(17)	Supplemental Compensation Plans

EXECUTIVE SALARY CONTINUATION PLAN

Pension Benefit Plans

The Company and the Bank maintain an unfunded non-contributory defined benefit pension plan (“Salary Continuation Plan”) and related split dollar plan for a select group of highly compensated employees. The plan provides defined annual benefit levels between $50 and $125 depending on responsibilities at the Bank. The retirement benefits are paid for 10 years following retirement at age 65. Reduced retirement benefits are available after age 55 and 10 years of service.

Eligibility to participate in the Salary Continuation Plan is limited to a select group of management or highly compensated employees of the Bank that are designated by the Board.

Additionally, the Company and the Bank adopted a supplemental executive retirement plan (“SERP”) in 2006. The SERP is intended to integrate the various forms of retirement payments offered to executives. There are currently three participants in the SERP.

The SERP benefit is calculated using 3-year average salary plus 7-year average bonus (average compensation). For each year of service, the benefit formula credits 2% to 2.5% of average compensation up to a cumulative maximum of 50%. Therefore, for an executive serving 20 to 25 years, the target benefit is 50% of average compensation.

The target benefit is reduced for other forms of retirement income provided by the Bank. Reductions are made for 50% of the social security benefit expected at age 65 and for the accumulated value of contributions the Bank makes to the executive’s profit sharing plan. For purposes of this reduction, contributions to the profit sharing plan are accumulated each year at a 3-year average of the yields on 10-year Treasury securities. Retirement benefits are paid monthly for 120 months, plus 6 months for each full year of service over 10 years, up to a maximum of 180 months.

Reduced benefits are payable for retirement prior to age 65. Should retirement occur prior to age 65, the benefit determined by the formula described above is reduced 5% for each year payments commence prior to age 65. Therefore, the new SERP benefit is reduced 50% for retirement at age 55. No benefit is payable for voluntary terminations prior to age 55.

The Bank uses a December 31 measurement date for these plans.

	For the Year Ended December 31,
	2019			2018			2017
Change in benefit obligation
Benefit obligation at beginning of year	$	5,322		$	5,419		$	4,523
Service cost		213			174			99
Interest cost		221			185			171
Plan loss (gain)		387			(184	)		948
Benefits Paid		(272	)		(272	)		(322	)
Benefit obligation at end of year	$	5,871		$	5,322		$	5,419

Change in plan assets
Employer Contribution	$	272		$	272		$	322
Benefits Paid		(272	)		(272	)		(322	)
Fair value of plan assets at end of year	$	—		$	—		$	—

Reconciliation of funded status
Funded status	$	(5,871	)	$	(5,322	)	$	(5,419	)
Unrecognized net plan loss		1,943			1,643			1,929
Unrecognized prior service cost		37			39			40
Net amount recognized	$	(3,891	)	$	(3,640	)	$	(3,450	)

Amounts recognized in the consolidated balance sheets consist of:
Accrued benefit liability	$	(5,871	)	$	(5,322	)	$	(5,419	)
Accumulated other comprehensive loss		1,980			1,682			1,969
Net amount recognized	$	(3,891	)	$	(3,640	)	$	(3,450	)

The Company expects to recognize approximately $117 of the unrecognized net actuarial loss and prior service cost as a component of net periodic benefit cost in 2020.

	For the Year Ended December 31,
	2019		2018			2017
Components of net periodic benefit cost
Service cost	$	213	$	174		$	99
Interest cost		221		185			171
Amortization of prior service cost		2		2			61
Recognized actuarial loss		87		101			58
Net periodic benefit cost		523		462			389

Additional Information
Minimum benefit obligation at year end	$	5,871	$	5,322		$	5,419
Increase (decrease) in minimum liability included in other comprehensive income (loss)	$	298	$	(287	)	$	827

Assumptions used to determine benefit obligations at December 31	2019			2018			2017
Discount rate used to determine net periodic benefit cost for years ended December 31		4.10	%		3.40	%		3.80	%

Discount rate used to determine benefit obligations at December 31		3.00	%		4.10	%		3.40	%

Future salary increases		5.70	%		5.70	%		5.20	%

Plan Assets

The Bank informally funds the liabilities of the Salary Continuation Plan through life insurance purchased on the lives of plan participants. This informal funding does not meet the definition of “plan assets” under pension accounting standards. Therefore, assets held for this purpose are not disclosed as part of the Salary Continuation Plan.

Cash Flows

Contributions and Estimated Benefit Payments

For unfunded plans, contributions to the Salary Continuation Plan are the benefit payments made to participants. The Bank paid $272 in benefit payments during fiscal 2019. The following benefit payments, which reflect expected future service, are expected to be paid in future fiscal years:

Year ending December 31,	Pension Benefits
2020	$	272
2021		276
2022		332
2023		332
2024		332
2025 to 2029		1,716

Disclosure of settlements and curtailments:

There were no events during fiscal 2019 that would constitute a curtailment or settlement.

DIRECTORS’ RETIREMENT PLAN

Pension Benefit Plans

On July 19, 2001, the Company and the Bank approved an unfunded non-contributory defined benefit pension plan (“Directors’ Retirement Plan”) and related split dollar plan for the directors of the Bank. The plan provides a retirement benefit equal to $1 per year of service as a director, up to a maximum benefit amount of $15. The retirement benefit is payable for ten years following retirement at age 65. Reduced retirement benefits are available after age 55 and ten years of service.

The Bank uses a December 31 measurement date for the Directors’ Retirement Plan.

	For the Year Ended December 31,
	2019			2018			2017
Change in benefit obligation
Benefit obligation at beginning of year	$	787		$	856		$	830
Service cost		2			12			11
Interest cost		28			25			27
Plan loss (gain)		63			(37	)		18
Benefits paid		(60	)		(69	)		(30	)
Benefit obligation at end of year	$	820		$	787		$	856

Change in plan assets
Employer contribution	$	60		$	69		$	30
Benefits paid		(60	)		(69	)		(30	)
Fair value of plan assets at end of year	$	—		$	—		$	—

Reconciliation of funded status
Funded status	$	(820	)	$	(787	)	$	(856	)
Unrecognized net plan gain		22			(40	)		(4	)
Net amount recognized	$	(798	)	$	(827	)	$	(860	)

Amounts recognized in the statement of financial position consist of:
Accrued benefit liability	$	(820	)	$	(787	)	$	(856	)
Accumulated other comprehensive loss (income)		22			(40	)		(4	)
Net amount recognized	$	(798	)	$	(827	)	$	(860	)

	For the Year Ended December 31,
	2019		2018			2017
Components of net periodic benefit cost
Service cost	$	2	$	12		$	11
Interest cost		28		25			27
Recognized actuarial gain		—		—			—
Net periodic benefit cost		30		37			38

Additional Information
Minimum benefit obligation at year end	$	820	$	787		$	856
Increase (decrease) in minimum liability included in other comprehensive income (loss)	$	62	$	(36	)	$	18

Assumptions used to determine benefit obligations at December 31	2019			2018			2017
Discount rate used to determine net periodic benefit cost for years ended December 31		3.70	%		3.00	%		3.30	%

Discount rate used to determine benefit obligations at December 31		2.40	%		3.70	%		3.00	%

Plan Assets

The Bank informally funds the liabilities of the Directors’ Retirement Plan through life insurance purchased on the lives of plan participants. This informal funding does not meet the definition of “plan assets” under pension accounting standards. Therefore, assets held for this purpose are not disclosed as part of the Directors’ Retirement Plan.

Cash Flows

Contributions and Estimated Benefit Payments

For unfunded plans, contributions to the Directors’ Retirement Plan are the benefit payments made to participants. The Bank paid $60 in benefit payments during fiscal 2019. The following benefit payments, which reflect expected future service, are expected to be paid in future fiscal years:

Year ending December 31,	Pension Benefits
2020	$	60
2021		75
2022		76
2023		75
2024		75
2025 to 2029		359

Disclosure of settlements and curtailments:

There were no events during fiscal 2019 that would constitute a curtailment or settlement.

EXECUTIVE ELECTIVE DEFERRED COMPENSATION PLAN — 2001 EXECUTIVE DEFERRAL PLAN

On July 19, 2001, the Bank approved a revised Executive Elective Deferred Compensation Plan (“2001 Executive Deferral Plan”) for certain officers to provide them the ability to make elective deferrals of compensation due to tax law limitations on benefit levels under qualified plans. Deferred amounts earn interest at an annual rate determined by the Bank’s Board. The plan is a non-qualified plan funded with Bank owned life insurance policies taken on the lives of the participating officers. During the year ended December 31, 2001, the Bank purchased insurance making a single-premium payment aggregating $1,125, which is reported in other assets on the Consolidated Balance Sheets. The Bank is the beneficiary and owner of the policies. The cash surrender value of the related insurance policies as of December 31, 2019 and 2018 totaled $2,614 and $2,548, respectively. The increase in accrued liability for the 2001 Executive Deferral Plan totaled $12 during each of the years ended December 31, 2019 and 2018. The expenses for the 2001 Executive Deferral Plan for the years ended December 31, 2019, 2018, and 2017 totaled $12, $12, and $14, respectively.

DIRECTOR ELECTIVE DEFERRED FEE PLAN — 2001 DIRECTOR DEFERRAL PLAN

On July 19, 2001, the Bank approved a Director Elective Deferred Fee Plan (“2001 Director Deferral Plan”) for directors to provide them the ability to make elective deferrals of director's fees. Deferred amounts earn interest at an annual rate determined by the Bank’s Board. The plan is a non-qualified plan funded with Bank owned life insurance policies taken on the lives of the participating directors. The Bank is the beneficiary and owner of the policies. The cash surrender value of the related insurance policies as of December 31, 2019 and 2018 totaled $144 and $140, respectively. The increase in accrued liability for the 2001 Director Deferral Plan totaled $1 during each of the years ended December 31, 2019 and 2018. The expenses for the 2001 Director Deferral Plan totaled $1 for each of the years ended December 31, 2019, 2018, and 2017.