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 March 31, 2017

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 0-33203

LANDMARK BANCORP, INC.

(Exact name of registrant as specified in its charter)

Delaware	43-1930755
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

701 Poyntz Avenue, Manhattan, Kansas       66502

(Address of principal executive offices)       (Zip code)

(785) 565-2000

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

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

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock as of the latest practicable date: as of May 4, 2017, the issuer had outstanding 3,869,922 shares of its common stock, $0.01 par value per share.

LANDMARK BANCORP, INC.

Form 10-Q Quarterly Report

Table of Contents

		Page Number
	PART I
Item 1.	Financial Statements	2 - 25
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	26 – 33
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	33 – 34
Item 4.	Controls and Procedures	35
	PART II
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Mine Safety Disclosures	36
Item 5.	Other Information	36
Item 6.	Exhibits	36
	Signature Page	37

1

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share amounts)	March 31,			December 31,
	2017			2016
	(Unaudited)
Assets
Cash and cash equivalents	$	20,062		$	19,996
Investment securities available-for-sale, at fair value		396,920			385,563
Bank stocks, at cost		5,323			5,299
Loans, net of allowance for loans losses of $5,327 at March 31, 2017 and $5,344 at December 31, 2016		417,955			420,461
Loans held for sale, at fair value		8,588			5,517
Premises and equipment, net		20,156			20,407
Bank owned life insurance		18,431			18,314
Goodwill		17,532			17,532
Other intangible assets, net		3,849			3,986
Real estate owned, net		1,003			1,279
Accrued interest and other assets		13,198			13,028
Total assets	$	923,017		$	911,382
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Non-interest-bearing demand	$	167,590		$	152,012
Money market and checking		352,608			361,398
Savings		93,291			88,273
Time		139,197			139,838
Total deposits		752,686			741,521
Federal Home Loan Bank borrowings		33,450			39,100
Subordinated debentures		21,334			21,284
Other borrowings		13,491			12,483
Accrued interest, taxes, and other liabilities		15,387			12,043
Total liabilities		836,348			826,431
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value per share, 200,000 shares authorized; none issued		-			-
Common stock, $0.01 par value per share, 7,500,000 shares authorized; 3,869,922 and 3,868,077 shares issued at March 31, 2017 and December 31, 2016, respectively		39			38
Additional paid-in capital		52,025			51,968
Retained earnings		35,724			34,293
Accumulated other comprehensive loss		(1,119	)		(1,348	)
Total stockholders’ equity		86,669			84,951
Total liabilities and stockholders’ equity	$	923,017		$	911,382

See accompanying notes to consolidated financial statements.

2

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

	Three months ended
(Dollars in thousands, except per share amounts)	March 31,
	2017		2016
Interest income:
Loans:
Taxable	$	5,019	$	5,136
Tax-exempt		35		66
Investment securities:
Taxable		1,192		1,163
Tax-exempt		942		809
Total interest income		7,188		7,174
Interest expense:
Deposits		338		277
Borrowings		482		493
Total interest expense		820		770
Net interest income		6,368		6,404
Provision for loan losses		50		50
Net interest income after provision for loan losses		6,318		6,354
Non-interest income:
Fees and service charges		1,715		1,729
Gains on sales of loans, net		1,389		1,794
Bank owned life insurance		117		120
Gains on sales of investment securities, net		147		12
Other		273		239
Total non-interest income		3,641		3,894
Non-interest expense:
Compensation and benefits		3,757		3,801
Occupancy and equipment		1,024		1,056
Data processing		330		311
Amortization of intangibles		298		337
Professional fees		290		219
Advertising		166		166
Federal deposit insurance premiums		72		110
Foreclosure and real estate owned expense		52		65
Other		1,072		1,097
Total non-interest expense		7,061		7,162
Earnings before income taxes		2,898		3,086
Income tax expense (1)		693		693
Net earnings (1)	$	2,205	$	2,393
Earnings per share:
Basic (2)	$	0.57	$	0.64
Diluted (1)(2)	$	0.56	$	0.63
Dividends per share (2)	$	0.20	$	0.19

(1) Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

(2) Per share amounts for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

See accompanying notes to consolidated financial statements.

3

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three months ended
(Dollars in thousands)	March 31,
	2017			2016
Net earnings (1)	$	2,205		$	2,393
Net unrealized holding gains on available-for-sale securities		522			3,390
Less reclassification adjustment for net gains included in earnings		(147	)		(12	)
Net unrealized gains		375			3,378
Income tax effect on net gains included in earnings		54			4
Income tax effect on net unrealized holding gains		(200	)		(1,257	)
Other comprehensive income		229			2,125
Total comprehensive income	$	2,434		$	4,518

(1) Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

See accompanying notes to consolidated financial statements.

4

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands, except per share amounts)	Common stock		Additional paid-in capital		Retained earnings			Accumulated other comprehensive income (loss)			Total
Balance at January 1, 2016	$	35	$	45,372	$	32,988		$	2,175		$	80,570
Net earnings (1)		-		-		2,393			-			2,393
Other comprehensive income		-		-		-			2,125			2,125
Dividends paid ($0.19 per share)		-		-		(713	)		-			(713	)
Exercise of stock options, 49,790 shares(1)		1		824		-			-			825
Balance at March 31, 2016	$	36	$	46,196	$	34,668		$	4,300		$	85,200
Balance at January 1, 2017	$	38	$	51,968	$	34,293		$	(1,348	)	$	84,951
Net earnings		-		-		2,205			-			2,205
Other comprehensive income		-		-		-			229			229
Dividends paid ($0.20 per share)		-		-		(774	)		-			(774	)
Stock-based compensation		-		35		-			-			35
Exercise of stock options, 1,845 shares,		1		22		-			-			23
Balance at March 31, 2017	$	39	$	52,025	$	35,724		$	(1,119	)	$	86,669

(1) Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

See accompanying notes to consolidated financial statements.

5

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three months ended
(Dollars in thousands)	March 31,
	2017			2016
Cash flows from operating activities:
Net earnings (1)	$	2,205		$	2,393
Adjustments to reconcile net earnings to net cash provided by operating activities:
Provision for loan losses		50			50
Valuation allowance on real estate owned		33			-
Amortization of investment security premiums, net		468			382
Amortization of purchase accounting adjustment on loans		(19	)		(2	)
Amortization of purchase accounting adjustment on subordinated debentures		50			50
Amortization of intangibles		298			337
Depreciation		263			292
Increase in cash surrender value of bank owned life insurance		(117	)		(120	)
Stock-based compensation		35			-
Deferred income taxes		60			91
Net gains on sales of investment securities		(147	)		(12	)
Net losses on sales of foreclosed assets		15			60
Net gains on sales of loans		(1,389	)		(1,794	)
Proceeds from sales of loans		31,153			56,631
Origination of loans held for sale		(32,835	)		(53,795	)
Changes in assets and liabilities:
Accrued interest and other assets		(520	)		(1,423	)
Accrued expenses, taxes, and other liabilities		(99	)		(2,088	)
Net cash (used in) provided by operating activities		(496	)		1,052
Cash flows from investing activities:
Net decrease in loans		2,452			9
Maturities and prepayments of investment securities		11,069			10,790
Purchases of investment securities		(30,726	)		(22,634	)
Proceeds from sales of investment securities		11,797			1,817
Redemption of bank stocks		1,802			1,161
Purchase of bank stocks		(1,826	)		(801	)
Proceeds from sales of foreclosed assets		233			630
Purchases of premises and equipment, net		(12	)		(178	)
Net cash used in investing activities		(5,211	)		(9,206	)
Cash flows from financing activities:
Net increase (decrease) in deposits		11,166			(6,333	)
Federal Home Loan Bank advance borrowings		148,857			46,717
Federal Home Loan Bank advance repayments		(154,507	)		(37,206	)
Proceeds from other borrowings		1,008			1,148
Proceeds from exercise of stock options (1)		23			825
Payment of dividends		(774	)		(713	)
Net cash provided by financing activities		5,773			4,438
Net increase (decrease) in cash and cash equivalents		66			(3,716	)
Cash and cash equivalents at beginning of period		19,996			13,569
Cash and cash equivalents at end of period	$	20,062		$	9,853

(Continued)

6

LANDMARK BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED

(Unaudited)

	Three months ended
(Dollars in thousands)	March 31,
	2017			2016
Supplemental disclosure of cash flow information:
Cash payments for income taxes	$	-		$	500
Cash paid for interest		786			738
Supplemental schedule of noncash investing and financing activities:
Transfer of loans to real estate owned		5			-
Investment securities purchases not yet settled		(3,443	)		(7,160	)

(1) Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

See accompanying notes to consolidated financial statements.

7

LANDMARK BANCORP, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Interim Financial Statements

The unaudited consolidated financial statements of Landmark Bancorp, Inc. (the “Company”) and its subsidiary, Landmark National Bank (the “Bank”) have been prepared in accordance with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements and should be read in conjunction with the Company’s most recent Annual Report on Form 10-K, containing the latest audited consolidated financial statements and notes thereto. The consolidated financial statements in this report have not been audited by an independent registered public accounting firm, but in the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of financial statements have been reflected herein. The results of the three month interim period ended March 31, 2017 are not necessarily indicative of the results expected for the year ending December 31, 2017 or any other future time period. The Company has evaluated subsequent events for recognition and disclosure up to the date the financial statements were issued.

2. Investments

A summary of investment securities available-for-sale is as follows:

	As of March 31, 2017
			Gross		Gross
	Amortized		unrealized		unrealized			Estimated
(Dollars in thousands)	cost		gains		losses			fair value
U. S. treasury securities	$	4,990	$	8	$	-		$	4,998
U. S. federal agency obligations		21,419		44		(40	)		21,423
Municipal obligations, tax exempt		176,646		893		(2,389	)		175,150
Municipal obligations, taxable		67,954		468		(257	)		68,165
Agency mortgage-backed securities		118,606		158		(1,067	)		117,697
Certificates of deposit		8,724		-		-			8,724
Common stocks		376		387		-			763
Total	$	398,715	$	1,958	$	(3,753	)	$	396,920

	As of December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized			Estimated
(Dollars in thousands)	cost		gains		losses			fair value
U. S. treasury securities	$	6,005	$	10	$	-		$	6,015
U. S. federal agency obligations		27,140		48		(49	)		27,139
Municipal obligations, tax exempt		163,632		696		(2,666	)		161,662
Municipal obligations, taxable		71,371		463		(271	)		71,563
Agency mortgage-backed securities		109,427		171		(1,222	)		108,376
Certificates of deposit		9,700		-		-			9,700
Common stocks		458		650		-			1,108
Total	$	387,733	$	2,038	$	(4,208	)	$	385,563

8

The tables above show that some of the securities in the available-for-sale investment portfolio had unrealized losses, or were temporarily impaired, as of March 31, 2017 and December 31, 2016. This temporary impairment represents the estimated amount of loss that would be realized if the securities were sold on the valuation date. Securities which were temporarily impaired are shown below, along with the length of time in a continuous unrealized loss position.

			As of March 31, 2017
(Dollars in thousands)			Less than 12 months					12 months or longer				Total
	No. of		Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
	securities		value		losses			value		losses		value		losses
U.S. federal agency obligations		9	$	11,841	$	(40	)	$	-	$	-	$	11,841	$	(40	)
Municipal obligations, tax exempt		237		95,197		(2,389	)		-		-		95,197		(2,389	)
Municipal obligations, taxable		66		27,071		(257	)		-		-		27,071		(257	)
Agency mortgage-backed securities		47		82,491		(1,067	)		-		-		82,491		(1,067	)
Total		359	$	216,600	$	(3,753	)	$	-	$	-	$	216,600	$	(3,753	)

			As of December 31, 2016
(Dollars in thousands)			Less than 12 months					12 months or longer				Total
	No. of		Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
	securities		value		losses			value		losses		value		losses
U. S. federal agency obligations		9		15,056		(49	)		-		-		15,056	$	(49	)
Municipal obligations, tax exempt		275		97,842		(2,666	)		-		-		97,842	$	(2,666	)
Municipal obligations, taxable		66		26,184		(271	)		-		-		26,184	$	(271	)
Agency mortgage-backed securities		58		83,011		(1,222	)		-		-		83,011	$	(1,222	)
Total		408	$	222,093	$	(4,208	)	$	-	$	-	$	222,093	$	(4,208	)

The Company’s U.S. federal agency portfolio consists of securities issued by the government-sponsored agencies of Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Federal Home Loan Bank (“FHLB”). The receipt of principal and interest on U.S. federal agency obligations is guaranteed by the respective government-sponsored agency guarantor, such that the Company believes that its U.S. federal agency obligations do not expose the Company to credit-related losses. Based on these factors, along with the Company’s intent to not sell the securities and its belief that it was more likely than not that the Company will not be required to sell the securities before recovery of their cost basis, the Company believed that the U.S. federal agency obligations identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

The Company’s portfolio of municipal obligations consists of both tax-exempt and taxable general obligations securities issued by various municipalities. As of March 31, 2017, the Company did not intend to sell and it is more likely than not that the Company will not be required to sell its municipal obligations in an unrealized loss position until the recovery of its cost. Due to the issuers’ continued satisfaction of the securities’ obligations in accordance with their contractual terms and the expectation that they will continue to do so, the evaluation of the fundamentals of the issuers’ financial condition and other objective evidence, the Company believed that the municipal obligations identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

The Company’s agency mortgage-backed securities portfolio consists of securities underwritten to the standards of and guaranteed by the government-sponsored agencies of FHLMC, FNMA and the Government National Mortgage Association. The receipt of principal, at par, and interest on agency mortgage-backed securities is guaranteed by the respective government-sponsored agency guarantor, such that the Company believed that its agency mortgage-backed securities did not expose the Company to credit-related losses. Based on these factors, along with the Company’s intent to not sell the securities and the Company’s belief that it was more likely than not that the Company will not be required to sell the securities before recovery of their cost basis, the Company believed that the agency mortgage-backed securities identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

9

The table below sets forth amortized cost and fair value of investment securities at March 31, 2017. The table includes scheduled principal payments and estimated prepayments, based on observable market inputs, for agency mortgage-backed securities. Actual maturities will differ from contractual maturities because borrowers have the right to prepay obligations with or without prepayment penalties. Securities with no maturity are listed separately.

(Dollars in thousands)	Amortized		Estimated
	cost		fair value
Due in less than one year	$	29,722	$	29,755
Due after one year but within five years		199,365		198,758
Due after five years but within ten years		83,169		82,960
Due after ten years		86,083		84,684
Common stocks		376		763
Total	$	398,715	$	396,920

Sales proceeds and gross realized gains and losses on sales of available-for-sale securities are as follows for the periods indicated:

(Dollars in thousands)	Three months ended March 31,
	2017			2016
Sales proceeds	$	11,797		$	1,817
Realized gains	$	171		$	16
Realized losses		(24	)		(4	)
Net realized gains	$	147		$	12

Securities with carrying values of $217.5 million and $224.3 million were pledged to secure public funds on deposit, repurchase agreements and as collateral for borrowings at March 31, 2017 and December 31, 2016, respectively. Except for U.S. federal agency obligations, no investment in a single issuer exceeded 10% of consolidated stockholders’ equity.

3. Loans and Allowance for Loan Losses

Loans consisted of the following as of the dates indicated below:

	March 31,			December 31,
(Dollars in thousands)	2017			2016
One-to-four family residential real estate	$	137,301		$	136,846
Construction and land		16,329			13,738
Commercial real estate		114,759			118,200
Commercial		54,102			54,506
Agriculture		76,124			78,324
Municipal		3,706			3,884
Consumer		21,088			20,271
Total gross loans		423,409			425,769
Net deferred loan costs and loans in process		(127	)		36
Allowance for loan losses		(5,327	)		(5,344	)
Loans, net	$	417,955		$	420,461

10

The following tables provide information on the Company’s allowance for loan losses by loan class and allowance methodology:

	Three months ended March 31, 2017
(Dollars in thousands)	One-to-four family residential real estate			Construction and land		Commercial real estate			Commercial			Agriculture		Municipal			Consumer			Total
Allowance for loan losses:
Balance at January 1, 2017	$	504		$	53	$	1,777		$	1,119		$	1,684	$	12		$	195		$	5,344
Charge-offs		(19	)		-		-			-			-		-			(107	)		(126	)
Recoveries		1			-		-			8			1		-			49			59
Provision for loan losses		7			18		(37	)		(26	)		46		(1	)		43			50
Balance at March 31, 2017		493			71		1,740			1,101			1,731		11			180			5,327

	Three months ended March 31, 2016
(Dollars in thousands)	One-to-four family residential real estate			Construction and land		Commercial real estate		Commercial			Agriculture		Municipal		Consumer			Total
Allowance for loan losses:
Balance at January 1, 2016	$	925		$	77	$	1,740	$	1,530		$	1,428	$	23	$	199		$	5,922
Charge-offs		-			-		-		-			-		-		(137	)		(137	)
Recoveries		2			-		-		19			-		-		13			34
Provision for loan losses		(63	)		5		91		(165	)		55		1		126			50
Balance at March 31, 2016		864			82		1,831		1,384			1,483		24		201			5,869

	As of March 31, 2017
(Dollars in thousands)	One-to-four family residential real estate		Construction and land		Commercial real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		106		70		132		-		-		308
Collectively evaluated for loss		493		71		1,634		1,031		1,599		11		180		5,019
Total		493		71		1,740		1,101		1,731		11		180		5,327
Loan balances:
Individually evaluated for loss		665		1,851		2,437		320		983		221		39		6,516
Collectively evaluated for loss		136,636		14,478		112,322		53,782		75,141		3,485		21,049		416,893
Total	$	137,301	$	16,329	$	114,759	$	54,102	$	76,124	$	3,706	$	21,088	$	423,409

	As of December 31, 2016
(Dollars in thousands)	One-to-four family residential real estate		Construction and land		Commercial real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		81		87		89		-		17		274
Collectively evaluated for loss		504		53		1,696		1,032		1,595		12		178		5,070
Total		504		53		1,777		1,119		1,684		12		195		5,344
Loan balances:
Individually evaluated for loss		780		1,937		2,445		355		881		258		72		6,728
Collectively evaluated for loss		136,066		11,801		115,755		54,151		77,443		3,626		20,199		419,041
Total	$	136,846	$	13,738	$	118,200	$	54,506	$	78,324	$	3,884	$	20,271	$	425,769

11

The Company recorded net loan charge-offs of $67,000 during the first quarter of 2017 compared to net loan charge-offs of $103,000 during the first quarter of 2016.

The Company’s impaired loans decreased from $6.7 million at December 31, 2016 to $6.5 million at March 31, 2017. The difference between the unpaid contractual principal and the impaired loan balance is a result of charge-offs recorded against impaired loans. The difference in the Company’s non-accrual loan balances and impaired loan balances at March 31, 2017 and December 31, 2016, was related to troubled debt restructurings (“TDR”) that are current and accruing interest, but still classified as impaired. Interest income recognized on a cash basis was immaterial during the three months ended March 31, 2017 and 2016. The following tables present information on impaired loans:

(Dollars in thousands)	As of March 31, 2017
	Unpaid contractual principal		Impaired loan balance		Impaired loans without an allowance		Impaired loans with an allowance		Related allowance recorded		Year-to- date average loan balance		Year-to- date interest income recognized
One-to-four family residential real estate	$	665	$	665	$	665	$	-	$	-	$	669	$	2
Construction and land		3,586		1,851		1,851		-		-		1,899		16
Commercial real estate		2,437		2,437		2,151		286		106		2,449		124
Commercial		320		320		29		291		70		332		-
Agriculture		1,198		983		102		881		132		996		1
Municipal		221		221		221		-		-		251		2
Consumer		39		39		39		-		-		39		-
Total impaired loans	$	8,466	$	6,516	$	5,058	$	1,458	$	308	$	6,635	$	145

(Dollars in thousands)	As of December 31, 2016
	Unpaid contractual principal		Impaired loan balance		Impaired loans without an allowance		Impaired loans with an allowance		Related allowance recorded		Year-to- date average loan balance		Year-to- date interest income recognized
One-to-four family residential real estate	$	780	$	780	$	780	$	-	$	-	$	798	$	7
Construction and land		3,672		1,937		1,937		-		-		2,068		72
Commercial real estate		2,445		2,445		2,145		300		81		2,587		505
Commercial		355		355		46		309		87		425		2
Agriculture		1,173		881		147		734		89		1,000		2
Municipal		258		258		258		-		-		418		-
Consumer		72		72		55		17		17		78		13
Total impaired loans	$	8,755	$	6,728	$	5,368	$	1,360	$	274	$	7,374	$	601

12

The Company’s key credit quality indicator is a loan’s performance status, defined as accruing or non-accruing. Performing loans are considered to have a lower risk of loss. Non-accrual loans are those which the Company believes have a higher risk of loss. The accrual of interest on non-performing loans is discontinued at the time the loan is ninety days delinquent, unless the credit is well secured and in process of collection. Loans are placed on non-accrual or are charged off at an earlier date if collection of principal or interest is considered doubtful. There were no loans ninety days delinquent and accruing interest at March 31, 2017 or December 31, 2016. The following tables present information on the Company’s past due and non-accrual loans by loan class:

(Dollars in thousands)	As of March 31, 2017
	30-59 days delinquent and accruing			60-89 days delinquent and accruing			90 days or more delinquent and accruing			Total past due loans accruing			Non-accrual loans			Total past due and non- accrual loans			Total loans not past due
One-to-four family residential real estate		334			92			-			426		$	484		$	910		$	136,391
Construction and land		-			-			-			-			595			595			15,734
Commercial real estate		260			69			-			329			286			615			114,144
Commercial		160			13			-			173			316			489			53,613
Agriculture		58			328			-			386			940			1,326			74,798
Municipal		-			-			-			-			-			-			3,706
Consumer		40			18			-			58			39			97			20,991
Total	$	852		$	520		$	-		$	1,372		$	2,660		$	4,032		$	419,377
Percent of gross loans		0.20	%		0.12	%		0.00	%		0.32	%		0.63	%		0.95	%		99.05	%

(Dollars in thousands)	As of December 31, 2016
	30-59 days delinquent and accruing			60-89 days delinquent and accruing			90 days or more delinquent and accruing			Total past due loans accruing			Non-accrual loans			Total past due and non- accrual loans			Total loans not past due
One-to-four family residential real estate	$	215		$	388		$	-		$	603		$	595		$	1,198		$	135,648
Construction and land		-			-			-			-			599			599			13,139
Commercial real estate		-			-			-			-			300			300			117,900
Commercial		13			5			-			18			342			360			54,146
Agriculture		55			-			-			55			838			893			77,431
Municipal		-			-			-			-			-			-			3,884
Consumer		79			3			-			82			72			154			20,117
Total	$	362		$	396		$	-		$	758		$	2,746		$	3,504		$	422,265
Percent of gross loans		0.09	%		0.09	%		0.00	%		0.18	%		0.64	%		0.82	%		99.18	%

Under the original terms of the Company’s non-accrual loans, interest earned on such loans for the three months ended March 31, 2017 and 2016 would have increased interest income by $31,000 and $33,000, respectively. No interest income related to non-accrual loans was included in interest income for the three months ended March 31, 2017 and 2016.

The Company also categorizes loans into risk categories based on relevant information about the ability of the borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis. Nonclassified loans generally include those loans that are expected to be repaid in accordance with contractual loan terms. Classified loans are those that are assigned a special mention, substandard or doubtful risk rating using the following definitions:

Special Mention: Loans are currently protected by the current net worth and paying capacity of the obligor or of the collateral pledged but such protection is potentially weak. These loans constitute an undue and unwarranted credit risk, but not to the point of justifying a classification of substandard. The credit risk may be relatively minor, yet constitutes an unwarranted risk in light of the circumstances surrounding a specific asset.

Substandard: Loans are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged. Loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Loans are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

13

Doubtful: Loans classified doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

The following table provides information on the Company’s risk categories by loan class:

	As of March 31, 2017				As of December 31, 2016
(Dollars in thousands)	Nonclassified		Classified		Nonclassified		Classified
One-to-four family residential real estate	$	136,143	$	1,158	$	135,640	$	1,206
Construction and land		15,734		595		13,138		600
Commercial real estate		108,527		6,232		111,641		6,559
Commercial		50,614		3,488		51,080		3,426
Agriculture		71,377		4,747		73,564		4,760
Municipal		3,706		-		3,884		-
Consumer		21,037		51		20,181		90
Total	$	407,138	$	16,271	$	409,128	$	16,641

At March 31, 2017, the Company had twelve loan relationships consisting of eighteen outstanding loans that were classified as TDRs. During the first three months of 2017, the Company classified a $11,000 commercial real estate loan as a TDR after extending the maturity of the loan and classified as a TDR a $15,000 agriculture loan extended to an existing loan relationship that was classified as a TDR in 2016. Since the loans were adequately secured, no charge-offs or impairments were recorded against the principal as of March 31, 2017. During the first quarter of 2016, a $44,000 agriculture loan relationship consisting of two loans was classified as a TDR after extending the maturity of the loans.

The Company evaluates each TDR individually and returns the loan to accrual status when a payment history is established after the restructuring and future payments are reasonably assured. There were no loans modified as TDRs for which there was a payment default within 12 months of modification as of March 31, 2017 and 2016. At March 31, 2017, there was a commitment of $84,000 to lend additional funds on one construction and land loan classified as a TDR. The Company did not record any charge-offs against loans classified as TDRs in the first quarter either of 2017 or 2016. A credit provision for loan losses of $13,000 related to TDRs was recorded in the three months ended March 31, 2017 compared to no provision in the same period of 2016. The Company had $67,000 and $80,000 allowance for loan losses recorded against loans classified as TDRs at March 31, 2017 and December 31, 2016, respectively.

The following table presents information on loans that are classified as TDRs:

(Dollars in thousands)
	As of March 31, 2017						As of December 31, 2016
	Number of loans		Non-accrual balance		Accruing balance		Number of loans		Non-accrual balance		Accruing balance
One-to-four family residential real estate		2	$	-	$	181		2	$	-	$	185
Construction and land		4		583		1,256		4		588		1,338
Commercial real estate		4		50		2,151		3		64		2,145
Commercial		1		-		3		2		-		13
Agriculture		5		268		44		4		268		44
Municipal		2		-		221		2		-		258
Total troubled debt restructurings		18	$	901	$	3,856		17	$	920	$	3,983

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4. Goodwill and Other Intangible Assets

The Company tests goodwill for impairment annually or more frequently if circumstances warrant. The Company’s annual step one impairment test as of December 31, 2016 concluded that its goodwill was not impaired. The Company concluded there were no triggering events during the first three months of 2017 that required an interim goodwill impairment test.

Lease intangible assets are amortized over the life of the lease. Core deposit intangible assets are amortized over the estimated useful life of ten years on an accelerated basis. Mortgage servicing rights are amortized over the estimated life of the mortgage loan serviced for others. A summary of the other intangible assets that continue to be subject to amortization is as follows:

(Dollars in thousands)	As of March 31, 2017
	Gross carrying amount		Accumulated amortization			Net carrying amount
Core deposit intangible assets	$	2,067	$	(1,201	)	$	866
Lease intangible asset		350		(154	)		196
Mortgage servicing rights		5,873		(3,086	)		2,787
Total other intangible assets	$	8,290	$	(4,441	)	$	3,849

(Dollars in thousands)	As of December 31, 2016
	Gross carrying amount		Accumulated amortization			Net carrying amount
Core deposit intangible assets	$	2,067	$	(1,137	)	$	930
Lease intangible asset		350		(143	)		207
Mortgage servicing rights		5,788		(2,939	)		2,849
Total other intangible assets	$	8,205	$	(4,219	)	$	3,986

The following sets forth estimated amortization expense for core deposit and lease intangible assets for the remainder of 2017 and in successive years ending December 31:

(Dollars in thousands)	Amortization
	expense
Remainder of 2017	$	214
2018		252
2019		214
2020		177
2021		121
Thereafter		84
Total	$	1,062

Mortgage loans serviced for others are not reported as assets. The following table provides information on the principal balances of mortgage loans serviced for others:

(Dollars in thousands)	March 31,		December 31,
	2017		2016
FHLMC	$	487,990	$	483,356
FHLB		10,851		11,393
Total	$	498,841	$	494,749

Custodial escrow balances maintained in connection with serviced loans were $7.2 million and $4.1 million at March 31, 2017 and December 31, 2016, respectively. Gross service fee income related to such loans was $319,000 and $300,000 for the three months ended March 31, 2017 and 2016, respectively, and is included in fees and service charges in the consolidated statements of earnings.

15

Activity for mortgage servicing rights is as follows:

	Three months ended
(Dollars in thousands)	March 31,
	2017			2016
Mortgage servicing rights:
Balance at beginning of period	$	2,849		$	2,840
Additions		161			221
Amortization		(223	)		(253	)
Balance at end of period	$	2,787		$	2,808

The fair value of mortgage servicing rights was $5.4 million and $5.1 million at March 31, 2017 and December 31, 2016, respectively. Fair value at March 31, 2017 was determined using discount rates ranging from 9.50% to 9.51%; prepayment speeds ranging from 4.39% to 33.19%, depending on the stratification of the specific mortgage servicing right; and a weighted average default rate of 2.24%. Fair value at December 31, 2016 was determined using discount rates ranging from 9.50% to 9.51%, prepayment speeds ranging from 4.86% to 32.79%, depending on the stratification of the specific mortgage servicing right, and a weighted average default rate of 2.26%.

The Company had a mortgage repurchase reserve of $301,000 at both March 31, 2017 and December 31, 2016, which represents the Company’s best estimate of probable losses that the Company will incur related to the repurchase of one-to-four family residential real estate loans previously sold or to reimburse investors for credit losses incurred on loans previously sold where a breach of the contractual representations and warranties occurred. The Company did not incur any losses charged against the reserve or make any provisions to the reserve during the first three months of 2017 and 2016. The Company recovered $7,000 of losses against the mortgage repurchase reserve during three months ended March 31, 2016. As of March 31, 2017, the Company had one outstanding mortgage repurchase request and expects to incur a loss of approximately $70,000.

5. Earnings per Share

Basic earnings per share have been computed based upon the weighted average number of common shares outstanding during each period. Diluted earnings per share include the effect of all potential common shares outstanding during each period. The diluted earnings per share computations for the three months ended March 31, 2017 and 2016 include all unexercised stock options because no stock options were anti-dilutive as of such dates. The shares used in the calculation of basic and diluted earnings per share are shown below:

	Three months ended
(Dollars in thousands, except per share amounts)	March 31,
	2017		2016
Net earnings (1)	$	2,205	$	2,393
Weighted average common shares outstanding - basic (2)		3,869,799		3,734,638
Assumed exercise of stock options (1)(2)		79,149		100,200
Weighted average common shares outstanding - diluted (1)(2)		3,948,948		3,834,838
Net earnings per share (1)(2):
Basic	$	0.57	$	0.64
Diluted	$	0.56	$	0.63

(1) Net earnings, diluted earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

(2) Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

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6. Repurchase Agreements

The Company has overnight repurchase agreements with certain deposit customers whereby the Company uses investment securities as collateral for non-insured funds. These balances are accounted for as collateralized financing and included in other borrowings on the balance sheet. The following is a summary of the balances and collateral of the Company’s repurchase agreements:

	As of March 31, 2017
	Overnight and						Greater
	Continuous		Up to 30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	2,564	$	-	$	-	$	-	$	2,564
Agency mortgage-backed securities		10,927		-		-		-		10,927
Total	$	13,491	$	-	$	-	$	-	$	13,491

	As of December 31, 2016
	Overnight and		Up to				Greater
	Continuous		30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	5,007	$	-	$	-	$	-	$	5,007
Agency mortgage-backed securities		7,476		-		-		-		7,476
Total	$	12,483	$	-	$	-	$	-	$	12,483

Repurchase agreements are comprised of non-insured customer funds, totaling $13.5 million at March 31, 2017 and $12.5 million at December 31, 2016, which were secured by $19.7 million and $15.7 million of the Company’s investment portfolio at the same dates, respectively.

The investment securities are held by a third party financial institution in the customer’s custodial account. The Company is required to maintain adequate collateral for each repurchase agreement. Changes in the fair value of the investment securities impact the amount of collateral required. If the Company were to default, the investment securities would be used to settle the repurchase agreement with the deposit customer.

7. Fair Value of Financial Instruments and Fair Value Measurements

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

17

Fair value estimates of the Company’s financial instruments as of March 31, 2017 and December 31, 2016, including methods and assumptions utilized, are set forth below:

(Dollars in thousands)	As of March 31, 2017
	Carrying
	amount			Level 1			Level 2			Level 3		Total
Financial assets:
Cash and cash equivalents	$	20,062		$	20,062		$	-		$	-	$	20,062
Investment securities available-for-sale		396,920			5,761			391,159			-		396,920
Bank stocks, at cost		5,323			n/a			n/a			n/a		n/a
Loans, net		417,955			-			-			416,130		416,130
Loans held for sale		8,588			-			8,588			-		8,588
Derivative financial instruments		966			-			966			-		966
Accrued interest receivable		3,874			16			2,067			1,791		3,874
Financial liabilities:
Non-maturity deposits	$	(613,489	)	$	(613,489	)	$	-		$	-		(613,489	)
Time deposits		(139,197	)		-			(137,820	)		-		(137,820	)
FHLB borrowings		(33,450	)		-			(33,967	)		-		(33,967	)
Subordinated debentures		(21,334	)		-			(18,731	)		-		(18,731	)
Other borrowings		(13,491	)		-			(13,491	)		-		(13,491	)
Derivative financial instruments		(154	)		-			(154	)		-		(154	)
Accrued interest payable		(253	)		-			(253	)		-		(253	)

	As of December 31, 2016
	Carrying
	amount			Level 1			Level 2			Level 3		Total
Financial assets:
Cash and cash equivalents	$	19,996		$	19,996		$	-		$	-	$	19,996
Investment securities available-for-sale		385,563			7,123			378,440			-		385,563
Bank stocks, at cost		5,299			n/a			n/a			n/a		n/a
Loans, net		420,461			-			-			417,957		417,957
Loans held for sales		5,517			-			5,517			-		5,517
Derivative financial instruments		662			-			662			-		662
Accrued interest receivable		4,240			21			2,104			2,115		4,240
Financial liabilities:
Non-maturity deposits	$	(601,683	)	$	(601,683	)	$	-		$	-		(601,683	)
Time deposits		(139,838	)		-			(138,623	)		-		(138,623	)
FHLB borrowings		(39,100	)		-			(35,695	)		-		(35,695	)
Subordinated debentures		(21,284	)		-			(18,608	)		-		(18,608	)
Other borrowings		(12,483	)		-			(12,483	)		-		(12,483	)
Accrued interest payable		(268	)		-			(268	)		-		(268	)

Methods and Assumptions Utilized

The carrying amount of cash and cash equivalents is considered to approximate fair value.

The Company’s investment securities classified as available-for-sale include U.S. treasury securities, U.S. federal agency securities, municipal obligations, agency mortgage-backed securities, certificates of deposits and common stocks. Quoted exchange prices are available for the Company’s U.S treasury securities and common stock investments, which are classified as Level 1. U.S. federal agency securities and agency mortgage-backed obligations are priced utilizing industry-standard models that consider various assumptions, including time value, yield curves, volatility factors, prepayment speeds, default rates, loss severity, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace. These measurements are classified as Level 2. Municipal securities are valued using a type of matrix, or grid, pricing in which securities are benchmarked against U.S. treasury rates based on credit rating. These model and matrix measurements are classified as Level 2 in the fair value hierarchy.

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It is not practical to determine the fair value of bank stocks due to restrictions placed on the transferability of FHLB and Federal Reserve Bank stock.

The estimated fair value of the Company’s loan portfolio is based on the segregation of loans by collateral type, interest terms, and maturities. The fair value is estimated based on discounting scheduled and estimated cash flows through maturity using an appropriate risk-adjusted yield curve to approximate current interest rates for each category. No adjustment was made to the interest rates for changes in credit risk of performing loans where there are no known credit concerns. Management segregates loans in appropriate risk categories. Management believes that the risk factor embedded in the interest rates along with the allowance for loan losses applicable to the performing loan portfolio results in a fair valuation of such loans. The fair values of impaired loans are generally based on market prices for similar assets determined through independent appraisals or discounted values of independent appraisals and brokers’ opinions of value. This method of estimating fair value does not incorporate the exit-price concept of fair value prescribed by ASC Topic 820 and is classified as Level 3.

Mortgage loans originated and intended for sale in the secondary market are carried at fair value. The mortgage loan valuations are based on quoted secondary market prices for similar loans and are classified as Level 2.

The carrying amount of accrued interest receivable and payable are considered to approximate fair value.

The estimated fair value of deposits with no stated maturity, such as non-interest-bearing demand deposits, savings, money market accounts, and checking accounts, is equal to the amount payable on demand. The fair value of interest-bearing time deposits is based on the discounted value of contractual cash flows of such deposits. The discount rate is tied to the FHLB yield curve plus an appropriate servicing spread. Fair value measurements based on discounted cash flows are classified as Level 2. These fair values do not incorporate the value of core deposit intangibles which may be associated with the deposit base.

The fair value of advances from the FHLB, subordinated debentures, and other borrowings is estimated using current yield curves for similar borrowings adjusted for the Company’s current credit spread and classified as Level 2.

The Company’s derivative financial instruments consist of interest rate lock commitments and corresponding forward sales contracts on mortgage loans held for sale. The fair values of these derivatives are based on quoted prices for similar loans in the secondary market. The market prices are adjusted by a factor, based on the Company’s historical data and its judgment about future economic trends, which considers the likelihood that a commitment will ultimately result in a closed loan. These instruments are classified as Level 2. The amounts are included in other assets or other liabilities on the consolidated balance sheets and gains on sale of loans, net in the consolidated statements of earnings.

Off-Balance-Sheet Financial Instruments

The fair value of letters of credit and commitments to extend credit is based on the fees currently charged to enter into similar agreements. The aggregate amount of these fees is not material.

Transfers

The Company did not transfer any assets or liabilities among levels during the three months ended March 31, 2017 or during the year ended December 31, 2016.

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Valuation Methods for Instruments Measured at Fair Value on a Recurring Basis

The following tables represent the Company’s financial instruments that are measured at fair value on a recurring basis at March 31, 2017 and December 31, 2016, allocated to the appropriate fair value hierarchy:

(Dollars in thousands)				As of March 31, 2017
				Fair value hierarchy
	Total			Level 1		Level 2			Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	4,998		$	4,998	$	-		$	-
U. S. federal agency obligations		21,423			-		21,423			-
Municipal obligations, tax exempt		175,150			-		175,150			-
Municipal obligations, taxable		68,165			-		68,165			-
Mortgage-backed securities		117,697			-		117,697			-
Common stocks		763			763		-			-
Certificates of deposit		8,724			-		8,724			-
Loans held for sale		8,588			-		8,588			-
Derivative financial instruments		966			-		966			-
Liabililty:
Derivative financial instruments		(154	)		-		(154	)		-

(Dollars in thousands)			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	6,015	$	6,015	$	-	$	-
U. S. federal agency obligations		27,139		-		27,139		-
Municipal obligations, tax exempt		161,662		-		161,662		-
Municipal obligations, taxable		71,563		-		71,563		-
Agency mortgage-backed securities		108,376		-		108,376		-
Common stocks		1,108		1,108		-		-
Certificates of deposit		9,700		-		9,700		-
Loans held for sale		5,517		-		5,517		-
Derivative financial instruments		662		-		662		-

Changes in the fair value of available-for-sale securities are included in other comprehensive income to the extent the changes are not considered other-than-temporary impairments. Other-than-temporary impairment tests are performed on a quarterly basis and any decline in the fair value of an individual security below its cost that is deemed to be other-than-temporary results in a write-down of that security’s cost basis.

The aggregate fair value, contractual balance (including accrued interest), and gain on loans held for sale were as follows:

	As of		As of
	March 31,		December 31,
(Dollars in thousands)	2017		2016
Aggregate fair value	$	8,588	$	5,517
Contractual balance		8,443		5,480
Gain	$	145	$	37

20

The total amount of gains from changes in fair value of loans held for sale included in earnings were as follows:

	Three months ended
	March 31,
(Dollars in thousands)	2017		2016
Interest income	$	45	$	105
Change in fair value		109		79
Total change in fair value	$	154	$	184

Valuation Methods for Instruments Measured at Fair Value on a Nonrecurring Basis

The Company does not value its loan portfolio at fair value. Collateral-dependent impaired loans are generally carried at the lower of cost or fair value of the collateral, less estimated selling costs. Collateral values are determined based on appraisals performed by qualified licensed appraisers hired by the Company and then further adjusted if warranted based on relevant facts and circumstances. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Impaired loans are reviewed and evaluated at least quarterly for additional impairment and adjusted accordingly, based on the same factors identified above. The carrying value of the Company’s impaired loans was $6.2 million and $6.5 million, with an allocated allowance of $308,000 and $274,000, at March 31, 2017 and December 31, 2016, respectively.

Real estate owned includes assets acquired through, or in lieu of, foreclosure and land previously acquired for expansion. Real estate owned is initially recorded at the fair value of the collateral less estimated selling costs. Subsequent valuations are updated periodically and are based upon independent appraisals, third party price opinions or internal pricing models. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Real estate owned is reviewed and evaluated at least annually for additional impairment and adjusted accordingly, based on the same factors identified above.

The following tables represent the Company’s financial instruments that are measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016 allocated to the appropriate fair value hierarchy:

(Dollars in thousands)
			As of March 31, 2017
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	180	$	-	$	-	$	180
Commercial		221		-		-	$	221
Agriculture		749		-		-	$	749
Real estate owned:
One-to-four family residential real estate		329		-		-		329

			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	219	$	-	$	-	$	219
Commercial		222		-		-		222
Agriculture		645		-		-		645
Real estate owned:
One-to-four family residential real estate		142		-		-		142

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The following table presents quantitative information about Level 3 fair value measurements measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016.

(Dollars in thousands)
	Fair value		Valuation technique	Unobservable inputs	Range
As of March 31, 2017
Impaired loans:
Commercial real estate	$	180	Sales comparison	Adjustment to appraised value		0%-60%
Commercial		221	Sales comparison	Adjustment to appraised value		0%-80%
Agriculture		749	Sales comparison	Adjustment to appraised value		8%-80%
Real estate owned:
One-to-four family residential real estate		329	Sales comparison	Adjustment to appraised value		10	%
As of December 31, 2016
Impaired loans:
Commercial real estate	$	219	Sales comparison	Adjustment to appraised value		2%-15%
Commercial		222	Sales comparison	Adjustment to comparable sales		7%-80%
Agriculture		645	Sales comparison	Adjustment to comparable sales		8%-80%
Real estate owned:
One-to-four family residential real estate		142	Sales comparison	Adjustment to appraised value		10	%

8. Regulatory Capital Requirements

Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. Management believed that as of March 31, 2017, the Company and the Bank met all capital adequacy requirements to which they were subject at that time.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. The Company and the Bank are subject to the capital rules (the “Basel III Rules”) that implemented the Basel III regulatory capital reforms from the Basel Committee on Banking Supervision and certain changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Basel III Rules are applicable to all U.S. banks that are subject to minimum capital requirements, as well as to bank and savings and loan holding companies other than “small bank holding companies” (generally, non-public bank holding companies with consolidated assets of less than $1.0 billion).

The Basel III Rules require a common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, a Tier 1 capital to risk-weighted assets minimum ratio of 6.0%, a Total Capital to risk-weighted assets minimum ratio of 8.0%, and a Tier 1 leverage minimum ratio of 4.0%. A capital conservation buffer, comprised of common equity Tier 1 capital, is also established above the regulatory minimum capital requirements. This capital conservation buffer began on January 1, 2016 at 0.625% of risk-weighted assets, was 1.25% effective on January 1, 2017, and will further increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. The capital conservation buffer increases the common equity Tier 1 capital ratio, Tier 1 capital and total risk based capital ratios as of March 31 of each year.

As of March 31, 2017 and December 31, 2016, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action then in effect. There are no conditions or events since that notification that management believes have changed the institution’s category.

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The following is a comparison of the Company’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

(Dollars in thousands)						For capital
	Actual					adequacy purposes
	Amount		Ratio			Amount		Ratio (1)
As of March 31, 2017
Leverage	$	90,260		10.05	%	$	35,914		4.0	%
Common Equity Tier 1 Capital		69,609		13.49	%		29,672		5.8	%
Tier 1 Capital		90,260		17.49	%		37,413		7.3	%
Total Risk Based Capital		95,901		18.58	%		47,733		9.3	%
As of December 31, 2016
Leverage	$	88,819		10.04	%	$	35,370		4.0	%
Common Equity Tier 1 Capital		68,263		13.32	%		26,265		5.1	%
Tier 1 Capital		88,819		17.33	%		33,952		6.6	%
Total Risk Based Capital		94,596		18.46	%		44,201		8.6	%

(1) The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

The following is a comparison of the Bank’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

											To be well-capitalized
											under prompt
(Dollars in thousands)						For capital					corrective
	Actual					adequacy purposes					action provisions
	Amount		Ratio			Amount		Ratio(1)			Amount		Ratio
As of March 31, 2017
Leverage	$	89,262		9.97	%	$	35,813		4.0	%	$	44,766		5.0	%
Common Equity Tier 1 Capital		89,262		17.35	%		29,583		5.8	%		33,442		6.5	%
Tier 1 Capital		89,262		17.35	%		37,301		7.3	%		41,159		8.0	%
Total Risk Based Capital		94,729		18.41	%		47,591		9.3	%		51,449		10.0	%
As of December 31, 2016
Leverage	$	88,076		9.98	%	$	35,284		4.0	%	$	44,105		5.0	%
Common Equity Tier 1 Capital		88,076		17.23	%		26,194		5.1	%		33,222		6.5	%
Tier 1 Capital		88,076		17.23	%		33,861		6.6	%		40,888		8.0	%
Total Risk Based Capital		93,560		18.31	%		44,083		8.6	%		51,110		10.0	%

(1) The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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9. Impact of Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The main provisions of the update require the identification of performance obligations within a contract and require the recognition of revenue based on a stand-alone allocation of contract revenue to each performance obligation. Performance obligations may be satisfied and revenue recognized over a period of time if: 1) the customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs, or 2) the entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced, or 3) the entity’s performance does not create an asset with an alternative use to the entity, and the entity has an enforceable right to payment for performance completed to date. For public entities the amendments of the update are effective for annual reporting periods beginning after December 15, 2017 including interim periods within that reporting periodThe Company’s revenue is primarily comprised of net interest income on financial asset and liabilities, which are excluded from the scope of ASU 2014-09. Management is still evaluating the impact of ASU 2014-09 on other non-interest income, but does not believe the adoption of ASU 2014-09 will have a material impact on the Company’s financial position, results of operations or cash flows.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities. The main provisions of the update are to eliminate the available for sale classification of accounting for equity securities and to adjust the fair value disclosures for financial instruments carried at amortized costs such that the disclosed fair values represent an exit price as opposed to an entry price. The provisions of this update will require that equity securities be carried at fair market value on the balance sheet and any periodic changes in value will be adjustments to the income statement. A practical expedient is provided for equity securities without a readily determinable fair value, such that these securities can be carried at cost less any impairment. The provisions of this update become effective for interim and annual periods beginning after December 15, 2017. Upon the effective date of the update, changes in the value of the Company's common stock investments will be adjustments to the income statement. Management has concluded that the remaining requirements of this update are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

In February 2016, the FASB issued an update (ASU No. 2016-02, Leases) creating FASB Topic 842, Leases. The guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and requiring more disclosures related to leasing transactions. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted. Management has concluded that based on the Company’s current operating leases, the adoption of ASU 2016-02 will not have a material impact on the Company’s consolidated financial statement and related disclosures.

In March 2016, the FASB issued an update, ASU No. 2016-09, Stock Compensation: Improvements to Employee Share-Based Payment Accounting. The guidance in this update affects any entity that issues share-based payment awards including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flow. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption was permitted. The Company elected to adopt ASU 2016-09 in 2016. As a result of this election, income tax expense decreased by $308,000 during 2016 as a result of recognized excess tax benefits from the exercise of stock options. The presentation of excess tax benefits from the exercise of stock options have been presented on a prospective basis and are included in changes in accrued interest and other assets in the operating activities section of the statement of cash flows. The Company’s excess tax benefits from the exercise of stock options totaled $12,000 in the first quarter of 2017 and $116,000 in the first quarter of 2016.

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In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), commonly referred to as “CECL.” The provisions of the update eliminate the probable initial recognition threshold under current GAAP which requires reserves to be based on an incurred loss methodology. Under CECL, reserves required for financial assets measured at amortized cost will reflect an organization’s estimate of all expected credit losses over the expected term of the financial asset and thereby require the use of reasonable and supportable forecasts to estimate future credit losses. Because CECL encompasses all financial assets carried at amortized cost, the requirement that reserves be established based on an organization’s reasonable and supportable estimate of expected credit losses extends to held to maturity debt securities. Under the provisions of the update, credit losses recognized on available for sale debt securities will be presented as an allowance as opposed to a write-down. In addition, CECL will modify the accounting for purchased loans, with credit deterioration since origination, so that reserves are established at the date of acquisition for purchased loans. Under current GAAP a purchased loan’s contractual balance is adjusted to fair value through a credit discount and no reserve is recorded on the purchased loan upon acquisition. Since under CECL reserves will be established for purchased loans at the time of acquisition, the accounting for purchased loans is made more comparable to the accounting for originated loans. Finally, increased disclosure requirements under CECL oblige organizations to present the currently required credit quality disclosures disaggregated by the year of origination or vintage. FASB expects that the evaluation of underwriting standards and credit quality trends by financial statement users will be enhanced with the additional vintage disclosures. For public entities, the amendments of the update are effective beginning January 1, 2020. Management has initiated an implementation committee to assist in assessing data and system needs for the new standard. Management anticipates the effect will be an increase to the allowance for loan losses upon adoption. However, the size of the overall increase is uncertain at this time.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Payments (a consensus of Emerging Issues Task Force). This ASU attempts to clarify how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The purpose of this update is to reduce existing diversity in practice in eight areas addressed by the update. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted. Management has concluded that the adoption of ASU 2016-15 will not have a material impact on the Company’s consolidated financial statements and related disclosures.

In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.  The amendments in this Update shorten the amortization period for certain callable debt securities held at a premium.  Specifically, the amendments require the premium to be amortized to the earliest call date.  The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity.  The provisions of this update become effective for interim and annual periods beginning after December 15, 2018.  Management has concluded that based on the Company’s current portfolio of investment securities that the adoption of these amendments will result in shorter amortization period for investment security premiums, which will initially result in lower interest income on investment securities.

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

Overview. Landmark Bancorp, Inc. is a one-bank holding company incorporated under the laws of the State of Delaware and is engaged in the banking business through its wholly-owned subsidiary, Landmark National Bank. References to the “Company,” “we,” “us,” and “our” refer collectively to Landmark Bancorp, Inc. and Landmark National Bank. The Company is listed on the Nasdaq Global Market under the symbol “LARK.” The Bank is dedicated to providing quality financial and banking services to its local communities. Our strategy includes continuing a tradition of holding and acquiring quality assets while growing our commercial, commercial real estate and agriculture loan portfolios. We are committed to developing relationships with our borrowers and providing a total banking service.

The Bank is principally engaged in the business of attracting deposits from the general public and using such deposits, together with borrowings and other funds, to originate one-to-four family residential real estate, construction and land, commercial real estate, commercial, agriculture, municipal and consumer loans. Although not our primary business function, we do invest in certain investment and mortgage-related securities using deposits and other borrowings as funding sources.

Our results of operations depend generally on net interest income, which is the difference between interest income from interest-earning assets and interest expense on interest-bearing liabilities. Net interest income is affected by regulatory, economic and competitive factors that influence interest rates, loan demand and deposit flows. In addition, we are subject to interest rate risk to the degree that our interest-earning assets mature or reprice at different times, or at different speeds, than our interest-bearing liabilities. Our results of operations are also affected by non-interest income, such as service charges, loan fees and gains from the sale of newly originated loans and gains or losses on investments. Our principal operating expenses, aside from interest expense, consist of compensation and employee benefits, occupancy costs, professional fees, federal deposit insurance costs, data processing expenses, amortization of intangibles, advertising expenses, foreclosure and real estate owned expense and provision for loan losses.

We are significantly impacted by prevailing economic conditions, including federal monetary and fiscal policies, and federal regulations of financial institutions. Deposit balances are influenced by numerous factors such as competing investments, the level of income and the personal rate of savings within our market areas. Factors influencing lending activities include the demand for housing and the interest rate pricing competition from other lending institutions.

Currently, our business consists of ownership of the Bank, with its main office in Manhattan, Kansas and twenty eight additional branch offices in central, eastern, southeast and southwest Kansas.

Critical Accounting Policies. Critical accounting policies are those which are both most important to the portrayal of our financial condition and results of operations and require our management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Our critical accounting policies relate to the allowance for loan losses, the valuation of investment securities, accounting for income taxes and the accounting for goodwill and other intangible assets, all of which involve significant judgment by our management. Information about our critical accounting policies is included under Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2016.

Summary of Results. During the first quarter of 2017, we recorded net earnings of $2.2 million, which was a decrease of $188,000 from the $2.4 million of net earnings in the first quarter of 2016.

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The following table summarizes earnings and key performance measures for the periods presented:

(Dollars in thousands, except per share amounts)	Three months ended March 31,
	2017			2016
Net earnings:
Net earnings (1)	$	2,205		$	2,393
Basic earnings per share (2)	$	0.57		$	0.64
Diluted earnings per share (1)(2)	$	0.56		$	0.63
Earnings ratios:
Return on average assets (1)(2)		0.98	%		1.10	%
Return on average equity (1)(2)		10.46	%		11.60	%
Equity to total assets		9.39	%		9.55	%
Net interest margin (3) (4)		3.38	%		3.47	%
Dividend payout ratio		35.71	%		32.26	%

(1) Net earnings, diluted earnings per share, return on average assets and return on average equity for the period ended March 31, 2016 have been recaset to reflect the early adoption of ASU 2016-09.

(2) Per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

(3) Ratios have been annualized and are not necessarily indicative of the results for the entire year.

(4) Net interest margin is presented on a fully tax equivalent basis, using a 34% federal tax rate.

Interest Income. Interest income of $7.2 million for the quarter ended March 31, 2017 was unchanged as compared to the same period of 2016. Interest income on loans decreased $148,000, or 2.8%, to $5.1 million for the quarter ended March 31, 2017, compared to the same period of 2016 due primarily to a decrease in our average loan balances, which decreased from $426.0 million in the first quarter of 2016 to $420.5 million in the first quarter of 2017. Also contributing to the decrease in interest income were lower yields on loans, which decreased from 4.94% in the first quarter of 2016 to 4.89% in the first quarter of 2017. Interest income on investment securities increased $162,000, or 8.2%, to $2.1 million for the first quarter of 2017, as compared to $2.0 million in the same period of 2016. The increase in interest income on investment securities was primarily the result of an increase in our average balance of investment securities from $359.1 million during the first quarter of 2016 to $393.5 million during the first quarter of 2017. Also contributing to the higher interest income on investment securities was an increase in our tax equivalent yield on investment securities, which increased from 2.65% in the first quarter of 2016 to 2.66% during the first quarter of 2017.

Interest Expense. Interest expense during the quarter ended March 31, 2017 increased $50,000, or 6.5%, to $820,000 as compared to the same period of 2016. Interest expense on interest-bearing deposits increased $61,000, or 22.2%, to $338,000 for the quarter ended March 31, 2017 as compared to the quarter ended March 31, 2016. The increase in interest expense on interest-bearing deposits was the result of deposits repricing higher and an increase in average interest-bearing deposit balances, which increased from $561.4 million in the first quarter of 2016 to $587.6 million in the first quarter of 2017. The average rate of interest-bearing deposits increased 0.03% for the first quarter of 2017 to 0.23% as compared to 0.20% in the same period of 2016. For the first quarter of 2017, interest expense on borrowings decreased $11,000, or 2.2%, to $482,000 as compared to the same period of 2016, due primarily to a decrease in our average outstanding borrowings, which decreased from $72.4 million in the first quarter of 2016 to $71.7 million in the same period of 2017. Also contributing to the lower interest expense on borrowings were lower average rates on our borrowings which decreased by 0.02% for the first quarter of 2017 compared to the same period of 2016.

Net Interest Income. Net interest income decreased $36,000, or 0.6%, to $6.4 million for the first quarter of 2017 compared to the same period of 2016. Our net interest margin, on a tax-equivalent basis, decreased from 3.47% during the first quarter of 2016 to 3.38% in the same period of 2017. Lower average balances of loans were the primary driver of the decrease in our net interest income. Our net interest income and net interest margin may continue to decline if short-term interest rates continue to increase and we are unable to reprice our loans higher while our cost of interest-bearing deposits and borrowings increase.

See the Average Assets/Liabilities and Rate/Volume tables at the end of Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional details on asset yields, liability rates and net interest margin.

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Provision for Loan Losses. We maintain, and our Board of Directors monitors, an allowance for losses on loans. The allowance is established based upon management's periodic evaluation of known and inherent risks in the loan portfolio, review of significant individual loans and collateral, review of delinquent loans, past loss experience, adverse situations that may affect the borrowers’ ability to repay, current and expected market conditions, and other factors management deems important. Determining the appropriate level of reserves involves a high degree of management judgment and is based upon historical and projected losses in the loan portfolio and the collateral value or discounted cash flows of specifically identified impaired loans. Additionally, allowance policies are subject to periodic review and revision in response to a number of factors, including current market conditions, actual loss experience and management’s expectations.

During the first quarter of both 2017 and 2016, we recorded a provision for loan losses of $50,000. We recorded net loan charge-offs of $67,000 during the first quarter of 2017 compared to $103,000 during the first quarter of 2016.

For further discussion of the allowance for loan losses, refer to the “Asset Quality and Distribution” section below.

Non-interest Income. Total non-interest income was $3.6 million in the first quarter of 2017, a decrease of $253,000, or 6.5%, compared to the same period of 2016. The decrease in non-interest income was primarily the result of a decline in our gains on sales of loans of $405,000 as a result of decreased volumes of one-to-four family residential real estate loans originated and sold during the first quarter of 2017 compared to the same period of 2016. Partially offsetting the decline in gains on sales of loans was a $147,000 gain on sales of investment securities during the first quarter of 2017, compared to a gain of $12,000 in the same period of 2016.

Non-interest Expense. Non-interest expense decreased $101,000, or 1.4%, to $7.1 million for the first quarter of 2017 compared to the same period of 2016. The decrease in non-interest expense was primarily the result of decreases of $44,000 in compensation and benefits expense, $39,000 in amortization of intangibles, $38,000 in federal deposit insurance premiums, $32,000 in occupancy and equipment expense and $25,000 in other non interest expense. These decreases were partially offset by increases of $71,000 in professional fees and $19,000 in data processing fees. The decrease in compensation and benefits expenses and other non-interest expense was primarily related to lower volumes of one-to-four family residential real estate loans originated for sale and the expenses related thereto during the first quarter of 2017 compared to the first quarter of 2016. The decrease in amortization of intangibles was primarily due to slower prepayment on our mortgage loans serviced for others, while the decline in FDIC insurance premiums was due to lower premiums starting in the 3^rd quarter of 2016. The increase in professional fees is due primarily to increased audit and compliance costs. The increase in data processing expense is due to adding additional services to our contract.

Income Tax Expense. During the first quarter of 2017, we recorded income tax expense of $693,000, compared to the same amount during the same period of 2016. The effective tax rate increased from 22.5% in the first quarter of 2016 to 23.9% in the first quarter of 2017 primarily as a result of a decrease in excess tax benefits from the exercise of stock options from $116,000 in the first quarter of 2016 to $12,000 in the same period of 2017. Income tax expense was recast for the first quarter of 2016 to reflect the early adoption of ASU 2016-09.

Financial Condition. Despite measured improvement in certain metrics, general uncertainty with respect to economic conditions in the United States continues to affect our asset quality and performance. The geographic markets in which the Company operates have also been impacted by an economic downturn in the agriculture sector. However, our loan portfolio is diversified across various types of loans and collateral throughout the markets in which we operate. Aside from a few problem loans that management is working to resolve, our asset quality has generally improved over the past few years. Aside from identified problem assets, management believes that the Company continues to have a high quality asset base and solid core earnings, and anticipates that its efforts to run a high quality financial institution with a sound asset base will continue to create a strong foundation for continued growth and profitability in the future.

Asset Quality and Distribution. Our primary investing activities are the origination of one-to-four family residential real estate, construction and land, commercial real estate, commercial, agriculture, municipal and consumer loans and the purchase of investment securities. Total assets increased to $923.0 million at March 31, 2017, compared to $911.4 million at December 31, 2016. The increase in our total assets was primarily the result of an increase in our investment securities, which increased from $385.6 million at December 31, 2016 to $396.9 million at March 31, 2017. Net loans, excluding loans held for sale, totaled $418.0 million at March 31, 2017 compared to $420.5 million at December 31, 2016.

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The allowance for loan losses is established through a provision for loan losses based on our evaluation of the risk inherent in the loan portfolio and changes in the nature and volume of our loan activity. This evaluation, which includes a review of all loans with respect to which full collectability may not be reasonably assured, considers the fair value of the underlying collateral, economic conditions, historical loan loss experience, level of classified loans and other factors that warrant recognition in providing for an appropriate allowance for loan losses. At March 31, 2017 and December 31, 2016, our allowance for loan losses totaled $5.3 million, or 1.26% of gross loans outstanding.

As of March 31, 2017 and December 31, 2016, approximately $16.3 million and $16.6 million, respectively, of loans were considered classified and assigned a risk rating of special mention, substandard or doubtful. These ratings indicate that these loans were identified as potential problem loans having more than normal risk which raised doubts as to the ability of the borrower to comply with present loan repayment terms. Even though borrowers were experiencing moderate cash flow problems as well as some deterioration in collateral value, management believed the general allowance was sufficient to cover the risks and probable incurred losses related to such loans at March 31, 2017 and December 31, 2016, respectively.

Loans past due 30-89 days and still accruing interest totaled $1.4 million, or 0.32% of gross loans, at March 31, 2017 compared to $758,000, or 0.18% of gross loans, at December 31, 2016. At March 31, 2017, $2.7 million in loans were on non-accrual status, or 0.63% of gross loans, compared to $2.7 million, or 0.64% of gross loans, at December 31, 2016. Non-accrual loans consist of loans 90 or more days past due and certain impaired loans. There were no loans 90 days delinquent and accruing interest at March 31, 2017 or December 31, 2016. Our impaired loans totaled $6.5 million at March 31, 2017 compared to $6.7 million at December 31, 2016. The difference in the Company’s non-accrual loan balances and impaired loan balances at March 31, 2017 was related to TDRs that were accruing interest but still classified as impaired.

At March 31, 2017, the Company had twelve loan relationships consisting of eighteen outstanding loans that were classified as TDRs. During the first three months of 2017, the Company classified a $11,000 commercial real estate loan as a TDR after extending the maturity of the loan and classified as a TDR a $15,000 agriculture loan extended to an existing loan relationship that was classified as a TDR in 2016. Since the loans were adequately secured, no charge-offs or impairments were recorded against the principal as of March 31, 2017. During the first quarter of 2016, a $44,000 agriculture loan relationship consisting of two loans was classified as a TDR after extending the maturity of the loans.

As part of our credit risk management, we continue to manage the loan portfolio to identify problem loans and have placed additional emphasis on commercial real estate and construction and land relationships. We are working to resolve the remaining problem credits or move the non-performing credits out of the loan portfolio. At March 31, 2017, we had $1.0 million of real estate owned compared to $1.3 million at December 31, 2016. As of March 31, 2017, real estate owned primarily consisted of a few residential real estate properties and one commercial property. The Company is currently marketing all of the remaining properties in real estate owned.

Liability Distribution. Our primary ongoing sources of funds are deposits, FHLB borrowings, proceeds from principal and interest payments on loans and investment securities and proceeds from the sale of mortgage loans and investment securities. While maturities and scheduled amortization of loans are a predictable source of funds, deposit flows and mortgage prepayments are greatly influenced by general interest rates and economic conditions. We experienced an increase of $11.2 million in total deposits during the first quarter of 2017, to $752.7 million at March 31, 2017, from $741.5 million at December 31, 2016. The increase in deposits was primarily due to increased balances in non-interest bearing and savings accounts. This increase was partially offset by lower balances of money market and checking and time deposit accounts.

Non-interest-bearing deposits at March 31, 2017, were $167.6 million, or 22.3% of deposits, compared to $152.0 million, or 20.5% of deposits, at December 31, 2016. Money market and checking deposit accounts were 46.9% of our deposit portfolio and totaled $352.6 million at March 31, 2017, compared to $361.4 million, or 48.7% of deposits, at December 31, 2016. Savings accounts increased to $93.3 million, or 12.4% of deposits, at March 31, 2017, from $88.3 million, or 11.9% of deposits, at December 31, 2016. Certificates of deposit totaled $139.2 million, or 18.4% of deposits, at March 31, 2017, compared to $139.8 million, or 18.9% of deposits, at December 31, 2016.

Certificates of deposit at March 31, 2017, scheduled to mature in one year or less, totaled $98.6 million. Historically, maturing deposits have generally remained with the Bank, and we believe that a significant portion of the deposits maturing in one year or less will remain with us upon maturity in some type of deposit account.

29

Total borrowings decreased $4.6 million to $68.3 million at March 31, 2017, from $72.9 million at December 31, 2016. The decrease in total borrowings was primarily due to a decrease in our FHLB borrowings from $39.1 million at December 31, 2016 to $33.5 million at March 31, 2017, which was primarily the result of a $5.0 million FHLB advance maturity in the period ending March 31, 2017.

Cash Flows. During the three months ended March 31, 2017, our cash and cash equivalents increased by $66,000. Our operating activities used net cash of $496,000 during the first three months of 2017, primarily as a result of funding loans held for sale. Our investing activities used net cash of $5.2 million during the first three months of 2017, primarily as a result of the purchase of investment securities. Financing activities provided net cash of $5.8 million during the first three months of 2017, primarily as a result of increased deposit balances.

Liquidity. Our most liquid assets are cash and cash equivalents and investment securities available for sale. The levels of these assets are dependent on the operating, financing, lending and investing activities during any given year. These liquid assets totaled $417.0 million at March 31, 2017 and $405.6 million at December 31, 2016. During periods in which we are not able to originate a sufficient amount of loans and/or periods of high principal prepayments, we generally increase our liquid assets by investing in short-term, high-grade investments.

Liquidity management is both a daily and long-term function of our strategy. Excess funds are generally invested in short-term investments. Excess funds are typically generated as a result of increased deposit balances, while uses of excess funds are generally deposit withdrawals and loan advances. In the event we require funds beyond our ability to generate them internally, additional funds are generally available through the use of FHLB advances, a line of credit with the FHLB, other borrowings or through sales of investment securities. At March 31, 2017, we had outstanding FHLB advances of $30.0 million and $3.5 million of borrowings against our line of credit with the FHLB. At March 31, 2017, we had collateral pledged to the FHLB that would allow us to borrow an additional $62.0 million, subject to FHLB credit requirements and policies. At March 31, 2017, we had no borrowings through the Federal Reserve discount window, while our borrowing capacity with the Federal Reserve was $15.8 million. We also have various other federal funds agreements, both secured and unsecured, with correspondent banks totaling approximately $30.0 million in available credit under which we had no outstanding borrowings at March 31, 2017. At March 31, 2017, we had subordinated debentures totaling $21.3 million and other borrowings of $13.5 million, which consisted of repurchase agreements. At March 31, 2017, the Company had no borrowings against a $7.5 million line of credit from an unrelated financial institution maturing on November 1, 2017, with an interest rate that adjusts daily based on the prime rate plus 0.25%, and a floor of 3.75%. This line of credit has covenants specific to capital and other financial ratios, which the Company was in compliance with at March 31, 2017.

Off Balance Sheet Arrangements. As a provider of financial services, we routinely issue financial guarantees in the form of financial and performance standby letters of credit. Standby letters of credit are contingent commitments issued by us generally to guarantee the payment or performance obligation of a customer to a third party. While these standby letters of credit represent a potential outlay by us, a significant amount of the commitments may expire without being drawn upon. We have recourse against the customer for any amount the customer is required to pay to a third party under a standby letter of credit. The letters of credit are subject to the same credit policies, underwriting standards and approval process as loans made by us. Most of the standby letters of credit are secured, and in the event of nonperformance by the customers, we have the right to the underlying collateral, which could include commercial real estate, physical plant and property, inventory, receivables, cash and marketable securities. The contract amount of these standby letters of credit, which represents the maximum potential future payments guaranteed by us, was $821,000 at March 31, 2017.

At March 31, 2017, we had outstanding loan commitments, excluding standby letters of credit, of $82.3 million. We anticipate that sufficient funds will be available to meet current loan commitments. These commitments consist of unfunded lines of credit and commitments to finance real estate loans.

Capital. Current regulatory capital regulations require financial institutions (including banks and bank holding companies) to meet certain regulatory capital requirements. The Company and the Bank are subject to the Basel III Rules that implemented the Basel III regulatory capital reforms from the Basel Committee on Banking Supervision and certain changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Basel III Rules are applicable to all U.S. banks that are subject to minimum capital requirements, as well as to bank and savings and loan holding companies other than “small bank holding companies” (generally, non-public bank holding companies with consolidated assets of less than $1.0 billion).

30

The Basel III Rules require a common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, a Tier 1 capital to risk-weighted assets minimum ratio of 6.0%, a Total Capital to risk-weighted assets minimum ratio of 8.0%, and a Tier 1 leverage minimum ratio of 4.0%. A capital conservation buffer, comprised of common equity Tier 1 capital, is also established above the regulatory minimum capital requirements. This capital conservation buffer began on January 1, 2016 at 0.625% of risk-weighted assets, was 1.25% effective on January 1, 2017, and will increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. As of March 31, 2017 and December 31, 2016, the Bank was rated “well capitalized,” which is the highest rating available under the regulatory capital regulations framework for prompt corrective action. Management believed that as of March 31, 2017, the Company and the Bank met all capital adequacy requirements to which we are subject.

Dividends. During the quarter ended March 31, 2017, we paid a quarterly cash dividend of $0.20 per share to our stockholders.

The payment of dividends by any financial institution or its holding company is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations. In addition, under the Basel III Rules, financial institutions will have to maintain 2.5% in Common Equity Tier 1 attributable to the capital conservation buffer in order to pay dividends and do other capital distributions. This buffer is being phased in over three years beginning in 2016. As described above, the Bank exceeded its minimum capital requirements under applicable guidelines as of March 31, 2017. The National Bank Act imposes limitations on the amount of dividends that a national bank may pay without prior regulatory approval. Generally, the amount is limited to the bank's current year's net earnings plus the adjusted retained earnings for the two preceding years. As of March 31, 2017, approximately $17.9 million was available to be paid as dividends to the Company by the Bank without prior regulatory approval.

Additionally, our ability to pay dividends is limited by the subordinated debentures that are held by three business trusts that we control. Interest payments on the debentures must be paid before we pay dividends on our capital stock, including our common stock. We have the right to defer interest payments on the debentures for up to 20 consecutive quarters. However, if we elect to defer interest payments, all deferred interest must be paid before we may pay dividends on our capital stock.

31

Average Assets/Liabilities. The following table reflects the tax-equivalent yields earned on average interest-earning assets and costs of average interest-bearing liabilities for the periods indicated (derived by dividing income or expense by the monthly average balance of assets or liabilities, respectively) as well as “net interest margin” (which reflects the effect of the net earnings balance) for the periods shown:

	Three months ended							Three months ended
	March 31, 2017							March 31, 2016
(Dollars in thousands)	Average balance		Income/ expense		Average yield/cost			Average balance		Income/ expense		Average yield/cost
Assets
Interest-earning assets:
Interest-bearing deposits at banks	$	8,809	$	17		0.83	%	$	6,934	$	9		0.52	%
Investment securities (1)		393,540		2,586		2.66	%		359,074		2,366		2.65	%
Loans receivable, net (2)		420,523		5,072		4.89	%		426,014		5,236		4.94	%
Total interest-earning assets		822,872		7,675		3.78	%		792,022		7,611		3.87	%
Non-interest-earning assets		91,034							85,059
Total	$	913,906						$	877,081
Liabilities and Stockholders' Equity
Interest-bearing liabilities:
Money market and checking	$	355,342	$	181		0.21	%	$	334,354	$	105		0.13	%
Savings accounts		91,277		7		0.03	%		83,423		6		0.03	%
Time deposits		140,975		150		0.43	%		143,660		166		0.46	%
Total interest-bearing deposits		587,594		338		0.23	%		561,437		277		0.20	%
FHLB advances and other borrowings		71,738		482		2.72	%		72,438		493		2.74	%
Total interest-bearing liabilities		659,332		820		0.50	%		633,875		770		0.49	%
Non-interest-bearing liabilities		169,077							160,226
Stockholders' equity		85,497							82,980
Total	$	913,906						$	877,081
Interest rate spread (3)						3.28	%						3.38	%
Net interest margin (4)			$	6,855		3.38	%			$	6,841		3.47	%
Tax-equivalent interest - imputed				487							437
Net interest income			$	6,368						$	6,404
Ratio of average interest-earning assets to average interest-bearing liabilities						124.8	%						124.9	%

(1) Income on tax exempt securities is presented on a fully tax-equivalent basis, using a 34% federal tax rate.

(2) Includes loans classified as non-accrual. Income on tax-exempt loans is presented on a fully tax-equivalent basis, using a 34% federal tax rate.

(3) Interest rate spread represents the difference between the average yield earned on interest-earning assets and the average rate paid on interest-bearing liabilities.

(4) Net interest margin represents annualized, tax-equivalent net interest income divided by average interest-earning assets.

32

Rate/Volume Table. The following table describes the extent to which changes in tax-equivalent interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities affected the Company’s interest income and expense for the periods indicated. The table distinguishes between (i) changes attributable to rate (changes in rate multiplied by prior volume), (ii) changes attributable to volume (changes in volume multiplied by prior rate), and (iii) net change (the sum of (i) and (ii)). The net changes attributable to the combined effect of volume and rate that cannot be segregated have been allocated proportionately to the change due to volume and the change due to rate.

	Three months ended March 31,
	2017 vs 2016
	Increase/(decrease) attributable to
	Volume			Rate			Net
	(Dollars in thousands)
Interest income:
Interest-bearing deposits at banks	$	3		$	5		$	8
Investment securities		212			8			220
Loans		(92	)		(72	)		(164	)
Total		123			(59	)		64
Interest expense:
Deposits		14			47			61
Other borrowings		(6	)		(5	)		(11	)
Total		8			42			50
Net interest margin	$	115		$	(101	)	$	14

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our assets and liabilities are principally financial in nature, and the resulting net interest income thereon is subject to changes in market interest rates and the mix of various assets and liabilities. Interest rates in the financial markets affect our decisions relating to pricing our assets and liabilities, which impact net interest income, a significant cash flow source for us. As a result, a substantial portion of our risk management activities relates to managing interest rate risk.

Our Asset/Liability Management Committee monitors the interest rate sensitivity of our balance sheet using earnings simulation models. We have set policy limits of interest rate risk to be assumed in the normal course of business and monitor such limits through our simulation process.

We have been successful in meeting the interest rate sensitivity objectives set forth in our policy. Simulation models are prepared to determine the impact on net interest income for the coming twelve months, including one using rates at March 31, 2017, and forecasting volumes for the twelve-month projection. This position is then subjected to a shift in interest rates of 100 and 200 basis points with an impact to our net interest income on a one-year horizon as follows:

	Dollar change in net			Percent change in
Scenario	interest income ($000’s)			net interest income
200 basis point rising	$	(1,044	)		(3.7	%)
100 basis point rising	$	(548	)		(1.9	%)
100 basis point falling	$	(407	)		(1.4	%)
200 basis point falling		NM			NM

The 200 basis point falling scenario is considered to be not meaningful (“NM”) in the current low interest rate environment.

33

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

Forward-Looking Statements

This document (including information incorporated by reference) contains, and future oral and written statements by us and our management may contain, forward-looking statements, within the meaning of such term in the Private Securities Litigation Reform Act of 1995, with respect to our financial condition, results of operations, plans, objectives, future performance and business. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of our management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and we undertake no obligation to update any statement in light of new information or future events.

Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on operations and future prospects of us and our subsidiaries include, but are not limited to, the following:

· The strength of the United States economy in general and the strength of the local economies in which we conduct our operations which may be less favorable than expected and may result in, among other things, a deterioration in the credit quality and value of our assets.

· The effects of, and changes in, federal, state and local laws, regulations and policies affecting banking, securities, insurance and monetary and financial matters (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations promulgated thereunder, as well as the Basel III Rules) and the effects of increases in FDIC premiums.

· The effects of changes in interest rates (including the effects of changes in the rate of prepayments of our assets) and the policies of the Board of Governors of the Federal Reserve System.

· Our ability to compete with other financial institutions as effectively as we currently do due to increases in competitive pressures in the financial services sector.

· Our inability to obtain new customers and to retain existing customers.

· The timely development and acceptance of products and services, including products and services offered through alternative delivery channels such as the Internet.

· Technological changes implemented by us and by other parties, including third-party vendors, which may be more difficult or more expensive than anticipated or which may have unforeseen consequences to us and our customers.

· Our ability to develop and maintain secure and reliable electronic systems.

· Our ability to retain key executives and employees and the difficulty that we may experience in replacing key executives and employees in an effective manner.

· Consumer spending and saving habits which may change in a manner that affects our business adversely.

· Our ability to successfully integrate acquired businesses and future growth.

· The costs, effects and outcomes of existing or future litigation.

· Changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies and the FASB.

· The economic impact of past and any future terrorist attacks, acts of war or threats thereof, and the response of the United States to any such threats and attacks.

· Our ability to effectively manage our credit risk.

· Our ability to forecast probable loan losses and maintain an adequate allowance for loan losses.

· The effects of declines in the value of our investment portfolio.

· Our ability to raise additional capital if needed.

· The effects of cyber-attacks.

· The effects of declines in real estate markets.

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning us and our business, including other factors that could materially affect our financial results, is included in our filings with the Securities and Exchange Commission, including the “Risk Factors” section in our Annual Report on Form 10-K for the year ended December 31, 2016.

34

ITEM 4. CONTROLS AND PROCEDURES

An evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended) as of March 31, 2017. Based on that evaluation, the Company’s management, including the Chief Executive Officer and Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2017.

There were no changes in the Company’s internal control over financial reporting during the quarter ended March 31, 2017 that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

35

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are no material pending legal proceedings to which the Company or its subsidiaries is a party or which any of their property is subject, other than ordinary routine litigation incidental to their respective businesses.

ITEM 1A. RISK FACTORS

There have been no material changes in the risk factors applicable to the Company from those disclosed in Part I, Item 1A. “Risk Factors,” in the Company's 2016 Annual Report on Form 10-K.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

Exhibit 31.1	Certificate of Chief Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a)
Exhibit 31.2	Certificate of Chief Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a)
Exhibit 32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets as of March 31, 2017 and December 31, 2016; (ii) Consolidated Statements of Earnings for the three months ended March 31, 2017 and March 31, 2016; (iii) Consolidated Statements of Comprehensive Income for the three months ended March 31, 2017 and March 31, 2016; (iv) Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2017 and March 31, 2016; (v) Consolidated Statements of Cash Flows for the three months ended March 31, 2017 and March 31, 2016; and (vi) Notes to Consolidated Financial Statements

36

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.

	LANDMARK BANCORP, INC.
Date: May 05, 2017	/s/ Michael E. Scheopner
	Michael E. Scheopner
	President and Chief Executive Officer
Date: May 05, 2017	/s/ Mark A. Herpich
	Mark A. Herpich
	Vice President, Secretary, Treasurer
	and Chief Financial Officer

37

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULE 13a-14(a)/15d-14(a)

I, Michael E. Scheopner, certify that:

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

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 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 5, 2017	/s/ Michael E. Scheopner
	Michael E. Scheopner
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULE 13a-14(a)/15d-14(a)

I, Mark A. Herpich, certify that:

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

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 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 and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 5, 2017	/s/ Mark A. Herpich
	Mark A. Herpich
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Landmark Bancorp, Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael E. Scheopner, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The 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 Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Michael E. Scheopner

Michael E. Scheopner

Chief Executive Officer

May 5, 2017

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Landmark Bancorp, Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2017 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Mark A. Herpich, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The 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 Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Mark A. Herpich

Mark A. Herpich

Chief Financial Officer

May 5, 2017

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2017	May 04, 2017
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1
Entity Registrant Name	LANDMARK BANCORP INC
Entity Central Index Key	0001141688
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	LARK
Entity Common Stock, Shares Outstanding		3,869,922

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Assets
Cash and cash equivalents	$ 20,062	$ 19,996
Investment securities available-for-sale, at fair value	396,920	385,563
Bank stocks, at cost	5,323	5,299
Loans, net of allowance for loans losses of $5,327 at March 31, 2017 and $5,344 at December 31, 2016	417,955	420,461
Loans held for sale, at fair value	8,588	5,517
Premises and equipment, net	20,156	20,407
Bank owned life insurance	18,431	18,314
Goodwill	17,532	17,532
Other intangible assets, net	3,849	3,986
Real estate owned, net	1,003	1,279
Accrued interest and other assets	13,198	13,028
Total assets	923,017	911,382
Deposits:
Non-interest-bearing demand	167,590	152,012
Money market and checking	352,608	361,398
Savings	93,291	88,273
Time	139,197	139,838
Total deposits	752,686	741,521
Federal Home Loan Bank borrowings	33,450	39,100
Subordinated debentures	21,334	21,284
Other borrowings	13,491	12,483
Accrued interest, taxes, and other liabilities	15,387	12,043
Total liabilities	836,348	826,431
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value per share, 200,000 shares authorized; none issued	0	0
Common stock, $0.01 par value per share, 7,500,000 shares authorized; 3,869,922 and 3,868,077 shares issued at March 31, 2017 and December 31, 2016, respectively	39	38
Additional paid-in capital	52,025	51,968
Retained earnings	35,724	34,293
Accumulated other comprehensive loss	(1,119)	(1,348)
Total stockholders’ equity	86,669	84,951
Total liabilities and stockholders’ equity	$ 923,017	$ 911,382

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CONSOLIDATED BALANCE SHEETS [Parenthetical] - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Net of allowance for loans losses (in dollars)	$ 5,327	$ 5,344
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	200,000	200,000
Preferred stock, shares issued	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	7,500,000	7,500,000
Common stock, shares issued	3,869,922	3,868,077
Common stock, shares, outstanding	3,869,922	3,868,077

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CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Loans:
Taxable		$ 5,019	$ 5,136
Tax-exempt		35	66
Investment securities:
Taxable		1,192	1,163
Tax-exempt		942	809
Total interest income		7,188	7,174
Interest expense:
Deposits		338	277
Borrowings		482	493
Total interest expense		820	770
Net interest income		6,368	6,404
Provision for loan losses		50	50
Net interest income after provision for loan losses		6,318	6,354
Non-interest income:
Fees and service charges		1,715	1,729
Gains on sales of loans, net		1,389	1,794
Bank owned life insurance		117	120
Gains on sales of investment securities, net		147	12
Other		273	239
Total non-interest income		3,641	3,894
Non-interest expense:
Compensation and benefits		3,757	3,801
Occupancy and equipment		1,024	1,056
Data processing		330	311
Amortization of intangibles		298	337
Professional fees		290	219
Advertising		166	166
Federal deposit insurance premiums		72	110
Foreclosure and real estate owned expense		52	65
Other		1,072	1,097
Total non-interest expense		7,061	7,162
Earnings before income taxes		2,898	3,086
Income tax expense	[1]	693	693
Net earnings	[1],[2],[3],[4]	$ 2,205	$ 2,393	[5]
Earnings per share:
Basic (in dollars per share)	[4],[6],[7]	$ 0.57	$ 0.64
Diluted (in dollars per share)	[1],[4],[6],[7]	0.56	0.63
Dividends per share (in dollars per share)	[6]	$ 0.20	$ 0.19

[1] Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

[2] Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[3] Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[4] Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

[5] Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[6] Per share amounts for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

[7] Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

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CONSOLIDATED STATEMENTS OF EARNINGS [Parenthetical]	3 Months Ended		12 Months Ended
	Mar. 31, 2016		Dec. 31, 2016
Percentage Of Stocks Dividend	5.00%	[1]	5.00%

[1] Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Net earnings	[1],[2],[3],[4]	$ 2,205	$ 2,393	[5]
Net unrealized holding gains on available-for-sale securities		522	3,390
Less reclassification adjustment for net gains included in earnings		(147)	(12)
Net unrealized gains		375	3,378
Income tax effect on net gains included in earnings		54	4
Income tax effect on net unrealized holding gains		(200)	(1,257)
Other comprehensive income		229	2,125
Total comprehensive income		$ 2,434	$ 4,518

[1] Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

[2] Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[3] Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[4] Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

[5] Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands		Total		Common stock [Member]	Additional paid-in capital [Member]	Retained earnings [Member]	Accumulated other comprehensive income (loss) [Member]
Balance at Dec. 31, 2015		$ 80,570		$ 35	$ 45,372	$ 32,988	$ 2,175
Net earnings	[2]	2,393	[1],[3],[4],[5]	0	0	2,393	0
Other comprehensive income		2,125		0	0	0	2,125
Dividends paid		(713)		0	0	(713)	0
Exercise of stock options	[2]	825		1	824	0	0
Balance at Mar. 31, 2016		85,200		36	46,196	34,668	4,300
Balance at Dec. 31, 2016		84,951		38	51,968	34,293	(1,348)
Net earnings		2,205	[1],[3],[4],[5]	0	0	2,205	0
Other comprehensive income		229		0	0	0	229
Dividends paid		(774)		0	0	(774)	0
Stock-based compensation		35		0	35	0	0
Exercise of stock options		23		1	22	0	0
Balance at Mar. 31, 2017		$ 86,669		$ 39	$ 52,025	$ 35,724	$ (1,119)

[1] Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

[2] Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[3] Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[4] Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[5] Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Cash flows from operating activities:
Net earnings	[1],[2],[3],[4]	$ 2,205	$ 2,393	[5]
Adjustments to reconcile net earnings to net cash provided by operating activities:
Provision for loan losses		50	50
Valuation allowance on real estate owned		33	0
Amortization of investment security premiums, net		468	382
Amortization of purchase accounting adjustment on loans		(19)	(2)
Amortization of purchase accounting adjustment on subordinated debentures		50	50
Amortization of intangibles		298	337
Depreciation		263	292
Increase in cash surrender value of bank owned life insurance		(117)	(120)
Stock-based compensation		35	0
Deferred income taxes		60	91
Net gains on sales of investment securities		(147)	(12)
Net losses on sales of foreclosed assets		15	60
Net gains on sales of loans		(1,389)	(1,794)
Proceeds from sales of loans		31,153	56,631
Origination of loans held for sale		(32,835)	(53,795)
Changes in assets and liabilities:
Accrued interest and other assets		(520)	(1,423)
Accrued expenses, taxes, and other liabilities		(99)	(2,088)
Net cash (used in) provided by operating activities		(496)	1,052
Cash flows from investing activities:
Net decrease in loans		2,452	9
Maturities and prepayments of investment securities		11,069	10,790
Purchases of investment securities		(30,726)	(22,634)
Proceeds from sales of investment securities		11,797	1,817
Redemption of bank stocks		1,802	1,161
Purchase of bank stocks		(1,826)	(801)
Proceeds from sales of foreclosed assets		233	630
Purchases of premises and equipment, net		(12)	(178)
Net cash used in investing activities		(5,211)	(9,206)
Cash flows from financing activities:
Net increase (decrease) in deposits		11,166	(6,333)
Federal Home Loan Bank advance borrowings		148,857	46,717
Federal Home Loan Bank advance repayments		(154,507)	(37,206)
Proceeds from other borrowings		1,008	1,148
Proceeds from exercise of stock options	[2]	23	825
Payment of dividends		(774)	(713)
Net cash provided by financing activities		5,773	4,438
Net increase (decrease) in cash and cash equivalents		66	(3,716)
Cash and cash equivalents at beginning of period		19,996	13,569
Cash and cash equivalents at end of period		20,062	9,853
Supplemental disclosure of cash flow information:
Cash payments for income taxes		0	500
Cash paid for interest		786	738
Supplemental schedule of noncash investing and financing activities:
Transfer of loans to real estate owned		5	0
Investment securities purchases not yet settled		$ (3,443)	$ (7,160)

[1] Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

[2] Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[3] Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[4] Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

[5] Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

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Interim Financial Statements

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1. Interim Financial Statements

The unaudited consolidated financial statements of Landmark Bancorp, Inc. (the “Company”) and its subsidiary, Landmark National Bank (the “Bank”) have been prepared in accordance with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements and should be read in conjunction with the Company’s most recent Annual Report on Form 10-K, containing the latest audited consolidated financial statements and notes thereto. The consolidated financial statements in this report have not been audited by an independent registered public accounting firm, but in the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of financial statements have been reflected herein. The results of the three month interim period ended March 31, 2017 are not necessarily indicative of the results expected for the year ending December 31, 2017 or any other future time period. The Company has evaluated subsequent events for recognition and disclosure up to the date the financial statements were issued.

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Investments

3 Months Ended

Mar. 31, 2017

Investments, Debt and Equity Securities [Abstract]

Marketable Securities [Text Block]

2. Investments

A summary of investment securities available-for-sale is as follows:

	As of March 31, 2017
			Gross		Gross
	Amortized		unrealized		unrealized		Estimated
(Dollars in thousands)	cost		gains		losses		fair value
U. S. treasury securities	$	4,990	$	8	$	-	$	4,998
U. S. federal agency obligations		21,419		44		(40)		21,423
Municipal obligations, tax exempt		176,646		893		(2,389)		175,150
Municipal obligations, taxable		67,954		468		(257)		68,165
Agency mortgage-backed securities		118,606		158		(1,067)		117,697
Certificates of deposit		8,724		-		-		8,724
Common stocks		376		387		-		763
Total	$	398,715	$	1,958	$	(3,753)	$	396,920

	As of December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized		Estimated
(Dollars in thousands)	cost		gains		losses		fair value
U. S. treasury securities	$	6,005	$	10	$	-	$	6,015
U. S. federal agency obligations		27,140		48		(49)		27,139
Municipal obligations, tax exempt		163,632		696		(2,666)		161,662
Municipal obligations, taxable		71,371		463		(271)		71,563
Agency mortgage-backed securities		109,427		171		(1,222)		108,376
Certificates of deposit		9,700		-		-		9,700
Common stocks		458		650		-		1,108
Total	$	387,733	$	2,038	$	(4,208)	$	385,563

The tables above show that some of the securities in the available-for-sale investment portfolio had unrealized losses, or were temporarily impaired, as of March 31, 2017 and December 31, 2016. This temporary impairment represents the estimated amount of loss that would be realized if the securities were sold on the valuation date. Securities which were temporarily impaired are shown below, along with the length of time in a continuous unrealized loss position.

			As of March 31, 2017
(Dollars in thousands)			Less than 12 months				12 months or longer				Total
	No. of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	securities		value		losses		value		losses		value		losses
U.S. federal agency obligations		9	$	11,841	$	(40)	$	-	$	-	$	11,841	$	(40)
Municipal obligations, tax exempt		237		95,197		(2,389)		-		-		95,197		(2,389)
Municipal obligations, taxable		66		27,071		(257)		-		-		27,071		(257)
Agency mortgage-backed securities		47		82,491		(1,067)		-		-		82,491		(1,067)
Total		359	$	216,600	$	(3,753)	$	-	$	-	$	216,600	$	(3,753)

			As of December 31, 2016
(Dollars in thousands)			Less than 12 months				12 months or longer				Total
	No. of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	securities		value		losses		value		losses		value		losses
U. S. federal agency obligations		9		15,056		(49)		-		-		15,056	$	(49)
Municipal obligations, tax exempt		275		97,842		(2,666)		-		-		97,842	$	(2,666)
Municipal obligations, taxable		66		26,184		(271)		-		-		26,184	$	(271)
Agency mortgage-backed securities		58		83,011		(1,222)		-		-		83,011	$	(1,222)
Total		408	$	222,093	$	(4,208)	$	-	$	-	$	222,093	$	(4,208)

The Company’s U.S. federal agency portfolio consists of securities issued by the government-sponsored agencies of Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Federal Home Loan Bank (“FHLB”). The receipt of principal and interest on U.S. federal agency obligations is guaranteed by the respective government-sponsored agency guarantor, such that the Company believes that its U.S. federal agency obligations do not expose the Company to credit-related losses. Based on these factors, along with the Company’s intent to not sell the securities and its belief that it was more likely than not that the Company will not be required to sell the securities before recovery of their cost basis, the Company believed that the U.S. federal agency obligations identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

The Company’s portfolio of municipal obligations consists of both tax-exempt and taxable general obligations securities issued by various municipalities. As of March 31, 2017, the Company did not intend to sell and it is more likely than not that the Company will not be required to sell its municipal obligations in an unrealized loss position until the recovery of its cost. Due to the issuers’ continued satisfaction of the securities’ obligations in accordance with their contractual terms and the expectation that they will continue to do so, the evaluation of the fundamentals of the issuers’ financial condition and other objective evidence, the Company believed that the municipal obligations identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

The Company’s agency mortgage-backed securities portfolio consists of securities underwritten to the standards of and guaranteed by the government-sponsored agencies of FHLMC, FNMA and the Government National Mortgage Association. The receipt of principal, at par, and interest on agency mortgage-backed securities is guaranteed by the respective government-sponsored agency guarantor, such that the Company believed that its agency mortgage-backed securities did not expose the Company to credit-related losses. Based on these factors, along with the Company’s intent to not sell the securities and the Company’s belief that it was more likely than not that the Company will not be required to sell the securities before recovery of their cost basis, the Company believed that the agency mortgage-backed securities identified in the tables above were temporarily impaired as of the March 31, 2017 and December 31, 2016.

The table below sets forth amortized cost and fair value of investment securities at March 31, 2017. The table includes scheduled principal payments and estimated prepayments, based on observable market inputs, for agency mortgage-backed securities. Actual maturities will differ from contractual maturities because borrowers have the right to prepay obligations with or without prepayment penalties. Securities with no maturity are listed separately.

(Dollars in thousands)	Amortized		Estimated
	cost		fair value
Due in less than one year	$	29,722	$	29,755
Due after one year but within five years		199,365		198,758
Due after five years but within ten years		83,169		82,960
Due after ten years		86,083		84,684
Common stocks		376		763
Total	$	398,715	$	396,920

Sales proceeds and gross realized gains and losses on sales of available-for-sale securities are as follows for the periods indicated:

(Dollars in thousands)	Three months ended March 31,
	2017		2016
Sales proceeds	$	11,797	$	1,817
Realized gains	$	171	$	16
Realized losses		(24)		(4)
Net realized gains	$	147	$	12

Securities with carrying values of $217.5 million and $224.3 million were pledged to secure public funds on deposit, repurchase agreements and as collateral for borrowings at March 31, 2017 and December 31, 2016, respectively. Except for U.S. federal agency obligations, no investment in a single issuer exceeded 10% of consolidated stockholders’ equity.

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Loans and Allowance for Loan Losses

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

3. Loans and Allowance for Loan Losses

Loans consisted of the following as of the dates indicated below:

	March 31,		December 31,
(Dollars in thousands)	2017		2016
One-to-four family residential real estate	$	137,301	$	136,846
Construction and land		16,329		13,738
Commercial real estate		114,759		118,200
Commercial		54,102		54,506
Agriculture		76,124		78,324
Municipal		3,706		3,884
Consumer		21,088		20,271
Total gross loans		423,409		425,769
Net deferred loan costs and loans in process		(127)		36
Allowance for loan losses		(5,327)		(5,344)
Loans, net	$	417,955	$	420,461

The following tables provide information on the Company’s allowance for loan losses by loan class and allowance methodology:

	Three months ended March 31, 2017
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Balance at January 1, 2017	$	504	$	53	$	1,777	$	1,119	$	1,684	$	12	$	195	$	5,344
Charge-offs		(19)		-		-		-		-		-		(107)		(126)
Recoveries		1		-		-		8		1		-		49		59
Provision for loan losses		7		18		(37)		(26)		46		(1)		43		50
Balance at March 31, 2017		493		71		1,740		1,101		1,731		11		180		5,327

	Three months ended March 31, 2016
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Balance at January 1, 2016	$	925	$	77	$	1,740	$	1,530	$	1,428	$	23	$	199	$	5,922
Charge-offs		-		-		-		-		-		-		(137)		(137)
Recoveries		2		-		-		19		-		-		13		34
Provision for loan losses		(63)		5		91		(165)		55		1		126		50
Balance at March 31, 2016		864		82		1,831		1,384		1,483		24		201		5,869

	As of March 31, 2017
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		106		70		132		-		-		308
Collectively evaluated for loss		493		71		1,634		1,031		1,599		11		180		5,019
Total		493		71		1,740		1,101		1,731		11		180		5,327
Loan balances:
Individually evaluated for loss		665		1,851		2,437		320		983		221		39		6,516
Collectively evaluated for loss		136,636		14,478		112,322		53,782		75,141		3,485		21,049		416,893
Total	$	137,301	$	16,329	$	114,759	$	54,102	$	76,124	$	3,706	$	21,088	$	423,409

	As of December 31, 2016
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		81		87		89		-		17		274
Collectively evaluated for loss		504		53		1,696		1,032		1,595		12		178		5,070
Total		504		53		1,777		1,119		1,684		12		195		5,344
Loan balances:
Individually evaluated for loss		780		1,937		2,445		355		881		258		72		6,728
Collectively evaluated for loss		136,066		11,801		115,755		54,151		77,443		3,626		20,199		419,041
Total	$	136,846	$	13,738	$	118,200	$	54,506	$	78,324	$	3,884	$	20,271	$	425,769

The Company recorded net loan charge-offs of $67,000 during the first quarter of 2017 compared to net loan charge-offs of $103,000 during the first quarter of 2016.

The Company’s impaired loans decreased from $6.7 million at December 31, 2016 to $6.5 million at March 31, 2017. The difference between the unpaid contractual principal and the impaired loan balance is a result of charge-offs recorded against impaired loans. The difference in the Company’s non-accrual loan balances and impaired loan balances at March 31, 2017 and December 31, 2016, was related to troubled debt restructurings (“TDR”) that are current and accruing interest, but still classified as impaired. Interest income recognized on a cash basis was immaterial during the three months ended March 31, 2017 and 2016. The following tables present information on impaired loans:

(Dollars in thousands)	As of March 31, 2017
					Impaired		Impaired						Year-to-
	Unpaid				loans		loans with		Related		Year-to-		date interest
	contractual		Impaired		without an		an		allowance		date average		income
	principal		loan balance		allowance		allowance		recorded		loan balance		recognized
One-to-four family residential real estate	$	665	$	665	$	665	$	-	$	-	$	669	$	2
Construction and land		3,586		1,851		1,851		-		-		1,899		16
Commercial real estate		2,437		2,437		2,151		286		106		2,449		124
Commercial		320		320		29		291		70		332		-
Agriculture		1,198		983		102		881		132		996		1
Municipal		221		221		221		-		-		251		2
Consumer		39		39		39		-		-		39		-
Total impaired loans	$	8,466	$	6,516	$	5,058	$	1,458	$	308	$	6,635	$	145

(Dollars in thousands)	As of December 31, 2016
					Impaired		Impaired						Year-to-
	Unpaid				loans		loans with		Related		Year-to-		date interest
	contractual		Impaired		without an		an		allowance		date average		income
	principal		loan balance		allowance		allowance		recorded		loan balance		recognized
One-to-four family residential real estate	$	780	$	780	$	780	$	-	$	-	$	798	$	7
Construction and land		3,672		1,937		1,937		-		-		2,068		72
Commercial real estate		2,445		2,445		2,145		300		81		2,587		505
Commercial		355		355		46		309		87		425		2
Agriculture		1,173		881		147		734		89		1,000		2
Municipal		258		258		258		-		-		418		-
Consumer		72		72		55		17		17		78		13
Total impaired loans	$	8,755	$	6,728	$	5,368	$	1,360	$	274	$	7,374	$	601

The Company’s key credit quality indicator is a loan’s performance status, defined as accruing or non-accruing. Performing loans are considered to have a lower risk of loss. Non-accrual loans are those which the Company believes have a higher risk of loss. The accrual of interest on non-performing loans is discontinued at the time the loan is ninety days delinquent, unless the credit is well secured and in process of collection. Loans are placed on non-accrual or are charged off at an earlier date if collection of principal or interest is considered doubtful. There were no loans ninety days delinquent and accruing interest at March 31, 2017 or December 31, 2016. The following tables present information on the Company’s past due and non-accrual loans by loan class:

(Dollars in thousands)	As of March 31, 2017
	30-59 days			60-89 days			90 days or
	delinquent			delinquent			more			Total past						Total past
	and			and			delinquent			due loans			Non-accrual			due and non-			Total loans
	accruing			accruing			and accruing			accruing			loans			accrual loans			not past due
One-to-four family residential real estate		334			92			-			426		$	484		$	910		$	136,391
Construction and land		-			-			-			-			595			595			15,734
Commercial real estate		260			69			-			329			286			615			114,144
Commercial		160			13			-			173			316			489			53,613
Agriculture		58			328			-			386			940			1,326			74,798
Municipal		-			-			-			-			-			-			3,706
Consumer		40			18			-			58			39			97			20,991
Total	$	852		$	520		$	-		$	1,372		$	2,660		$	4,032		$	419,377
Percent of gross loans		0.20	%		0.12	%		0.00	%		0.32	%		0.63	%		0.95	%		99.05	%

(Dollars in thousands)	As of December 31, 2016
	30-59 days			60-89 days			90 days or
	delinquent			delinquent			more			Total past						Total past
	and			and			delinquent			due loans			Non-accrual			due and non-			Total loans
	accruing			accruing			and accruing			accruing			loans			accrual loans			not past due
One-to-four family residential real estate	$	215		$	388		$	-		$	603		$	595		$	1,198		$	135,648
Construction and land		-			-			-			-			599			599			13,139
Commercial real estate		-			-			-			-			300			300			117,900
Commercial		13			5			-			18			342			360			54,146
Agriculture		55			-			-			55			838			893			77,431
Municipal		-			-			-			-			-			-			3,884
Consumer		79			3			-			82			72			154			20,117
Total	$	362		$	396		$	-		$	758		$	2,746		$	3,504		$	422,265
Percent of gross loans		0.09	%		0.09	%		0.00	%		0.18	%		0.64	%		0.82	%		99.18	%

Under the original terms of the Company’s non-accrual loans, interest earned on such loans for the three months ended March 31, 2017 and 2016 would have increased interest income by $31,000 and $33,000, respectively. No interest income related to non-accrual loans was included in interest income for the three months ended March 31, 2017 and 2016.

The Company also categorizes loans into risk categories based on relevant information about the ability of the borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis. Nonclassified loans generally include those loans that are expected to be repaid in accordance with contractual loan terms. Classified loans are those that are assigned a special mention, substandard or doubtful risk rating using the following definitions:

Special Mention: Loans are currently protected by the current net worth and paying capacity of the obligor or of the collateral pledged but such protection is potentially weak. These loans constitute an undue and unwarranted credit risk, but not to the point of justifying a classification of substandard. The credit risk may be relatively minor, yet constitutes an unwarranted risk in light of the circumstances surrounding a specific asset.

Substandard: Loans are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged. Loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. Loans are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

The following table provides information on the Company’s risk categories by loan class:

	As of March 31, 2017				As of December 31, 2016
(Dollars in thousands)	Nonclassified		Classified		Nonclassified		Classified
One-to-four family residential real estate	$	136,143	$	1,158	$	135,640	$	1,206
Construction and land		15,734		595		13,138		600
Commercial real estate		108,527		6,232		111,641		6,559
Commercial		50,614		3,488		51,080		3,426
Agriculture		71,377		4,747		73,564		4,760
Municipal		3,706		-		3,884		-
Consumer		21,037		51		20,181		90
Total	$	407,138	$	16,271	$	409,128	$	16,641

At March 31, 2017, the Company had twelve loan relationships consisting of eighteen outstanding loans that were classified as TDRs. During the first three months of 2017, the Company classified a $11,000 commercial real estate loan as a TDR after extending the maturity of the loan and classified as a TDR a $15,000 agriculture loan extended to an existing loan relationship that was classified as a TDR in 2016. Since the loans were adequately secured, no charge-offs or impairments were recorded against the principal as of March 31, 2017. During the first quarter of 2016, a $44,000 agriculture loan relationship consisting of two loans was classified as a TDR after extending the maturity of the loans.

The Company evaluates each TDR individually and returns the loan to accrual status when a payment history is established after the restructuring and future payments are reasonably assured. There were no loans modified as TDRs for which there was a payment default within 12 months of modification as of March 31, 2017 and 2016. At March 31, 2017, there was a commitment of $84,000 to lend additional funds on one construction and land loan classified as a TDR. The Company did not record any charge-offs against loans classified as TDRs in the first quarter either of 2017 or 2016. A credit provision for loan losses of $13,000 related to TDRs was recorded in the three months ended March 31, 2017 compared to no provision in the same period of 2016. The Company had $67,000 and $80,000 allowance for loan losses recorded against loans classified as TDRs at March 31, 2017 and December 31, 2016, respectively.

The following table presents information on loans that are classified as TDRs:

(Dollars in thousands)	As of March 31, 2017						As of December 31, 2016
	Number of		Non-accrual		Accruing		Number of		Non-accrual		Accruing
	loans		balance		balance		loans		balance		balance
One-to-four family residential real estate		2	$	-	$	181		2	$	-	$	185
Construction and land		4		583		1,256		4		588		1,338
Commercial real estate		4		50		2,151		3		64		2,145
Commercial		1		-		3		2		-		13
Agriculture		5		268		44		4		268		44
Municipal		2		-		221		2		-		258
Total troubled debt restructurings		18	$	901	$	3,856		17	$	920	$	3,983

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Goodwill and Other Intangible Assets

3 Months Ended

Mar. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

4. Goodwill and Other Intangible Assets

The Company tests goodwill for impairment annually or more frequently if circumstances warrant. The Company’s annual step one impairment test as of December 31, 2016 concluded that its goodwill was not impaired. The Company concluded there were no triggering events during the first three months of 2017 that required an interim goodwill impairment test.

Lease intangible assets are amortized over the life of the lease. Core deposit intangible assets are amortized over the estimated useful life of ten years on an accelerated basis. Mortgage servicing rights are amortized over the estimated life of the mortgage loan serviced for others. A summary of the other intangible assets that continue to be subject to amortization is as follows:

(Dollars in thousands)	As of March 31, 2017
	Gross carrying		Accumulated		Net carrying
	amount		amortization		amount
Core deposit intangible assets	$	2,067	$	(1,201)	$	866
Lease intangible asset		350		(154)		196
Mortgage servicing rights		5,873		(3,086)		2,787
Total other intangible assets	$	8,290	$	(4,441)	$	3,849

(Dollars in thousands)	As of December 31, 2016
	Gross carrying		Accumulated		Net carrying
	amount		amortization		amount
Core deposit intangible assets	$	2,067	$	(1,137)	$	930
Lease intangible asset		350		(143)		207
Mortgage servicing rights		5,788		(2,939)		2,849
Total other intangible assets	$	8,205	$	(4,219)	$	3,986

The following sets forth estimated amortization expense for core deposit and lease intangible assets for the remainder of 2017 and in successive years ending December 31:

(Dollars in thousands)	Amortization
	expense
Remainder of 2017	$	214
2018		252
2019		214
2020		177
2021		121
Thereafter		84
Total	$	1,062

Mortgage loans serviced for others are not reported as assets. The following table provides information on the principal balances of mortgage loans serviced for others:

(Dollars in thousands)	March 31,		December 31,
	2017		2016
FHLMC	$	487,990	$	483,356
FHLB		10,851		11,393
Total	$	498,841	$	494,749

Custodial escrow balances maintained in connection with serviced loans were $7.2 million and $4.1 million at March 31, 2017 and December 31, 2016, respectively. Gross service fee income related to such loans was $319,000 and $300,000 for the three months ended March 31, 2017 and 2016, respectively, and is included in fees and service charges in the consolidated statements of earnings.

Activity for mortgage servicing rights is as follows:

	Three months ended
(Dollars in thousands)	March 31,
	2017		2016
Mortgage servicing rights:
Balance at beginning of period	$	2,849	$	2,840
Additions		161		221
Amortization		(223)		(253)
Balance at end of period	$	2,787	$	2,808

The fair value of mortgage servicing rights was $5.4 million and $5.1 million at March 31, 2017 and December 31, 2016, respectively. Fair value at March 31, 2017 was determined using discount rates ranging from 9.50% to 9.51%; prepayment speeds ranging from 4.39% to 33.19%, depending on the stratification of the specific mortgage servicing right; and a weighted average default rate of 2.24%. Fair value at December 31, 2016 was determined using discount rates ranging from 9.50% to 9.51%, prepayment speeds ranging from 4.86% to 32.79%, depending on the stratification of the specific mortgage servicing right, and a weighted average default rate of 2.26%.

The Company had a mortgage repurchase reserve of $301,000 at both March 31, 2017 and December 31, 2016, which represents the Company’s best estimate of probable losses that the Company will incur related to the repurchase of one-to-four family residential real estate loans previously sold or to reimburse investors for credit losses incurred on loans previously sold where a breach of the contractual representations and warranties occurred. The Company did not incur any losses charged against the reserve or make any provisions to the reserve during the first three months of 2017 and 2016. The Company recovered $7,000 of losses against the mortgage repurchase reserve during three months ended March 31, 2016. As of March 31, 2017, the Company had one outstanding mortgage repurchase request and expects to incur a loss of approximately $70,000.

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Earnings per Share

3 Months Ended

Mar. 31, 2017

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

5. Earnings per Share

Basic earnings per share have been computed based upon the weighted average number of common shares outstanding during each period. Diluted earnings per share include the effect of all potential common shares outstanding during each period. The diluted earnings per share computations for the three months ended March 31, 2017 and 2016 include all unexercised stock options because no stock options were anti-dilutive as of such dates. The shares used in the calculation of basic and diluted earnings per share are shown below:

	Three months ended
(Dollars in thousands, except per share amounts)	March 31,
	2017		2016
Net earnings (1)	$	2,205	$	2,393
Weighted average common shares outstanding - basic (2)		3,869,799		3,734,638
Assumed exercise of stock options (1)(2)		79,149		100,200
Weighted average common shares outstanding - diluted (1)(2)		3,948,948		3,834,838
Net earnings per share (1)(2):
Basic	$	0.57	$	0.64
Diluted	$	0.56	$	0.63

(1) Net earnings, diluted earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

(2) Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

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Repurchase Agreements

3 Months Ended

Mar. 31, 2017

Banking and Thrift [Abstract]

Repurchase Agreements, Resale Agreements, Securities Borrowed, and Securities Loaned Disclosure [Text Block]

6. Repurchase Agreements

The Company has overnight repurchase agreements with certain deposit customers whereby the Company uses investment securities as collateral for non-insured funds. These balances are accounted for as collateralized financing and included in other borrowings on the balance sheet. The following is a summary of the balances and collateral of the Company’s repurchase agreements:

	As of March 31, 2017
	Overnight and						Greater
	Continuous		Up to 30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	2,564	$	-	$	-	$	-	$	2,564
Agency mortgage-backed securities		10,927		-		-		-		10,927
Total	$	13,491	$	-	$	-	$	-	$	13,491

	As of December 31, 2016
	Overnight and		Up to				Greater
	Continuous		30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	5,007	$	-	$	-	$	-	$	5,007
Agency mortgage-backed securities		7,476		-		-		-		7,476
Total	$	12,483	$	-	$	-	$	-	$	12,483

Repurchase agreements are comprised of non-insured customer funds, totaling $13.5 million at March 31, 2017 and $12.5 million at December 31, 2016, which were secured by $19.7 million and $15.7 million of the Company’s investment portfolio at the same dates, respectively.

The investment securities are held by a third party financial institution in the customer’s custodial account. The Company is required to maintain adequate collateral for each repurchase agreement. Changes in the fair value of the investment securities impact the amount of collateral required. If the Company were to default, the investment securities would be used to settle the repurchase agreement with the deposit customer.

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Fair Value of Financial Instruments and Fair Value Measurements

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

7. Fair Value of Financial Instruments and Fair Value Measurements

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1 – Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 – Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 – Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Fair value estimates of the Company’s financial instruments as of March 31, 2017 and December 31, 2016, including methods and assumptions utilized, are set forth below:

(Dollars in thousands)	As of March 31, 2017
	Carrying
	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	20,062	$	20,062	$	-	$	-	$	20,062
Investment securities available-for-sale		396,920		5,761		391,159		-		396,920
Bank stocks, at cost		5,323		n/a		n/a		n/a		n/a
Loans, net		417,955		-		-		416,130		416,130
Loans held for sale		8,588		-		8,588		-		8,588
Derivative financial instruments		966		-		966		-		966
Accrued interest receivable		3,874		16		2,067		1,791		3,874
Financial liabilities:
Non-maturity deposits	$	(613,489)	$	(613,489)	$	-	$	-		(613,489)
Time deposits		(139,197)		-		(137,820)		-		(137,820)
FHLB borrowings		(33,450)		-		(33,967)		-		(33,967)
Subordinated debentures		(21,334)		-		(18,731)		-		(18,731)
Other borrowings		(13,491)		-		(13,491)		-		(13,491)
Derivative financial instruments		(154)		-		(154)		-		(154)
Accrued interest payable		(253)		-		(253)		-		(253)

	As of December 31, 2016
	Carrying
	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	19,996	$	19,996	$	-	$	-	$	19,996
Investment securities available-for-sale		385,563		7,123		378,440		-		385,563
Bank stocks, at cost		5,299		n/a		n/a		n/a		n/a
Loans, net		420,461		-		-		417,957		417,957
Loans held for sales		5,517		-		5,517		-		5,517
Derivative financial instruments		662		-		662		-		662
Accrued interest receivable		4,240		21		2,104		2,115		4,240
Financial liabilities:
Non-maturity deposits	$	(601,683)	$	(601,683)	$	-	$	-		(601,683)
Time deposits		(139,838)		-		(138,623)		-		(138,623)
FHLB borrowings		(39,100)		-		(35,695)		-		(35,695)
Subordinated debentures		(21,284)		-		(18,608)		-		(18,608)
Other borrowings		(12,483)		-		(12,483)		-		(12,483)
Accrued interest payable		(268)		-		(268)		-		(268)

Methods and Assumptions Utilized

The carrying amount of cash and cash equivalents is considered to approximate fair value.

The Company’s investment securities classified as available-for-sale include U.S. treasury securities, U.S. federal agency securities, municipal obligations, agency mortgage-backed securities, certificates of deposits and common stocks. Quoted exchange prices are available for the Company’s U.S treasury securities and common stock investments, which are classified as Level 1. U.S. federal agency securities and agency mortgage-backed obligations are priced utilizing industry-standard models that consider various assumptions, including time value, yield curves, volatility factors, prepayment speeds, default rates, loss severity, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace. These measurements are classified as Level 2. Municipal securities are valued using a type of matrix, or grid, pricing in which securities are benchmarked against U.S. treasury rates based on credit rating. These model and matrix measurements are classified as Level 2 in the fair value hierarchy.

It is not practical to determine the fair value of bank stocks due to restrictions placed on the transferability of FHLB and Federal Reserve Bank stock.

The estimated fair value of the Company’s loan portfolio is based on the segregation of loans by collateral type, interest terms, and maturities. The fair value is estimated based on discounting scheduled and estimated cash flows through maturity using an appropriate risk-adjusted yield curve to approximate current interest rates for each category. No adjustment was made to the interest rates for changes in credit risk of performing loans where there are no known credit concerns. Management segregates loans in appropriate risk categories. Management believes that the risk factor embedded in the interest rates along with the allowance for loan losses applicable to the performing loan portfolio results in a fair valuation of such loans. The fair values of impaired loans are generally based on market prices for similar assets determined through independent appraisals or discounted values of independent appraisals and brokers’ opinions of value. This method of estimating fair value does not incorporate the exit-price concept of fair value prescribed by ASC Topic 820 and is classified as Level 3.

Mortgage loans originated and intended for sale in the secondary market are carried at fair value. The mortgage loan valuations are based on quoted secondary market prices for similar loans and are classified as Level 2.

The carrying amount of accrued interest receivable and payable are considered to approximate fair value.

The estimated fair value of deposits with no stated maturity, such as non-interest-bearing demand deposits, savings, money market accounts, and checking accounts, is equal to the amount payable on demand. The fair value of interest-bearing time deposits is based on the discounted value of contractual cash flows of such deposits. The discount rate is tied to the FHLB yield curve plus an appropriate servicing spread. Fair value measurements based on discounted cash flows are classified as Level 2. These fair values do not incorporate the value of core deposit intangibles which may be associated with the deposit base.

The fair value of advances from the FHLB, subordinated debentures, and other borrowings is estimated using current yield curves for similar borrowings adjusted for the Company’s current credit spread and classified as Level 2.

The Company’s derivative financial instruments consist of interest rate lock commitments and corresponding forward sales contracts on mortgage loans held for sale. The fair values of these derivatives are based on quoted prices for similar loans in the secondary market. The market prices are adjusted by a factor, based on the Company’s historical data and its judgment about future economic trends, which considers the likelihood that a commitment will ultimately result in a closed loan. These instruments are classified as Level 2. The amounts are included in other assets or other liabilities on the consolidated balance sheets and gains on sale of loans, net in the consolidated statements of earnings.

Off-Balance-Sheet Financial Instruments

The fair value of letters of credit and commitments to extend credit is based on the fees currently charged to enter into similar agreements. The aggregate amount of these fees is not material.

Transfers

The Company did not transfer any assets or liabilities among levels during the three months ended March 31, 2017 or during the year ended December 31, 2016.

Valuation Methods for Instruments Measured at Fair Value on a Recurring Basis

The following tables represent the Company’s financial instruments that are measured at fair value on a recurring basis at March 31, 2017 and December 31, 2016, allocated to the appropriate fair value hierarchy:

(Dollars in thousands)			As of March 31, 2017
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	4,998	$	4,998	$	-	$	-
U. S. federal agency obligations		21,423		-		21,423		-
Municipal obligations, tax exempt		175,150		-		175,150		-
Municipal obligations, taxable		68,165		-		68,165		-
Mortgage-backed securities		117,697		-		117,697		-
Common stocks		763		763		-		-
Certificates of deposit		8,724		-		8,724		-
Loans held for sale		8,588		-		8,588		-
Derivative financial instruments		966		-		966		-
Liabililty:
Derivative financial instruments		(154)		-		(154)		-

(Dollars in thousands)			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	6,015	$	6,015	$	-	$	-
U. S. federal agency obligations		27,139		-		27,139		-
Municipal obligations, tax exempt		161,662		-		161,662		-
Municipal obligations, taxable		71,563		-		71,563		-
Agency mortgage-backed securities		108,376		-		108,376		-
Common stocks		1,108		1,108		-		-
Certificates of deposit		9,700		-		9,700		-
Loans held for sale		5,517		-		5,517		-
Derivative financial instruments		662		-		662		-

Changes in the fair value of available-for-sale securities are included in other comprehensive income to the extent the changes are not considered other-than-temporary impairments. Other-than-temporary impairment tests are performed on a quarterly basis and any decline in the fair value of an individual security below its cost that is deemed to be other-than-temporary results in a write-down of that security’s cost basis.

The aggregate fair value, contractual balance (including accrued interest), and gain on loans held for sale were as follows:

	As of		As of
	March 31,		December 31,
(Dollars in thousands)	2017		2016
Aggregate fair value	$	8,588	$	5,517
Contractual balance		8,443		5,480
Gain	$	145	$	37

The total amount of gains from changes in fair value of loans held for sale included in earnings were as follows:

	Three months ended
	March 31,
(Dollars in thousands)	2017		2016
Interest income	$	45	$	105
Change in fair value		109		79
Total change in fair value	$	154	$	184

Valuation Methods for Instruments Measured at Fair Value on a Nonrecurring Basis

The Company does not value its loan portfolio at fair value. Collateral-dependent impaired loans are generally carried at the lower of cost or fair value of the collateral, less estimated selling costs. Collateral values are determined based on appraisals performed by qualified licensed appraisers hired by the Company and then further adjusted if warranted based on relevant facts and circumstances. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Impaired loans are reviewed and evaluated at least quarterly for additional impairment and adjusted accordingly, based on the same factors identified above. The carrying value of the Company’s impaired loans was $6.2 million and $6.5 million, with an allocated allowance of $308,000 and $274,000, at March 31, 2017 and December 31, 2016, respectively.

Real estate owned includes assets acquired through, or in lieu of, foreclosure and land previously acquired for expansion. Real estate owned is initially recorded at the fair value of the collateral less estimated selling costs. Subsequent valuations are updated periodically and are based upon independent appraisals, third party price opinions or internal pricing models. The appraisals may utilize a single valuation approach or a combination of approaches including the comparable sales and income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Real estate owned is reviewed and evaluated at least annually for additional impairment and adjusted accordingly, based on the same factors identified above.

The following tables represent the Company’s financial instruments that are measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016 allocated to the appropriate fair value hierarchy:

(Dollars in thousands)
			As of March 31, 2017
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	180	$	-	$	-	$	180
Commercial		221		-		-	$	221
Agriculture		749		-		-	$	749
Real estate owned:
One-to-four family residential real estate		329		-		-		329

			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	219	$	-	$	-	$	219
Commercial		222		-		-		222
Agriculture		645		-		-		645
Real estate owned:
One-to-four family residential real estate		142		-		-		142

The following table presents quantitative information about Level 3 fair value measurements measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016.

(Dollars in thousands)
	Fair value		Valuation technique	Unobservable inputs	Range
As of March 31, 2017
Impaired loans:
Commercial real estate	$	180	Sales comparison	Adjustment to appraised value		0%-60%
Commercial		221	Sales comparison	Adjustment to appraised value		0%-80%
Agriculture		749	Sales comparison	Adjustment to appraised value		8%-80%
Real estate owned:
One-to-four family residential real estate		329	Sales comparison	Adjustment to appraised value		10%
As of December 31, 2016
Impaired loans:
Commercial real estate	$	219	Sales comparison	Adjustment to appraised value		2%-15%
Commercial		222	Sales comparison	Adjustment to comparable sales		7%-80%
Agriculture		645	Sales comparison	Adjustment to comparable sales		8%-80%
Real estate owned:
One-to-four family residential real estate		142	Sales comparison	Adjustment to appraised value		10%

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Regulatory Capital Requirements

3 Months Ended

Mar. 31, 2017

Banking and Thrift [Abstract]

Regulatory Capital Requirements under Banking Regulations [Text Block]

8. Regulatory Capital Requirements

Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. Management believed that as of March 31, 2017, the Company and the Bank met all capital adequacy requirements to which they were subject at that time.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. The Company and the Bank are subject to the capital rules (the “Basel III Rules”) that implemented the Basel III regulatory capital reforms from the Basel Committee on Banking Supervision and certain changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Basel III Rules are applicable to all U.S. banks that are subject to minimum capital requirements, as well as to bank and savings and loan holding companies other than “small bank holding companies” (generally, non-public bank holding companies with consolidated assets of less than $1.0 billion).

The Basel III Rules require a common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.5%, a Tier 1 capital to risk-weighted assets minimum ratio of 6.0%, a Total Capital to risk-weighted assets minimum ratio of 8.0%, and a Tier 1 leverage minimum ratio of 4.0%. A capital conservation buffer, comprised of common equity Tier 1 capital, is also established above the regulatory minimum capital requirements. This capital conservation buffer began on January 1, 2016 at 0.625% of risk-weighted assets, was 1.25% effective on January 1, 2017, and will further increase each subsequent year by an additional 0.625% until reaching its final level of 2.5% on January 1, 2019. The capital conservation buffer increases the common equity Tier 1 capital ratio, Tier 1 capital and total risk based capital ratios as of March 31 of each year.

As of March 31, 2017 and December 31, 2016, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action then in effect. There are no conditions or events since that notification that management believes have changed the institution’s category.

The following is a comparison of the Company’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

(Dollars in thousands)						For capital
	Actual					adequacy purposes
	Amount		Ratio			Amount		Ratio (1)
As of March 31, 2017
Leverage	$	90,260		10.05	%	$	35,914		4.0	%
Common Equity Tier 1 Capital		69,609		13.49	%		29,672		5.8	%
Tier 1 Capital		90,260		17.49	%		37,413		7.3	%
Total Risk Based Capital		95,901		18.58	%		47,733		9.3	%
As of December 31, 2016
Leverage	$	88,819		10.04	%	$	35,370		4.0	%
Common Equity Tier 1 Capital		68,263		13.32	%		26,265		5.1	%
Tier 1 Capital		88,819		17.33	%		33,952		6.6	%
Total Risk Based Capital		94,596		18.46	%		44,201		8.6	%

(1)  The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

The following is a comparison of the Bank’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

											To be well-capitalized
											under prompt
(Dollars in thousands)						For capital					corrective
	Actual					adequacy purposes					action provisions
	Amount		Ratio			Amount		Ratio(1)			Amount		Ratio
As of March 31, 2017
Leverage	$	89,262		9.97	%	$	35,813		4.0	%	$	44,766		5.0	%
Common Equity Tier 1 Capital		89,262		17.35	%		29,583		5.8	%		33,442		6.5	%
Tier 1 Capital		89,262		17.35	%		37,301		7.3	%		41,159		8.0	%
Total Risk Based Capital		94,729		18.41	%		47,591		9.3	%		51,449		10.0	%
As of December 31, 2016
Leverage	$	88,076		9.98	%	$	35,284		4.0	%	$	44,105		5.0	%
Common Equity Tier 1 Capital		88,076		17.23	%		26,194		5.1	%		33,222		6.5	%
Tier 1 Capital		88,076		17.23	%		33,861		6.6	%		40,888		8.0	%
Total Risk Based Capital		93,560		18.31	%		44,083		8.6	%		51,110		10.0	%

(1)  The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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Impact of Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2017

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

9. Impact of Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The main provisions of the update require the identification of performance obligations within a contract and require the recognition of revenue based on a stand-alone allocation of contract revenue to each performance obligation. Performance obligations may be satisfied and revenue recognized over a period of time if: 1) the customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs, or 2) the entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced, or 3) the entity’s performance does not create an asset with an alternative use to the entity, and the entity has an enforceable right to payment for performance completed to date. For public entities the amendments of the update are effective for annual reporting periods beginning after December 15, 2017 including interim periods within that reporting periodThe Company’s revenue is primarily comprised of net interest income on financial asset and liabilities, which are excluded from the scope of ASU 2014-09. Management is still evaluating the impact of ASU 2014-09 on other non-interest income, but does not believe the adoption of ASU 2014-09 will have a material impact on the Company’s financial position, results of operations or cash flows.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities. The main provisions of the update are to eliminate the available for sale classification of accounting for equity securities and to adjust the fair value disclosures for financial instruments carried at amortized costs such that the disclosed fair values represent an exit price as opposed to an entry price. The provisions of this update will require that equity securities be carried at fair market value on the balance sheet and any periodic changes in value will be adjustments to the income statement. A practical expedient is provided for equity securities without a readily determinable fair value, such that these securities can be carried at cost less any impairment. The provisions of this update become effective for interim and annual periods beginning after December 15, 2017. Upon the effective date of the update, changes in the value of the Company's common stock investments will be adjustments to the income statement. Management has concluded that the remaining requirements of this update are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

In February 2016, the FASB issued an update (ASU No. 2016-02, Leases) creating FASB Topic 842, Leases. The guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and requiring more disclosures related to leasing transactions. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted. Management has concluded that based on the Company’s current operating leases, the adoption of ASU 2016-02 will not have a material impact on the Company’s consolidated financial statement and related disclosures.

In March 2016, the FASB issued an update, ASU No. 2016-09, Stock Compensation: Improvements to Employee Share-Based Payment Accounting. The guidance in this update affects any entity that issues share-based payment awards including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flow. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption was permitted. The Company elected to adopt ASU 2016-09 in 2016. As a result of this election, income tax expense decreased by $308,000 during 2016 as a result of recognized excess tax benefits from the exercise of stock options. The presentation of excess tax benefits from the exercise of stock options have been presented on a prospective basis and are included in changes in accrued interest and other assets in the operating activities section of the statement of cash flows. The Company’s excess tax benefits from the exercise of stock options totaled $12,000 in the first quarter of 2017 and $116,000 in the first quarter of 2016.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), commonly referred to as “CECL.” The provisions of the update eliminate the probable initial recognition threshold under current GAAP which requires reserves to be based on an incurred loss methodology. Under CECL, reserves required for financial assets measured at amortized cost will reflect an organization’s estimate of all expected credit losses over the expected term of the financial asset and thereby require the use of reasonable and supportable forecasts to estimate future credit losses. Because CECL encompasses all financial assets carried at amortized cost, the requirement that reserves be established based on an organization’s reasonable and supportable estimate of expected credit losses extends to held to maturity debt securities. Under the provisions of the update, credit losses recognized on available for sale debt securities will be presented as an allowance as opposed to a write-down. In addition, CECL will modify the accounting for purchased loans, with credit deterioration since origination, so that reserves are established at the date of acquisition for purchased loans. Under current GAAP a purchased loan’s contractual balance is adjusted to fair value through a credit discount and no reserve is recorded on the purchased loan upon acquisition. Since under CECL reserves will be established for purchased loans at the time of acquisition, the accounting for purchased loans is made more comparable to the accounting for originated loans. Finally, increased disclosure requirements under CECL oblige organizations to present the currently required credit quality disclosures disaggregated by the year of origination or vintage. FASB expects that the evaluation of underwriting standards and credit quality trends by financial statement users will be enhanced with the additional vintage disclosures. For public entities, the amendments of the update are effective beginning January 1, 2020. Management has initiated an implementation committee to assist in assessing data and system needs for the new standard. Management anticipates the effect will be an increase to the allowance for loan losses upon adoption. However, the size of the overall increase is uncertain at this time.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Payments (a consensus of Emerging Issues Task Force). This ASU attempts to clarify how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The purpose of this update is to reduce existing diversity in practice in eight areas addressed by the update. The amendments in this update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted. Management has concluded that the adoption of ASU 2016-15 will not have a material impact on the Company’s consolidated financial statements and related disclosures.

In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.  The amendments in this Update shorten the amortization period for certain callable debt securities held at a premium.  Specifically, the amendments require the premium to be amortized to the earliest call date.  The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity.  The provisions of this update become effective for interim and annual periods beginning after December 15, 2018.  Management has concluded that based on the Company’s current portfolio of investment securities that the adoption of these amendments will result in shorter amortization period for investment security premiums, which will initially result in lower interest income on investment securities.

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Investments (Tables)

3 Months Ended

Mar. 31, 2017

Investments, Debt and Equity Securities [Abstract]

Available-for-sale Securities [Table Text Block]

A summary of investment securities available-for-sale is as follows:

	As of March 31, 2017
			Gross		Gross
	Amortized		unrealized		unrealized		Estimated
(Dollars in thousands)	cost		gains		losses		fair value
U. S. treasury securities	$	4,990	$	8	$	-	$	4,998
U. S. federal agency obligations		21,419		44		(40)		21,423
Municipal obligations, tax exempt		176,646		893		(2,389)		175,150
Municipal obligations, taxable		67,954		468		(257)		68,165
Agency mortgage-backed securities		118,606		158		(1,067)		117,697
Certificates of deposit		8,724		-		-		8,724
Common stocks		376		387		-		763
Total	$	398,715	$	1,958	$	(3,753)	$	396,920

	As of December 31, 2016
			Gross		Gross
	Amortized		unrealized		unrealized		Estimated
(Dollars in thousands)	cost		gains		losses		fair value
U. S. treasury securities	$	6,005	$	10	$	-	$	6,015
U. S. federal agency obligations		27,140		48		(49)		27,139
Municipal obligations, tax exempt		163,632		696		(2,666)		161,662
Municipal obligations, taxable		71,371		463		(271)		71,563
Agency mortgage-backed securities		109,427		171		(1,222)		108,376
Certificates of deposit		9,700		-		-		9,700
Common stocks		458		650		-		1,108
Total	$	387,733	$	2,038	$	(4,208)	$	385,563

Available For Sale Securities Continuous Unrealized Loss Position Fair Value [Table Text Block]

Securities which were temporarily impaired are shown below, along with the length of time in a continuous unrealized loss position.

			As of March 31, 2017
(Dollars in thousands)			Less than 12 months				12 months or longer				Total
	No. of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	securities		value		losses		value		losses		value		losses
U.S. federal agency obligations		9	$	11,841	$	(40)	$	-	$	-	$	11,841	$	(40)
Municipal obligations, tax exempt		237		95,197		(2,389)		-		-		95,197		(2,389)
Municipal obligations, taxable		66		27,071		(257)		-		-		27,071		(257)
Agency mortgage-backed securities		47		82,491		(1,067)		-		-		82,491		(1,067)
Total		359	$	216,600	$	(3,753)	$	-	$	-	$	216,600	$	(3,753)

			As of December 31, 2016
(Dollars in thousands)			Less than 12 months				12 months or longer				Total
	No. of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	securities		value		losses		value		losses		value		losses
U. S. federal agency obligations		9		15,056		(49)		-		-		15,056	$	(49)
Municipal obligations, tax exempt		275		97,842		(2,666)		-		-		97,842	$	(2,666)
Municipal obligations, taxable		66		26,184		(271)		-		-		26,184	$	(271)
Agency mortgage-backed securities		58		83,011		(1,222)		-		-		83,011	$	(1,222)
Total		408	$	222,093	$	(4,208)	$	-	$	-	$	222,093	$	(4,208)

Investments Classified by Contractual Maturity Date [Table Text Block]

The table includes scheduled principal payments and estimated prepayments, based on observable market inputs, for agency mortgage-backed securities. Actual maturities will differ from contractual maturities because borrowers have the right to prepay obligations with or without prepayment penalties. Securities with no maturity are listed separately.

(Dollars in thousands)	Amortized		Estimated
	cost		fair value
Due in less than one year	$	29,722	$	29,755
Due after one year but within five years		199,365		198,758
Due after five years but within ten years		83,169		82,960
Due after ten years		86,083		84,684
Common stocks		376		763
Total	$	398,715	$	396,920

Schedule of Realized Gain (Loss) [Table Text Block]

Sales proceeds and gross realized gains and losses on sales of available-for-sale securities are as follows for the periods indicated:

(Dollars in thousands)	Three months ended March 31,
	2017		2016
Sales proceeds	$	11,797	$	1,817
Realized gains	$	171	$	16
Realized losses		(24)		(4)
Net realized gains	$	147	$	12

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Loans and Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2017

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Loans consisted of the following as of the dates indicated below:

	March 31,		December 31,
(Dollars in thousands)	2017		2016
One-to-four family residential real estate	$	137,301	$	136,846
Construction and land		16,329		13,738
Commercial real estate		114,759		118,200
Commercial		54,102		54,506
Agriculture		76,124		78,324
Municipal		3,706		3,884
Consumer		21,088		20,271
Total gross loans		423,409		425,769
Net deferred loan costs and loans in process		(127)		36
Allowance for loan losses		(5,327)		(5,344)
Loans, net	$	417,955	$	420,461

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The following tables provide information on the Company’s allowance for loan losses by loan class and allowance methodology:

	Three months ended March 31, 2017
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Balance at January 1, 2017	$	504	$	53	$	1,777	$	1,119	$	1,684	$	12	$	195	$	5,344
Charge-offs		(19)		-		-		-		-		-		(107)		(126)
Recoveries		1		-		-		8		1		-		49		59
Provision for loan losses		7		18		(37)		(26)		46		(1)		43		50
Balance at March 31, 2017		493		71		1,740		1,101		1,731		11		180		5,327

	Three months ended March 31, 2016
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Balance at January 1, 2016	$	925	$	77	$	1,740	$	1,530	$	1,428	$	23	$	199	$	5,922
Charge-offs		-		-		-		-		-		-		(137)		(137)
Recoveries		2		-		-		19		-		-		13		34
Provision for loan losses		(63)		5		91		(165)		55		1		126		50
Balance at March 31, 2016		864		82		1,831		1,384		1,483		24		201		5,869

	As of March 31, 2017
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		106		70		132		-		-		308
Collectively evaluated for loss		493		71		1,634		1,031		1,599		11		180		5,019
Total		493		71		1,740		1,101		1,731		11		180		5,327
Loan balances:
Individually evaluated for loss		665		1,851		2,437		320		983		221		39		6,516
Collectively evaluated for loss		136,636		14,478		112,322		53,782		75,141		3,485		21,049		416,893
Total	$	137,301	$	16,329	$	114,759	$	54,102	$	76,124	$	3,706	$	21,088	$	423,409

	As of December 31, 2016
(Dollars in thousands)	One-to-four
	family
	residential		Construction		Commercial
	real estate		and land		real estate		Commercial		Agriculture		Municipal		Consumer		Total
Allowance for loan losses:
Individually evaluated for loss		-		-		81		87		89		-		17		274
Collectively evaluated for loss		504		53		1,696		1,032		1,595		12		178		5,070
Total		504		53		1,777		1,119		1,684		12		195		5,344
Loan balances:
Individually evaluated for loss		780		1,937		2,445		355		881		258		72		6,728
Collectively evaluated for loss		136,066		11,801		115,755		54,151		77,443		3,626		20,199		419,041
Total	$	136,846	$	13,738	$	118,200	$	54,506	$	78,324	$	3,884	$	20,271	$	425,769

Impaired Financing Receivables [Table Text Block]

The following tables present information on impaired loans:

(Dollars in thousands)	As of March 31, 2017
					Impaired		Impaired						Year-to-
	Unpaid				loans		loans with		Related		Year-to-		date interest
	contractual		Impaired		without an		an		allowance		date average		income
	principal		loan balance		allowance		allowance		recorded		loan balance		recognized
One-to-four family residential real estate	$	665	$	665	$	665	$	-	$	-	$	669	$	2
Construction and land		3,586		1,851		1,851		-		-		1,899		16
Commercial real estate		2,437		2,437		2,151		286		106		2,449		124
Commercial		320		320		29		291		70		332		-
Agriculture		1,198		983		102		881		132		996		1
Municipal		221		221		221		-		-		251		2
Consumer		39		39		39		-		-		39		-
Total impaired loans	$	8,466	$	6,516	$	5,058	$	1,458	$	308	$	6,635	$	145

(Dollars in thousands)	As of December 31, 2016
					Impaired		Impaired						Year-to-
	Unpaid				loans		loans with		Related		Year-to-		date interest
	contractual		Impaired		without an		an		allowance		date average		income
	principal		loan balance		allowance		allowance		recorded		loan balance		recognized
One-to-four family residential real estate	$	780	$	780	$	780	$	-	$	-	$	798	$	7
Construction and land		3,672		1,937		1,937		-		-		2,068		72
Commercial real estate		2,445		2,445		2,145		300		81		2,587		505
Commercial		355		355		46		309		87		425		2
Agriculture		1,173		881		147		734		89		1,000		2
Municipal		258		258		258		-		-		418		-
Consumer		72		72		55		17		17		78		13
Total impaired loans	$	8,755	$	6,728	$	5,368	$	1,360	$	274	$	7,374	$	601

Past Due Financing Receivables [Table Text Block]

The following tables present information on the Company’s past due and non-accrual loans by loan class:

(Dollars in thousands)	As of March 31, 2017
	30-59 days			60-89 days			90 days or
	delinquent			delinquent			more			Total past						Total past
	and			and			delinquent			due loans			Non-accrual			due and non-			Total loans
	accruing			accruing			and accruing			accruing			loans			accrual loans			not past due
One-to-four family residential real estate		334			92			-			426		$	484		$	910		$	136,391
Construction and land		-			-			-			-			595			595			15,734
Commercial real estate		260			69			-			329			286			615			114,144
Commercial		160			13			-			173			316			489			53,613
Agriculture		58			328			-			386			940			1,326			74,798
Municipal		-			-			-			-			-			-			3,706
Consumer		40			18			-			58			39			97			20,991
Total	$	852		$	520		$	-		$	1,372		$	2,660		$	4,032		$	419,377
Percent of gross loans		0.20	%		0.12	%		0.00	%		0.32	%		0.63	%		0.95	%		99.05	%

(Dollars in thousands)	As of December 31, 2016
	30-59 days			60-89 days			90 days or
	delinquent			delinquent			more			Total past						Total past
	and			and			delinquent			due loans			Non-accrual			due and non-			Total loans
	accruing			accruing			and accruing			accruing			loans			accrual loans			not past due
One-to-four family residential real estate	$	215		$	388		$	-		$	603		$	595		$	1,198		$	135,648
Construction and land		-			-			-			-			599			599			13,139
Commercial real estate		-			-			-			-			300			300			117,900
Commercial		13			5			-			18			342			360			54,146
Agriculture		55			-			-			55			838			893			77,431
Municipal		-			-			-			-			-			-			3,884
Consumer		79			3			-			82			72			154			20,117
Total	$	362		$	396		$	-		$	758		$	2,746		$	3,504		$	422,265
Percent of gross loans		0.09	%		0.09	%		0.00	%		0.18	%		0.64	%		0.82	%		99.18	%

Risk Categories By Loan Class [Table Text Block]

The following table provides information on the Company’s risk categories by loan class:

	As of March 31, 2017				As of December 31, 2016
(Dollars in thousands)	Nonclassified		Classified		Nonclassified		Classified
One-to-four family residential real estate	$	136,143	$	1,158	$	135,640	$	1,206
Construction and land		15,734		595		13,138		600
Commercial real estate		108,527		6,232		111,641		6,559
Commercial		50,614		3,488		51,080		3,426
Agriculture		71,377		4,747		73,564		4,760
Municipal		3,706		-		3,884		-
Consumer		21,037		51		20,181		90
Total	$	407,138	$	16,271	$	409,128	$	16,641

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

The following table presents information on loans that are classified as TDRs:

(Dollars in thousands)	As of March 31, 2017						As of December 31, 2016
	Number of		Non-accrual		Accruing		Number of		Non-accrual		Accruing
	loans		balance		balance		loans		balance		balance
One-to-four family residential real estate		2	$	-	$	181		2	$	-	$	185
Construction and land		4		583		1,256		4		588		1,338
Commercial real estate		4		50		2,151		3		64		2,145
Commercial		1		-		3		2		-		13
Agriculture		5		268		44		4		268		44
Municipal		2		-		221		2		-		258
Total troubled debt restructurings		18	$	901	$	3,856		17	$	920	$	3,983

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Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets and Goodwill [Table Text Block]

A summary of the other intangible assets that continue to be subject to amortization is as follows:

(Dollars in thousands)	As of March 31, 2017
	Gross carrying		Accumulated		Net carrying
	amount		amortization		amount
Core deposit intangible assets	$	2,067	$	(1,201)	$	866
Lease intangible asset		350		(154)		196
Mortgage servicing rights		5,873		(3,086)		2,787
Total other intangible assets	$	8,290	$	(4,441)	$	3,849

(Dollars in thousands)	As of December 31, 2016
	Gross carrying		Accumulated		Net carrying
	amount		amortization		amount
Core deposit intangible assets	$	2,067	$	(1,137)	$	930
Lease intangible asset		350		(143)		207
Mortgage servicing rights		5,788		(2,939)		2,849
Total other intangible assets	$	8,205	$	(4,219)	$	3,986

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

The following sets forth estimated amortization expense for core deposit and lease intangible assets for the remainder of 2017 and in successive years ending December 31:

(Dollars in thousands)	Amortization
	expense
Remainder of 2017	$	214
2018		252
2019		214
2020		177
2021		121
Thereafter		84
Total	$	1,062

Schedule of Participating Mortgage Loans [Table Text Block]

The following table provides information on the principal balances of mortgage loans serviced for others:

(Dollars in thousands)	March 31,		December 31,
	2017		2016
FHLMC	$	487,990	$	483,356
FHLB		10,851		11,393
Total	$	498,841	$	494,749

Servicing Asset at Amortized Cost [Table Text Block]

Activity for mortgage servicing rights is as follows:

	Three months ended
(Dollars in thousands)	March 31,
	2017		2016
Mortgage servicing rights:
Balance at beginning of period	$	2,849	$	2,840
Additions		161		221
Amortization		(223)		(253)
Balance at end of period	$	2,787	$	2,808

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Earnings per Share (Tables)

3 Months Ended

Mar. 31, 2017

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The shares used in the calculation of basic and diluted earnings per share are shown below:

	Three months ended
(Dollars in thousands, except per share amounts)	March 31,
	2017		2016
Net earnings (1)	$	2,205	$	2,393
Weighted average common shares outstanding - basic (2)		3,869,799		3,734,638
Assumed exercise of stock options (1)(2)		79,149		100,200
Weighted average common shares outstanding - diluted (1)(2)		3,948,948		3,834,838
Net earnings per share (1)(2):
Basic	$	0.57	$	0.64
Diluted	$	0.56	$	0.63

(1) Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

(2) Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

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Repurchase Agreements (Tables)

3 Months Ended

Mar. 31, 2017

Banking and Thrift [Abstract]

Schedule of Repurchase Agreements [Table Text Block]

The following is a summary of the balances and collateral of the Company’s repurchase agreements:

	As of March 31, 2017
	Overnight and						Greater
	Continuous		Up to 30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	2,564	$	-	$	-	$	-	$	2,564
Agency mortgage-backed securities		10,927		-		-		-		10,927
Total	$	13,491	$	-	$	-	$	-	$	13,491

	As of December 31, 2016
	Overnight and		Up to				Greater
	Continuous		30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal agency obligations	$	5,007	$	-	$	-	$	-	$	5,007
Agency mortgage-backed securities		7,476		-		-		-		7,476
Total	$	12,483	$	-	$	-	$	-	$	12,483

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Fair Value of Financial Instruments and Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value, by Balance Sheet Grouping [Table Text Block]

Fair value estimates of the Company’s financial instruments as of March 31, 2017 and December 31, 2016, including methods and assumptions utilized, are set forth below:

(Dollars in thousands)	As of March 31, 2017
	Carrying
	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	20,062	$	20,062	$	-	$	-	$	20,062
Investment securities available-for-sale		396,920		5,761		391,159		-		396,920
Bank stocks, at cost		5,323		n/a		n/a		n/a		n/a
Loans, net		417,955		-		-		416,130		416,130
Loans held for sale		8,588		-		8,588		-		8,588
Derivative financial instruments		966		-		966		-		966
Accrued interest receivable		3,874		16		2,067		1,791		3,874
Financial liabilities:
Non-maturity deposits	$	(613,489)	$	(613,489)	$	-	$	-		(613,489)
Time deposits		(139,197)		-		(137,820)		-		(137,820)
FHLB borrowings		(33,450)		-		(33,967)		-		(33,967)
Subordinated debentures		(21,334)		-		(18,731)		-		(18,731)
Other borrowings		(13,491)		-		(13,491)		-		(13,491)
Derivative financial instruments		(154)		-		(154)		-		(154)
Accrued interest payable		(253)		-		(253)		-		(253)

	As of December 31, 2016
	Carrying
	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	19,996	$	19,996	$	-	$	-	$	19,996
Investment securities available-for-sale		385,563		7,123		378,440		-		385,563
Bank stocks, at cost		5,299		n/a		n/a		n/a		n/a
Loans, net		420,461		-		-		417,957		417,957
Loans held for sales		5,517		-		5,517		-		5,517
Derivative financial instruments		662		-		662		-		662
Accrued interest receivable		4,240		21		2,104		2,115		4,240
Financial liabilities:
Non-maturity deposits	$	(601,683)	$	(601,683)	$	-	$	-		(601,683)
Time deposits		(139,838)		-		(138,623)		-		(138,623)
FHLB borrowings		(39,100)		-		(35,695)		-		(35,695)
Subordinated debentures		(21,284)		-		(18,608)		-		(18,608)
Other borrowings		(12,483)		-		(12,483)		-		(12,483)
Accrued interest payable		(268)		-		(268)		-		(268)

Fair Value, Assets Measured On Recurring Basis [Table Text Block]

The following tables represent the Company’s financial instruments that are measured at fair value on a recurring basis at March 31, 2017 and December 31, 2016, allocated to the appropriate fair value hierarchy:

(Dollars in thousands)			As of March 31, 2017
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	4,998	$	4,998	$	-	$	-
U. S. federal agency obligations		21,423		-		21,423		-
Municipal obligations, tax exempt		175,150		-		175,150		-
Municipal obligations, taxable		68,165		-		68,165		-
Mortgage-backed securities		117,697		-		117,697		-
Common stocks		763		763		-		-
Certificates of deposit		8,724		-		8,724		-
Loans held for sale		8,588		-		8,588		-
Derivative financial instruments		966		-		966		-
Liabililty:
Derivative financial instruments		(154)		-		(154)		-

(Dollars in thousands)			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale investment securities:
U. S. treasury securities	$	6,015	$	6,015	$	-	$	-
U. S. federal agency obligations		27,139		-		27,139		-
Municipal obligations, tax exempt		161,662		-		161,662		-
Municipal obligations, taxable		71,563		-		71,563		-
Agency mortgage-backed securities		108,376		-		108,376		-
Common stocks		1,108		1,108		-		-
Certificates of deposit		9,700		-		9,700		-
Loans held for sale		5,517		-		5,517		-
Derivative financial instruments		662		-		662		-

Schedule Of Fair Value Contractual Balance And Gain Loss On Loans Held For Sale [Table Text Block]

The aggregate fair value, contractual balance (including accrued interest), and gain on loans held for sale were as follows:

	As of		As of
	March 31,		December 31,
(Dollars in thousands)	2017		2016
Aggregate fair value	$	8,588	$	5,517
Contractual balance		8,443		5,480
Gain	$	145	$	37

Schedule of Gains and Losses from Changes in Fair Value of Loans Held for Sale [Table Text Block]

The total amount of gains from changes in fair value of loans held for sale included in earnings were as follows:

	Three months ended
	March 31,
(Dollars in thousands)	2017		2016
Interest income	$	45	$	105
Change in fair value		109		79
Total change in fair value	$	154	$	184

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques [Table Text Block]

The following tables represent the Company’s financial instruments that are measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016 allocated to the appropriate fair value hierarchy:

(Dollars in thousands)
			As of March 31, 2017
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	180	$	-	$	-	$	180
Commercial		221		-		-	$	221
Agriculture		749		-		-	$	749
Real estate owned:
One-to-four family residential real estate		329		-		-		329

			As of December 31, 2016
			Fair value hierarchy
	Total		Level 1		Level 2		Level 3
Assets:
Impaired loans:
Commercial real estate	$	219	$	-	$	-	$	219
Commercial		222		-		-		222
Agriculture		645		-		-		645
Real estate owned:
One-to-four family residential real estate		142		-		-		142

Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block]

The following table presents quantitative information about Level 3 fair value measurements measured at fair value on a non-recurring basis as of March 31, 2017 and December 31, 2016.

(Dollars in thousands)
	Fair value		Valuation technique	Unobservable inputs	Range
As of March 31, 2017
Impaired loans:
Commercial real estate	$	180	Sales comparison	Adjustment to appraised value		0%-60%
Commercial		221	Sales comparison	Adjustment to appraised value		0%-80%
Agriculture		749	Sales comparison	Adjustment to appraised value		8%-80%
Real estate owned:
One-to-four family residential real estate		329	Sales comparison	Adjustment to appraised value		10%
As of December 31, 2016
Impaired loans:
Commercial real estate	$	219	Sales comparison	Adjustment to appraised value		2%-15%
Commercial		222	Sales comparison	Adjustment to comparable sales		7%-80%
Agriculture		645	Sales comparison	Adjustment to comparable sales		8%-80%
Real estate owned:
One-to-four family residential real estate		142	Sales comparison	Adjustment to appraised value		10%

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Regulatory Capital Requirements (Tables)

3 Months Ended

Mar. 31, 2017

Banking and Thrift [Abstract]

Schedule of Compliance with Regulatory Capital Requirements for Mortgage Companies [Table Text Block]

The following is a comparison of the Company’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

(Dollars in thousands)						For capital
	Actual					adequacy purposes
	Amount		Ratio			Amount		Ratio (1)
As of March 31, 2017
Leverage	$	90,260		10.05	%	$	35,914		4.0	%
Common Equity Tier 1 Capital		69,609		13.49	%		29,672		5.8	%
Tier 1 Capital		90,260		17.49	%		37,413		7.3	%
Total Risk Based Capital		95,901		18.58	%		47,733		9.3	%
As of December 31, 2016
Leverage	$	88,819		10.04	%	$	35,370		4.0	%
Common Equity Tier 1 Capital		68,263		13.32	%		26,265		5.1	%
Tier 1 Capital		88,819		17.33	%		33,952		6.6	%
Total Risk Based Capital		94,596		18.46	%		44,201		8.6	%

(1)  The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations [Table Text Block]

The following is a comparison of the Bank’s regulatory capital to minimum capital requirements at March 31, 2017 and December 31, 2016:

											To be well-capitalized
											under prompt
(Dollars in thousands)						For capital					corrective
	Actual					adequacy purposes					action provisions
	Amount		Ratio			Amount		Ratio(1)			Amount		Ratio
As of March 31, 2017
Leverage	$	89,262		9.97	%	$	35,813		4.0	%	$	44,766		5.0	%
Common Equity Tier 1 Capital		89,262		17.35	%		29,583		5.8	%		33,442		6.5	%
Tier 1 Capital		89,262		17.35	%		37,301		7.3	%		41,159		8.0	%
Total Risk Based Capital		94,729		18.41	%		47,591		9.3	%		51,449		10.0	%
As of December 31, 2016
Leverage	$	88,076		9.98	%	$	35,284		4.0	%	$	44,105		5.0	%
Common Equity Tier 1 Capital		88,076		17.23	%		26,194		5.1	%		33,222		6.5	%
Tier 1 Capital		88,076		17.23	%		33,861		6.6	%		40,888		8.0	%
Total Risk Based Capital		93,560		18.31	%		44,083		8.6	%		51,110		10.0	%

(1)  The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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Investments (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	$ 398,715	$ 387,733
Gross unrealized gains	1,958	2,038
Gross unrealized losses	(3,753)	(4,208)
Estimated fair value	396,920	385,563
U. S. treasury securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	4,990	6,005
Gross unrealized gains	8	10
Gross unrealized losses	0	0
Estimated fair value	4,998	6,015
Common stocks [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	376	458
Gross unrealized gains	387	650
Gross unrealized losses	0	0
Estimated fair value	763	1,108
U. S. federal agency obligations [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	21,419	27,140
Gross unrealized gains	44	48
Gross unrealized losses	(40)	(49)
Estimated fair value	21,423	27,139
Municipal obligations, tax exempt [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	176,646	163,632
Gross unrealized gains	893	696
Gross unrealized losses	(2,389)	(2,666)
Estimated fair value	175,150	161,662
Municipal obligations, taxable [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	67,954	71,371
Gross unrealized gains	468	463
Gross unrealized losses	(257)	(271)
Estimated fair value	68,165	71,563
Agency mortgage-backed securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	118,606	109,427
Gross unrealized gains	158	171
Gross unrealized losses	(1,067)	(1,222)
Estimated fair value	117,697	108,376
Certificates of deposit [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized cost	8,724	9,700
Gross unrealized gains	0	0
Gross unrealized losses	0	0
Estimated fair value	$ 8,724	$ 9,700

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Investments (Details 1) $ in Thousands	Mar. 31, 2017 USD ($) Number	Dec. 31, 2016 USD ($) Number
Schedule of Available-for-sale Securities [Line Items]
No. of securities | Number	359	408
Fair value, Less than 12 months	$ 216,600	$ 222,093
Unrealized losses, Less than 12 months	(3,753)	(4,208)
Fair value, 12 months or longer	0	0
Unrealized losses, 12 months or longer	0	0
Total, Fair value	216,600	222,093
Total, Unrealized losses	$ (3,753)	$ (4,208)
U.S. federal agency obligations [Member]
Schedule of Available-for-sale Securities [Line Items]
No. of securities | Number	9	9
Fair value, Less than 12 months	$ 11,841	$ 15,056
Unrealized losses, Less than 12 months	(40)	(49)
Fair value, 12 months or longer	0	0
Unrealized losses, 12 months or longer	0	0
Total, Fair value	11,841	15,056
Total, Unrealized losses	$ (40)	$ (49)
Municipal obligations, tax exempt [Member]
Schedule of Available-for-sale Securities [Line Items]
No. of securities | Number	237	275
Fair value, Less than 12 months	$ 95,197	$ 97,842
Unrealized losses, Less than 12 months	(2,389)	(2,666)
Fair value, 12 months or longer	0	0
Unrealized losses, 12 months or longer	0	0
Total, Fair value	95,197	97,842
Total, Unrealized losses	$ (2,389)	$ (2,666)
Municipal obligations, taxable [Member]
Schedule of Available-for-sale Securities [Line Items]
No. of securities | Number	66	66
Fair value, Less than 12 months	$ 27,071	$ 26,184
Unrealized losses, Less than 12 months	(257)	(271)
Fair value, 12 months or longer	0	0
Unrealized losses, 12 months or longer	0	0
Total, Fair value	27,071	26,184
Total, Unrealized losses	$ (257)	$ (271)
Agency mortgage-backed securities [Member]
Schedule of Available-for-sale Securities [Line Items]
No. of securities | Number	47	58
Fair value, Less than 12 months	$ 82,491	$ 83,011
Unrealized losses, Less than 12 months	(1,067)	(1,222)
Fair value, 12 months or longer	0	0
Unrealized losses, 12 months or longer	0	0
Total, Fair value	82,491	83,011
Total, Unrealized losses	$ (1,067)	$ (1,222)

XML

Investments (Details 2) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Amortized cost, Due in less than one year	$ 29,722
Amortized cost, Due after one year but within five years	199,365
Amortized cost, Due after five years but within ten years	83,169
Amortized cost, Due after ten years	86,083
Amortized cost, Common stocks	376
Amortized cost, Total	398,715	$ 387,733
Estimated fair value, Due in less than one year	29,755
Estimated fair value, Due after one year but within five years	198,758
Estimated fair value, Due after five years but within ten years	82,960
Estimated fair value, Due after ten years	84,684
Estimated fair value, Common stocks	763
Estimated fair value, Total	$ 396,920	$ 385,563

XML

Investments (Details 3) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Sales proceeds	$ 11,797	$ 1,817
Realized gains	171	16
Realized losses	(24)	(4)
Net realized gains	$ 147	$ 12

XML

Investments (Details Textual) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Security Owned and Pledged as Collateral, Fair Value, Total	$ 217.5	$ 224.3
Equity Method Investment, Ownership Percentage	10.00%

XML

Loans and Allowance for Loan Losses (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	$ 423,409	$ 425,769
Net deferred loan costs and loans in process	(127)	36
Allowance for loan losses	(5,327)	(5,344)	$ (5,869)	$ (5,922)
Loans, net	417,955	420,461
Residential Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	137,301	136,846
Allowance for loan losses	(493)	(504)	(864)	(925)
Loans, net	137,301	136,846
Construction Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	16,329	13,738
Allowance for loan losses	(71)	(53)	(82)	(77)
Loans, net	16,329	13,738
Commercial Real Estate [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	114,759	118,200
Allowance for loan losses	(1,740)	(1,777)	(1,831)	(1,740)
Loans, net	114,759	118,200
Commercial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	54,102	54,506
Allowance for loan losses	(1,101)	(1,119)	(1,384)	(1,530)
Loans, net	54,102	54,506
Agriculture [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	76,124	78,324
Allowance for loan losses	(1,731)	(1,684)	(1,483)	(1,428)
Loans, net	76,124	78,324
Municipal Bonds [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	3,706	3,884
Allowance for loan losses	(11)	(12)	(24)	(23)
Loans, net	3,706	3,884
Consumer [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total gross loans	21,088	20,271
Allowance for loan losses	(180)	(195)	$ (201)	$ (199)
Loans, net	$ 21,088	$ 20,271

XML

Loans and Allowance for Loan Losses (Details 1) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Dec. 31, 2016
Allowance for loan losses:
Balance	$ 5,344	$ 5,922
Charge-offs	(126)	(137)
Recoveries	59	34
Provision for loan losses	50	50
Balance	5,327	5,869
Allowance for loan losses:
Individually evaluated for loss			$ 308	$ 274
Collectively evaluated for loss			5,019	5,070
Total	5,327	5,922	5,327	5,344
Loan balances:
Individually evaluated for loss			6,516	6,728
Collectively evaluated for loss			416,893	419,041
Total			417,955	420,461
Residential Real Estate [Member]
Allowance for loan losses:
Balance	504	925
Charge-offs	(19)	0
Recoveries	1	2
Provision for loan losses	7	(63)
Balance	493	864
Allowance for loan losses:
Individually evaluated for loss			0	0
Collectively evaluated for loss			493	504
Total	504	925	493	504
Loan balances:
Individually evaluated for loss			665	780
Collectively evaluated for loss			136,636	136,066
Total			137,301	136,846
Construction Loans [Member]
Allowance for loan losses:
Balance	53	77
Charge-offs	0	0
Recoveries	0	0
Provision for loan losses	18	5
Balance	71	82
Allowance for loan losses:
Individually evaluated for loss			0	0
Collectively evaluated for loss			71	53
Total	53	77	71	53
Loan balances:
Individually evaluated for loss			1,851	1,937
Collectively evaluated for loss			14,478	11,801
Total			16,329	13,738
Commercial Real Estate [Member]
Allowance for loan losses:
Balance	1,777	1,740
Charge-offs	0	0
Recoveries	0	0
Provision for loan losses	(37)	91
Balance	1,740	1,831
Allowance for loan losses:
Individually evaluated for loss			106	81
Collectively evaluated for loss			1,634	1,696
Total	1,777	1,740	1,740	1,777
Loan balances:
Individually evaluated for loss			2,437	2,445
Collectively evaluated for loss			112,322	115,755
Total			114,759	118,200
Commercial [Member]
Allowance for loan losses:
Balance	1,119	1,530
Charge-offs	0	0
Recoveries	8	19
Provision for loan losses	(26)	(165)
Balance	1,101	1,384
Allowance for loan losses:
Individually evaluated for loss			70	87
Collectively evaluated for loss			1,031	1,032
Total	1,119	1,530	1,101	1,119
Loan balances:
Individually evaluated for loss			320	355
Collectively evaluated for loss			53,782	54,151
Total			54,102	54,506
Agriculture [Member]
Allowance for loan losses:
Balance	1,684	1,428
Charge-offs	0	0
Recoveries	1	0
Provision for loan losses	46	55
Balance	1,731	1,483
Allowance for loan losses:
Individually evaluated for loss			132	89
Collectively evaluated for loss			1,599	1,595
Total	1,684	1,428	1,731	1,684
Loan balances:
Individually evaluated for loss			983	881
Collectively evaluated for loss			75,141	77,443
Total			76,124	78,324
Municipal Bonds [Member]
Allowance for loan losses:
Balance	12	23
Charge-offs	0	0
Recoveries	0	0
Provision for loan losses	(1)	1
Balance	11	24
Allowance for loan losses:
Individually evaluated for loss			0	0
Collectively evaluated for loss			11	12
Total	12	23	11	12
Loan balances:
Individually evaluated for loss			221	258
Collectively evaluated for loss			3,485	3,626
Total			3,706	3,884
Consumer [Member]
Allowance for loan losses:
Balance	195	199
Charge-offs	(107)	(137)
Recoveries	49	13
Provision for loan losses	43	126
Balance	180	201
Allowance for loan losses:
Individually evaluated for loss			0	17
Collectively evaluated for loss			180	178
Total	$ 195	$ 199	180	195
Loan balances:
Individually evaluated for loss			39	72
Collectively evaluated for loss			21,049	20,199
Total			$ 21,088	$ 20,271

XML

Loans and Allowance for Loan Losses (Details 2) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	$ 8,466	$ 8,755
Impaired loan balance	6,516	6,728
Impaired loans without an allowance	5,058	5,368
Impaired loans with an allowance	1,458	1,360
Related allowance recorded	308	274
Year-to-date average loan balance	6,635	7,374
Year-to-date interest income recognized	145	601
Residential Real Estate [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	665	780
Impaired loan balance	665	780
Impaired loans without an allowance	665	780
Impaired loans with an allowance	0	0
Related allowance recorded	0	0
Year-to-date average loan balance	669	798
Year-to-date interest income recognized	2	7
Construction Loans [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	3,586	3,672
Impaired loan balance	1,851	1,937
Impaired loans without an allowance	1,851	1,937
Impaired loans with an allowance	0	0
Related allowance recorded	0	0
Year-to-date average loan balance	1,899	2,068
Year-to-date interest income recognized	16	72
Commercial Real Estate [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	2,437	2,445
Impaired loan balance	2,437	2,445
Impaired loans without an allowance	2,151	2,145
Impaired loans with an allowance	286	300
Related allowance recorded	106	81
Year-to-date average loan balance	2,449	2,587
Year-to-date interest income recognized	124	505
Commercial [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	320	355
Impaired loan balance	320	355
Impaired loans without an allowance	29	46
Impaired loans with an allowance	291	309
Related allowance recorded	70	87
Year-to-date average loan balance	332	425
Year-to-date interest income recognized	0	2
Agriculture [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	1,198	1,173
Impaired loan balance	983	881
Impaired loans without an allowance	102	147
Impaired loans with an allowance	881	734
Related allowance recorded	132	89
Year-to-date average loan balance	996	1,000
Year-to-date interest income recognized	1	2
Municipal [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	221	258
Impaired loan balance	221	258
Impaired loans without an allowance	221	258
Impaired loans with an allowance	0	0
Related allowance recorded	0	0
Year-to-date average loan balance	251	418
Year-to-date interest income recognized	2	0
Consumer [Member]
Financing Receivable, Impaired [Line Items]
Unpaid contractual principal	39	72
Impaired loan balance	39	72
Impaired loans without an allowance	39	55
Impaired loans with an allowance	0	17
Related allowance recorded	0	17
Year-to-date average loan balance	39	78
Year-to-date interest income recognized	$ 0	$ 13

XML

Loans and Allowance for Loan Losses (Details 3) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	$ 0	$ 0
Loans, Total past due loans accruing	1,372	758
Loans, Non-accrual loans	2,660	2,746
Loan, Total past due and non-accrual loans	4,032	3,504
Loan, Total loans not past due	$ 419,377	$ 422,265
Percent of gross loans, 30-59 days delinquent and accruing	0.20%	0.09%
Percent of gross loans, 60-89 days delinquent and accruing	0.12%	0.09%
Percent of gross loans, 90 days or more delinquent and accruing	0.00%	0.00%
Percentage of gross loans, Total past due loans accruing	0.32%	0.18%
Percent of gross loans, Non-accrual loans	0.63%	0.64%
Percentage of Total past due and non-accrual loans	0.95%	0.82%
Percentage of Total loans not past due	99.05%	99.18%
Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	$ 852	$ 362
Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	520	396
Residential Real Estate [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	426	603
Loans, Non-accrual loans	484	595
Loan, Total past due and non-accrual loans	910	1,198
Loan, Total loans not past due	136,391	135,648
Residential Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	334	215
Residential Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	92	388
Construction Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	0	0
Loans, Non-accrual loans	595	599
Loan, Total past due and non-accrual loans	595	599
Loan, Total loans not past due	15,734	13,139
Construction Loans [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	0	0
Construction Loans [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	0	0
Commercial Real Estate [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	329	0
Loans, Non-accrual loans	286	300
Loan, Total past due and non-accrual loans	615	300
Loan, Total loans not past due	114,144	117,900
Commercial Real Estate [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	260	0
Commercial Real Estate [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	69	0
Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	173	18
Loans, Non-accrual loans	316	342
Loan, Total past due and non-accrual loans	489	360
Loan, Total loans not past due	53,613	54,146
Commercial [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	160	13
Commercial [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	13	5
Agriculture [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	386	55
Loans, Non-accrual loans	940	838
Loan, Total past due and non-accrual loans	1,326	893
Loan, Total loans not past due	74,798	77,431
Agriculture [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	58	55
Agriculture [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	328	0
Municipal [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	0	0
Loans, Non-accrual loans	0	0
Loan, Total past due and non-accrual loans	0	0
Loan, Total loans not past due	3,706	3,884
Municipal [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	0	0
Municipal [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	0	0
Consumer [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans, 90 days or more delinquent and accruing	0	0
Loans, Total past due loans accruing	58	82
Loans, Non-accrual loans	39	72
Loan, Total past due and non-accrual loans	97	154
Loan, Total loans not past due	20,991	20,117
Consumer [Member] | Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	40	79
Consumer [Member] | Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable, Recorded Investment, Past Due	$ 18	$ 3

XML

Loans and Allowance for Loan Losses (Details 4) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	$ 423,409	$ 425,769
Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	407,138	409,128
Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	16,271	16,641
Residential Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	137,301	136,846
Residential Real Estate [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	136,143	135,640
Residential Real Estate [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	1,158	1,206
Construction Loans [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	16,329	13,738
Construction Loans [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	15,734	13,138
Construction Loans [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	595	600
Commercial Real Estate [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	114,759	118,200
Commercial Real Estate [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	108,527	111,641
Commercial Real Estate [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	6,232	6,559
Commercial [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	50,614	51,080
Commercial [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	3,488	3,426
Municipal [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	3,706	3,884
Municipal [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	3,706	3,884
Municipal [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	0	0
Agriculture [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	76,124	78,324
Agriculture [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	71,377	73,564
Agriculture [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	4,747	4,760
Consumer [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	21,088	20,271
Consumer [Member] | Loans Receivables Non Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	21,037	20,181
Consumer [Member] | Loans Receivables Classified [Member]
Financing Receivable, Modifications [Line Items]
Loans and Leases Receivable, Gross, Total	$ 51	$ 90

XML

Loans and Allowance for Loan Losses (Details 5) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017 USD ($) Number	Dec. 31, 2016 USD ($) Number
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 2,660	$ 2,746
Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	18	17
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 901	$ 920
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	$ 3,856	$ 3,983
Municipal [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	2	2
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 0	$ 0
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	221	258
Commercial [Member]
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 316	$ 342
Commercial [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	1	2
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 0	$ 0
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	$ 3	$ 13
Construction Loans [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	4	4
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 583	$ 588
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	$ 1,256	$ 1,338
Agriculture [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	5	4
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 268	$ 268
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	44	44
Residential Real Estate [Member]
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 484	$ 595
Residential Real Estate [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	2	2
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 0	$ 0
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	181	185
Commercial Real Estate [Member]
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 286	$ 300
Commercial Real Estate [Member] | Troubled Debt Restructurings [Member]
Troubled debt restructurings, Number of loans | Number	4	3
Financing Receivable, Modifications, Recorded Investment, Non Accrual Balance	$ 50	$ 64
Financing Receivable, Modifications, Recorded Investment, Accruing Balance	$ 2,151	$ 2,145

XML

Loans and Allowance for Loan Losses (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Financing Receivable Loan Balance Charged Off	$ 67,000	$ 103,000
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans	31,000	33,000
Impaired Financing Receivable, Recorded Investment, Total	6,516,000		$ 6,728,000
Loans and Leases Receivable, Allowance	5,327,000	$ 5,869,000	5,344,000	$ 5,922,000
Provision For Loan Losses Reversal	13,000
Trouble Debt Restructurings [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans Receivable, Gross, Commercial, Real Estate, Total	11,000
Loans Receivable, Gross, Commercial, Agricultural	44,000		15,000
Loans and Leases Receivable, Allowance	67,000		80,000
Construction Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans and Leases Receivable, Impaired, Commitment to Lend	84,000
Minimum [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Financing Receivable, Recorded Investment, Total			$ 6,700,000
Maximum [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Financing Receivable, Recorded Investment, Total	$ 6,500,000

XML

Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross carrying amount	$ 8,290	$ 8,205
Intangible assets, Accumulated amortization	(4,441)	(4,219)
Intangible assets, Net carrying amount	3,849	3,986
Core deposit intangible assets [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross carrying amount	2,067	2,067
Intangible assets, Accumulated amortization	(1,201)	(1,137)
Intangible assets, Net carrying amount	866	930
Lease intangible asset [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross carrying amount	350	350
Intangible assets, Accumulated amortization	(154)	(143)
Intangible assets, Net carrying amount	196	207
Mortgage servicing rights [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Gross carrying amount	5,873	5,788
Intangible assets, Accumulated amortization	(3,086)	(2,939)
Intangible assets, Net carrying amount	$ 2,787	$ 2,849

XML

Goodwill and Other Intangible Assets (Details 1) $ in Thousands	Mar. 31, 2017 USD ($)
Finite-Lived Intangible Assets [Line Items]
Remainder of 2017	$ 214
2018	252
2019	214
2020	177
2021	121
Thereafter	84
Total	$ 1,062

XML

Goodwill and Other Intangible Assets (Details 2) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Mortgage Loans on Real Estate [Line Items]
Mortgage Loans on Real Estate, Face Amount of Mortgages	$ 498,841	$ 494,749
FHLMC [Member]
Mortgage Loans on Real Estate [Line Items]
Mortgage Loans on Real Estate, Face Amount of Mortgages	487,990	483,356
FHLB [Member]
Mortgage Loans on Real Estate [Line Items]
Mortgage Loans on Real Estate, Face Amount of Mortgages	$ 10,851	$ 11,393

XML

Goodwill and Other Intangible Assets (Details 3) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Mortgage servicing rights:
Balance at beginning of period	$ 2,849	$ 2,840
Additions	161	221
Amortization	(223)	(253)
Balance at end of period	$ 2,787	$ 2,808

XML

Goodwill and Other Intangible Assets (Details Textual) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Weighted Average [Member]
Finite-Lived Intangible Assets [Line Items]
Assumption For Fair Value Of Interests Continued To Be Held By Transferor Servicing Assets Or Liabilities Weighted Average Default Rate	2.24%		2.26%
Mortgage Loans Serviced [Member]
Finite-Lived Intangible Assets [Line Items]
Escrow Deposit	$ 7,200,000		$ 4,100,000
Interest and Fee Income, Other Loans	319,000	$ 300,000
Servicing Asset at Fair Value, Amount	5,400,000		5,100,000
Mortgage Loans on Real Estate, Other Deductions	$ 70,000
Financing Receivable, Allowance for Credit Losses, Recovery			$ 7,000
Mortgage Loans Serviced [Member] | Minimum [Member]
Finite-Lived Intangible Assets [Line Items]
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Discount Rate	9.50%		9.50%
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Prepayment Speed	4.39%		4.86%
Mortgage Loans Serviced [Member] | Maximum [Member]
Finite-Lived Intangible Assets [Line Items]
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Discount Rate	9.51%		9.51%
Assumption for Fair Value of Assets or Liabilities that relate to Transferor's Continuing Involvement, Prepayment Speed	33.19%		32.79%
Mortgage Repurchase Reserve [Member]
Finite-Lived Intangible Assets [Line Items]
Mortgage Loans on Real Estate, Write-down or Reserve, Amount	$ 301,000		$ 301,000

XML

Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
		Mar. 31, 2017	Mar. 31, 2016
Net earnings	[1],[2],[3],[4]	$ 2,205	$ 2,393	[5]
Weighted average common shares outstanding - basic	[6]	3,869,799	3,734,638
Assumed exercise of stock options	[4],[6]	79,149	100,200
Weighted average common shares outstanding - diluted	[4],[6]	3,948,948	3,834,838
Net earnings per share:
Basic	[4],[6],[7]	$ 0.57	$ 0.64
Diluted	[1],[4],[6],[7]	$ 0.56	$ 0.63

[1] Income tax expense, net earnings and diluted earnings per share for the period ended March 31, 2016 have been recast to reflect the early adoption of Accounting Standards Update ("ASU") 2016-09.

[2] Net earnings and proceeds from the exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[3] Net earnings for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[4] Net earnings, earnings per share and assumed exercise of stock options for the period ended March 31, 2016 have been recast to relect the early adoption of ASU 2016-09.

[5] Net earnings and exercise of stock options for the period ended March 31, 2016 have been recast to reflect the early adoption of ASU 2016-09.

[6] Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

[7] Per share amounts for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

XML

Earnings per Share (Details Textual)	3 Months Ended		12 Months Ended
	Mar. 31, 2016		Dec. 31, 2016
Percentage Of Stocks Dividend	5.00%	[1]	5.00%

[1] Share and per share values for the period ended March 31, 2016 have been adjusted to give effect to the 5% stock dividend paid during December 2016.

XML

Repurchase Agreements (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	$ 13,491	$ 12,483
US Government Corporations and Agencies Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	2,564	5,007
US Government Agencies Debt Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	10,927	7,476
Maturity Overnight [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	13,491	12,483
Maturity Overnight [Member] | US Government Corporations and Agencies Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	2,564	5,007
Maturity Overnight [Member] | US Government Agencies Debt Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	10,927	7,476
Maturity Less than 30 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity Less than 30 Days [Member] | US Government Corporations and Agencies Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity Less than 30 Days [Member] | US Government Agencies Debt Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity 30 to 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity 30 to 90 Days [Member] | US Government Corporations and Agencies Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity 30 to 90 Days [Member] | US Government Agencies Debt Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity Greater than 90 Days [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity Greater than 90 Days [Member] | US Government Corporations and Agencies Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	0	0
Maturity Greater than 90 Days [Member] | US Government Agencies Debt Securities [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Assets Sold under Agreements to Repurchase, Carrying Amount	$ 0	$ 0

XML

Repurchase Agreements (Details Textual) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Assets Sold under Agreements to Repurchase [Line Items]
Customer Funds	$ 13.5	$ 12.5
Repurchase Agreements [Member]
Assets Sold under Agreements to Repurchase [Line Items]
Debt Instrument, Collateral Amount	$ 19.7	$ 15.7

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016	Dec. 31, 2015
Financial assets:
Cash and cash equivalents, carrying amount	$ 20,062	$ 19,996	$ 9,853	$ 13,569
Cash and cash equivalents	20,062	19,996
Investment securities available for sale	396,920	385,563
Bank stocks, at cost, carrying amount	5,323	5,299
Loans, net	416,130	417,957
Loans held for sale	8,588	5,517
Loans, net, carrying amount	417,955	420,461
Loans held for sale, net, carrying amount	8,588	5,517
Derivative financial instruments	966	662
Accrued interest receivable	3,874	4,240
Financial liabilities:
Time deposits, carrying amount	(139,197)	(139,838)
FHLB borrowings, carrying amount	(33,450)	(39,100)
Subordinated debentures, carrying amount	(21,334)	(21,284)
Other borrowings, carrying amount	(13,491)	(12,483)
Non-maturity deposits	(613,489)	(601,683)
Time deposits	(137,820)	(138,623)
FHLB borrowings	(33,967)	(35,695)
Subordinated debentures	(18,731)	(18,608)
Other borrowings	(13,491)	(12,483)
Derivative financial instruments	(154)
Accrued interest payable	(253)	(268)
Fair Value, Inputs, Level 1 [Member]
Financial assets:
Cash and cash equivalents	20,062	19,996
Investment securities available for sale	5,761	7,123
Loans, net	0	0
Loans held for sale	0	0
Derivative financial instruments	0	0
Accrued interest receivable	16	21
Financial liabilities:
Non-maturity deposits	(613,489)	(601,683)
Time deposits	0	0
FHLB borrowings	0	0
Subordinated debentures	0	0
Other borrowings	0	0
Derivative financial instruments	0
Accrued interest payable	0	0
Fair Value, Inputs, Level 2 [Member]
Financial assets:
Cash and cash equivalents	0	0
Investment securities available for sale	391,159	378,440
Loans, net	0	0
Loans held for sale	8,588	5,517
Derivative financial instruments	966	662
Accrued interest receivable	2,067	2,104
Financial liabilities:
Non-maturity deposits	0	0
Time deposits	(137,820)	(138,623)
FHLB borrowings	(33,967)	(35,695)
Subordinated debentures	(18,731)	(18,608)
Other borrowings	(13,491)	(12,483)
Derivative financial instruments	(154)
Accrued interest payable	(253)	(268)
Fair Value, Inputs, Level 3 [Member]
Financial assets:
Cash and cash equivalents	0	0
Investment securities available for sale	0	0
Loans, net	416,130	417,957
Loans held for sale	0	0
Derivative financial instruments	0	0
Accrued interest receivable	1,791	2,115
Financial liabilities:
Non-maturity deposits	0	0
Time deposits	0	0
FHLB borrowings	0	0
Subordinated debentures	0	0
Other borrowings	0	0
Derivative financial instruments	0
Accrued interest payable	0	0
Carrying Amount, Fair Value Disclosure [Member]
Financial assets:
Cash and cash equivalents, carrying amount	20,062	19,996
Investment securities available for sale	396,920	385,563
Bank stocks, at cost, carrying amount	5,323	5,299
Loans held for sale		5,517
Loans, net, carrying amount	417,955	420,461
Loans held for sale, net, carrying amount	8,588
Derivative financial instruments	966	662
Accrued interest receivable, carrying amount	3,874	4,240
Financial liabilities:
Non-maturity deposits, carrying amount	(613,489)	(601,683)
Time deposits, carrying amount	(139,197)	(139,838)
FHLB borrowings, carrying amount	(33,450)	(39,100)
Subordinated debentures, carrying amount	(21,334)	(21,284)
Other borrowings, carrying amount	(13,491)	(12,483)
Accrued interest payable, carrying amount	(253)	$ (268)
Derivative financial instruments	$ (154)

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details 1) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Assets:
Investment securities available-for-sale, at fair value	$ 396,920	$ 385,563
Loans held for Sale	8,588	5,517
Derivative financial instruments	966	662
Liabilities:
Derivative financial instruments, carrying amount	(154)
Common stocks [Member]
Assets:
Investment securities available-for-sale, at fair value	763	1,108
Fair Value, Measurements, Recurring [Member]
Assets:
Loans held for Sale	8,588
Derivative financial instruments	966	662
Liabilities:
Derivative financial instruments, carrying amount	(154)
Fair Value, Measurements, Recurring [Member] | Common stocks [Member]
Assets:
Investment securities available-for-sale, at fair value	763	1,108
Fair Value, Measurements, Recurring [Member] | Agency mortgage-backed securities [Member]
Assets:
Investment securities available-for-sale, at fair value	117,697	108,376
U. S. federal agency obligations [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	21,423	27,139
Municipal obligations, tax exempt [Member]
Assets:
Investment securities available-for-sale, at fair value	175,150	161,662
Municipal obligations, tax exempt [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	175,150	161,662
Municipal obligations, taxable [Member]
Assets:
Investment securities available-for-sale, at fair value	68,165	71,563
Municipal obligations, taxable [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	68,165	71,563
Loans Held for Sale [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value		5,517
U. S. treasury securities [Member]
Assets:
Investment securities available-for-sale, at fair value	4,998	6,015
U. S. treasury securities [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	4,998	6,015
Certificates of deposit [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	8,724	9,700
Fair Value, Inputs, Level 1 [Member]
Assets:
Investment securities available-for-sale, at fair value	5,761	7,123
Loans held for Sale	0	0
Derivative financial instruments	0	0
Liabilities:
Derivative financial instruments, carrying amount	0
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Loans held for Sale	0
Derivative financial instruments	0	0
Liabilities:
Derivative financial instruments, carrying amount	0
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Common stocks [Member]
Assets:
Investment securities available-for-sale, at fair value	763	1,108
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Agency mortgage-backed securities [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 1 [Member] | U. S. federal agency obligations [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 1 [Member] | Municipal obligations, tax exempt [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 1 [Member] | Municipal obligations, taxable [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 1 [Member] | Loans Held for Sale [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value		0
Fair Value, Inputs, Level 1 [Member] | U. S. treasury securities [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	4,998	6,015
Fair Value, Inputs, Level 1 [Member] | Certificates of deposit [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 2 [Member]
Assets:
Investment securities available-for-sale, at fair value	391,159	378,440
Loans held for Sale	8,588	5,517
Derivative financial instruments	966	662
Liabilities:
Derivative financial instruments, carrying amount	(154)
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Loans held for Sale	8,588
Derivative financial instruments	966	662
Liabilities:
Derivative financial instruments, carrying amount	(154)
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Common stocks [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Agency mortgage-backed securities [Member]
Assets:
Investment securities available-for-sale, at fair value	117,697	108,376
Fair Value, Inputs, Level 2 [Member] | U. S. federal agency obligations [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	21,423	27,139
Fair Value, Inputs, Level 2 [Member] | Municipal obligations, tax exempt [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	175,150	161,662
Fair Value, Inputs, Level 2 [Member] | Municipal obligations, taxable [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	68,165	71,563
Fair Value, Inputs, Level 2 [Member] | Loans Held for Sale [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value		5,517
Fair Value, Inputs, Level 2 [Member] | U. S. treasury securities [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 2 [Member] | Certificates of deposit [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	8,724	9,700
Fair Value, Inputs, Level 3 [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Loans held for Sale	0	0
Derivative financial instruments	0	0
Liabilities:
Derivative financial instruments, carrying amount	0
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Loans held for Sale	0
Derivative financial instruments	0	0
Liabilities:
Derivative financial instruments, carrying amount	0
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Common stocks [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Agency mortgage-backed securities [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | U. S. federal agency obligations [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | Municipal obligations, tax exempt [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | Municipal obligations, taxable [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | Loans Held for Sale [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value		0
Fair Value, Inputs, Level 3 [Member] | U. S. treasury securities [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	0	0
Fair Value, Inputs, Level 3 [Member] | Certificates of deposit [Member] | Fair Value, Measurements, Recurring [Member]
Assets:
Investment securities available-for-sale, at fair value	$ 0	$ 0

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details 2) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Aggregate fair value	$ 8,588	$ 5,517
Contractual balance	8,443	5,480
Gain	$ 145	$ 37

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details 3) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Interest income	$ 45	$ 105
Change in fair value	109	79
Total change in fair value	$ 154	$ 184

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details 4) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Commercial [Member]
Assets:
Impaired loans	$ 221	$ 222
Agriculture [Member]
Assets:
Impaired loans	749	645
One-to-four family residential real estate [Member]
Assets:
Impaired loans	329	142
Commercial real estate [Member]
Assets:
Impaired loans	180	219
Fair Value, Inputs, Level 1 [Member] | Commercial [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 1 [Member] | Agriculture [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 1 [Member] | One-to-four family residential real estate [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 1 [Member] | Commercial real estate [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 2 [Member] | Commercial [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 2 [Member] | Agriculture [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 2 [Member] | One-to-four family residential real estate [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 2 [Member] | Commercial real estate [Member]
Assets:
Impaired loans	0	0
Fair Value, Inputs, Level 3 [Member] | Commercial [Member]
Assets:
Impaired loans	221	222
Fair Value, Inputs, Level 3 [Member] | Agriculture [Member]
Assets:
Impaired loans	749	645
Fair Value, Inputs, Level 3 [Member] | One-to-four family residential real estate [Member]
Assets:
Impaired loans	329	142
Fair Value, Inputs, Level 3 [Member] | Commercial real estate [Member]
Assets:
Impaired loans	$ 180	$ 219

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details 5) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
One-to-four family residential real estate [Member]
Impaired Loans Fair Value Disclosure		$ 142
Real Estate Owned Fair Value Disclosure	$ 329
Fair Value Measurements, Valuation Techniques	Sales comparison	Sales comparison
Fair Value Measurements, Changes in Valuation Techniques	Adjustment to appraised value	Adjustment to appraised value
Fair Value Measurements Sales Comparison Range	10.00%	10.00%
Commercial [Member]
Impaired Loans Fair Value Disclosure	$ 221
Fair Value Measurements, Valuation Techniques	Sales comparison
Fair Value Measurements, Changes in Valuation Techniques	Adjustment to appraised value
Agriculture [Member]
Impaired Loans Fair Value Disclosure	$ 749	$ 645
Fair Value Measurements, Valuation Techniques	Sales comparison	Sales comparison
Fair Value Measurements, Changes in Valuation Techniques	Adjustment to appraised value	Adjustment to comparable sales
Agriculture [Member] | Minimum [Member]
Fair Value Measurements Sales Comparison Range	8.00%	8.00%
Agriculture [Member] | Maximum [Member]
Fair Value Measurements Sales Comparison Range	80.00%	80.00%
Consumer loans [Member]
Impaired Loans Fair Value Disclosure		$ 222
Fair Value Measurements, Valuation Techniques		Sales comparison
Fair Value Measurements, Changes in Valuation Techniques		Adjustment to comparable sales
Consumer loans [Member] | Minimum [Member]
Fair Value Measurements Sales Comparison Range	0.00%	7.00%
Consumer loans [Member] | Maximum [Member]
Fair Value Measurements Sales Comparison Range	80.00%	80.00%
Commercial real estate [Member]
Impaired Loans Fair Value Disclosure	$ 180	$ 219
Fair Value Measurements, Valuation Techniques	Sales comparison	Sales comparison
Fair Value Measurements, Changes in Valuation Techniques	Adjustment to appraised value	Adjustment to appraised value
Commercial real estate [Member] | Minimum [Member]
Fair Value Measurements Sales Comparison Range	0.00%	2.00%
Commercial real estate [Member] | Maximum [Member]
Fair Value Measurements Sales Comparison Range	60.00%	15.00%

XML

Fair Value of Financial Instruments and Fair Value Measurements (Details Textual) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Fair Value of Financial Instruments And Fair Value Measurements [Line Items]
Impaired Financing Receivable, Related Allowance	$ 308	$ 274
Impaired Financing Receivable, Recorded Investment, Total	$ 6,516	$ 6,728

XML

Regulatory Capital Requirements (Details) - USD ($) $ in Thousands		Mar. 31, 2017	Dec. 31, 2016
Regulatory Capital Requirements [Line Items]
Leverage - For capital adequacy purposes Ratio		4.00%
Common Equity Tier 1 Capital - For capital adequacy purposes Ratio		4.50%
Tier 1 Capital - For capital adequacy purposes Ratio		6.00%
Total Risk Based Capital - For capital adequacy purposes Ratio		8.00%
Companys Regulatory Capital Requirements [Member]
Regulatory Capital Requirements [Line Items]
Leverage - Actual Amount		$ 90,260	$ 88,819
Common Equity Tier 1 Capital - Actual Amount		69,609	68,263
Tier 1 Capital - Actual Amount		90,260	88,819
Total Risk Based Capital - Actual Amount		$ 95,901	$ 94,596
Leverage - Actual Ratio		10.05%	10.04%
Common Equity Tier 1 Capital - Actual Ratio		13.49%	13.32%
Tier 1 Capital - Actual Ratio		17.49%	17.33%
Total Risk Based Capital - Actual Ratio		18.58%	18.46%
Leverage - For capital adequacy purposes Amount		$ 35,914	$ 35,370
Common Equity Tier 1 Capital - For capital adequacy purposes Amount		29,672	26,265
Tier 1 Capital - For capital adequacy purposes Amount		37,413	33,952
Total Risk Based Capital - For capital adequacy purposes Amount		$ 47,733	$ 44,201
Leverage - For capital adequacy purposes Ratio	[1]	4.00%	4.00%
Common Equity Tier 1 Capital - For capital adequacy purposes Ratio	[1]	5.80%	5.10%
Tier 1 Capital - For capital adequacy purposes Ratio	[1]	7.30%	6.60%
Total Risk Based Capital - For capital adequacy purposes Ratio	[1]	9.30%	8.60%

[1] The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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Regulatory Capital Requirements (Details 1) - USD ($) $ in Thousands		Mar. 31, 2017	Dec. 31, 2016
Regulatory Capital Requirements [Line Items]
Leverage - For capital adequacy purposes Ratio		4.00%
Common Equity Tier 1 Capital - For capital adequacy purposes Ratio		4.50%
Tier 1 Capital - For capital adequacy purposes Ratio		6.00%
Total Risk Based Capital - For capital adequacy purposes Ratio		8.00%
Banks Regulatory Capital Requirements [Member]
Regulatory Capital Requirements [Line Items]
Leverage - Actual Amount		$ 89,262	$ 88,076
Common Equity Tier 1 Capital - Actual Amount		89,262	88,076
Tier 1 Capital - Actual Amount		89,262	88,076
Total Risk Based Capital - Actual Amount		$ 94,729	$ 93,560
Leverage - Actual Ratio		9.97%	9.98%
Common Equity Tier 1 Capital - Actual Ratio		17.35%	17.23%
Tier 1 Capital - Actual Ratio		17.35%	17.23%
Total Risk Based Capital - Actual Ratio		18.41%	18.31%
Leverage - For capital adequacy purposes Amount		$ 35,813	$ 35,284
Common Equity Tier 1 Capital - For capital adequacy purposes Amount		29,583	26,194
Tier 1 Capital - For capital adequacy purposes Amount		37,301	33,861
Total Risk Based Capital - For capital adequacy purposes Amount		$ 47,591	$ 44,083
Leverage - For capital adequacy purposes Ratio	[1]	4.00%	4.00%
Common Equity Tier 1 Capital - For capital adequacy purposes Ratio	[1]	5.80%	5.10%
Tier 1 Capital - For capital adequacy purposes Ratio	[1]	7.30%	6.60%
Total Risk Based Capital - For capital adequacy purposes Ratio	[1]	9.30%	8.60%
Leverage - To be well-capitalized under prompt corrective action provisions Amount		$ 44,766	$ 44,105
Common Equity Tier 1 Capital - To be well-capitalized under prompt corrective action provisions Amount		33,442	33,222
Tier 1 Capital - To be well-capitalized under prompt corrective action provisions Amount		41,159	40,888
Total Risk Based Capital - To be well-capitalized under prompt corrective action provisions Amount		$ 51,449	$ 51,110
Leverage - To be well-capitalized under prompt corrective action provisions Ratio		5.00%	5.00%
Common Equity Tier 1 Capital - To be well-capitalized under prompt corrective action provisions Ratio		6.50%	6.50%
Tier 1 Capital - To be well-capitalized under prompt corrective action provisions Ratio		8.00%	8.00%
Total Risk Based Capital - To be well-capitalized under prompt corrective action provisions Ratio		10.00%	10.00%

[1] The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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Regulatory Capital Requirements (Details Textual) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended	36 Months Ended
		Mar. 31, 2017	Dec. 31, 2016	Jan. 01, 2019
Regulatory Capital Requirements [Line Items]
Tier One Leverage Capital Required for Capital Adequacy to Average Assets		4.00%
Capital Required for Capital Adequacy to Risk Weighted Assets		8.00%
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets		4.50%
Assets, Total		$ 923,017	$ 911,382
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets		6.00%
Companys Regulatory Capital Requirements [Member]
Regulatory Capital Requirements [Line Items]
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	[1]	4.00%	4.00%
Capital Required for Capital Adequacy to Risk Weighted Assets	[1]	9.30%	8.60%
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets	[1]	5.80%	5.10%
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	[1]	7.30%	6.60%
Tier One Capital Conversation Buffer		1.25%	0.625%
Banks Regulatory Capital Requirements [Member]
Regulatory Capital Requirements [Line Items]
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	[1]	4.00%	4.00%
Capital Required for Capital Adequacy to Risk Weighted Assets	[1]	9.30%	8.60%
Common Equity Tier One Risk Based Capital Required For Capital Adequacy To Risk Weighted Assets	[1]	5.80%	5.10%
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	[1]	7.30%	6.60%
Tier One Capital Conversation Buffer		1.25%	0.625%
Small Bank Holding Companies [Member]
Regulatory Capital Requirements [Line Items]
Assets, Total		$ 1,000,000
Capital Conservation Buffer [Member]
Regulatory Capital Requirements [Line Items]
Tier One Capital Conversation Buffer		1.25%	0.625%
Tier One Capital Conversation Buffer Increase		0.00%
Capital Conservation Buffer [Member] | Scenario, Forecast [Member]
Regulatory Capital Requirements [Line Items]
Tier One Capital Conversation Buffer				2.50%

[1] The required ratios for capital adequacy purposes include a capital conservation buffer of 1.25% for March 31, 2017 and 0.625% for December 31, 2016.

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Impact of Recent Accounting Pronouncements (Details Textual) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Accounting Standards Update 2016-09 [Member]
Employee Service Share-based Compensation, Tax Benefit Realized from Exercise of Stock Options	$ 12,000	$ 116,000	$ 308,000