		35,435		37,545		24
Total Consumer Loans		1,878		269		2,147		36,393		38,540		41
Total Loans	$	13,991	$	6,752	$	20,743	$	368,723	$	389,466	$	269

Loans are considered impaired when, based on current information and events, it is probable the Corporation will be unable to collect all the amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. In determining which loans to evaluate for impairment, management looks at past due loans, bankruptcy filing and any situation that might lend itself to cause a borrower to be unable to repay the loan according to the original contract terms. If a loan is determined to be impaired and the collateral is deemed to be insufficient to fully repay the loan, a specific reserve will be established. Interest payments on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assured, in which case interest is recognized on a cash basis. Impaired loans or portions thereof, are charged-off when deemed uncollectible.

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Impaired loans as of June 30, 2012 and December 31, 2011, by class of loans, are as follows (in thousands):

June 30, 2012	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	252	$	120	$	132	$	252	$	117	$	479
Farmland		469		324		145		469		24		557
1-4 Family Mortgages		2,251		1,482		769		2,251		202		2,419
Commercial Real Estate		7,251		1,432		5,819		7,251		1,205		7,032
Total Real Estate Loans		10,223		3,358		6,865		10,223		1,548		10,487
Business Loans:
Commercial and Industrial Loans		218		114		104		218		57		241
Farm Production and Other Farm Loans		10		10		—		10		—		13
Total Business Loans		228		124		104		228		57		254
Consumer Loans:
Other Consumer Loans		281		281		—		281		—		307
Total Consumer Loans		281		281		—		281		—		307
Total Loans	$	10,732	$	3,763	$	6,969	$	10,732	$	1,605	$	11,048

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December 31, 2011	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	1,134	$	992	$	142	$	1,134	$	134	$	883
Farmland		641		492		149		641		24		588
1-4 Family Mortgages		2,066		1,297		769		2,066		216		1,933
Commercial Real Estate		6,818		5,042		1,776		6,818		736		6,896
Total Real Estate Loans		10,659		7,823		2,836		10,659		1,110		10,300
Business Loans:
Commercial and Industrial Loans		284		163		121		284		57		860
Farm Production and Other Farm Loans		21		21		—		21		—		19
Total Business Loans		305		184		121		305		57		879
Consumer Loans:
Other Consumer Loans		435		430		5		435		—		321
Total Consumer Loans		435		430		5		435		—		321
Total Loans	$	11,399	$	8,437	$	2,962	$	11,399	$	1,167	$	11,500

The Corporation utilizes a risk grading matrix to assign a risk grade to each of its loans when originated and is updated as factors related to the strength of the loan changes. Loans are graded on a scale of 1 to 9. A description of the general characteristics of the 9 risk grades is as follows.

Grade 1. MINIMAL RISK - These loans are without loss exposure to the Corporation. This classification is reserved for only the best, well secured loans to borrowers with significant capital strength, low leverage, stable earnings and growth and other readily available financing alternatives. This type of loan would also include loans secured by a program of the government.

Grade 2. MODEST RISK - These loans include borrowers with solid credit quality and moderate risk of loss. These loans may be fully secured by certificates of deposit with another reputable financial institution, or secured by readily marketable securities with acceptable margins.

Grade 3. AVERAGE RISK - This is the rating assigned to most of the loans held by the Corporation. This includes loans with average loss exposure and average overall quality. These loans should liquidate through possessing adequate collateral and adequate earnings of the borrower. In addition, these loans are properly documented and are in accordance with all aspects of the current loan policy.

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Grade 4. ACCEPTABLE RISK - Borrower generates sufficient cash flow to fund debt service but most working asset and capital expansion needs are provided from external sources. Profitability and key balance sheet ratios are usually close to peers but one or more may be higher than peers.

Grade 5. MANAGEMENT ATTENTION - Borrower has significant weaknesses resulting from performance trends or management concerns. The financial condition of the borrower has taken a negative turn and may be temporarily strained. Cash flow is weak but cash reserves remain adequate to meet debt service. Management weakness is evident.

Grade 6. OTHER LOANS ESPECIALLY MENTIONED (OLEM) - Loans in this category are fundamentally sound but possess some weaknesses. OLEM loans have potential weaknesses which may, if not checked or corrected, weaken the asset or inadequately protect the bank’s credit position at some future date. These loans have an identifiable weakness in credit, collateral, or repayment ability but there is no expectation of loss.

Grade 7. SUBSTANDARD ASSETS - Assets classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Assets classified as substandard must have a well-defined weakness based upon objective evidence. Assets classified as substandard are characterized by the distinct possibility that the insured institution will sustain some loss if the deficiencies are not corrected. The possibility that liquidation would not be timely requires a substandard classification even if there is little likelihood of total loss.

Grade 8. DOUBTFUL - A loan classified as doubtful has all the weaknesses of a substandard classification and the added characteristic that the weakness makes collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable or improbable. The possibility of loss is extremely high, but because of certain important and reasonable specific pending factors which may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined. A doubtful classification could reflect the fact that the primary source of repayment is gone and serious doubt exists as to the quality of a secondary source of repayment.

Grade 9. LOSS - Loans classified loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may occur in the future. Also included in this classification is the defined loss portion of loans rated substandard assets and doubtful assets.

These internally assigned grades are updated on a continual basis throughout the course of the year and represent management’s most updated judgment regarding grades at June 30, 2012.

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The following table details the amount of gross loans by loan grade and class as of June 30, 2012 (in thousands):

Grades	Satisfactory 1, 2, 3, 4		Special Mention 5,6		Substandard 7		Doubtful 8		Loss   9		Total Loans
Real Estate:
Land Development and Construction	$	8,978	$	1,974	$	442	$	—	$	—	$	11,394
Farmland		30,066		2,786		1,352		—		—		34,204
1-4 Family Mortgages		103,767		5,852		12,473		27		—		122,119
Commercial Real Estate		110,646		6,762		18,602		—		—		136,010
Total Real Estate Loans		253,457		17,374		32,869		27		—		303,727
Business Loans:
Commercial and Industrial Loans		39,248		7,057		764		32		—		47,101
Farm Production and Other Farm Loans		1,470		7		60		—		—		1,537
Total Business Loans		40,718		7,064		824		32		—		48,638
Consumer Loans:
Credit Cards		958		—		13		—		—		971
Other Consumer Loans		29,736		216		1,181		30		—		31,163
Total Consumer Loans		30,694		216		1,194		30		—		32,134
Total Loans	$	324,869	$	24,654	$	34,887	$	89	$	—	$	384,499

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The following table details the amount of gross loans by loan grade and class as of December 31, 2011:

Grades	Satisfactory 1, 2, 3,4		Mention 5,6		Substandard 7		Doubtful 8		Loss 9		Total Loans
Real Estate:
Land Development and Construction	$	9,647	$	2,290	$	1,481	$	—	$	62	$	13,480
Farmland		31,405		3,043		1,464		—		—		35,912
1-4 Family Mortgages		115,365		5,784		12,811		27		—		133,987
Commercial Real Estate		108,347		7,188		13,852		—		—		129,387
Total Real Estate Loans		264,764		18,305		29,608		27		62		312,766
Business Loans:
Commercial and Industrial Loans		27,970		7,712		863		36		—		36,581
Farm Production and Other Farm Loans		1,481		8		90		—		—		1,579
Total Business Loans		29,451		7,720		953		36		—		38,160
Consumer Loans:
Credit Cards		978		—		17		—		—		995
Other Consumer Loans		35,859		325		1,304		53		4		37,545
Total Consumer Loans		36,837		325		1,321		53		4		38,540
Total Loans	$	331,052	$	26,350	$	31,882	$	116	$	66	$	389,466

The allowance for loan losses is a reserve established through a provision for loan losses charged to expense, which represents management’s best estimate of probable losses within the existing portfolio of loans. The allowance, in the judgment of management, is necessary to reserve for estimated loan losses and risks inherent in the loan portfolio.

The allowance on the majority of the loan portfolio is calculated using a historical chargeoff percentage applied to the current loan balances by loan segment. This historical period is the average of the previous 5 years with the most current years weighted to show the effect of the most recent chargeoff activity. This percentage is also adjusted for economic factors such as local unemployment and general business conditions, both local and nationwide.

The group of loans that are considered to be impaired are individually evaluated for possible loss and a specific reserve is established to cover any loss contingency. Loans that are determined to be a loss with no benefit of remaining in the portfolio are charged off to the allowance. These specific reserves are reviewed periodically for continued impairment and adequacy of the specific reserve and adjusted when necessary.

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The following table details activity in the allowance for possible loan losses by portfolio segment for the six months ended June 30, 2012:

June 30, 2012	Real Estate		Business Loans			Consumer		Total
Beginning Balance, January 1, 2012	$	4,176,475	$	1,672,467		$	832,470	$	6,681,412
Provision for possible loan losses		817,494		(160,894	)		209,177		865,777
Chargeoffs		280,703		28,759			158,865		468,327
Recoveries		28,459		39,553			63,843		131,855
Net Chargeoffs		252,244		(10,794	)		95,022		336,472
Ending Balance	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717
Period end allowance allocated to:
Loans individually evaluated for impairment	$	1,548,065	$	57,325		$	—	$	1,605,390
Loans collectively evaluated for impairment		3,193,660		1,465,042			946,625		5,605,327
Ending Balance, June 30, 2012	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717

Activity in the allowance for possible loan losses for the six months ended June 30, 2011 was as follows:

	June 30, 2011
Balance, beginning of period	$	6,379,070
Provision for loan losses		926,834
Loans charged off		(1,017,099	)
Recoveries of loans previously charged off		70,797
Balance, end of period	$	6,359,602

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The Corporation’s recorded investment in loans as of June 30, 2012 and December 31, 2011 related to each balance in the allowance for possible loan losses by portfolio segment and disaggregated on the basis of the Corporation’s impairment methodology was as follows (in thousands):

June 30, 2012	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,224	$	227	$	281	$	10,732
Loans collectively evaluated for general impairment		293,503		48,411		31,853		373,767
	$	303,727	$	48,638	$	32,134	$	384,499

December 31, 2011	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,659	$	305	$	435	$	11,399
Loans collectively evaluated for general impairment		302,107		37,855		38,105		378,067
	$	312,766	$	38,160	$	38,540	$	389,466

Note 7. Recent Accounting Pronouncements

In September 2011, FASB issued an update to ASC Topic 350 to give entities the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the first step of the two-step impairment test by calculating the fair value of the reporting unit and comparing the fair value with the carrying amount of the reporting unit. This update is effective for annual and interim impairment tests beginning after December 15, 2011, and is not expected to have a significant impact on the Corporation’s financial statements as it related to disclosures made herein.

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Note 8. Fair Value of Financial Instruments

The fair value topic of the ASC establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. This topic clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. This topic also requires disclosure about how fair value was determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

Level 1	Quoted prices in active markets for identical assets or liabilities;
Level 2	Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or
Level 3	Unobservable inputs, such as discounted cash flow models or valuations.

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2012:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	151,509,731	$	—	$	151,509,731
Mortgage-backed Securities		—		30,550,393		—		30,550,393
State, county and municipal obligations		—		110,949,942		—		110,949,942
Other investments		—		—		2,746,801		2,746,801
Total	$	—	$	293,010,066	$	2,746,801	$	295,756,867

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The following table presents assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2011:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	234,938,488	$	—	$	234,938,488
Mortgage-backed Securities		—		35,117,858		—		35,117,858
State, county and municipal obligations		—		102,422,164		—		102,422,164
Other investments		—		—		2,029,295		2,029,295
Total	$	—	$	372,478,510	$	2,029,295	$	374,507,805

The following table reports the activity for 2012 in assets measured at fair value on a recurring basis using significant unobservable inputs.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Structured Financial Product
Balance at January 1, 2012	$	2,029,295
Unrealized gains included in other comprehensive income		717,506
Balance at June 30, 2012	$	2,746,801

The Corporation recorded no gains or losses in earnings for the period that were attributable to the change in unrealized gains or losses relating to assets still held at the reporting date.

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For assets measured at fair value on a nonrecurring basis during 2012 that were still held in the balance sheet at June 30, 2012, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	4,100,152	$	4,100,152
Other real estate owned		—		—		688,091		688,091
Total	$	—	$	—	$	4,788,243	$	4,788,243

For assets measured at fair value on a nonrecurring basis during 2011 that were still held in the balance sheet at December 31, 2011, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	505,585	$	505,585
Other real estate owned		—		—		3,056,902		3,056,902
Total	$	—	$	—	$	3,562,487	$	3,562,487

Impaired loans with a carrying value of $4,828,328 and $682,517 had an allocated allowance for loan losses of $728,176 and $176,932 at June 30, 2012 and December 31, 2011, respectively. The allocated allowance is based on the carrying value of the impaired loan and the fair value of the underlying collateral less estimated costs to sell.

Other real estate owned (“OREO”) acquired during the six-month period ended June 30, 2012, and recorded at fair value, less costs to sell, was $827,891, of which $139,800 was acquired and sold during this period. There have been no writedowns during the period on OREO previously acquired and still held. OREO acquired during 2011 and recorded at fair value, less costs to sell, was $2,503,659. Additional writedowns during 2011 on OREO acquired in previous years was $216,000 on 10 properties valued at $553,243.

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The financial instruments topic of the ASC requires disclosure of financial instruments’ fair values, as well as the methodology and significant assumptions used in estimating fair values. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument. The financial instruments topic of the ASC excludes certain financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Corporation and may not be indicative of amounts that might ultimately be realized upon disposition or settlement of those assets and liabilities.

The following represents the carrying value and estimated fair value of the Corporation’s financial instruments at June 30, 2012, and December 31, 2011:

	June 30, 2012				December 31, 2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets
Cash and due from banks	$	44,363,414	$	44,363,414	$	35,407,715	$	35,407,715
Interest bearing deposits with banks		67,957,333		67,957,333		3,990,521		3,990,521
Securities available-for-sale		299,928,467		299,928,467		374,507,805		374,507,805
Net loans		377,012,459		376,439,588		382,580,529		382,174,094
Financial liabilities
Deposits	$	591,571,885	$	591,904,539	$	572,338,135	$	572,388,706
Federal Home Loan Bank advances		78,500,000		81,527,818		68,500,000		71,950,022
Securities Sold under agreement to repurchase		79,103,790		79,103,790		120,220,433		120,220,433

The fair value estimates, methods and assumptions used by the Corporation in estimating its fair value disclosures for financial statements were as follows:

Cash and Due from Banks and Interest Bearing Deposits with Banks

The carrying amounts reported in the balance sheet for these instruments approximate fair value because of their immediate and shorter-term maturities, which are considered to be three months or less when purchased.

Securities Available-for-Sale

Fair values for investment securities are based on quoted market prices, when available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. When neither quoted prices nor comparable instruments are available, unobservable inputs are needed to form an expected future cash flow analysis to establish fair values. Level 2 securities include debt securities such as obligations of United States government agencies and corporations, mortgage-backed securities and state, county and municipal bonds. Level 3 securities consist of a pooled trust preferred security.

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Net Loans

For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair values for other loans (i.e., commercial real estate and rental property mortgage loans, commercial and industrial loans, financial institution loans, and agricultural loans) are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality.

Deposits

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

Securities Sold Under Agreement to Repurchase

Due to the short term nature of these instruments, which is considered to be three months or less, the carrying amount is equal to the fair value.

Federal Home Loan Bank (FHLB) Borrowings

The fair value of FHLB advances is based on discounted cash flow analysis.

Off-Balance Sheet Instruments

The fair value of commitments to extend credit and letters of credit are estimated using fees currently charged to enter into similar agreements. The fees associated with these financial instruments are not material.

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CITIZENS HOLDING COMPANY

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

FORWARD LOOKING STATEMENTS

In addition to historical information, this report contains statements which constitute forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are based on management’s beliefs, plans, expectations and assumptions and on information currently available to management. The words “may,” “should,” “expect,” “anticipate,” “intend,” “plan,” “continue,” “believe,” “seek,” “estimate” and similar expressions used in this report that do not relate to historical facts are intended to identify forward-looking statements. These statements appear in a number of places in this report, including, but not limited to, statements found in Item 1, “Notes to Consolidated Financial Statements” and in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The Corporation notes that a variety of factors could cause the actual results or experience to differ materially from the anticipated results or other expectations described or implied by such forward-looking statements. The risks and uncertainties that may affect the operation, performance, development and results of the Corporation’s business include, but are not limited to, the following: (a) the risk of adverse changes in business conditions in the banking industry generally and in the specific markets in which the Corporation operates; (b) changes in the legislative and regulatory environment that negatively impact the Corporation through increased operating expenses; (c) increased competition from other financial institutions; (d) the impact of technological advances; (e) expectations about the movement of interest rates, including actions that may be taken by the Federal Reserve Board in response to changing economic conditions; (f) changes in asset quality and loan demand; (g) expectations about overall economic strength and the performance of the economies in the Corporation’s market area; and (h) other risks detailed from time to time in the Corporation’s filings with the Securities and Exchange Commission. The Corporation does not undertake any obligation to update or revise any forward-looking statements subsequent to the date on which they are made.

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Management’s discussion and analysis is intended to provide greater insight into the results of operations and the financial condition of Citizens Holding Company and its wholly owned subsidiary, The Citizens Bank of Philadelphia (the “Bank,” and collectively with Citizens Holding Company, the “Corporation”). The following discussion should be read in conjunction with the consolidated financial statements and notes appearing elsewhere in this report.

LIQUIDITY

The Corporation has an asset and liability management program that assists management in maintaining net interest margins during times of both rising and falling interest rates and in maintaining sufficient liquidity. A measurement of liquidity is the ratio of net deposits and short-term liabilities divided by the sum of net cash, short-term investments and marketable assets. This measurement for liquidity of the Corporation at June 30, 2012, was 43.10% and at December 31, 2011, was 29.32%. Liquidity increased due to the amount of investment securities that were called and not reinvested at June 30, 2012. Management believes it maintains adequate liquidity for the Corporation’s current needs.

The Corporation’s primary source of liquidity is customer deposits, which were $591,571,885 at June 30, 2012, and $572,338,135 at December 31, 2011. Other sources of liquidity include investment securities, the Corporation’s line of credit with the Federal Home Loan Bank (“FHLB”) and federal funds lines with correspondent banks. The Corporation had $299,928,467 invested in investment securities at June 30, 2012, and $374,507,805 at December 31, 2011. The Corporation also had $67,957,333 in interest bearing deposits at other banks at June 30, 2012 and $3,990,521 at December 31, 2011. The Corporation had secured and unsecured federal funds lines with correspondent banks in the amount of $37,500,000 at June 30, 2012 and December 31, 2011. In addition, the Corporation has the ability to draw on its line of credit with the FHLB. At June 30, 2012, the Corporation had unused and available $93,598,381 of its line of credit with the FHLB and at December 31, 2011, the Corporation had unused and available $126,473,758 of its line of credit with the FHLB. The decrease in the amount available under the Corporation’s line of credit with the FHLB from the end of 2011 to June 30, 2012, was the result of an increase in advances outstanding of $10 million and a reduction in the amount of loans eligible for the collateral pool. The Corporation had no federal funds purchased as of June 30, 2012 and December 31, 2011. The Corporation usually purchases funds from correspondent banks on a temporary basis to meet short term funding needs.

When the Corporation has more funds than it needs for its reserve requirements or short-term liquidity needs, the Corporation increases its investment portfolio, increases the balances in interest bearing due from accounts or sells federal funds. It is management’s policy to maintain an adequate portion of its portfolio of assets and liabilities on a short-term basis to insure rate flexibility and to meet loan funding and liquidity needs. When deposits decline or do not grow sufficiently to fund loan demand, management will seek funding either through federal funds purchased or advances from the FHLB.

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CAPITAL RESOURCES

The total stockholders’ equity was $88,396,666 at June 30, 2012, as compared to $86,079,217 at December 31, 2011. The reason for the increase in stockholders’ equity was net earnings in excess of dividends paid and the increase in the investment securities market value adjustment due to an increase in the market value of the Corporation’s investment portfolio. This market value increase was due to general market conditions, specifically the increase in medium term interest rates, which caused an increase in the market price of the investment portfolio.

Cash dividends in the amount of $2,137,261, or $0.44 per share, have been paid in 2012 as of the end of the second quarter 2012.

Quantitative measures established by federal regulations to ensure capital adequacy require the Corporation to maintain minimum amounts and ratios of Total and Tier 1 capital (primarily common stock and retained earnings, less goodwill) to risk weighted assets, and of Tier 1 capital to average assets. Management believes that as of June 30, 2012, the Corporation meets all capital adequacy requirements to which it is subject.

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Actions Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of June 30, 2012
Total Capital (to Risk-Weighted Assets)	$	86,092,530		17.95	%	$	38,374,642		>8.00	%	$	47,968,303		>10.00	%
Tier 1 Capital (to Risk-Weighted Assets)		80,081,496		16.69	%		19,187,321		>4.00	%		28,780,982		>6.00	%
Tier 1 Capital ( to Average Assets)		80,081,496		9.62	%		33,281,182		>4.00	%		41,601,478		>5.00	%

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RESULTS OF OPERATIONS

The following table sets forth for the periods indicated, certain items in the consolidated statements of income of the Corporation and the related changes between those periods:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2012		2011		2012		2011
Interest Income, including fees	$	9,003,168	$	9,443,851	$	17,902,158	$	18,789,123
Interest Expense		1,457,253		1,682,368		2,967,842		3,449,321
Net Interest Income		7,545,915		7,761,483		14,934,316		15,339,802
Provision for Loan Losses		330,097		682,773		865,777		926,834
Net Interest Income after
Provision for Loan Losses		7,215,818		7,078,710		14,068,539		14,412,968
Other Income		1,637,156		1,516,466		3,246,755		3,100,861
Other Expense		6,674,001		6,246,039		13,084,268		12,646,320
Income Before Provision For
Income Taxes		2,178,973		2,349,137		4,231,026		4,867,509
Provision for Income Taxes		427,375		494,865		816,262		1,058,351
Net Income	$	1,751,598	$	1,854,272	$	3,414,764	$	3,809,158
Net Income Per share - Basic	$	0.36	$	0.38	$	0.70	$	0.79
Net Income Per Share - Diluted	$	0.36	$	0.38	$	0.70	$	0.79

See Note 3 to the Corporation’s Consolidated Financial Statements for an explanation regarding the Corporation’s calculation of Net Income Per Share - basic and - diluted.

Annualized return on average equity (“ROE”) was 7.79% for the three months ended June 30, 2012, and 9.19% for the corresponding period in 2011. For the six months ended June 30, 2012, ROE was 7.74% compared to 9.60% for the six months ended June 30, 2011. In both instances, the decrease in ROE was caused by an increase in average equity along with a decrease in net income for the three and six months of 2012.

The book value per share increased to $18.21 at June 30, 2012, compared to $17.77 at December 31, 2011. The increase in book value per share reflects the increase in other comprehensive income due to the increase in market value of the Corporation’s investment securities and by the amount of earnings in excess of dividends. Average assets for the six months ended June 30, 2012, were $834,621,887 compared to $829,177,021 for the year ended December 31, 2011.

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NET INTEREST INCOME / NET INTEREST MARGIN

One component of the Corporation’s earnings is net interest income, which is the difference between the interest and fees earned on loans and investments and the interest paid for deposits and borrowed funds. The net interest margin is net interest income expressed as a percentage of average earning assets.

The annualized net interest margin was 4.16% for the second quarter of 2012 compared to 4.29% for the corresponding period of 2011. For the six months ended June 30, 2012, annualized net interest margin was 4.13% compared to 4.28% for the six months ended June 30, 2011. The decrease in net interest margin from 2011 to 2012 is the result of a decrease in yields on earning assets compared to the decrease in rates paid on deposits and borrowed funds, offset partially by an increase in average earning assets, as detailed below. Earning assets averaged $774,095,199 for the three months ended June 30, 2012. This represents an increase of $22,590,525, or 3.0%, over average earning assets of $751,504,674 for the three month period ended June 30, 2011. Earning assets averaged $765,801,458 for the six months ended June 30, 2012. This represents an increase of $17,358,127, or 2.3% over average earning assets of $748,443,331 for the six months ended June 30, 2011. The increase in earning assets for the three and six months ended June 30, 2012, is the result of an increase in investment securities offset partially by a decrease in loans due to the declining loan demand due to current local, national and international economic conditions.

Interest bearing deposits averaged $470,496,017 for the three months ended June 30, 2012. This represents an increase of $24,400,460, or 5.6%, from the average of interest bearing deposits of $438,381,788 for the three-month period ended June 30, 2011. This was due, in large part, to an increase in certificates of deposit and interest-bearing NOW and money market accounts.

Other borrowed funds averaged $163,988,201 for the three months ended June 30, 2012. This represents a decrease of $42,086,599, or 20.4%, over the other borrowed funds of $206,074,800 for the three-month period ended June 30, 2011. This decrease in other borrowed funds was due to a $35,007,634 decrease in the Commercial Repo Liability, a $62,086 decrease in the ABE Loan Liability, a $2,591,141 increase in Federal Funds Purchased and a decrease in the FHLB advances of $9,608,020 for the three-month period ended June 30, 2012, when compared to the three-month period ended June 30, 2011.

Interest bearing deposits averaged $467,043,764 for the six months ended June 30, 2012. This represents an increase of $24,400,460, or 5.6%, from the average of interest bearing deposits of $438,784,184 for the six-month period ended June 30, 2011.

Other borrowed funds averaged $168,840,833 for the six months ended June 30, 2012. This represents a decrease of $36,797,910, or 17.9%, over the other borrowed funds of $205,638,743 for the six-month period ended June 30, 2011. This decrease in other borrowed funds was due to a $27,666,358 decrease in the Commercial Repo Liability, a $96,155 decrease in the ABE Loan Liability, a $1,872,769 increase in Federal Funds Purchased and a decrease in the FHLB advances of $10,908,166 for the six-month period ended June 30, 2012, when compared to the six-month period ended June 30, 2011.

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Net interest income was $7,545,915 for the three-month period ended June 30, 2012, an increase of $215,568 from $7,761,483 for the three-month period ended June 30, 2011, primarily due to changes in rate. The changes in volume in earning assets and in deposits and in borrowed funds are discussed above. As to changes in rate in the three-month period ended June 30, 2012, the yield on earning assets decreased more than the rates paid on deposits and borrowed funds decreased from the same period in 2011. The yield on all interest bearing assets decreased 25 basis points to 4.93% in the second quarter of 2012 from 5.18% for the same period in 2011. At the same time, the rate paid on all interest bearing liabilities for the second quarter of 2012 decreased by 13 basis points to 0.92% from 1.05% in the same period of 2011. As longer term interest bearing assets and liabilities mature and reprice, management believes that the yields on interest bearing assets and rates on interest bearing liabilities will both decrease.

Net interest income was $14,934,316 for the six months ended June 30, 2012, a decrease of $405,486 from the $15,339,802 for the six-months ended June 30, 2011, primarily due to changes in both rate and volume. The changes in volume in earning assets and in deposits and in borrowed funds are discussed above. As to changes in rate in the six-month period ended June 30, 2012, the yield on earning assets decreased more than the rates paid on deposits and borrowed funds as compared to the changes in rates and yields in the same period of 2011. The yield on all interest bearing assets decreased 28 basis points to 4.92% in the first six months of 2012 from 5.20% for the same period in 2011. At the same time, the rate paid on all interest bearing liabilities for the first six months of 2012 decreased 14 basis points to 0.93% from 1.07% in the same period in 2011. As longer term interest bearing assets and liabilities mature and reprice, management believes that the yields on interest bearing assets and rates on interest bearing liabilities will both decrease.

The following table shows the interest and fees and corresponding yields for loans only.

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2012			2011			2012			2011
Interest and Fees	$	6,038,190		$	6,398,678		$	12,010,427		$	12,947,609
Average Loans		386,667,016			412,887,296			387,733,738			415,451,123
Annualized Yield		6.25	%		6.20	%		6.20	%		6.23	%

The decrease in interest rates in the six-month period ended June 30, 2012, reflects the decrease in all loan interest rates for both new and refinanced loans in the period.

CREDIT LOSS EXPERIENCE

As a natural corollary to the Corporation’s lending activities, some loan losses are to be expected. The risk of loss varies with the type of loan being made and the overall creditworthiness of the borrower over the term of the loan. The degree of perceived risk is taken into account in establishing the structure of, and interest rates and security for, specific loans and for various types of loans. The Corporation attempts to minimize its credit risk exposure by use of thorough loan application and approval procedures.

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The Corporation maintains a program of systematic review of its existing loans. Loans are graded for their overall quality. Those loans, which the Corporation’s management determines require further monitoring and supervision, are segregated and reviewed on a regular basis. Significant problem loans are reviewed on a monthly basis by the Corporation’s Board of Directors.

The Corporation charges off that portion of any loan that management has determined to be a loss. A loan is generally considered by management to represent a loss in whole or in part when exposure beyond the collateral value is apparent, servicing of the unsecured portion has been discontinued or collection is not anticipated based on the borrower’s financial condition. The general economic conditions in the borrower’s industry influence this determination. The principal amount of any loan that is declared a loss is charged against the Corporation’s allowance for loan losses.

The Corporation’s allowance for loan losses is designed to provide for loan losses that can be reasonably anticipated. The allowance for loan losses is established through charges to operating expenses in the form of provisions for loan losses. Actual loan losses or recoveries are charged or credited to the allowance for loan losses. Management of the Corporation determines the amount of the allowance. Among the factors considered in determining the allowance for loan losses are the current financial condition of the Corporation’s borrowers and the value of security, if any, for their loans. Estimates of future economic conditions and their impact on various industries and individual borrowers are also taken into consideration, as are the Corporation’s historical loan loss experience and reports of banking regulatory authorities. As these estimates, factors and evaluations are primarily judgmental, no assurance can be given as to whether the Corporation will sustain loan losses in excess or below its allowance or that subsequent evaluation of the loan portfolio may not require material increases or decreases in such allowance.

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The following table summarizes the Corporation’s allowance for loan losses for the dates indicated:

	Quarter Ended June 30, 2012			Year Ended December 31, 2011			Amount of Increase (Decrease)			Percent of Increase (Decrease)
BALANCES:
Gross Loans	$	384,499,320		$	389,466,242		$	(4,966,922	)		-1.28	%
Allowance for Loan Losses		7,210,717			6,681,412			529,305			7.92	%
Nonaccrual Loans		10,632,129			11,299,060			(666,931	)		-5.90	%
Ratios:
Allowance for loan losses to gross loans		1.88	%		1.72	%
Net loans charged off to allowance for loan losses		4.67	%		40.31	%

The provision for loan losses for the three months ended June 30, 2012, was $330,097, a decrease of $352,676 from the $682,773 provision for the same period in 2011. The provision for loan losses was $865,777 for the six month period ended June 30, 2012, compared to a provision of $926,834 for the six months ended June 30, 2011. The decrease in our loan loss provisions for the three and six month periods is a result of a decrease in loan losses recorded for the respective periods and management’s assessment of inherent loss in the loan portfolio, including the impact caused by current local, national and global economic conditions. The Corporation’s model used to calculate the provision is based on the percentage of historical charge-offs applied to the current loan balances by loan segment and specific reserves applied to certain impaired loans. Nonaccrual loans decreased during this period due to payments received in excess of the amount of new loans being added to the list.

For the three months ended June 30, 2012, net loan losses charged to the allowance for loan losses totaled $191,330, an increase of $656,059 from the $847,389 charged off in the same period in 2011. For the six months ended June 30, 2012, net loan losses charged to the allowance for loan losses totaled $336,472, a decrease of $609,830 from the $946,302 charged off in the same period in 2011. This decrease was due to an overall decrease in the number of charge offs in 2012 when compared to the same period in 2011 and not the result of any one loan segment.

Management reviews with the Board of Directors the adequacy of the allowance for loan losses on a quarterly basis. The loan loss provision is adjusted when specific items reflect a need for such an adjustment. Management believes that there were no material loan losses during the first six months of 2012 that have not been charged off. Management also believes that the Corporation’s allowance will be adequate to absorb probable losses inherent in the Corporation’s loan portfolio. However, in light of overall economic conditions in the Corporation’s geographic area, the nation and internationally, as a whole, it is possible that additional provisions for loan loss may be required.

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OTHER INCOME

Other income includes service charges on deposit accounts, wire transfer fees, safe deposit box rentals and other revenue not derived from interest on earning assets. Other income for the three months ended June 30, 2012, was $1,637,156, an increase of $120,690, or 8.0%, from the same period in 2011. Service charges on deposit accounts increased by $41,934, or 4.9%, to $897,920 in the three months ended June 30, 2012, compared to $855,986 for the same period in 2011. Other service charges and fees increased by $22,299, or 5.4%, in the three months ended June 30, 2012, compared to the same period in 2011. The difference in fee income was the result of fluctuations in volume and not a direct result of fee changes.

Other income for the six months ended June 30, 2012, was $3,246,755, an increase of $145,894, or 4.7%, from the same period in 2011. Service charges on deposit accounts increased by $15,187, or 0.9%, to $1,745,570 in the six months ended June 30, 2012, compared to $1,730,383 for the same period in 2011. Other service charges and fees increased by $36,936, or 5.4%, in the six months ended June 30, 2012, compared to the same period in 2011. The difference in fee income was the result of fluctuations in volume and not a direct result of fee changes. The following is a detail of the other major income classifications that are included in Other Income on the income statement:

	Three months				Six months
	ended June 30,				ended June 30,
Other Income	2012		2011		2012		2011
BOLI Insurance	$	120,000	$	121,924	$	240,000	$	237,309
Mortgage Loan Origination Income		100,783		69,993		217,012		168,493
Income from Security Sales, net		9,061		5,357		37,753		5,789
Other Income		71,919		48,032		140,351		129,754
Total Other Income	$	301,763	$	245,306	$	635,116	$	541,345

OTHER EXPENSES

Other expenses include salaries and employee benefits, occupancy and equipment, and other operating expenses. Aggregate non-interest expenses for the three-month period ended June 30, 2012 and 2011 were $6,674,001 and $6,246,039, respectively, an increase of $427,962, or 6.9%, from 2011 to 2012. Salaries and benefits decreased to $3,473,956 for the three months ended June 30, 2012, from $3,524,103 for the same period in 2011. This represents a decrease of $50,147, or 1.4%. This decrease was the result of decreases in the cost of employee benefits paid by the Corporation and a reduction in the number of employees. Occupancy expense increased by $79,314, or 7.8%, to $1,097,856 for the three months ended June 30, 2012, when compared to the same period of 2011. This increase is due in part to an increase in office and equipment rental and service costs. Other operating expenses increased by $398,795 from 2011 to 2012. A detail of the major expense classifications is set forth below.

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Total non-interest expenses for the six-month period ended June 30, 2012 and 2011 were $13,084,268 and $12,646,320, respectively, an increase of $437,948, or 3.5%, from 2011 to 2012. Salaries and benefits decreased to $7,033,660 for the six months ended June 30, 2012, from $7,043,712 for the same period in 2011. This represents a decrease of $10,052, or 0.1%. This decrease was the result of a reduction in the number of employees. Occupancy expense increased $21,676, or 1.0%, to $2,129,165 in the six months ended June 2012 when compared to the same period in 2011. Other operating expenses increased by $426,324 from 2011 to 2012. A detail of the major expense classifications is set forth below.

The following is a detail of the major expense classifications that make up the other operating expense line item in the income statement:

	Three months ended June 30,					Six months ended June 30,
Other Operating Expense	2012		2011			2012		2011
Intangible Amortization	$	30,782	$	46,172		$	76,955	$	92,345
Advertising		171,044		180,900			333,654		351,662
Office Supplies		94,650		123,474			208,708		303,250
Legal and Audit Fees		121,954		116,254			226,779		237,160
Telephone expense		92,626		117,770			211,666		214,152
Postage and Freight		93,350		100,224			230,033		192,874
Loan Collection Expense		126,323		(31,323	)		229,498		42,051
Other Losses		16,675		(1,818	)		29,398		11,502
FDIC and State Assessment		316,966		267,801			628,416		532,870
Debit Card/ATM expense		205,522		203,983			397,584		385,361
Travel and Convention		52,648		75,578			105,211		138,779
Other expenses		779,649		504,379			1,243,541		993,113
Total Other Expense	$	2,102,189	$	1,703,394		$	3,921,443	$	3,495,119

The Corporation’s efficiency ratio for the three months ended June 30, 2012, was 70.16% compared to the 65.11% for the same period in 2011. For the six months ended June 30, 2012 and 2011, the Corporation’s efficiency ratio was 69.54% and 66.31%, respectively. The efficiency ratio is the ratio of non-interest expenses divided by the sum of net interest income (on a fully tax equivalent basis) and non-interest income.

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BALANCE SHEET ANALYSIS

	June 30, 2012		December 31, 2011		Amount of Increase (Decrease)			Percent of Increase (Decrease)
Cash and Due From Banks	$	44,363,414	$	35,407,715	$	8,955,699			25.29	%
Interest Bearing deposits with Other Banks		67,957,333		3,990,521		63,966,812			1602.97	%
Investment Securities		299,928,467		374,507,805		(74,579,338	)		-19.91	%
Loans, net		377,012,459		382,580,529		(5,568,070	)		-1.46	%
Total Assets		844,689,027		853,945,454		(9,256,427	)		-1.08	%
Total Deposits		591,571,885		572,338,135		19,233,750			3.36	%
Total Stockholders’ Equity		88,396,666		86,079,217		2,317,449			2.69	%

CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash, balances at correspondent banks, interest bearing deposits with other banks and items in process of collection. The balance at June 30, 2012, was $112,320,747, an increase of $72,922,511 from the balance of $39,398,236 at December 31, 2011, due to an increase in the balances of correspondent banks due to an increase in the amount of the month ending cash letter and by an increase in the balances of interest bearing deposits with other banks.

PREMISES AND EQUIPMENT

During the quarter ended June 30, 2012, premises and equipment decreased by $540,801, or 2.7%, to $19,737,642 when compared to $20,278,443 at December 31, 2011. The decrease was due to the amount of depreciation exceeding the addition of property and equipment in the normal course of business.

INVESTMENT SECURITIES

The investment securities portfolio consists of United States agency debentures, mortgage-backed securities, obligations of states, counties and municipal governments and FHLB stock and FNBB stock. Investments at June 30, 2012, decreased $74,579,338, or 19.9%, to $299,928,467 from the balance at December 31, 2011. This decrease is due to the maturity and calls of investment securities that were not reinvested by the end of the reporting period.

LOANS

The loan balance decreased by $5,568,070 during the six months ended June 30, 2012, to $377,012,459 from $382,580,529 at December 31, 2011. Loan demand, especially in the commercial and industrial loan and consumer categories, was weak during the first six months of 2012. No material changes were made to the loan products offered by the Corporation during this period.

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DEPOSITS

The following table shows the balance and percentage change in the various deposits:

	June 30, 2012		December 31, 2011		Amount of Increase (Decrease)			Percent of Increase (Decrease)
Noninterest-Bearing Deposits	$	114,043,397	$	116,894,676	$	(2,851,279	)		-2.44	%
Interest-Bearing Deposits		180,465,762		172,585,498		7,880,264			4.57	%
Savings Deposits		45,297,712		41,876,977		3,420,735			8.17	%
Certificates of Deposit		251,765,014		240,980,984		10,784,030			4.48	%
Total Deposits	$	591,571,885	$	572,338,135	$	19,233,750			3.36	%

Interest-bearing deposits, certificates of deposit and savings increased while noninterest-bearing deposits decreased during the three months ended June 30, 2012. Management continually monitors the interest rates on loan and deposit products to ensure that the Corporation is in line with the rates dictated by the market and our asset and liability management. These rate adjustments impact deposit balances.

OFF-BALANCE SHEET ARRANGEMENTS

Refer to Note 2 to the consolidated financial statements included in this report for a discussion of the nature and extent of the Corporation’s off-balance sheet arrangements, which consist of commitments to fund loans and letters of credit.

CONTRACTUAL OBLIGATIONS

There have been no material changes outside of the ordinary course of the Corporation’s business to the contractual obligations set forth in Note 12 to the Corporation’s financial statements contained in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

The following discussion outlines specific risks that could affect the Corporation’s ability to compete, change the Corporation’s risk profile or eventually impact the Corporation’s financial results. The risks the Corporation faces generally are similar to those experienced, to varying degrees, by all financial services companies.

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The Corporation’s strategies and its management’s ability to react to changing competitive and economic environments have historically enabled the Corporation to compete effectively and manage risks to acceptable levels. The Corporation has outlined potential risk factors below that it presently believe could be important; however, other risks may prove to be important in the future. New risks may emerge at any time and the Corporation cannot predict with certainty all potential developments which could affect the Corporation’s financial performance. The following discussion highlights potential risks, which could intensify over time or shift dynamically in a way that might change the Corporation’s risk profile.

Competition Risks

The market in which the Corporation competes is saturated with community banks seeking to provide a service oriented banking experience to individuals and businesses compared with what the Corporation believes is the more rigid and less friendly environment found in large banks. This requires the Corporation to offer most, if not all, of the products and conveniences that are offered by the larger banks with a service differentiation. In doing so, it is imperative that the Corporation identify the lines of business that the Corporation can excel in, prudently utilize the Corporation’s available capital to acquire the people and platforms required thereof and execute on the strategy.

Credit Risks

Like all lenders, the Corporation faces the risk that the Corporation’s customers may not repay their loans and that the realizable value of collateral may be insufficient to avoid a loss of principal. In the Corporation’s business, some level of credit loss is unavoidable and overall levels of credit loss can vary over time. Our ability to manage credit risks depends primarily upon the Corporation’s ability to assess the creditworthiness of customers and the value of collateral, including real estate. The Corporation controls credit risk by diversifying the Corporation’s loan portfolio and managing its composition, and by recording and managing an allowance for expected loan losses in accordance with applicable accounting rules. At the end of June 30, 2012, the Corporation had $7.211 million of available reserves to cover such losses. The models and approaches the Corporation uses to originate and manage loans are regularly updated to take into account changes in the competitive environment, in real estate prices and other collateral values, and in the economy, among other things based on the Corporation’s experience originating loans and servicing loan portfolios.

Financing, Funding and Liquidity Risks

One of the most important aspects of management’s efforts to sustain long-term profitability for the Corporation is the management of interest rate risk. Management’s goal is to maximize net interest income within acceptable levels of interest-rate risk and liquidity.

The Corporation’s assets and liabilities are principally financial in nature and the resulting earnings thereon are subject to significant variability due to the timing and extent to which the Corporation can reprice the yields on interest-earning assets and the costs of interest bearing liabilities as a result of changes in market interest rates. Interest rates in the financial markets affect the Corporation’s decisions on pricing its assets and liabilities which impacts net interest income, an important cash flow stream for the Corporation. As a result, a substantial part of the Corporation’s risk-management activities are devoted to managing interest-rate risk. Currently, the Corporation does not have any significant risks related to foreign exchange, commodities or equity risk exposures.

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Interest Rate and Yield Curve Risks

A significant portion of the Corporation’s business involves borrowing and lending money. Accordingly, changes in interest rates directly impact the Corporation’s revenues and expenses, and potentially could compress the Corporation’s net interest margin. The Corporation actively manages its balance sheet to control the risks of a reduction in net interest margin brought about by ordinary fluctuations in rates.

Like all financial services companies, the Corporation faces the risks of abnormalities in the yield curve. The yield curve simply shows the interest rates applicable to short and long term debt. The curve is steep when short-term rates are much lower than long-term rates: it is flat when short-term rates are equal, or nearly equal, to long-term rates: and it is inverted when short-term rates exceed long-term rates. Historically, the yield curve is positively sloped. A flat or inverted yield curve tends to decrease net interest margin, as funding costs increase relative to the yield on assets. Currently, the yield curve is positively sloped.

Regulatory and Legal Risks

The Corporation operates in a heavily regulated industry and therefore is subject to many banking, deposit, and consumer lending regulations in addition to the rules applicable to all companies publicly traded in the U.S. securities markets. Failure to comply with applicable regulations could result in financial, structural, and operational penalties. In addition, efforts to comply with applicable regulations may increase the Corporation’s costs and, or limit the Corporation’s ability to pursue certain business opportunities. Federal and state regulations significantly limit the types of activities in which the Corporation, as a financial institution, may engage. In addition, the Corporation is subject to a wide array of other regulations that govern other aspects of how the Corporation conducts business, such as in the areas of employment and intellectual property. Federal and state legislative and regulatory authorities occasionally consider changing these regulations or adopting new ones. Such actions could limit the amount of interest or fees the Corporation can charge, could restrict the Corporation’s ability to collect loans or realize on collateral or could materially affect us in other ways. Additional federal and state consumer protection regulations also could expand the privacy protections afforded to customers of financial institutions, restricting the Corporation’s ability to share or receive customer information and increasing the Corporation’s costs. In addition, changes in accounting rules can significantly affect how the Corporation records and reports assets, liabilities, revenues, expenses and earnings.

The Corporation also faces litigation risks from customers (individually or in class actions) and from federal or state regulators. Litigation is an unavoidable part of doing business, and the Corporation manages those risks through internal controls, personnel training, insurance, litigation management, the Corporation’s compliance and ethics processes and other means. However, the commencement, outcome and magnitude of litigation cannot be predicted or controlled with certainty.

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Accounting Estimate Risks

The preparation of the Corporation’s consolidated financial statements in conformity with United States generally accepted accounting principles requires management to make significant estimates that affect the financial statements. The Corporation’s most critical estimate is the level of the allowance for credit losses. However, other estimates occasionally become highly significant, especially in volatile situations such as litigation and other loss contingency matters. Estimates are made at specific points in time; as actual events unfold, estimates are adjusted accordingly. Due to the inherent nature of these estimates, it is possible that, at some time in the future, the Corporation may significantly increase the allowance for credit losses or sustain credit losses that are significantly higher than the provided allowance, or the Corporation may make some other adjustment that will differ materially from the estimates that the Corporation makes today.

Expense Control

Expenses and other costs directly affect the Corporation’s earnings. The Corporation’s ability to successfully manage expenses is important to its long-term profitability. Many factors can influence the amount of the Corporation’s expenses, as well as how quickly they grow. As the Corporation’s businesses change or expand, additional expenses can arise from asset purchases, structural reorganization evolving business strategies, and changing regulations, among other things. The Corporation manages expense growth and risk through a variety of means, including actual versus budget management, imposition of expense authorization, and procurement coordination and processes.

ITEM 4. CONTROLS AND PROCEDURES.

The management of the Corporation, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures in ensuring that the information required to be disclosed in our filings under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, including ensuring that such information is accumulated and communicated to the Corporation’s management as appropriate to allow timely decision regarding required disclosure. Based on such evaluation, our principal executive officer and principal financial officer have concluded that such disclosure controls and procedures were effective as of June 30, 2012 (the end of the period covered by this Quarterly Report on Form 10-Q).

There were no changes to the Corporation’s internal control over financial reporting that occurred in the three months ended June 30, 2012, that have materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1A. RISK FACTORS.

The Corporation is supplementing the risk factors that appear in Part I, Item 1A., “Risk Factors,” of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011, to include the following.

Changes in interest rates could make it difficult to maintain our current interest income spread and could result in reduced earnings.

Our earnings are largely derived from net interest income, which is interest income and fees earned on loans and investments, less interest paid on deposits and other borrowings. Interest rates are highly sensitive to many factors that are beyond the control of our management, such as general economic conditions and the policies of various governmental and regulatory authorities. An unanticipated rapid decrease or increase in interest rates could have an adverse effect on the spreads between the interest rates earned on assets and the rates of interest paid on liabilities, and therefore on the level of net interest income. Further, substantially higher interest rates generally reduce loan demand and may result in slower loan growth than previously experienced. Due to concerns regarding the federal debt ceiling, one credit rating agency has downgraded the credit rating of the federal government, and others may as well, which could result in increased interest rates generally. For the reasons set forth above, an increase in interest rates generally as a result of such a credit rating downgrade could adversely affect our net interest income levels, thereby resulting in reduced earnings, and reduce loan demand.

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ITEM 6. EXHIBITS.

Exhibits

31(a)	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a).
31(b)	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a).
32(a)	Certification of the Chief Executive Officer pursuant to 18 U.S.C. § 1350.
32(b)	Certification of the Chief Financial Officer pursuant to 18 U.S.C. § 1350.
101	The following financial information from Citizens Holding Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2012, filed with the SEC on August 9, 2012, formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Statements of Condition as of June 30, 2012 (Unaudited) and December 31, 2011; (ii) the Consolidated Statements of Income for the three and six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); (iii) the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); (iv) the Consolidated Statements of Cash Flows for the six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); and (v) Notes to Consolidated Financial Statements, tagged as blocks of text (Unaudited).*

* Pursuant to Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed part of a registration statement, prospectus or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filings.

40

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

CITIZENS HOLDING COMPANY

BY:	/s/ Greg L. McKee
Greg L. McKee
President and Chief Executive Officer
(Principal Executive Officer)
BY:	/s/ Robert T. Smith
Robert T. Smith
Treasurer and Chief Financial Officer
(Principal Financial Officer and Chief Accounting Officer)
DATE: August 8, 2012

41

EXHIBIT INDEX

Exhibit Number	Description of Exhibit
31(a)	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)
31(b)	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
32(a)	Certification of the Chief Executive Officer pursuant to 18 U.S.C. §1350.
32(b)	Certification of the Chief Financial Officer pursuant to 18 U.S.C. §1350.
101	The following financial information from Citizens Holding Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2012, filed with the SEC on August 9, 2012, formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Statements of Condition as of June 30, 2012 (Unaudited) and December 31, 2011; (ii) the Consolidated Statements of Income for the three and six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); (iii) the Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); (iv) the Consolidated Statements of Cash Flows for the six months ended June 30, 2012 (Unaudited) and 2011 (Unaudited); and (v) Notes to Consolidated Financial Statements, tagged as blocks of text (Unaudited).*

* Pursuant to Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed part of a registration statement, prospectus or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filings.

42

EX-31.A

EXHIBIT 31(a)

Certification of Chief Executive Officer

Pursuant to Rule 13a-14(a)/15d-14(a)

I, Greg L. McKee, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Citizens Holding Company;

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: August 8, 2012

/s/ Greg L. McKee

Greg L. McKee

President and Chief Executive Officer

EX-31.B

EXHIBIT 31(b)

Certification of Chief Financial Officer

Pursuant to Rule 13a-14(a)/15d-14(a)

I, Robert T. Smith, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Citizens Holding Company;

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: August 8, 2012

/s/ Robert T. Smith

Robert T. Smith

Treasurer and Chief Financial Officer

EX-32.A

EXHIBIT 32(a)

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. § 1350

In connection with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2012, of Citizens Holding Company (the “Company”), as filed with the Securities Exchange Commission on the date hereof (the “Quarterly Report”), I, Greg L. McKee, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 8, 2012	/s/ Greg L. McKee
	Greg L. McKee
	President and Chief Executive Officer

EX-32.B

EXHIBIT 32(b)

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. § 1350

In connection with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2012, of Citizens Holding Company (the “Company”), as filed with the Securities Exchange Commission on the date hereof (the “Quarterly Report”), I, Robert T. Smith, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Quarterly Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 8, 2012	/s/ Robert T. Smith
	Robert T. Smith
	Treasurer and Chief Financial Officer

XML

Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (Fair Value, Measurements, Recurring, USD $)	Jun. 30, 2012	Dec. 31, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	$ 295,756,867	$ 374,507,805
Obligations of U. S. Government Agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	151,509,731	234,938,488
Mortgage-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	30,550,393	35,117,858
State, county and municipal obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	110,949,942	102,422,164
Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	2,746,801	2,029,295
Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	293,010,066	372,478,510
Fair Value, Inputs, Level 2 | Obligations of U. S. Government Agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	151,509,731	234,938,488
Fair Value, Inputs, Level 2 | Mortgage-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	30,550,393	35,117,858
Fair Value, Inputs, Level 2 | State, county and municipal obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	110,949,942	102,422,164
Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	2,746,801	2,029,295
Fair Value, Inputs, Level 3 | Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities available for sale	$ 2,746,801	$ 2,029,295

XML

Period-end Non-Accrual Loans, Segregated by Class of Loans (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	$ 10,632	$ 11,299
Real Estate Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	10,123	10,559
Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	252	1,134
Real Estate Loans | Farmland
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	469	641
Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	2,151	1,966
Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	7,251	6,818
Business Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	228	305
Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	218	284
Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	10	21
Consumer Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	281	435
Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Non-accrual Loans	$ 281	$ 435

XML

Carrying Value and Estimated Fair Value of Financial Instruments (Detail) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Carrying Amount
Financial assets
Cash and due from banks	$ 44,363,414	$ 35,407,715
Interest bearing deposits with banks	67,957,333	3,990,521
Securities available-for-sale	299,928,467	374,507,805
Net loans	377,012,459	382,580,529
Financial liabilities
Deposits	591,571,885	572,338,135
Federal Home Loan Bank advances	78,500,000	68,500,000
Securities Sold under agreement to repurchase	79,103,790	120,220,433
Fair Value
Financial assets
Cash and due from banks	44,363,414	35,407,715
Interest bearing deposits with banks	67,957,333	3,990,521
Securities available-for-sale	299,928,467	374,507,805
Net loans	376,439,588	382,174,094
Financial liabilities
Deposits	591,904,539	572,388,706
Federal Home Loan Bank advances	81,527,818	71,950,022
Securities Sold under agreement to repurchase	$ 79,103,790	$ 120,220,433

XML

Net Income per Share

6 Months Ended

Jun. 30, 2012

Net Income per Share

Note 3. Net Income per Share

Net income per share - basic has been computed based on the weighted average number of shares outstanding during each period. Net income per share - diluted has been computed based on the weighted average number of shares outstanding during each period plus the dilutive effect of outstanding stock options using the treasury stock method. Earnings per share was computed as follows:

	For the Three Months				For the Six Months
	Ended June 30,				Ended June 30,
	2012		2011		2012		2011
Basic weighted average shares outstanding		4,859,125		4,841,438		4,854,145		4,840,770
Dilutive effect of granted options		6,881		12,799		8,654		9,056
Diluted weighted average shares outstanding		4,866,006		4,854,237		4,862,799		4,849,826
Net income	$	1,751,598	$	1,854,272	$	3,414,764	$	3,809,158
Net income per share-basic	$	0.36	$	0.38	$	0.70	$	0.79
Net income per share-diluted	$	0.36	$	0.38	$	0.70	$	0.79

XML

Loans - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2012
Financing Receivable, Allowance for Credit Losses [Line Items]
Number of years used to calculate allowance for loans	5 years

XML

Detailed Amount of Gross Loans by Loan Grade and Class (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	$ 384,499	$ 389,466
Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	303,727	312,766
Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	11,394	13,480
Real Estate Loans | Farmland
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	34,204	35,912
Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	122,119	133,987
Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	136,010	129,387
Business Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	48,638	38,160
Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	47,101	36,581
Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,537	1,579
Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	32,134	38,540
Consumer Loans | Credit Cards
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	971	995
Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	31,163	37,545
Satisfactory 1, 2, 3, 4
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	324,869	331,052
Satisfactory 1, 2, 3, 4 | Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	253,457	264,764
Satisfactory 1, 2, 3, 4 | Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	8,978	9,647
Satisfactory 1, 2, 3, 4 | Real Estate Loans | Farmland
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	30,066	31,405
Satisfactory 1, 2, 3, 4 | Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	103,767	115,365
Satisfactory 1, 2, 3, 4 | Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	110,646	108,347
Satisfactory 1, 2, 3, 4 | Business Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	40,718	29,451
Satisfactory 1, 2, 3, 4 | Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	39,248	27,970
Satisfactory 1, 2, 3, 4 | Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,470	1,481
Satisfactory 1, 2, 3, 4 | Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	30,694	36,837
Satisfactory 1, 2, 3, 4 | Consumer Loans | Credit Cards
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	958	978
Satisfactory 1, 2, 3, 4 | Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	29,736	35,859
Special Mention 5,6
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	24,654	26,350
Special Mention 5,6 | Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	17,374	18,305
Special Mention 5,6 | Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,974	2,290
Special Mention 5,6 | Real Estate Loans | Farmland
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	2,786	3,043
Special Mention 5,6 | Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	5,852	5,784
Special Mention 5,6 | Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	6,762	7,188
Special Mention 5,6 | Business Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	7,064	7,720
Special Mention 5,6 | Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	7,057	7,712
Special Mention 5,6 | Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	7	8
Special Mention 5,6 | Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	216	325
Special Mention 5,6 | Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	216	325
Substandard 7
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	34,887	31,882
Substandard 7 | Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	32,869	29,608
Substandard 7 | Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	442	1,481
Substandard 7 | Real Estate Loans | Farmland
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,352	1,464
Substandard 7 | Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	12,473	12,811
Substandard 7 | Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	18,602	13,852
Substandard 7 | Business Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	824	953
Substandard 7 | Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	764	863
Substandard 7 | Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	60	90
Substandard 7 | Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,194	1,321
Substandard 7 | Consumer Loans | Credit Cards
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	13	17
Substandard 7 | Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	1,181	1,304
Doubtful 8
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	89	116
Doubtful 8 | Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	27	27
Doubtful 8 | Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	27	27
Doubtful 8 | Business Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	32	36
Doubtful 8 | Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	32	36
Doubtful 8 | Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	30	53
Doubtful 8 | Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans	30	53
Loss 9
Financing Receivable, Recorded Investment [Line Items]
Total gross loans		66
Loss 9 | Real Estate Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans		62
Loss 9 | Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment [Line Items]
Total gross loans		62
Loss 9 | Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans		4
Loss 9 | Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total gross loans		$ 4

XML

Detailed Activity in Allowance for Possible Loan Losses by Portfolio Segment (Detail) (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning Balance	$ 6,681,412	$ 6,379,070
Provision for possible loan losses	865,777	926,834
Chargeoffs	468,327	1,017,099
Recoveries	131,855	70,797
Net Chargeoffs	336,472
Ending Balance	7,210,717	6,359,602
Loans individually evaluated for impairment	1,605,390
Loans collectively evaluated for impairment	5,605,327
Loans, allowance for loan losses	7,210,717	6,359,602
Real Estate Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning Balance	4,176,475
Provision for possible loan losses	817,494
Chargeoffs	280,703
Recoveries	28,459
Net Chargeoffs	252,244
Ending Balance	4,741,725
Loans individually evaluated for impairment	1,548,065
Loans collectively evaluated for impairment	3,193,660
Loans, allowance for loan losses	4,741,725
Business Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning Balance	1,672,467
Provision for possible loan losses	(160,894)
Chargeoffs	28,759
Recoveries	39,553
Net Chargeoffs	(10,794)
Ending Balance	1,522,367
Loans individually evaluated for impairment	57,325
Loans collectively evaluated for impairment	1,465,042
Loans, allowance for loan losses	1,522,367
Consumer Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning Balance	832,470
Provision for possible loan losses	209,177
Chargeoffs	158,865
Recoveries	63,843
Net Chargeoffs	95,022
Ending Balance	946,625
Loans collectively evaluated for impairment	946,625
Loans, allowance for loan losses	$ 946,625

XML

Activity in Allowance for Possible Loan Losses (Detail) (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Financing Receivable, Allowance for Credit Losses [Line Items]
Beginning Balance	$ 6,681,412	$ 6,379,070
Provision for loan losses	865,777	926,834
Loans charged off	(468,327)	(1,017,099)
Recoveries of loans previously charged off	131,855	70,797
Ending Balance	$ 7,210,717	$ 6,359,602

XML

Commitments and Contingent Liabilities

6 Months Ended

Jun. 30, 2012

Commitments and Contingent Liabilities

Note 2. Commitments and Contingent Liabilities

In the ordinary course of business, the Corporation enters into commitments to extend credit to its customers. The unused portion of these commitments is not reflected in the accompanying financial statements. As of June 30, 2012, the Corporation had entered into loan commitments with certain customers with an aggregate unused balance of $34,798,961compared to an aggregate unused balance of $37,703,387 at December 31, 2011. There were $2,956,725 of letters of credit outstanding at June 30, 2012 and $3,113,225 at December 31, 2011. The fair value of such contracts is not considered material because letters of credit and loan commitments often are not used in their entirety, if at all, before they expire. The balances of such letters and commitments should not be used to project actual future liquidity requirements. However, the Corporation does incorporate expectations about the level of draws under its credit-related commitments into its asset and liability management program.

The Corporation is a party to lawsuits and other claims that arise in the ordinary course of business, all of which are being vigorously contested. In the regular course of business, management evaluates estimated losses or costs related to litigation, and provisions are made for anticipated losses whenever management believes that such losses are probable and can be reasonably estimated. At the present time, management believes, based on the advice of legal counsel, that the final resolution of pending legal proceedings will not have a material impact on the Corporation’s consolidated financial condition or results of operations.

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Recorded Investment in Loans Related to Balance in Allowance for Possible Loan Losses by Portfolio Segment (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for specific impairment	$ 10,732	$ 11,399
Loans collectively evaluated for general impairment	373,767	378,067
Total Gross Loans	384,499	389,466
Real Estate Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for specific impairment	10,224	10,659
Loans collectively evaluated for general impairment	293,503	302,107
Total Gross Loans	303,727	312,766
Business Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for specific impairment	227	305
Loans collectively evaluated for general impairment	48,411	37,855
Total Gross Loans	48,638	38,160
Consumer Loans
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for specific impairment	281	435
Loans collectively evaluated for general impairment	31,853	38,105
Total Gross Loans	$ 32,134	$ 38,540

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CONSOLIDATED STATEMENTS OF CONDITION (USD $)	Jun. 30, 2012	Dec. 31, 2011
ASSETS
Cash and due from banks	$ 44,363,414	$ 35,407,715
Interest bearing deposits with other banks	67,957,333	3,990,521
Investment securities available for sale, at fair value	299,928,467	374,507,805
Loans, net of allowance for loan losses of $7,210,717 in 2012 and $6,681,412 in 2011	377,012,459	382,580,529
Premises and equipment, net	19,737,642	20,278,443
Other real estate owned, net	4,461,177	4,868,653
Accrued interest receivable	3,920,561	4,445,384
Cash value of life insurance	20,745,332	20,382,063
Intangible assets, net	3,149,657	3,226,612
Other assets	3,412,985	4,257,729
TOTAL ASSETS	844,689,027	853,945,454
Deposits:
Noninterest-bearing demand	114,043,397	116,894,676
Interest-bearing NOW and money market accounts	180,465,762	172,585,498
Savings deposits	45,297,712	41,876,977
Certificates of deposit	251,765,014	240,980,984
Total deposits	591,571,885	572,338,135
Securities sold under agreement to repurchase	79,103,790	120,220,433
Federal Home Loan Bank advances	78,500,000	68,500,000
Accrued interest payable	351,756	372,374
Deferred compensation payable	5,560,842	5,085,935
Other liabilities	1,204,088	1,349,360
Total liabilities	756,292,361	767,866,237
STOCKHOLDERS' EQUITY
Common stock; $.20 par value, 22,500,000 shares authorized, 4,861,411 shares outstanding at June 30, 2012 and 4,843,911 shares outstanding at December 31, 2011	972,282	968,782
Additional paid-in capital	3,561,050	3,247,208
Retained earnings	78,697,821	77,420,318
Accumulated other comprehensive income, net of applicable taxes of $3,072,945 in 2012 and $2,643,070 in 2011	5,165,513	4,442,909
Total stockholders' equity	88,396,666	86,079,217
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 844,689,027	$ 853,945,454

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net cash provided by operating activities	$ 6,065,086	$ 5,419,819
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from maturities and calls of securities available for sale	190,899,754	73,203,384
Purchases of investment securities available for sale	(115,075,780)	(88,813,259)
Purchases of bank premises and equipment	(30,889)	(1,035,486)
Increase in interest bearing deposits with other banks	(63,966,812)	(10,466,534)
Purchase of Federal Home Loan Bank Stock	(282,700)	(108,000)
Proceeds from sale of other real estate	1,235,367	338,080
Net decrease in loans	3,874,402	8,072,260
Net cash provided by (used by) investing activities	16,653,342	(18,809,555)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposits	19,233,750	9,720,050
Net change in securities sold under agreement to repurchase	(41,116,643)	3,572,364
Proceeds from exercising stock options	257,425	63,385
Increase in Federal Home Loan Bank advances	10,000,000	10,000,000
Decrease in federal funds purchased		(2,500,000)
Payment of dividends	(2,137,261)	(2,130,331)
Net cash provided by financing activities	(13,762,729)	18,725,468
Net increase in cash and due from banks	8,955,699	5,335,732
Cash and due from banks, beginning of period	35,407,715	16,963,393
Cash and due from banks, end of period	$ 44,363,414	$ 22,299,125

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Asset Measured at Fair Value on Nonrecurring Basis (Detail) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	$ 827,891	$ 2,503,659
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	4,788,243	3,562,487
Fair Value, Measurements, Nonrecurring | Impaired Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	4,100,152	505,585
Fair Value, Measurements, Nonrecurring | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	688,091	3,056,902
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	4,788,243	3,562,487
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3 | Impaired Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	4,100,152	505,585
Fair Value, Measurements, Nonrecurring | Fair Value, Inputs, Level 3 | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on non-recurring Basis	$ 688,091	$ 3,056,902

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Assumptions Used in Estimating Fair Value of Options Granted to Directors (Detail) (Directors Stock Option Plan, USD $)	6 Months Ended
	Jun. 30, 2012
Directors Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend Yield	4.70%
Risk-Free Interest Rate	0.78%
Expected Life	8 years 2 months 12 days
Expected Volatility	78.29%
Calculated Value per Option	$ 8.88
Forfeitures	0.00%

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Fair Value of Financial Instruments - Additional Information (Detail) (USD $)	Jun. 30, 2012	Dec. 31, 2011 Property
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Carrying value of an impaired loan	$ 4,828,328	$ 682,517
Impaired loans, allowance for loan losses	728,176	176,932
Additional write downs on OREO previously acquired	139,800	216,000
Number of real estate properties acquired		10
Real Estate Investment Property, at Cost		553,243
Other real estate owned
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Other real estate owned	$ 827,891	$ 2,503,659

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Composition of Net Loans (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Accounts, Notes, Loans and Financing Receivable [Line Items]
Real estate loans	$ 303,727	$ 312,766
Business loans	48,638	38,160
Consumer loans	32,134	38,540
Total Gross Loans	384,499	389,466
Unearned income	(276)	(204)
Allowance for loan losses	(7,211)	(6,681)
Loans, net	377,012	382,581
Land Development and Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Real estate loans	11,394	13,480
Farmland
Accounts, Notes, Loans and Financing Receivable [Line Items]
Real estate loans	34,204	35,912
1-4 Family Mortgages
Accounts, Notes, Loans and Financing Receivable [Line Items]
Real estate loans	122,119	133,987
Commercial Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Real estate loans	136,010	129,387
Commercial and Industrial Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Business loans	47,101	36,581
Farm Production and Other Farm Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Business loans	1,537	1,579
Credit Cards
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer loans	971	995
Other Consumer Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer loans	$ 31,163	$ 37,545

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Basis of Presentation

6 Months Ended

Jun. 30, 2012

Basis of Presentation

Note 1. Basis of Presentation

These interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). However, these financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. The interim consolidated financial statements are unaudited and reflect all adjustments and reclassifications, which, in the opinion of management, are necessary for a fair presentation of the results of operations and financial condition as of and for the interim periods presented. All adjustments and reclassifications are of a normal and recurring nature. Results for the period ended June 30, 2012, are not necessarily indicative of the results that may be expected for any other interim periods or for the year as a whole.

The interim consolidated financial statements of Citizens Holding Company include the accounts of its wholly-owned subsidiary, The Citizens Bank of Philadelphia (the “Bank” and collectively with Citizens Holding Company, the “Corporation”). All significant intercompany transactions have been eliminated in consolidation.

For further information and significant accounting policies of the Corporation, see the Notes to Consolidated Financial Statements of Citizens Holding Company included in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011, filed with the Securities and Exchange Commission on March 14, 2012.

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CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Loans, allowance for loan losses	$ 7,210,717	$ 6,681,412
Common stock, par value	$ 0.20	$ 0.20
Common stock, shares authorized	22,500,000	22,500,000
Common stock, shares outstanding	4,861,411	4,843,911
Accumulated other comprehensive income, applicable taxes	$ 3,072,945	$ 2,643,070

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Loans (Tables)

6 Months Ended

Jun. 30, 2012

Composition of Net Loans

The composition of net loans at June 30, 2012 and December 31, 2011 is as follows:

	June 30, 2012			December 31, 2011
	(In Thousands)
Real Estate:
Land Development and Construction	$	11,394		$	13,480
Farmland		34,204			35,912
1-4 Family Mortgages		122,119			133,987
Commercial Real Estate		136,010			129,387
Total Real Estate Loans		303,727			312,766
Business Loans:
Commercial and Industrial Loans		47,101			36,581
Farm Production and Other Farm Loans		1,537			1,579
Total Business Loans		48,638			38,160
Consumer Loans:
Credit Cards		971			995
Other Consumer Loans		31,163			37,545
Total Consumer Loans		32,134			38,540
Total Gross Loans		384,499			389,466
Unearned income		(276	)		(204	)
Allowance for loan losses		(7,211	)		(6,681	)
Loans, net	$	377,012		$	382,581

Period-end Non-Accrual Loans, Segregated by Class of Loans

Period-end non-accrual loans, segregated by class of loans, were as follows:

	June 30, 2012		December 31, 2011
	(in thousands)
Real Estate:
Land Development and Construction	$	252	$	1,134
Farmland		469		641
1-4 Family Mortgages		2,151		1,966
Commercial Real Estate		7,251		6,818
Total Real Estate Loans		10,123		10,559
Business Loans:
Commercial and Industrial Loans		218		284
Farm Production and Other Farm Loans		10		21
Total Business Loans		228		305
Consumer Loans:
Credit Cards		—		—
Other Consumer Loans		281		435
Total Consumer Loans		281		435
Total Non-Accrual Loans	$	10,632	$	11,299

Age Analysis of Past Due Loans, Segregated by Class of Loans

An aging analysis of past due loans, segregated by class of loans, as of June 30, 2012, was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	176	$	—	$	176	$	11,218	$	11,394	$	—
Farmland		786		—		786		33,418		34,204		—
1-4 Family Mortgages		5,620		994		6,614		115,505		122,119		536
Commercial Real Estate		6,882		1,089		7,971		128,039		136,010		—
Total Real Estate Loans		13,464		2,083		15,547		288,180		303,727		536
Business Loans:
Commercial and Industrial Loans		704		19		723		46,378		47,101		—
Farm Production and Other Farm Loans		16		—		16		1,521		1,537		—
Total Business Loans		720		19		739		47,899		48,638		—
Consumer Loans:
Credit Cards		16		13		29		942		971		13
Other Consumer Loans		1,386		26		1,412		29,751		31,163		3
Total Consumer Loans		1,402		39		1,441		30,693		32,134		16
Total Loans	$	15,586	$	2,141	$	17,727	$	366,772	$	384,499	$	552

An aging analysis of past due loans, segregated by class of loans, as of December 31, 2011 was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	30	$	562	$	592	$	12,888	$	13,480	$	39
Farmland		1,061		139		1,200		34,712		35,912		—
1-4 Family Mortgages		5,774		822		6,596		127,391		133,987		80
Commercial Real Estate		4,941		4,855		9,796		119,591		129,387		109
Total Real Estate Loans		11,806		6,378		18,184		294,582		312,766		228
Business Loans:
Commercial and Industrial Loans		294		99		393		36,188		36,581		—
Farm Production and Other Farm Loans		13		6		19		1,560		1,579		—
Total Business Loans		307		105		412		37,748		38,160		—
Consumer Loans:
Credit Cards		20		17		37		958		995		17
Other Consumer Loans		1,858		252		2,110		35,435		37,545		24
Total Consumer Loans		1,878		269		2,147		36,393		38,540		41
Total Loans	$	13,991	$	6,752	$	20,743	$	368,723	$	389,466	$	269

Impaired Loans, by Class of Loans

Impaired loans as of June 30, 2012 and December 31, 2011, by class of loans, are as follows (in thousands):

June 30, 2012	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	252	$	120	$	132	$	252	$	117	$	479
Farmland		469		324		145		469		24		557
1-4 Family Mortgages		2,251		1,482		769		2,251		202		2,419
Commercial Real Estate		7,251		1,432		5,819		7,251		1,205		7,032
Total Real Estate Loans		10,223		3,358		6,865		10,223		1,548		10,487
Business Loans:
Commercial and Industrial Loans		218		114		104		218		57		241
Farm Production and Other Farm Loans		10		10		—		10		—		13
Total Business Loans		228		124		104		228		57		254
Consumer Loans:
Other Consumer Loans		281		281		—		281		—		307
Total Consumer Loans		281		281		—		281		—		307
Total Loans	$	10,732	$	3,763	$	6,969	$	10,732	$	1,605	$	11,048

December 31, 2011	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	1,134	$	992	$	142	$	1,134	$	134	$	883
Farmland		641		492		149		641		24		588
1-4 Family Mortgages		2,066		1,297		769		2,066		216		1,933
Commercial Real Estate		6,818		5,042		1,776		6,818		736		6,896
Total Real Estate Loans		10,659		7,823		2,836		10,659		1,110		10,300
Business Loans:
Commercial and Industrial Loans		284		163		121		284		57		860
Farm Production and Other Farm Loans		21		21		—		21		—		19
Total Business Loans		305		184		121		305		57		879
Consumer Loans:
Other Consumer Loans		435		430		5		435		—		321
Total Consumer Loans		435		430		5		435		—		321
Total Loans	$	11,399	$	8,437	$	2,962	$	11,399	$	1,167	$	11,500

Detailed Amount of Gross Loans by Loan Grade and Class

The following table details the amount of gross loans by loan grade and class as of June 30, 2012 (in thousands):

Grades	Satisfactory 1, 2, 3, 4		Special Mention 5,6		Substandard 7		Doubtful 8		Loss   9		Total Loans
Real Estate:
Land Development and Construction	$	8,978	$	1,974	$	442	$	—	$	—	$	11,394
Farmland		30,066		2,786		1,352		—		—		34,204
1-4 Family Mortgages		103,767		5,852		12,473		27		—		122,119
Commercial Real Estate		110,646		6,762		18,602		—		—		136,010
Total Real Estate Loans		253,457		17,374		32,869		27		—		303,727
Business Loans:
Commercial and Industrial Loans		39,248		7,057		764		32		—		47,101
Farm Production and Other Farm Loans		1,470		7		60		—		—		1,537
Total Business Loans		40,718		7,064		824		32		—		48,638
Consumer Loans:
Credit Cards		958		—		13		—		—		971
Other Consumer Loans		29,736		216		1,181		30		—		31,163
Total Consumer Loans		30,694		216		1,194		30		—		32,134
Total Loans	$	324,869	$	24,654	$	34,887	$	89	$	—	$	384,499

The following table details the amount of gross loans by loan grade and class as of December 31, 2011:

Grades	Satisfactory 1, 2, 3,4		Mention 5,6		Substandard 7		Doubtful 8		Loss 9		Total Loans
Real Estate:
Land Development and Construction	$	9,647	$	2,290	$	1,481	$	—	$	62	$	13,480
Farmland		31,405		3,043		1,464		—		—		35,912
1-4 Family Mortgages		115,365		5,784		12,811		27		—		133,987
Commercial Real Estate		108,347		7,188		13,852		—		—		129,387
Total Real Estate Loans		264,764		18,305		29,608		27		62		312,766
Business Loans:
Commercial and Industrial Loans		27,970		7,712		863		36		—		36,581
Farm Production and Other Farm Loans		1,481		8		90		—		—		1,579
Total Business Loans		29,451		7,720		953		36		—		38,160
Consumer Loans:
Credit Cards		978		—		17		—		—		995
Other Consumer Loans		35,859		325		1,304		53		4		37,545
Total Consumer Loans		36,837		325		1,321		53		4		38,540
Total Loans	$	331,052	$	26,350	$	31,882	$	116	$	66	$	389,466

Detailed Activity in Allowance for Possible Loan Losses by Portfolio Segment

The following table details activity in the allowance for possible loan losses by portfolio segment for the six months ended June 30, 2012:

June 30, 2012	Real Estate		Business Loans			Consumer		Total
Beginning Balance, January 1, 2012	$	4,176,475	$	1,672,467		$	832,470	$	6,681,412
Provision for possible loan losses		817,494		(160,894	)		209,177		865,777
Chargeoffs		280,703		28,759			158,865		468,327
Recoveries		28,459		39,553			63,843		131,855
Net Chargeoffs		252,244		(10,794	)		95,022		336,472
Ending Balance	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717
Period end allowance allocated to:
Loans individually evaluated for impairment	$	1,548,065	$	57,325		$	—	$	1,605,390
Loans collectively evaluated for impairment		3,193,660		1,465,042			946,625		5,605,327
Ending Balance, June 30, 2012	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717

Activity in Allowance for Possible Loan Losses

Activity in the allowance for possible loan losses for the six months ended June 30, 2011 was as follows:

	June 30, 2011
Balance, beginning of period	$	6,379,070
Provision for loan losses		926,834
Loans charged off		(1,017,099	)
Recoveries of loans previously charged off		70,797
Balance, end of period	$	6,359,602

Recorded Investment in Loans Related to Balance in Allowance for Possible Loan Losses by Portfolio Segment

The Corporation’s recorded investment in loans as of June 30, 2012 and December 31, 2011 related to each balance in the allowance for possible loan losses by portfolio segment and disaggregated on the basis of the Corporation’s impairment methodology was as follows (in thousands):

June 30, 2012	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,224	$	227	$	281	$	10,732
Loans collectively evaluated for general impairment		293,503		48,411		31,853		373,767
	$	303,727	$	48,638	$	32,134	$	384,499

December 31, 2011	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,659	$	305	$	435	$	11,399
Loans collectively evaluated for general impairment		302,107		37,855		38,105		378,067
	$	312,766	$	38,160	$	38,540	$	389,466

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Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Aug. 08, 2012
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Trading Symbol	CIZN
Entity Registrant Name	CITIZENS HOLDING CO /MS/
Entity Central Index Key	0001075706
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		4,861,411

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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2012

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2012:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	151,509,731	$	—	$	151,509,731
Mortgage-backed Securities		—		30,550,393		—		30,550,393
State, county and municipal obligations		—		110,949,942		—		110,949,942
Other investments		—		—		2,746,801		2,746,801
Total	$	—	$	293,010,066	$	2,746,801	$	295,756,867

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2011:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	234,938,488	$	—	$	234,938,488
Mortgage-backed Securities		—		35,117,858		—		35,117,858
State, county and municipal obligations		—		102,422,164		—		102,422,164
Other investments		—		—		2,029,295		2,029,295
Total	$	—	$	372,478,510	$	2,029,295	$	374,507,805

Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs

The following table reports the activity for 2012 in assets measured at fair value on a recurring basis using significant unobservable inputs.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Structured Financial Product
Balance at January 1, 2012	$	2,029,295
Unrealized gains included in other comprehensive income		717,506
Balance at June 30, 2012	$	2,746,801

Asset Measured at Fair Value on Nonrecurring Basis

For assets measured at fair value on a nonrecurring basis during 2012 that were still held in the balance sheet at June 30, 2012, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	4,100,152	$	4,100,152
Other real estate owned		—		—		688,091		688,091
Total	$	—	$	—	$	4,788,243	$	4,788,243

For assets measured at fair value on a nonrecurring basis during 2011 that were still held in the balance sheet at December 31, 2011, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	505,585	$	505,585
Other real estate owned		—		—		3,056,902		3,056,902
Total	$	—	$	—	$	3,562,487	$	3,562,487

Carrying Value and Estimated Fair Value of Financial Instruments

The following represents the carrying value and estimated fair value of the Corporation’s financial instruments at June 30, 2012, and December 31, 2011:

	June 30, 2012				December 31, 2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets
Cash and due from banks	$	44,363,414	$	44,363,414	$	35,407,715	$	35,407,715
Interest bearing deposits with banks		67,957,333		67,957,333		3,990,521		3,990,521
Securities available-for-sale		299,928,467		299,928,467		374,507,805		374,507,805
Net loans		377,012,459		376,439,588		382,580,529		382,174,094
Financial liabilities
Deposits	$	591,571,885	$	591,904,539	$	572,338,135	$	572,388,706
Federal Home Loan Bank advances		78,500,000		81,527,818		68,500,000		71,950,022
Securities Sold under agreement to repurchase		79,103,790		79,103,790		120,220,433		120,220,433

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CONSOLIDATED STATEMENTS OF INCOME (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
INTEREST INCOME
Loans, including fees	$ 6,038,190	$ 6,398,678	$ 12,010,427	$ 12,947,609
Investment securities	2,956,655	3,038,701	5,874,050	5,823,247
Other interest	8,323	6,472	17,681	18,267
Total interest income	9,003,168	9,443,851	17,902,158	18,789,123
INTEREST EXPENSE
Deposits	703,728	802,618	1,428,434	1,689,617
Other borrowed funds	753,525	879,750	1,539,408	1,759,704
Total interest expense	1,457,253	1,682,368	2,967,842	3,449,321
NET INTEREST INCOME	7,545,915	7,761,483	14,934,316	15,339,802
PROVISION FOR LOAN LOSSES	330,097	682,773	865,777	926,834
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	7,215,818	7,078,710	14,068,539	14,412,968
OTHER INCOME
Service charges on deposit accounts	897,920	855,986	1,745,570	1,730,383
Other service charges and fees	437,473	415,174	866,069	829,133
Other income	301,763	245,306	635,116	541,345
Total other income	1,637,156	1,516,466	3,246,755	3,100,861
OTHER EXPENSES
Salaries and employee benefits	3,473,956	3,524,103	7,033,660	7,043,712
Occupancy expense	1,097,856	1,018,542	2,129,165	2,107,489
Other operating expense	2,102,189	1,703,394	3,921,443	3,495,119
Total other expenses	6,674,001	6,246,039	13,084,268	12,646,320
INCOME BEFORE PROVISION FOR INCOME TAXES	2,178,973	2,349,137	4,231,026	4,867,509
PROVISION FOR INCOME TAXES	427,375	494,865	816,262	1,058,351
NET INCOME	$ 1,751,598	$ 1,854,272	$ 3,414,764	$ 3,809,158
NET INCOME PER SHARE
-Basic	$ 0.36	$ 0.38	$ 0.70	$ 0.79
-Diluted	$ 0.36	$ 0.38	$ 0.70	$ 0.79
DIVIDENDS PAID PER SHARE	$ 0.22	$ 0.22	$ 0.44	$ 0.44

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Loans

6 Months Ended

Jun. 30, 2012

Loans

Note 6. Loans

The composition of net loans at June 30, 2012 and December 31, 2011 is as follows:

	June 30, 2012			December 31, 2011
	(In Thousands)
Real Estate:
Land Development and Construction	$	11,394		$	13,480
Farmland		34,204			35,912
1-4 Family Mortgages		122,119			133,987
Commercial Real Estate		136,010			129,387
Total Real Estate Loans		303,727			312,766
Business Loans:
Commercial and Industrial Loans		47,101			36,581
Farm Production and Other Farm Loans		1,537			1,579
Total Business Loans		48,638			38,160
Consumer Loans:
Credit Cards		971			995
Other Consumer Loans		31,163			37,545
Total Consumer Loans		32,134			38,540
Total Gross Loans		384,499			389,466
Unearned income		(276	)		(204	)
Allowance for loan losses		(7,211	)		(6,681	)
Loans, net	$	377,012		$	382,581

Loans are considered to be past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on non-accrual status, when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. Loans may be placed on non-accrual status regardless of whether such loans are considered past due. When interest accruals are discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Period-end non-accrual loans, segregated by class of loans, were as follows:

	June 30, 2012		December 31, 2011
	(in thousands)
Real Estate:
Land Development and Construction	$	252	$	1,134
Farmland		469		641
1-4 Family Mortgages		2,151		1,966
Commercial Real Estate		7,251		6,818
Total Real Estate Loans		10,123		10,559
Business Loans:
Commercial and Industrial Loans		218		284
Farm Production and Other Farm Loans		10		21
Total Business Loans		228		305
Consumer Loans:
Credit Cards		—		—
Other Consumer Loans		281		435
Total Consumer Loans		281		435
Total Non-Accrual Loans	$	10,632	$	11,299

An aging analysis of past due loans, segregated by class of loans, as of June 30, 2012, was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	176	$	—	$	176	$	11,218	$	11,394	$	—
Farmland		786		—		786		33,418		34,204		—
1-4 Family Mortgages		5,620		994		6,614		115,505		122,119		536
Commercial Real Estate		6,882		1,089		7,971		128,039		136,010		—
Total Real Estate Loans		13,464		2,083		15,547		288,180		303,727		536
Business Loans:
Commercial and Industrial Loans		704		19		723		46,378		47,101		—
Farm Production and Other Farm Loans		16		—		16		1,521		1,537		—
Total Business Loans		720		19		739		47,899		48,638		—
Consumer Loans:
Credit Cards		16		13		29		942		971		13
Other Consumer Loans		1,386		26		1,412		29,751		31,163		3
Total Consumer Loans		1,402		39		1,441		30,693		32,134		16
Total Loans	$	15,586	$	2,141	$	17,727	$	366,772	$	384,499	$	552

An aging analysis of past due loans, segregated by class of loans, as of December 31, 2011 was as follows (in thousands):

	Loans 30-89 Days Past Due		Loans 90 or more Days Past Due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or  more Days Past Due
Real Estate:
Land Development and Construction	$	30	$	562	$	592	$	12,888	$	13,480	$	39
Farmland		1,061		139		1,200		34,712		35,912		—
1-4 Family Mortgages		5,774		822		6,596		127,391		133,987		80
Commercial Real Estate		4,941		4,855		9,796		119,591		129,387		109
Total Real Estate Loans		11,806		6,378		18,184		294,582		312,766		228
Business Loans:
Commercial and Industrial Loans		294		99		393		36,188		36,581		—
Farm Production and Other Farm Loans		13		6		19		1,560		1,579		—
Total Business Loans		307		105		412		37,748		38,160		—
Consumer Loans:
Credit Cards		20		17		37		958		995		17
Other Consumer Loans		1,858		252		2,110		35,435		37,545		24
Total Consumer Loans		1,878		269		2,147		36,393		38,540		41
Total Loans	$	13,991	$	6,752	$	20,743	$	368,723	$	389,466	$	269

Loans are considered impaired when, based on current information and events, it is probable the Corporation will be unable to collect all the amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. In determining which loans to evaluate for impairment, management looks at past due loans, bankruptcy filing and any situation that might lend itself to cause a borrower to be unable to repay the loan according to the original contract terms. If a loan is determined to be impaired and the collateral is deemed to be insufficient to fully repay the loan, a specific reserve will be established. Interest payments on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assured, in which case interest is recognized on a cash basis. Impaired loans or portions thereof, are charged-off when deemed uncollectible.

Impaired loans as of June 30, 2012 and December 31, 2011, by class of loans, are as follows (in thousands):

June 30, 2012	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	252	$	120	$	132	$	252	$	117	$	479
Farmland		469		324		145		469		24		557
1-4 Family Mortgages		2,251		1,482		769		2,251		202		2,419
Commercial Real Estate		7,251		1,432		5,819		7,251		1,205		7,032
Total Real Estate Loans		10,223		3,358		6,865		10,223		1,548		10,487
Business Loans:
Commercial and Industrial Loans		218		114		104		218		57		241
Farm Production and Other Farm Loans		10		10		—		10		—		13
Total Business Loans		228		124		104		228		57		254
Consumer Loans:
Other Consumer Loans		281		281		—		281		—		307
Total Consumer Loans		281		281		—		281		—		307
Total Loans	$	10,732	$	3,763	$	6,969	$	10,732	$	1,605	$	11,048

December 31, 2011	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
Real Estate:
Land Development and Construction	$	1,134	$	992	$	142	$	1,134	$	134	$	883
Farmland		641		492		149		641		24		588
1-4 Family Mortgages		2,066		1,297		769		2,066		216		1,933
Commercial Real Estate		6,818		5,042		1,776		6,818		736		6,896
Total Real Estate Loans		10,659		7,823		2,836		10,659		1,110		10,300
Business Loans:
Commercial and Industrial Loans		284		163		121		284		57		860
Farm Production and Other Farm Loans		21		21		—		21		—		19
Total Business Loans		305		184		121		305		57		879
Consumer Loans:
Other Consumer Loans		435		430		5		435		—		321
Total Consumer Loans		435		430		5		435		—		321
Total Loans	$	11,399	$	8,437	$	2,962	$	11,399	$	1,167	$	11,500

The Corporation utilizes a risk grading matrix to assign a risk grade to each of its loans when originated and is updated as factors related to the strength of the loan changes. Loans are graded on a scale of 1 to 9. A description of the general characteristics of the 9 risk grades is as follows.

Grade 1. MINIMAL RISK - These loans are without loss exposure to the Corporation. This classification is reserved for only the best, well secured loans to borrowers with significant capital strength, low leverage, stable earnings and growth and other readily available financing alternatives. This type of loan would also include loans secured by a program of the government.

Grade 2. MODEST RISK - These loans include borrowers with solid credit quality and moderate risk of loss. These loans may be fully secured by certificates of deposit with another reputable financial institution, or secured by readily marketable securities with acceptable margins.

Grade 3. AVERAGE RISK - This is the rating assigned to most of the loans held by the Corporation. This includes loans with average loss exposure and average overall quality. These loans should liquidate through possessing adequate collateral and adequate earnings of the borrower. In addition, these loans are properly documented and are in accordance with all aspects of the current loan policy.

Grade 4. ACCEPTABLE RISK - Borrower generates sufficient cash flow to fund debt service but most working asset and capital expansion needs are provided from external sources. Profitability and key balance sheet ratios are usually close to peers but one or more may be higher than peers.

Grade 5. MANAGEMENT ATTENTION - Borrower has significant weaknesses resulting from performance trends or management concerns. The financial condition of the borrower has taken a negative turn and may be temporarily strained. Cash flow is weak but cash reserves remain adequate to meet debt service. Management weakness is evident.

Grade 6. OTHER LOANS ESPECIALLY MENTIONED (OLEM) - Loans in this category are fundamentally sound but possess some weaknesses. OLEM loans have potential weaknesses which may, if not checked or corrected, weaken the asset or inadequately protect the bank’s credit position at some future date. These loans have an identifiable weakness in credit, collateral, or repayment ability but there is no expectation of loss.

Grade 7. SUBSTANDARD ASSETS - Assets classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Assets classified as substandard must have a well-defined weakness based upon objective evidence. Assets classified as substandard are characterized by the distinct possibility that the insured institution will sustain some loss if the deficiencies are not corrected. The possibility that liquidation would not be timely requires a substandard classification even if there is little likelihood of total loss.

Grade 8. DOUBTFUL - A loan classified as doubtful has all the weaknesses of a substandard classification and the added characteristic that the weakness makes collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable or improbable. The possibility of loss is extremely high, but because of certain important and reasonable specific pending factors which may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined. A doubtful classification could reflect the fact that the primary source of repayment is gone and serious doubt exists as to the quality of a secondary source of repayment.

Grade 9. LOSS - Loans classified loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may occur in the future. Also included in this classification is the defined loss portion of loans rated substandard assets and doubtful assets.

These internally assigned grades are updated on a continual basis throughout the course of the year and represent management’s most updated judgment regarding grades at June 30, 2012.

The following table details the amount of gross loans by loan grade and class as of June 30, 2012 (in thousands):

Grades	Satisfactory 1, 2, 3, 4		Special Mention 5,6		Substandard 7		Doubtful 8		Loss   9		Total Loans
Real Estate:
Land Development and Construction	$	8,978	$	1,974	$	442	$	—	$	—	$	11,394
Farmland		30,066		2,786		1,352		—		—		34,204
1-4 Family Mortgages		103,767		5,852		12,473		27		—		122,119
Commercial Real Estate		110,646		6,762		18,602		—		—		136,010
Total Real Estate Loans		253,457		17,374		32,869		27		—		303,727
Business Loans:
Commercial and Industrial Loans		39,248		7,057		764		32		—		47,101
Farm Production and Other Farm Loans		1,470		7		60		—		—		1,537
Total Business Loans		40,718		7,064		824		32		—		48,638
Consumer Loans:
Credit Cards		958		—		13		—		—		971
Other Consumer Loans		29,736		216		1,181		30		—		31,163
Total Consumer Loans		30,694		216		1,194		30		—		32,134
Total Loans	$	324,869	$	24,654	$	34,887	$	89	$	—	$	384,499

The following table details the amount of gross loans by loan grade and class as of December 31, 2011:

Grades	Satisfactory 1, 2, 3,4		Mention 5,6		Substandard 7		Doubtful 8		Loss 9		Total Loans
Real Estate:
Land Development and Construction	$	9,647	$	2,290	$	1,481	$	—	$	62	$	13,480
Farmland		31,405		3,043		1,464		—		—		35,912
1-4 Family Mortgages		115,365		5,784		12,811		27		—		133,987
Commercial Real Estate		108,347		7,188		13,852		—		—		129,387
Total Real Estate Loans		264,764		18,305		29,608		27		62		312,766
Business Loans:
Commercial and Industrial Loans		27,970		7,712		863		36		—		36,581
Farm Production and Other Farm Loans		1,481		8		90		—		—		1,579
Total Business Loans		29,451		7,720		953		36		—		38,160
Consumer Loans:
Credit Cards		978		—		17		—		—		995
Other Consumer Loans		35,859		325		1,304		53		4		37,545
Total Consumer Loans		36,837		325		1,321		53		4		38,540
Total Loans	$	331,052	$	26,350	$	31,882	$	116	$	66	$	389,466

The allowance for loan losses is a reserve established through a provision for loan losses charged to expense, which represents management’s best estimate of probable losses within the existing portfolio of loans. The allowance, in the judgment of management, is necessary to reserve for estimated loan losses and risks inherent in the loan portfolio.

The allowance on the majority of the loan portfolio is calculated using a historical chargeoff percentage applied to the current loan balances by loan segment. This historical period is the average of the previous 5 years with the most current years weighted to show the effect of the most recent chargeoff activity. This percentage is also adjusted for economic factors such as local unemployment and general business conditions, both local and nationwide.

The group of loans that are considered to be impaired are individually evaluated for possible loss and a specific reserve is established to cover any loss contingency. Loans that are determined to be a loss with no benefit of remaining in the portfolio are charged off to the allowance. These specific reserves are reviewed periodically for continued impairment and adequacy of the specific reserve and adjusted when necessary.

The following table details activity in the allowance for possible loan losses by portfolio segment for the six months ended June 30, 2012:

June 30, 2012	Real Estate		Business Loans			Consumer		Total
Beginning Balance, January 1, 2012	$	4,176,475	$	1,672,467		$	832,470	$	6,681,412
Provision for possible loan losses		817,494		(160,894	)		209,177		865,777
Chargeoffs		280,703		28,759			158,865		468,327
Recoveries		28,459		39,553			63,843		131,855
Net Chargeoffs		252,244		(10,794	)		95,022		336,472
Ending Balance	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717
Period end allowance allocated to:
Loans individually evaluated for impairment	$	1,548,065	$	57,325		$	—	$	1,605,390
Loans collectively evaluated for impairment		3,193,660		1,465,042			946,625		5,605,327
Ending Balance, June 30, 2012	$	4,741,725	$	1,522,367		$	946,625	$	7,210,717

Activity in the allowance for possible loan losses for the six months ended June 30, 2011 was as follows:

	June 30, 2011
Balance, beginning of period	$	6,379,070
Provision for loan losses		926,834
Loans charged off		(1,017,099	)
Recoveries of loans previously charged off		70,797
Balance, end of period	$	6,359,602

The Corporation’s recorded investment in loans as of June 30, 2012 and December 31, 2011 related to each balance in the allowance for possible loan losses by portfolio segment and disaggregated on the basis of the Corporation’s impairment methodology was as follows (in thousands):

June 30, 2012	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,224	$	227	$	281	$	10,732
Loans collectively evaluated for general impairment		293,503		48,411		31,853		373,767
	$	303,727	$	48,638	$	32,134	$	384,499

December 31, 2011	Real Estate		Business Loans		Consumer		Total
Loans individually evaluated for specific impairment	$	10,659	$	305	$	435	$	11,399
Loans collectively evaluated for general impairment		302,107		37,855		38,105		378,067
	$	312,766	$	38,160	$	38,540	$	389,466

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Income Taxes

6 Months Ended

Jun. 30, 2012

Income Taxes

Note 5. Income Taxes

The income tax topic of the ASC defines the threshold for recognizing the benefits of tax return positions in the financial statements as “more-likely-than-not” to be sustained by the taxing authority. This topic also provides guidance on the derecognition, measurement and classification of income tax uncertainties, along with any related interest and penalties, and includes guidance concerning accounting for income tax uncertainties in interim periods. As of June 30, 2012, the Corporation had no unrecognized tax benefits related to federal and state income tax matters. Therefore, the Corporation does not anticipate any material increase or decrease in the effective tax rate during 2012 relative to any tax positions taken. It is the Corporation’s policy to recognize interest and/or penalties related to income tax matters in income tax expense.

The Corporation files a consolidated United States federal income tax return. The Corporation is currently open to audit under the statute of limitations by the Internal Revenue Service for all tax years after 2009. The Corporation consolidated state income tax returns are also open to audit under the statute of limitations for the same period.

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Summary of Stock Option Activity (Detail) (USD $)	6 Months Ended
	Jun. 30, 2012
Directors Stock Option Plan
Number of Shares
Outstanding at December 31, 2011	102,000
Granted	13,500
Exercised	(3,000)
Expired	(1,500)
Outstanding at June 30, 2012	111,000
Weighted Average Exercise Price
Outstanding at December 31, 2011	$ 21.00
Granted	$ 18.76
Exercised	$ 15.00
Expired	$ 15.00
Outstanding at June 30, 2012	$ 20.97
Employee Stock Option
Number of Shares
Outstanding at December 31, 2011	135,500
Exercised	(14,500)
Expired	(13,000)
Outstanding at June 30, 2012	108,000
Weighted Average Exercise Price
Outstanding at December 31, 2011	$ 19.96
Exercised	$ 14.65
Expired	$ 18.09
Outstanding at June 30, 2012	$ 20.90

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Commitments and Contingent Liabilities - Additional Information (Detail) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Commitments and Contingencies Disclosure [Line Items]
Loan Commitments	$ 34,798,961	$ 37,703,387
Letters of Credit Outstanding	$ 2,956,725	$ 3,113,225

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Net Income per Share (Tables)

6 Months Ended

Jun. 30, 2012

Earnings Per Share

Earnings per share was computed as follows:

	For the Three Months				For the Six Months
	Ended June 30,				Ended June 30,
	2012		2011		2012		2011
Basic weighted average shares outstanding		4,859,125		4,841,438		4,854,145		4,840,770
Dilutive effect of granted options		6,881		12,799		8,654		9,056
Diluted weighted average shares outstanding		4,866,006		4,854,237		4,862,799		4,849,826
Net income	$	1,751,598	$	1,854,272	$	3,414,764	$	3,809,158
Net income per share-basic	$	0.36	$	0.38	$	0.70	$	0.79
Net income per share-diluted	$	0.36	$	0.38	$	0.70	$	0.79

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Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2012

Recent Accounting Pronouncements

Note 7. Recent Accounting Pronouncements

In September 2011, FASB issued an update to ASC Topic 350 to give entities the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the first step of the two-step impairment test by calculating the fair value of the reporting unit and comparing the fair value with the carrying amount of the reporting unit. This update is effective for annual and interim impairment tests beginning after December 15, 2011, and is not expected to have a significant impact on the Corporation’s financial statements as it related to disclosures made herein.

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Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2012

Fair Value of Financial Instruments

Note 8. Fair Value of Financial Instruments

The fair value topic of the ASC establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. This topic clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. This topic also requires disclosure about how fair value was determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

Level 1	Quoted prices in active markets for identical assets or liabilities;
Level 2	Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or
Level 3	Unobservable inputs, such as discounted cash flow models or valuations.

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2012:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	151,509,731	$	—	$	151,509,731
Mortgage-backed Securities		—		30,550,393		—		30,550,393
State, county and municipal obligations		—		110,949,942		—		110,949,942
Other investments		—		—		2,746,801		2,746,801
Total	$	—	$	293,010,066	$	2,746,801	$	295,756,867

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2011:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Securities available for sale Obligations of U. S. Government Agencies	$	—	$	234,938,488	$	—	$	234,938,488
Mortgage-backed Securities		—		35,117,858		—		35,117,858
State, county and municipal obligations		—		102,422,164		—		102,422,164
Other investments		—		—		2,029,295		2,029,295
Total	$	—	$	372,478,510	$	2,029,295	$	374,507,805

The following table reports the activity for 2012 in assets measured at fair value on a recurring basis using significant unobservable inputs.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Structured Financial Product
Balance at January 1, 2012	$	2,029,295
Unrealized gains included in other comprehensive income		717,506
Balance at June 30, 2012	$	2,746,801

The Corporation recorded no gains or losses in earnings for the period that were attributable to the change in unrealized gains or losses relating to assets still held at the reporting date.

For assets measured at fair value on a nonrecurring basis during 2012 that were still held in the balance sheet at June 30, 2012, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	4,100,152	$	4,100,152
Other real estate owned		—		—		688,091		688,091
Total	$	—	$	—	$	4,788,243	$	4,788,243

For assets measured at fair value on a nonrecurring basis during 2011 that were still held in the balance sheet at December 31, 2011, the following table provides the hierarchy level and the fair value of the related assets:

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Totals
Impaired loans	$	—	$	—	$	505,585	$	505,585
Other real estate owned		—		—		3,056,902		3,056,902
Total	$	—	$	—	$	3,562,487	$	3,562,487

Impaired loans with a carrying value of $4,828,328 and $682,517 had an allocated allowance for loan losses of $728,176 and $176,932 at June 30, 2012 and December 31, 2011, respectively. The allocated allowance is based on the carrying value of the impaired loan and the fair value of the underlying collateral less estimated costs to sell.

Other real estate owned (“OREO”) acquired during the six-month period ended June 30, 2012, and recorded at fair value, less costs to sell, was $827,891, of which $139,800 was acquired and sold during this period. There have been no writedowns during the period on OREO previously acquired and still held. OREO acquired during 2011 and recorded at fair value, less costs to sell, was $2,503,659. Additional writedowns during 2011 on OREO acquired in previous years was $216,000 on 10 properties valued at $553,243.

The financial instruments topic of the ASC requires disclosure of financial instruments’ fair values, as well as the methodology and significant assumptions used in estimating fair values. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument. The financial instruments topic of the ASC excludes certain financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Corporation and may not be indicative of amounts that might ultimately be realized upon disposition or settlement of those assets and liabilities.

The following represents the carrying value and estimated fair value of the Corporation’s financial instruments at June 30, 2012, and December 31, 2011:

	June 30, 2012				December 31, 2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets
Cash and due from banks	$	44,363,414	$	44,363,414	$	35,407,715	$	35,407,715
Interest bearing deposits with banks		67,957,333		67,957,333		3,990,521		3,990,521
Securities available-for-sale		299,928,467		299,928,467		374,507,805		374,507,805
Net loans		377,012,459		376,439,588		382,580,529		382,174,094
Financial liabilities
Deposits	$	591,571,885	$	591,904,539	$	572,338,135	$	572,388,706
Federal Home Loan Bank advances		78,500,000		81,527,818		68,500,000		71,950,022
Securities Sold under agreement to repurchase		79,103,790		79,103,790		120,220,433		120,220,433

The fair value estimates, methods and assumptions used by the Corporation in estimating its fair value disclosures for financial statements were as follows:

Cash and Due from Banks and Interest Bearing Deposits with Banks

The carrying amounts reported in the balance sheet for these instruments approximate fair value because of their immediate and shorter-term maturities, which are considered to be three months or less when purchased.

Securities Available-for-Sale

Fair values for investment securities are based on quoted market prices, when available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments. When neither quoted prices nor comparable instruments are available, unobservable inputs are needed to form an expected future cash flow analysis to establish fair values. Level 2 securities include debt securities such as obligations of United States government agencies and corporations, mortgage-backed securities and state, county and municipal bonds. Level 3 securities consist of a pooled trust preferred security.

Net Loans

For variable-rate loans that reprice frequently and with no significant change in credit risk, fair values are based on carrying values. The fair values for other loans (i.e., commercial real estate and rental property mortgage loans, commercial and industrial loans, financial institution loans, and agricultural loans) are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality.

Deposits

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

Securities Sold Under Agreement to Repurchase

Due to the short term nature of these instruments, which is considered to be three months or less, the carrying amount is equal to the fair value.

Federal Home Loan Bank (FHLB) Borrowings

The fair value of FHLB advances is based on discounted cash flow analysis.

Off-Balance Sheet Instruments

The fair value of commitments to extend credit and letters of credit are estimated using fees currently charged to enter into similar agreements. The fees associated with these financial instruments are not material.

CITIZENS HOLDING COMPANY

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Stock Option Plan (Tables)

6 Months Ended

Jun. 30, 2012

Assumptions Used in Estimating Fair Value of Options Granted to Directors

The following assumptions were used in estimating the fair value of the options granted to the directors in the second quarter of 2012:

Assumption	Directors
Dividend Yield		4.70	%
Risk-Free Interest Rate		0.78	%
Expected Life		8.2 years
Expected Volatility		78.29	%
Calculated Value per Option	$	8.88
Forfeitures		0.00	%

Summary of Stock Option Activity

The following table below is a summary of the stock option activity for the six months ended June 30, 2012.

	Directors’ Plan					Employees’ Plan
				Weighted					Weighted
	Number			Average		Number			Average
	of			Exercise		of			Exercise
	Shares			Price		Shares			Price
Outstanding at December 31, 2011		102,000		$	21.00		135,500		$	19.96
Granted		13,500			18.76		—			—
Exercised		(3,000	)		15.00		(14,500	)		14.65
Expired		(1,500	)		15.00		(13,000	)		18.09
Outstanding at June 30, 2012		111,000		$	20.97		108,000		$	20.90

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Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Detail) (USD $)	6 Months Ended
	Jun. 30, 2012
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance at January 1, 2012	$ 2,029,295
Unrealized gains included in other comprehensive income	717,506
Balance at June 30, 2012	$ 2,746,801

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Stock Option Plan - Additional Information (Detail) (USD $)	6 Months Ended
	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of options granted	$ 167,160
Directors Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted	13,500
Option exercise price	$ 18.76
Option exercise price, start date	Oct. 26, 2012
Option exercise price, end date	Apr. 25, 2022
Cost of options granted	$ 119,834
Stock option expense recognition per month	19,972
Stock option expense, requisite service period	6 months
Stock option, deferred tax	44,698
Deferred tax amortization per month	$ 7,450
Deferred tax, requisite service period	6 months
Intrinsic value of options granted	$ 60,000
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of options granted	$ 107,160

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Age Analysis of Past Due Loans, Segregated by Class of Loans (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	$ 15,586	$ 13,991
Loans 90 or more Days Past Due	2,141	6,752
Total Past Due Loans	17,727	20,743
Current Loans	366,772	368,723
Total Gross Loans	384,499	389,466
Accruing Loans 90 or more Days Past Due	552	269
Real Estate Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	13,464	11,806
Loans 90 or more Days Past Due	2,083	6,378
Total Past Due Loans	15,547	18,184
Current Loans	288,180	294,582
Total Gross Loans	303,727	312,766
Accruing Loans 90 or more Days Past Due	536	228
Real Estate Loans | Land Development and Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	176	30
Loans 90 or more Days Past Due		562
Total Past Due Loans	176	592
Current Loans	11,218	12,888
Total Gross Loans	11,394	13,480
Accruing Loans 90 or more Days Past Due		39
Real Estate Loans | Farmland
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	786	1,061
Loans 90 or more Days Past Due		139
Total Past Due Loans	786	1,200
Current Loans	33,418	34,712
Total Gross Loans	34,204	35,912
Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	5,620	5,774
Loans 90 or more Days Past Due	994	822
Total Past Due Loans	6,614	6,596
Current Loans	115,505	127,391
Total Gross Loans	122,119	133,987
Accruing Loans 90 or more Days Past Due	536	80
Real Estate Loans | Commercial Real Estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	6,882	4,941
Loans 90 or more Days Past Due	1,089	4,855
Total Past Due Loans	7,971	9,796
Current Loans	128,039	119,591
Total Gross Loans	136,010	129,387
Accruing Loans 90 or more Days Past Due		109
Business Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	720	307
Loans 90 or more Days Past Due	19	105
Total Past Due Loans	739	412
Current Loans	47,899	37,748
Total Gross Loans	48,638	38,160
Business Loans | Commercial and Industrial Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	704	294
Loans 90 or more Days Past Due	19	99
Total Past Due Loans	723	393
Current Loans	46,378	36,188
Total Gross Loans	47,101	36,581
Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	16	13
Loans 90 or more Days Past Due		6
Total Past Due Loans	16	19
Current Loans	1,521	1,560
Total Gross Loans	1,537	1,579
Consumer Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	1,402	1,878
Loans 90 or more Days Past Due	39	269
Total Past Due Loans	1,441	2,147
Current Loans	30,693	36,393
Total Gross Loans	32,134	38,540
Accruing Loans 90 or more Days Past Due	16	41
Consumer Loans | Credit Cards
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	16	20
Loans 90 or more Days Past Due	13	17
Total Past Due Loans	29	37
Current Loans	942	958
Total Gross Loans	971	995
Accruing Loans 90 or more Days Past Due	13	17
Consumer Loans | Other Consumer Loans
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30-89 Days Past Due	1,386	1,858
Loans 90 or more Days Past Due	26	252
Total Past Due Loans	1,412	2,110
Current Loans	29,751	35,435
Total Gross Loans	31,163	37,545
Accruing Loans 90 or more Days Past Due	$ 3	$ 24

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Net income	$ 1,751,598	$ 1,854,272	$ 3,414,764	$ 3,809,158
Other comprehensive income
Unrealized holding gains	4,631,065	5,816,380	1,190,231	8,351,093
Income tax effect	(1,727,387)	(2,169,510)	(443,956)	(3,114,958)
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax, Total	2,903,678	3,646,870	746,275	5,236,135
Reclassification adjustment for gains included in net income	(9,061)	(5,357)	(37,753)	(5,789)
Income tax effect	3,380	1,998	14,082	2,159
Other Comprehensive Income (Loss), Reclassification Adjustment for Sale of Securities Included in Net Income, Net of Tax, Total	(5,681)	(3,359)	(23,671)	(3,630)
Total other comprehensive income	2,897,997	3,643,511	722,604	5,232,505
Comprehensive income	$ 4,649,595	$ 5,497,783	$ 4,137,368	$ 9,041,663

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Stock Option Plan

6 Months Ended

Jun. 30, 2012

Stock Option Plan

Note 4. Stock Option Plan

At June 30, 2012, the Corporation had one stock-based compensation plan, which is the 1999 Directors’ Stock Compensation Plan (the “Directors’ Plan”). Prior to its expiration, the Corporation also had the 1999 Employees’ Long-Term Incentive Plan, or the Employees’ Plan.

On April 25, 2012, the non-management members of the Board of Directors were granted a total of 13,500 options as specified in the Directors’ Plan. These options were granted at an exercise price of $18.76 per option, which was the closing price of Citizens Holding Company stock on that day. These options are first exercisable on October 26, 2012, and must be exercised no later than April 25, 2022.

The fair value of each option granted is estimated on the date of the grant using the Black-Scholes option-pricing model. The following assumptions were used in estimating the fair value of the options granted to the directors in the second quarter of 2012:

Assumption	Directors
Dividend Yield		4.70	%
Risk-Free Interest Rate		0.78	%
Expected Life		8.2 years
Expected Volatility		78.29	%
Calculated Value per Option	$	8.88
Forfeitures		0.00	%

Using the Black-Scholes option-pricing model with the foregoing assumptions, it was determined that the cost of options granted under the Directors’ Plan on April 25, 2012 was $119,834 and should be recognized as an expense of $19,972 per month over the six-month requisite service period, beginning on April 25, 2012. This was recorded as salary expense with a credit to paid-in capital. A deferred tax on these options was recorded in the aggregate amount of $44,698, or $7,450 per month, over the six-month requisite service period, beginning on April 25, 2012.

The following table below is a summary of the stock option activity for the six months ended June 30, 2012.

	Directors’ Plan					Employees’ Plan
				Weighted					Weighted
	Number			Average		Number			Average
	of			Exercise		of			Exercise
	Shares			Price		Shares			Price
Outstanding at December 31, 2011		102,000		$	21.00		135,500		$	19.96
Granted		13,500			18.76		—			—
Exercised		(3,000	)		15.00		(14,500	)		14.65
Expired		(1,500	)		15.00		(13,000	)		18.09
Outstanding at June 30, 2012		111,000		$	20.97		108,000		$	20.90

The intrinsic value of options granted under the Directors’ Plan at June 30, 2012, was $60,000 and the intrinsic value of options granted under the Employees’ Plan at June 30, 2012, was $107,160 for a total intrinsic value at June 30, 2012, of $167,160.

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Impaired Loans, by Class of Loans (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	$ 10,732	$ 11,399
Recorded Investment With No Allowance	3,763	8,437
Recorded Investment With Allowance	6,969	2,962
Total Recorded Investment	10,732	11,399
Related Allowance	1,605	1,167
Average Recorded Investment	11,048	11,500
Real Estate Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	10,223	10,659
Recorded Investment With No Allowance	3,358	7,823
Recorded Investment With Allowance	6,865	2,836
Total Recorded Investment	10,223	10,659
Related Allowance	1,548	1,110
Average Recorded Investment	10,487	10,300
Real Estate Loans | Land Development and Construction
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	252	1,134
Recorded Investment With No Allowance	120	992
Recorded Investment With Allowance	132	142
Total Recorded Investment	252	1,134
Related Allowance	117	134
Average Recorded Investment	479	883
Real Estate Loans | Farmland
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	469	641
Recorded Investment With No Allowance	324	492
Recorded Investment With Allowance	145	149
Total Recorded Investment	469	641
Related Allowance	24	24
Average Recorded Investment	557	588
Real Estate Loans | 1-4 Family Mortgages
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	2,251	2,066
Recorded Investment With No Allowance	1,482	1,297
Recorded Investment With Allowance	769	769
Total Recorded Investment	2,251	2,066
Related Allowance	202	216
Average Recorded Investment	2,419	1,933
Real Estate Loans | Commercial Real Estate
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	7,251	6,818
Recorded Investment With No Allowance	1,432	5,042
Recorded Investment With Allowance	5,819	1,776
Total Recorded Investment	7,251	6,818
Related Allowance	1,205	736
Average Recorded Investment	7,032	6,896
Business Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	228	305
Recorded Investment With No Allowance	124	184
Recorded Investment With Allowance	104	121
Total Recorded Investment	228	305
Related Allowance	57	57
Average Recorded Investment	254	879
Business Loans | Commercial and Industrial Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	218	284
Recorded Investment With No Allowance	114	163
Recorded Investment With Allowance	104	121
Total Recorded Investment	218	284
Related Allowance	57	57
Average Recorded Investment	241	860
Business Loans | Farm Production and Other Farm Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	10	21
Recorded Investment With No Allowance	10	21
Total Recorded Investment	10	21
Average Recorded Investment	13	19
Consumer Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	281	435
Recorded Investment With No Allowance	281	430
Recorded Investment With Allowance		5
Total Recorded Investment	281	435
Average Recorded Investment	307	321
Consumer Loans | Other Consumer Loans
Financing Receivable, Impaired [Line Items]
Unpaid Principal Balance	281	435
Recorded Investment With No Allowance	281	430
Recorded Investment With Allowance		5
Total Recorded Investment	281	435
Average Recorded Investment	$ 307	$ 321

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Earnings Per Share (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Schedule of Earnings Per Share, Basic and Diluted, by Common Class [Line Items]
Basic weighted average shares outstanding	4,859,125	4,841,438	4,854,145	4,840,770
Dilutive effect of granted options	6,881	12,799	8,654	9,056
Diluted weighted average shares outstanding	4,866,006	4,854,237	4,862,799	4,849,826
Net income	$ 1,751,598	$ 1,854,272	$ 3,414,764	$ 3,809,158
Net income per share-basic	$ 0.36	$ 0.38	$ 0.70	$ 0.79
Net income per share-diluted	$ 0.36	$ 0.38	$ 0.70	$ 0.79