10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 _______________________________

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2018

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: 000-52694

QUAINT OAK BANCORP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Pennsylvania	35-2293957
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

501 Knowles Avenue, Southampton, Pennsylvania  18966

(Address of Principal Executive Offices)

(215) 364-4059

(Registrant's Telephone Number, Including Area Code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                                                                                                                                                                                                                                                                                  [X]  Yes     [   ]  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).                                                                                                                                                                                                                                                                                 [X]  Yes      [   ]   No

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

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     [X]  No
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, 2018, 1,951,301 shares of the Registrant's common stock were issued and outstanding.

INDEX

PART I - FINANCIAL INFORMATION	Page
Item 1 -                Financial Statements
Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017 (Unaudited)	1
Consolidated Statements of Income for the Three Months Ended March 31, 2018 and 2017 (Unaudited)	2
Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2018 and 2017 (Unaudited)	3
Consolidated Statement of Stockholders' Equity for the Three Months Ended March 31, 2018 (Unaudited)	4
Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2018 and 2017 (Unaudited)	5
Notes to Unaudited Consolidated Financial Statements	6
Item 2 -                Management's Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3 -                Quantitative and Qualitative Disclosures About Market Risk	41
Item 4 -                Controls and Procedures	41
PART II - OTHER INFORMATION
Item 1 -                Legal Proceedings	42
Item 1A -             Risk Factors	42
Item 2 -                Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3 -                Defaults Upon Senior Securities	42
Item 4 -                Mine Safety Disclosures	42
Item 5 -                Other Information	43
Item 6 -                Exhibits	43
SIGNATURES

ITEM 1. FINANCIAL STATEMENTS

Quaint Oak Bancorp, Inc.

Consolidated Balance Sheets (Unaudited)

	At March 31,			At December 31,
	2018			2017
	(In thousands, except share data)
Assets
Due from banks, non-interest-bearing	$	350		$	64
Due from banks, interest-bearing		16,581			7,846
Cash and cash equivalents		16,931			7,910
Investment in interest-earning time deposits		4,920			4,879
Investment securities available for sale		7,674			7,912
Loans held for sale		4,941			7,006
Loans receivable, net of allowance for loan losses (2018 $1,836; 2017 $1,812)		207,054			201,667
Accrued interest receivable		981			1,021
Investment in Federal Home Loan Bank stock, at cost		1,234			1,234
Bank-owned life insurance		3,834			3,814
Premises and equipment, net		2,010			1,988
Goodwill		515			515
Other intangible, net of accumulated amortization		404			416
Prepaid expenses and other assets		1,064			1,234
Total Assets	$	251,562		$	239,596
Liabilities and Stockholders' Equity
Liabilities
Deposits:
Non-interest bearing	$	11,013		$	7,956
Interest-bearing		187,923			178,265
Total deposits		198,936			186,221
Federal Home Loan Bank short-term borrowings		10,000			10,000
Federal Home Loan Bank long-term borrowings		18,000			18,000
Accrued interest payable		174			167
Advances from borrowers for taxes and insurance		1,651			2,423
Accrued expenses and other liabilities		316			600
Total Liabilities		229,077			217,411
Stockholders' Equity
Preferred stock – $0.01 par value, 1,000,000 shares authorized;          none issued or outstanding		-			-
Common stock – $0.01 par value; 9,000,000 shares
authorized; 2,777,250 issued; 1,954,571 and 1,920,024 outstanding at March 31, 2018 and December 31, 2017, respectively		28			28
Additional paid-in capital		14,534			14,481
Treasury stock, at cost: 2018 822,679 shares; 2017 857,226 shares		(4,649	)		(4,675	)
Unallocated common stock held by:
Employee Stock Ownership Plan (ESOP)		(236	)		(253	)
Recognition & Retention Plan Trust (RRP)		(24	)		(24	)
Accumulated other comprehensive loss		(3	)		(15	)
Retained earnings		12,835			12,643
Total Stockholders' Equity		22,485			22,185
Total Liabilities and Stockholders' Equity	$	251,562		$	239,596

See accompanying notes to the unaudited consolidated financial statements.

1

Quaint Oak Bancorp, Inc.

Consolidated Statements of Income (Unaudited)

	For the Three Months Ended March 31,
	2018		2017
	(In thousands, except share
	and per share data)
Interest Income
Interest on loans	$	2,709	$	2,430
Interest and dividends on time deposits and investment securities		126		85
Total Interest Income		2,835		2,515
Interest Expense
Interest on deposits		729		648
Interest on Federal Home Loan Bank short-term borrowings		36		13
Interest on Federal Home Loan Bank long-term borrowings		91		33
Total Interest Expense		856		694
Net Interest Income		1,979		1,821
Provision for Loan Losses		71		42
Net Interest Income after Provision for Loan Losses		1,908		1,779
Non-Interest Income
Mortgage banking and title abstract fees		110		111
Other fees and services charges		74		26
Insurance commissions		79		77
Income from bank-owned life insurance		20		22
Net gain on loans held for sale		321		108
Gain on the sale of SBA loans		23		-
Gain on sales of other real estate owned		63		4
Other		52		9
Total Non-Interest Income		742		357
Non-Interest Expense
Salaries and employee benefits		1,668		1,317
Directors' fees and expenses		54		52
Occupancy and equipment		150		145
Data processing		86		47
Professional fees		60		90
FDIC deposit insurance assessment		47		44
Other real estate owned expenses		-		7
Advertising		54		39
Amortization of other intangible		12		12
Other		176		138
Total Non-Interest Expense		2,307		1,891
Income before Income Taxes		343		245
Income Taxes		55		74
Net Income	$	288	$	171
Earnings per share – basic	$	0.15	$	0.09
Average shares outstanding - basic		1,881,865		1,838,125
Earnings per share - diluted	$	0.14	$	0.09
Average shares outstanding - diluted		1,990,290		1,980,217

See accompanying notes to the unaudited consolidated financial statements.

2

Quaint Oak Bancorp, Inc.

Consolidated Statements of Comprehensive Income (Unaudited)

	For the Three Months Ended March 31,
	2018			2017
	(In Thousands)
Net Income	$	288		$	171
Other Comprehensive Income:
Unrealized gains on investment securities available for sale		15			20
Income tax effect		(3	)		(7	)
Net other comprehensive  income		12			13
Total Comprehensive Income	$	300		$	184

See accompanying notes to the unaudited consolidated financial statements.

3

Quaint Oak Bancorp, Inc.

Consolidated Statements of Stockholders' Equity (Unaudited)

For the Three Months Ended March 31, 2018
												Unallocated
	Common Stock											Common			Accumulated
	Number of					Additional						Stock Held			Other						Total
	Shares					Paid-in			Treasury			by Benefit			Comprehensive			Retained			Stockholders'
	Outstanding			Amount		Capital			Stock			Plans			Loss			Earnings			Equity
	(In thousands, except share data)
BALANCE –DECEMBER 31, 2017		1,920,024		$	28	$	14,481		$	(4,675	)	$	(277	)	$	(15	)	$	12,643		$	22,185
Common stock allocated by    ESOP							31						17									48
Treasury stock  purchase		(20,101	)							(272	)											(272	)
Reissuance of treasury stock     under 401(k) Plan		1,786					14			10												24
Reissuance of treasury stock    for exercised stock options		52,862					(24	)		288												264
Stock based compensation     expense							32															32
Cash dividends declared     ($0.05 per share)																			(96	)		(96	)
Net income																			288			288
Other comprehensive income,     net																12						12
BALANCE – March 31, 2018		1,954,571		$	28	$	14,534		$	(4,649	)	$	(260	)	$	(3	)	$	12,835		$	22,485

See accompanying notes to the unaudited consolidated financial statements.

4

Quaint Oak Bancorp, Inc.

Consolidated Statements of Cash Flows (Unaudited)

	For the Three Months Ended March 31,
	2018			2017
	(In Thousands)
Cash Flows from Operating Activities
Net income	$	288		$	171
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		71			42
Depreciation expense		51			45
Amortization of intangibles		12			12
Net amortization of securities premiums		5			5
Accretion of deferred loan fees and costs, net		(83	)		(84	)
Stock-based compensation expense		80			77
Net gain on loans held for sale		(321	)		(108	)
Loans held for sale-originations		(17,320	)		(8,030	)
Loans held for sale-proceeds		19,706			10,776
Gain on the sale of SBA loans		(23	)		-
Net gain on sale and write-downs of other real estate owned		(63	)		(4	)
Increase in the cash surrender value of bank-owned life insurance		(20	)		(22	)
Changes in assets and liabilities which provided (used) cash:
Accrued interest receivable		40			(16	)
Prepaid expenses and other assets		167			99
Accrued interest payable		7			(1	)
Accrued expenses and other liabilities		(284	)		(111	)
Net Cash Provided by Operating Activities		2,313			2,851
Cash Flows from Investing Activities
Purchase of interest-earning time deposits		(541	)		(290	)
Redemption of interest-earning time deposits		500			1,029
Principal repayments of investment securities available for sale		248			354
Net increase in loans receivable		(5,352	)		(7,255	)
Proceeds from the sale of other real estate owned		63			81
Capitalized expenditures on other real estate owned		-			(6	)
Purchase of premises and equipment		(73	)		(172	)
Net Cash Used in Investing Activities		(5,155	)		(6,259	)
Cash Flows from Financing Activities
Net increase in demand deposits and savings accounts		4,303			3,010
Net increase in certificate accounts		8,412			615
Dividends paid		(96	)		(75	)
Purchase of treasury stock		(272	)		-
Proceeds from the reissuance of treasury stock		24			22
Proceeds from the exercise of stock options		264			172
Decrease in advances from borrowers for taxes and insurance		(772	)		(703	)
Net Cash Provided by Financing Activities		11,863			3,041
Net Increase (Decrease)  in Cash and Cash Equivalents		9,021			(367	)
Cash and Cash Equivalents – Beginning of Year		7,910			9,300
Cash and Cash Equivalents – End of Year	$	16,931		$	8,933
Cash payments for interest	$	849		$	695
Cash payments for income taxes	$	30		$	25

See accompanying notes to the unaudited consolidated financial statements.

5

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies

Basis of Financial Presentation.  The consolidated financial statements include the accounts of Quaint Oak Bancorp, Inc., a Pennsylvania chartered corporation (the "Company" or "Quaint Oak Bancorp") and its wholly owned subsidiary, Quaint Oak Bank, a Pennsylvania chartered stock savings bank, along with its wholly owned subsidiaries.  At March 31, 2018, the Bank has five wholly-owned subsidiaries, Quaint Oak Mortgage, LLC, Quaint Oak Real Estate, LLC, Quaint Oak Abstract, LLC, QOB Properties, LLC, and Quaint Oak Insurance Agency, LLC, each a Pennsylvania limited liability company.  The mortgage, real estate and abstract companies offer mortgage banking, real estate sales and title abstract services, respectively, in the Lehigh Valley region of Pennsylvania, and began operation in July 2009.  QOB Properties, LLC began operations in July 2012 and holds Bank properties acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure.  Quaint Oak Insurance Agency, LLC began operations in August 2016 and provides a broad range of personal and commercial insurance coverage solutions. All significant intercompany balances and transactions have been eliminated.

The Bank is subject to regulation by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation.  Pursuant to the Bank's election under Section 10(l) of the Home Owners' Loan Act, the Company is a savings and loan holding company regulated by the Board of Governors of the Federal Reserve System.  The market area served by the Bank is principally Bucks County, Pennsylvania and to a lesser extent, Montgomery and Philadelphia Counties in Pennsylvania.  The Bank has two locations: the main office location in Southampton, Pennsylvania and a regional banking office in the Lehigh Valley area of Pennsylvania. The principal deposit products offered by the Bank are certificates of deposit, money market accounts, non-interest bearing checking accounts for businesses and consumers, and savings accounts.  The principal loan products offered by the Bank are fixed and adjustable rate residential and commercial mortgages, construction loans, commercial business loans, home equity loans, and lines of credit.

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP) for interim information and with the instructions to Form 10-Q, as applicable to a smaller reporting company.  Accordingly, they do not include all the information and footnotes required by US GAAP for complete financial statements.

The foregoing consolidated financial statements are unaudited; but in the opinion of management include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation thereof.  The balances as of December 31, 2017 have been derived from the audited financial statements.  These financial statements should be read in conjunction with the financial statements and notes thereto included in Quaint Oak Bancorp's 2017 Annual Report on Form 10-K.  The results of operations for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018.

Use of Estimates in the Preparation of Financial Statements. The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period.  Actual results could differ from those estimates.  The Company's most significant estimates are the determination of the allowance for loan losses and the valuation of deferred tax assets.

6

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

Loans Receivable.  Loans receivable that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of an allowance for loan losses and any deferred fees and costs.  Interest income is accrued on the unpaid principal balance.  Loan origination fees and costs are deferred and recognized as an adjustment of the yield (interest income) of the related loans.  The Bank is generally amortizing these amounts over the contractual life of the loan.

The loans receivable portfolio is segmented into residential loans, commercial real estate loans, construction loans, commercial business loans, and consumer loans.  The residential loan segment has two classes: one-to-four family residential owner occupied loans and one-to-four residential family non-owner occupied loans.  The commercial real estate loan segment consists of the following classes: multi-family (five or more) residential, commercial real estate and commercial lines of credit.  Construction loans are generally granted for the purpose of building a single residential home.  Commercial business loans are loans to businesses for working capital, purchase of a business, tenant improvements, receivables, purchase of inventory, and for the purchase of business essential equipment.  Business essential equipment is equipment necessary for a business to support or assist with the day-to-day operation or profitability of the business.   The consumer loan segment consists of the following classes: home equity loans and other consumer loans.  Included in the home equity class are home equity loans and home equity lines of credit.  Included in the other consumer are loans secured by saving accounts.

The accrual of interest is generally discontinued when principal or interest has become 90 days past due unless the loan is in the process of collection and is either guaranteed or well secured.  When a loan is placed on nonaccrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against the allowance for loan losses.  Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management's judgment as to the collectability of principal.  Generally, a loan is restored to accrual status when the obligation is brought current, it has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is no longer in doubt.

Allowance for Loan Losses.  The allowance for loan losses represents management's estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans receivable. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Because all identified losses are immediately charged off, no portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses.

The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company's past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower's ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available.

7

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

The allowance consists of specific, general and unallocated components. The specific component relates to loans that are designated as impaired. For loans that are designated as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers pools of loans by loan class. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These significant factors may include changes in lending policies and procedures, changes in existing general economic and business conditions affecting our primary lending areas, credit quality trends, collateral value, loan volumes and concentrations, seasoning of the loan portfolio, recent loss experience in particular segments of the portfolio, duration of the current business cycle and bank regulatory examination results. The applied loss factors are reevaluated quarterly to ensure their relevance in the current economic environment.  Residential owner occupied mortgage lending generally entails a lower risk of default than other types of lending. Consumer loans and commercial real estate loans generally involve more risk of collectability because of the type and nature of the collateral and, in certain cases, the absence of collateral. It is the Company's policy to establish a specific reserve for loss on any delinquent loan when it determines that a loss is probable. An unallocated component is maintained to cover uncertainties that could affect management's estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not considered impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower's prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan's effective interest rate or the fair value of the collateral if the loan is collateral dependent.  An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company's impaired loans are measured based on the estimated fair value of the loan's collateral.

A loan is identified as a troubled debt restructuring ("TDR") if the Company, for economic or legal reasons related to a debtor's financial difficulties, grants a concession to the debtor that it would not otherwise consider. Concessions granted under a TDR typically involve a temporary or permanent reduction in payments or interest rate or an extension of a loan's stated maturity date at less than a current market rate of interest. Loans identified as TDRs are designated as impaired.

For loans secured by real estate, estimated fair values are determined primarily through third-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property.

8

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower's overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for all loans (except one-to-four family residential owner-occupied loans) where the total amount outstanding to any borrower or group of borrowers exceeds $500,000, or when credit deficiencies arise, such as delinquent loan payments. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans criticized as special mention have potential weaknesses that deserve management's close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans not classified are rated pass. In addition, Federal regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses and may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which may not be currently available to management. Based on management's comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate.

Loans Held for Sale.  Loans originated by the Bank's mortgage banking subsidiary, Quaint Oak Mortgage, LLC, are intended for sale in the secondary market and are carried at the lower of cost or fair value (LOCOM). Gains and losses on loan sales (sales proceeds minus carrying value) are recorded in noninterest income, and direct loan origination costs, commissions and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan.  To a lesser extent, the Bank originates equipment loans for sale primarily to other financial institutions.

Federal Home Loan Bank Stock.  Federal law requires a member institution of the Federal Home Loan Bank (FHLB) system to hold restricted stock of its district Federal Home Loan Bank according to a predetermined formula.  FHLB stock is carried at cost and evaluated for impairment. When evaluating FHLB stock for impairment, its value is determined based on the ultimate recoverability of the par value of the stock. We evaluate our holdings of FHLB stock for impairment each reporting period. No impairment charges were recognized on FHLB stock during the three months ended March 31, 2018 and 2017.

Bank Owned Life Insurance (BOLl).  The Company purchases bank owned life insurance as a mechanism for funding various employee benefit costs.  The Company is the beneficiary of these policies that insure the lives of certain officers of its subsidiaries. The Company has recognized the cash surrender value under the insurance policies as an asset in the consolidated balance sheets. Changes in the cash surrender value are recorded in non-interest income in the consolidated statements of income.

Intangible Assets.   Intangible assets on the consolidated balance sheets represent the acquisition by Quaint Oak Insurance Agency of the renewal rights to the book of business produced and serviced by Signature Insurance Services, LLC on August 1, 2016 at a total cost of $1.0 million. Based on a valuation, $515,000 of the purchase price was determined to be goodwill and $485,000 was determined to be related to the renewal rights to the book of business and deemed an other intangible asset.  The renewal rights are being amortized over a ten year period based upon the annual retention rate of the book of business.

9

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

The Company will complete a goodwill and other intangible asset analysis at least on an annual basis or more often if events and circumstances indicate that there may be impairment.

Other Real Estate Owned, Net. Other real estate owned or foreclosed assets are comprised of property acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure and loans classified as in-substance foreclosures.  A loan is classified as in-substance foreclosure when the Bank has taken possession of the collateral regardless of whether formal foreclosure proceedings take place.  Other real estate properties are initially recorded at fair value, net of estimated selling costs at the date of foreclosure, establishing a new cost basis. After foreclosure, valuations are periodically performed by management and the real estate is carried at the lower of cost or fair value less estimated costs to sell.  Net revenue and expenses from operations and additions to the valuation allowance are included in other expenses.  The Company has no other real estate owned as of March 31, 2018 or December 31, 2017.

Share-Based Compensation.  Compensation expense for share-based compensation awards is based on the grant date fair value of the award. That cost is recognized over the period during which an employee is required to provide service in exchange for the award.

At March 31, 2018, the Company has outstanding equity awards under three share-based plans: the 2008 Recognition and Retention Plan ("RRP"), the 2008 Stock Option Plan, and the 2013 Stock Incentive Plan.  Awards under these plans were made in May 2008 and 2013.  These plans are more fully described in Note 10.

The Company also has an employee stock ownership plan ("ESOP").  This plan is more fully described in Note 10.  As ESOP shares are committed to be released and allocated among participants, the Company recognizes compensation expense equal to the average market price of the shares over the period earned.

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

Earnings per Share.  Amounts reported in earnings per share reflect earnings available to common stockholders' for the period divided by the weighted average number of shares of common stock outstanding during the period, exclusive of unearned ESOP shares, unvested restricted stock (RRP) shares and treasury shares.  Stock options and unvested restricted stock are regarded as potential common stock and are considered in the diluted earnings per share calculations to the extent they would have a dilutive effect if converted to common stock, computed using the "treasury stock" method.

Revenue from Contracts with Customers.   The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic 606, "Revenue from Contracts with Customers" ("Topic 606"). Under Topic 606, the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has not been recognized in the current reporting period that results from performance obligations satisfied in previous periods.

10

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

The Company's primary sources of revenue are derived from interest and dividends earned on loans and investment securities, gains on the sale of loans, income from bank-owned life insurance, and other financial instruments that are not within the scope of Topic 606.  The main types of non-interest income within the scope of the standard are as follows:

Service Charges on Deposits: The Bank has contracts with its commercial checking deposit customers where fees are charged if the account balance falls below predetermined levels defined as compensating balances. These agreements can be cancelled at any time by either the Bank or the deposit customer. Revenue from these transactions is recognized on a monthly basis as the Bank has an unconditional right to the fee consideration. The Bank also has transaction fees related to specific transactions or activities resulting from customer request or activity that include overdraft fees, wire fees, and other transaction fees. All of these fees are attributable to specific performance obligations of the Bank where the revenue is recognized at a defined point in time, completion of the requested service/transaction.

Insurance Commissions:  Insurance income generally consist of commissions from the sale of insurance policies and performance-based commissions from insurance companies.  The Bank recognizes commission income from the sale of insurance policies when it acts as an agent between the insurance carrier and policyholder, arranging for the insurance carrier to provide policies to policyholders, and acts on behalf of the insurance carrier by providing customer service to the policyholder during the policy period. Commission income is recognized over time, using the output method of time elapsed, which corresponds with the underlying insurance policy period, for which the Bank is obligated to perform under contract with the insurance carrier. Commission income is variable, as it is comprised of a certain percentage of the underlying policy premium. The Bank estimates the variable consideration based upon the "most likely amount" method, and does not expect or anticipate a significant reversal of revenue in future periods, based upon historical experience.  Payment is due from the insurance carrier for commission income once the insurance policy has been sold. The Bank has elected to apply a practical expedient related to capitalizable costs, which are the commissions paid to insurance producers, and will expense these commissions paid to insurance producers as incurred, as these costs are related to the commission income and would have been amortized within one year or less if they had been capitalized, the same period over which the commission income was earned. Performance-based commissions from insurance companies are recognized at a point in time, when received, and no contingencies remain.

Recent Accounting Pronouncements.  In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10):  Recognition and Measurement of Financial Assets and Financial Liabilities.  This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments.  Among other things, this Update (a) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (b) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (c) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; (d) eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (e) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (f) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; and (g) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity's other deferred tax assets.

11

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

The Bank has adopted this standard effective January 1, 2018.  On a prospective basis, the Bank implemented changes to the measurement of the fair value of financial instruments using an exit price notion for disclosure purposes included in Note 11 to the financial statements.  The Bank estimated the fair value based on guidance from ASC 820-10, Fair Value Measurements, which defines fair value as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is no active observable market for sale information on community bank loans and, thus, Level III fair value procedures were utilized, primarily in the use of present value techniques incorporating assumptions that market participants would use in estimating fair values. In the absence of reliable market information, the Bank used its own assumptions in an effort to determine a reasonable estimate of fair value.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842).  The standard requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet.  A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term.  A short-term lease is defined as one in which (a) the lease term is 12 months or less and (b) there is not an option to purchase the underlying asset that the lessee is reasonably certain to exercise.  For short-term leases, lessees may elect to recognize lease payments over the lease term on a straight-line basis.  For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, and interim periods within those years.  The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period.   The Company is currently assessing the practical expedients it may elect at adoption, but does not anticipate the amendments will have a significant impact to the financial statements. Based on the Company's preliminary analysis of its current portfolio, the impact to the Company's balance sheet is estimated to result in less than a 1% increase in assets and liabilities. The Company also anticipates additional disclosures to be provided at adoption.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments, which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations.  The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management's current estimate of credit losses that are expected to occur over the remaining life of a financial asset.  The income statement will be effected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted for annual and interim periods beginning after December 15, 2018. With certain exceptions, transition to the new requirements will be through a cumulative effect adjustment to opening retained earnings as of the beginning of the first reporting period in which the guidance is adopted.  We expect to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, but cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the consolidated financial statements.

12

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 – Financial Statement Presentation and Significant Accounting Policies (Continued)

In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment. To simplify the subsequent measurement of goodwill, the FASB eliminated Step 2 from the goodwill impairment test.  In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination.  Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  A public business entity that is a U.S. Securities and Exchange Commission ("SEC") filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019.  This Update is not expected to have a significant impact on the Company's financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20).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.For public business entities, the amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018.  Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period.An entity should apply the amendments in this Update on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning ofthe period of adoption. Additionally, in the period of adoption, an entity should provide disclosures about

a change in accounting principle.This Update is not expected to have a significant impact on the Company's financial statements.

In January 2018, the FASB issued ASU 2018-01, Leases (Topic 842), which provides an optional transition practical expedient to not evaluate under Topic 842 existing or expired land easements that were not previously accounted for as leases under the current lease guidance in Topic 840.  An entity that elects this practical expedient should evaluate new or modified land easements under Topic 842 beginning at the date the entity adopts Topic 842; otherwise, an entity should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic 842 to assess whether they meet the definition of a lease.  The effective date and transition requirements for the amendments are the same as the effective date and transition requirements in ASU 2016-02.  This Update is not expected to have a significant impact on the Company's financial statements

Reclassifications.  Certain items in the 2017 consolidated financial statements have been reclassified to conform to the presentation in the 2018 consolidated financial statements. Such reclassifications did not have a material impact on the presentation of the overall financial statements.  The reclassifications had no effect on net income or stockholders' equity.

13

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 2 – Earnings Per Share

Earnings per share ("EPS") consists of two separate components, basic EPS and diluted EPS.  Basic EPS is computed based on the weighted average number of shares of common stock outstanding for each period presented.  Diluted EPS is calculated based on the weighted average number of shares of common stock outstanding plus dilutive common stock equivalents ("CSEs").  CSEs consist of shares that are assumed to have been purchased with the proceeds from the exercise of stock options, as well as unvested restricted stock (RRP) shares. Common stock equivalents which are considered antidilutive are not included for the purposes of this calculation. For the three months ended March 31, 2018 and 2017, all unvested restricted stock program awards and outstanding stock options representing shares were dilutive.

The following table sets forth the composition of the weighted average shares (denominator) used in the basic and dilutive earnings per share computations.

	For the Three Months Ended  March 31,
	2018		2017
Net Income	$	288,000	$	171,000
Weighted average shares outstanding – basic		1,881,865		1,838,125
Effect of dilutive common stock equivalents		108,425		142,092
Adjusted weighted average shares outstanding – diluted		1,990,290		1,980,217
Basic earnings per share	$	0.15	$	0.09
Diluted earnings per share	$	0.14	$	0.09

Note 3 – Accumulated Other Comprehensive Loss

The following table presents the changes in accumulated other comprehensive loss by component, net of tax, for the three months ended March 31, 2018 and 2017 (in thousands):

	Unrealized Gains (Losses) on Investment Securities Available for Sale (1)
	For the Three Months Ended March 31,
	2018			2017
Balance at the beginning of the period	$	(15	)	$	(38	)
Other comprehensive income before classifications		12			13
Amount reclassified from accumulated other comprehensive income		-			-
Total other comprehensive income		12			13
Balance at the end of the period	$	(3	)	$	(25	)

(1) All amounts are net of tax.  Amounts in parentheses indicate debits.

14

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 4 – Investment in Interest-Earning Time Deposits

The investment in interest-earning time deposits as of March 31, 2018 and December 31, 2017, by contractual maturity, are shown below (in thousands):

	March 31, 2018		December 31, 2017
Due in one year or less	$	1,332	$	761
Due after one year through five years		3,588		4,118
Total	$	4,920	$	4,879

Note 5 – Investment Securities Available for Sale

The amortized cost, gross unrealized gains and losses, and fair value of investment securities available for sale at March 31, 2018 and December 31, 2017 are summarized below (in thousands): 

	March 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,462	$	28	$	-		$	5,490
Federal Home Loan Mortgage Corporation securities		1,309		-		(28	)		1,281
Federal National Mortgage Association securities		547		1					548
Total mortgage-backed securities		7,318		29		(28	)		7,319
Debt securities:
U.S. government agency		360		-		(5	)		355
Total available-for-sale-securities	$	7,678	$	29	$	(33	)	$	7,674

	December 31, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,624	$	19	$	--		$	5,643
Federal Home Loan Mortgage Corporation securities		1,377		--		(35	)		1,342
Federal National Mortgage Association securities		570		--		--			570
Total mortgage-backed securities		7,571		19		(35	)		7,555
Debt securities:
U.S. government agency		360		--		(3	)		357
Total available-for-sale-securities	$	7,931	$	19	$	(38	)	$	7,912

15

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 5 – Investment Securities Available for Sale (Continued)

The amortized cost and fair value of debt securities at March 31, 2018, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties (in thousands):

	Available for Sale
	Amortized Cost		Fair Value
Due after one year through five years	$	360	$	355
Due after ten years		7,318		7,319
Total	$	7,678	$	7,674

The following tables show the Company's gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at March 31, 2018  and December 31, 2017 (in thousands):

	March 31, 2018
			Less than Twelve Months				Twelve Months or Greater					Total
	Number ofSecurities		Fair Value		GrossUnrealizedLosses		Fair Value		GrossUnrealizedLosses			Fair Value		GrossUnrealizedLosses
Federal Home Loan    Mortgage Corporation    mortgage-backed    securities		2	$	--	$	--	$	1,281	$	(28	)	$	1,281	$	(28	)
Debt securities, U.S.    government agency		1		--		--		355		(5	)		355		(5	)
Total		3	$	--	$	--	$	1,636	$	(33	)	$	1,699	$	(33	)

	December 31, 2017
			Less than Twelve Months				Twelve Months or Greater					Total
	Number ofSecurities		Fair Value		GrossUnrealizedLosses		Fair Value		GrossUnrealizedLosses			Fair Value		GrossUnrealizedLosses
Federal Home Loan    Mortgage Corporation     mortgage-backed     securities		2	$	--	$	--	$	1,342	$	(35	)	$	1,342	$	(35	)
Debt securities, U.S.    government agency		1		--		--		357		(3	)		357		(3	)
Total		3	$	--	$	--	$	1,699	$	(38	)	$	1,699	$	(38	)

At March 31, 2018, there were three securities in an unrealized loss position that at such date had an aggregate depreciation of 1.97% from the Company's amortized cost basis. Management believes that the estimated fair value of the securities disclosed above is primarily dependent on the movement of market interest rates.  Management evaluated the length of time and the extent to which the fair value has been less than cost and the financial condition and near term prospects of the issuer, including any specific events which may influence the operations of the issuer.  The Company has the ability and intent to hold the securities until the anticipated recovery of fair value occurs. Management does not believe any individual unrealized loss as of March 31, 2018 represents an other-than-temporary impairment. There were no impairment charges recognized during the three months ended March 31, 2018 or 2017.

16

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses

The composition of net loans receivable is as follows:

	March 31, 2018			December 31, 2017
Real estate loans:
One-to-four family residential:
Owner occupied	$	6,316		$	5,681
Non-owner occupied		48,902			51,833
Total one-to-four family residential		55,218			57,514
Multi-family (five or more) residential		23,447			21,715
Commercial real estate		96,396			92,234
Construction		16,209			15,632
Home equity		4,772			5,129
Total real estate loans		196,042			192,224
Commercial business		13,559			11,954
Other consumer		132			138
Total Loans		209,733			204,316
Deferred loan fees and costs		(843	)		(837	)
Allowance for loan losses		(1,836	)		(1,812	)
Net Loans	$	207,054		$	201,667

The following tables present the classes of the loan portfolio summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company's internal risk rating system as of March 31, 2018 and December 31, 2017(in thousands):

	March 31, 2018
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,894	$	180	$	242	$	-	$	6,316
One-to-four family residential non-owner occupied		48,562		28		312		-		48,902
Multi-family residential		23,447		-		-		-		23,447
Commercial real estate		94,193		2,101		102		-		96,396
Construction		14,150		-		2,059		-		16,209
Home equity		4,772		-		-		-		4,772
Commercial business		13,029		530		-		-		13,559
Other consumer		132		-		-		-		132
Total	$	204,179	$	2,839	$	2,715	$	-	$	209,733

	December 31, 2017
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,258	$	423	$	-	$	-	$	5,681
One-to-four family residential non-owner occupied		51,372		29		432		-		51,833
Multi-family residential		21,715		-		-		-		21,715
Commercial real estate		91,549		399		286		-		92,234
Construction		13,562		-		2,070		-		15,632
Home equity		5,129		-		-		-		5,129
Commercial business		11,419		535		-		-		11,954
Other consumer		138		-		-		-		138
Total	$	200,142	$	1,386	$	2,788	$	--	$	204,316

17

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary as of March 31, 2018 as well as the average recorded investment and related interest income for the period then ended (in thousands):

	March 31, 2018
	Recorded  Investment		Unpaid  Principal Balance		Related Allowance		Average  Recorded  Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		325		325		-		326		3
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		-		-
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		93		93		25		94		2
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		418		418		25		420		5
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,896	$	2,896	$	30	$	2,906	$	8

18

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was not necessary as of December 31, 2017 as well as the average recorded investment and related interest income for the year then ended (in thousands):

	December 31, 2017
	Recorded  Investment		Unpaid Principal Balance		Related Allowance		Average  Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		442		442		-		937		24
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		398		38
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		214		214		70		214		5
Multi-family residential		--		--		-		-		-
Commercial real estate		133		133		1		395		9
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		656		656		70		1,151		29
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		1		793		47
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,903	$	2,903	$	71	$	4,055	$	139

The loan portfolio also includes certain loans that have been modified in a troubled debt restructuring, where economic concessions have been granted to borrowers who have experienced or are expected to experience financial difficulties. These concessions typically result from loss mitigation activities and could include reductions in the interest rate, payment extensions, forbearance, or other actions.  At March 31, 2018, the Company had six loans totaling $595,000 that were identified as troubled debt restructurings.  All six of these loans were performing in accordance with their modified terms.  At December 31, 2017, the Company had eight loans totaling $714,000 that were identified as troubled debt restructurings.  If a TDR is placed on non-accrual it is not reverted back to accruing status until the borrower makes timely payments as contracted for at least six months and future collection under the revised terms is probable.  During the three months ended March 31, 2018, no new loans were identified as TDRs and two loans previously identified as TDRs were paid off.

19

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

The following tables present the Company's TDR loans as of March 31, 2018 and December 31, 2017 (dollar amounts in thousands):

	March 31, 2018
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related  Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		3		418		-		418		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		5
Construction		-		-		-		-		-
Home equity		2		44		-		44		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		6	$	595	$	-	$	595	$	30

	December 31, 2017
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related  Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		5		536		-		536		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		1
Construction		-		-		-		-		-
Home equity		2		45		-		45		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		8	$	714	$	-	$	714	$	26

The contractual aging of the TDRs in the table above as of March 31, 2018 and December 31, 2017 is as follows (in thousands):

	March 31, 2018
	Accruing  Past Due  Less than 30  Days		Past Due 30-89 Days		90 Days or More Past  Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		418		-		-		-		418
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		44		-		-		-		44
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	595	$	-	$	-	$	-	$	595

20

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

	December 31, 2017
	Accruing Past Due Less than 30 Days		Past Due 30-89 Days		90 Days or More Past Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		536		-		-		-		536
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		45		-		-		-		45
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	714	$	-	$	-	$	-	$	714

Any reserve for an impaired TDR loan is based upon the present value of the future expected cash flows discounted at the loan's original effective rate or upon the fair value of the collateral less costs to sell, if the loan is deemed collateral dependent. At March 31, 2018 there were no commitments to lend additional funds to debtors whose loan terms have been modified as TDRs.

The general practice of the Bank is to work with borrowers so that they are able to pay back their loan in full. If a borrower continues to be delinquent or cannot meet the terms of a TDR modification and the loan is determined to be uncollectible, the loan will be charged off.

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the three months ended March 31, 2018 and recorded investment in loans receivable as of March 31, 2018 (in thousands):

	March 31, 2018
	1-4 Family Residential Owner Occupied		1-4 Family Residential  Non- Owner Occupied			Multi- Family Residential		Commercial Real Estate		Construction		Home Equity			Commercial Business  and Other Consumer		Unallocated			Total
Allowance for loan losses:
Beginning balance	$	48	$	540		$	152	$	687	$	136	$	27		$	140	$	82		$	1,812
Charge-offs		-		(47	)		-		-		-		-			-		-			(47	)
Recoveries		-		-			-		-		-		-			-		-			-
Provision		6		2			12		33		6		(1	)		30		(17	)		71
Ending balance	$	54	$	495		$	164	$	720	$	142	$	26		$	170	$	65		$	1,836
Ending balance evaluated
for impairment
Individually	$	-	$	25		$	-	$	5	$	-	$	-		$	-	$	-		$	30
Collectively	$	54	$	470		$	164	$	715	$	142	$	26		$	170	$	65		$	1,806
Loans receivable:
Ending balance	$	6,316	$	48,902		$	23,447	$	96,396	$	16,209	$	4,772		$	13,691	$	-		$	209,733
Ending balance evaluated    for impairment
Individually	$	242	$	418		$	-	$	133	$	2,059	$	44		$	-	$	-		$	2,896
Collectively	$	6,074	$	48,484		$	23,447	$	96,263	$	14,150	$	4,728		$	13,691	$	-		$	206,837

21

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

The Bank allocated increased allowance for loan loss provisions to the commercial real estate, commercial business and multi-family residential portfolio classes for the three months ended March 31, 2018, due primarily to increased balances and delinquencies in these portfolio classes.

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the three months ended March 31, 2017 (in thousands):

	March 31, 2017
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non- Owner Occupied		Multi- Family Residential		Commercial Real Estate			Construction			Home  Equity		Commercial Business and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503	$	103	$	616		$	138		$	37	$	87	$	80	$	1,605
Charge-offs		-		-		-		-			-			-		-		-		-
Recoveries		-		-		-		3			-			-		-		-		3
Provision		3		21		5		(7	)		(11	)		14		7		10		42
Ending balance	$	44	$	524	$	108	$	612		$	127		$	51	$	94	$	90	$	1,650
Ending balance evaluated
for impairment
Individually	$	-	$	16	$	-	$	24		$	-		$	-	$	-	$	-	$	40
Collectively	$	44	$	508	$	108	$	588		$	127		$	51	$	94	$	90	$	1,610

The Bank allocated increased allowance for loan loss provisions to the 1-4 family residential non-owner occupied and home equity portfolio classes  for the three months ended March 31, 2017, due primarily to increased delinquencies in these portfolio classes.  The Bank allocated decreased allowance for loan loss provisions to the construction portfolio class for the three months ended March 31, 2017, due primarily to decreased delinquencies in this portfolio class.  The Bank allocated decreased allowance for loan loss provisions to the commercial real estate portfolio class for the three months ended March 31, 2017, due to changes to qualitative factors in this portfolio class.

22

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the year ended December 31, 2017 and recorded investment in loans receivable based on impairment evaluation as of December 31, 2017 (in thousands):

	December 31, 2017
	1-4 Family Residential  Owner Occupied		1-4 Family Residential Non- Owner Occupied			Multi- Family Residential		Commercial Real Estate			Construction			Home Equity			Commercial Business  and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503		$	103	$	616		$	138		$	37		$	87	$	80	$	1,605
Charge-offs		-		(56	)		-		(24	)		-			-			-		-		(80	)
Recoveries		-		-			-		3			-			-			-		-		3
Provision		7		93			49		92			(2	)		(10	)		53		2		284
Ending balance	$	48	$	540		$	152	$	687		$	136		$	27		$	140	$	82	$	1,812
Ending balance evaluated
for impairment
Individually	$	-	$	70		$	-	$	1		$	-		$	-		$	-	$	-	$	71
Collectively	$	48	$	470		$	152	$	686		$	136		$	27		$	140	$	82	$	1,741
Loans receivable:
Ending balance	$	5,681	$	51,833		$	21,715	$	92,234		$	15,632		$	5,129		$	12,092	$	-	$	204,316
Ending balance evaluated
for impairment
Individually	$	-	$	656		$	-	$	133		$	2,069		$	45		$	-	$	-	$	2,903
Collectively	$	5,681	$	51,177		$	21,715	$	92,101		$	13,563		$	5,084		$	12,092	$	-	$	201,413

The Bank allocated increased allowance for loan loss provisions to the commercial real estate, commercial business, and multi-family portfolio classes for the year ended December 31, 2017, due primarily to increased balances in these portfolio classes.  The Bank allocated increased allowance for loan loss provisions to the 1-4 family residential non-owner occupied portfolio class for the year ended December 31, 2017, due primarily to increased specific reserves in this portfolio class.

The following table presents nonaccrual loans by classes of the loan portfolio as of March 31, 2018 and December 31, 2017 (in thousands):

	March 31, 2018		December 31, 2017
One-to-four family residential owner occupied	$	242	$	-
One-to-four family residential non-owner occupied		-		120
Multi-family residential		-		-
Commercial real estate		-		-
Construction		2,059		2,069
Home equity		-		-
Commercial business		-		-
Other consumer		-		-
Total	$	2,301	$	2,189

Non-performing loans, which consist of non-accruing loans plus accruing loans 90 days or more past due, amounted to $2.7 million and $3.1 million at March 31, 2018 and December 31, 2017, respectively.  For the delinquent loans in our portfolio, we have considered our ability to collect the past due interest, as well as the principal balance of the loan, in order to determine whether specific loans should be placed on non-accrual status. In cases where our evaluations have determined that the principal and interest balances are collectible, we have continued to accrue interest.

23

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Continued)

For the three months ended March 31, 2018 and 2017 there was no interest income recognized on non-accrual loans on a cash basis.  Interest income foregone on non-accrual loans was approximately $44,000 and $43,000 for the three months ended March 31, 2018 and 2017, respectively.

The performance and credit quality of the loan portfolio is also monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. The following tables present the classes of the loan portfolio summarized by the past due status as of March 31, 2018 and December 31, 2017 (in thousands):

	March 31, 2018
	30-89 Days Past Due		90 Days  or More Past Due		Total  Past Due		Current		Total Loans Receivable		Loans Receivable 90 Days or More Past Due and Accruing
One-to-four family residential owner occupied	$	497	$	422	$	919	$	5,97	$	6,316	$	180
One-to-four family residential non-owner occupied		1,022		181		1,203		47,699		48,902		181
Multi-family residential		73		-		73		23,374		23,447		-
Commercial real estate		2,378		42		2,420		93,976		96,396		42
Construction		850		2,059		2,909		13,300		16,209		-
Home equity		33		-		33		4,739		4,772		-
Commercial business		468		-		468		13,091		13,559		-
Other consumer		-		-		-		132		132		-
Total	$	5,321	$	2,704	$	8,025	$	201,708	$	209,733	$	403

	December 31, 2017
	30-89 Days Past Due		90 Days  or More  Past Due		Total Past Due		Current		Total Loans Receivable		Loans  Receivable  90 Days or More Past  Due and Accruing
One-to-four family residential owner occupied	$	670	$	423	$	1,093	$	4,588	$	5,681	$	423
One-to-four family residential non-owner occupied		969		337		1,306		50,527		51,833		217
Multi-family residential		313		-		313		21,402		21,715		-
Commercial real estate		505		241		746		91,488		92,234		241
Construction		407		2,069		2,476		13,156		15,632		-
Home equity		51		-		51		5,078		5,129		-
Commercial business		-		-		-		11,954		11,954		-
Other consumer		-		-		-		138		138		-
Total	$	2,915	$	3,070	$	5,985	$	198,331	$	204,316	$	881

24

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 7 – Goodwill and Other Intangible, Net

On August 1, 2016, Quaint Oak Insurance Agency, LLC began operations by acquiring the renewal rights to the book of business produced and serviced by an independent insurance agency located in New Britain, Pennsylvania, that provides a broad range of personal and commercial insurance coverage solutions.  The Company paid $1.0 million for these rights.  Based on a valuation, $515,000 of the purchase price was determined to be goodwill and $485,000 was determined to be related to the renewal rights to the book of business and deemed to be an other intangible asset.  This other intangible asset is being amortized over a ten year period based upon the annual retention rate of the book of business.  The balance of other intangible asset at March 31, 2018 was $404,000 net of accumulated amortization of $81,000.  Amortization expense for the three months ended March 31, 2018 amounted to $12,000.

Note 8 – Deposits

Deposits consist of the following classifications (in thousands):

	March 31, 2018		December 31,  2017
Non-interest bearing checking accounts	$	11,013	$	7,956
Passbook accounts		354		463
Savings accounts		1,974		2,353
Money market accounts		32,145		30,411
Certificates of deposit		153,450		145,038
Total deposits	$	198,936	$	186,221

Note 9 – Borrowings

Federal Home Loan Bank advances consist of the following at March 31, 2018 and December 31, 2017 (in thousands):

		March 31, 2018				March 31, 2017
			Weighted				Weigthted
			Interest				Interest
		Amount	Rate			Amount	Rate
Short-term borrowings	$	10,000	1.87	%	$	10,000	1.54	%
Fixed rate borrowings maturing:
2018		3,000	1.46			3,000	1.46
2019		3,000	1.86			3,000	1.86
2020		2,000	2.00			2,000	2.00
2021		3,000	2.05			3,000	2.05
2022		3,000	2.18			3,000	2.18
2023		3,000	2.33			3,000	2.33
2024		1,000	2.54			1,000	2.54
Total  FHLB long-term debt	$	18,000	2.01	%	$	18,000	2.01	%

25

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 10 – Stock Compensation Plans

Employee Stock Ownership Plan

The Company maintains an Employee Stock Ownership Plan (ESOP) for the benefit of employees who meet the eligibility requirements of the plan.  Using proceeds from a loan from the Company, the ESOP purchased 8%, or 222,180 shares of the Company's then outstanding common stock in the open market during 2007.  The Bank makes cash contributions to the ESOP on a quarterly basis sufficient to enable the ESOP to make the required loan payments to the Company.  The loan bears an interest rate of 7.75% per annum, with principal and interest to be paid quarterly in equal installments over 15 years. The loan is secured by the unallocated shares of common stock held by the ESOP.

Shares of the Company's common stock purchased by the ESOP are held in a suspense account and reported as unallocated common stock held by the ESOP in stockholders' equity until released for allocation to participants.  As the debt is repaid, shares are released from collateral and are allocated to each eligible participant based on the ratio of each such participant's base compensation to the total base compensation of eligible plan participants.  As the unearned shares are committed to be released and allocated among participants, the Company recognizes compensation expense equal to the average market value of the shares, and the shares become outstanding for earnings per share computations.  During the three months ended March 31, 2018 and 2017, the Company recognized $48,000 and $45,000 of ESOP expense, respectively.

Recognition & Retention and Stock Incentive Plans

In May 2008, the shareholders of Quaint Oak Bancorp approved the adoption of the 2008 Recognition and Retention Plan (the "RRP") and Trust Agreement.  In order to fund the RRP, the 2008 Recognition and Retention Plan Trust acquired 111,090 shares of the Company's stock in the open market at an average price of $4.68 totaling $520,000.  In May 2013, the shareholders of Quaint Oak Bancorp approved the adoption of the 2013 Stock Incentive Plan (the "Stock Incentive Plan").  The Stock Incentive Plan provides that no more than 48,750, or 25%, of the shares may be granted as restricted stock awards.

As of March 31, 2018, a total of 10,061 share awards were unvested under the RRP and Stock Incentive Plan and up to 21,608 share awards were available for future grant under the Stock Incentive Plan and none under the RRP.  The RRP and Stock Incentive Plan share awards have vesting periods of five years.

A summary of the status of the share awards under the RRP and Stock Incentive Plan as of March 31, 2018 and 2017 and changes during the three months ended March 31, 2018 and 2017 is as follows:

	March 31, 2018				March 31, 2017
	Number of Shares		Weighted Average Grant  Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Unvested at the beginning of the period		10,061	$	8.10		20,524	$	8.10
Granted		-		-		-		-
Vested		-		-		-		-
Forfeited		-		-		-		-
Unvested at the end of the period		10,061	$	8.10		20,524	$	8.10

26

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 10 – Stock Compensation Plans (Continued)

Recognition & Retention and Stock Incentive Plans (Continued)

Compensation expense on the restricted stock awards is recognized ratably over the five year vesting period in an amount which is equal to the fair value of the common stock at the date of grant.  During both the three months ended March 31, 2018 and 2017, the Company recognized approximately $21,000 of compensation expense.  A tax benefit of approximately $4,000 and $7,000 was recognized during the three months ended March 31, 2018 and 2017, respectively.  As of March 31, 2018, approximately $10,000 in additional compensation expense will be recognized over the remaining service period of approximately 0.1 years.

Stock Option and Stock Incentive Plans

In May 2008, the shareholders of Quaint Oak Bancorp approved the adoption of the 2008 Stock Option Plan (the "Option Plan").  The Option Plan authorizes the grant of stock options to officers, employees and directors of the Company to acquire 277,726 shares of common stock with an exercise price no less than the fair market value on the date of the grant.  The Stock Incentive Plan approved by shareholders in May 2013 covered a total of 195,000 shares, of which 48,750 may be restricted stock awards, for a balance of 146,250 stock options assuming all the restricted shares are awarded.

For grants in May 2008, the Compensation Committee of the Board of Directors determined to grant the stock options at an exercise price equal to $5.00 per share (split-adjusted) which is higher than the fair market value of the common stock on the grant date.  All incentive stock options issued under the Option Plan and the Stock Incentive Plan are intended to comply with the requirements of Section 422 of the Internal Revenue Code.

As of March 31, 2018, a total of 212,440 grants of stock options were outstanding under the Option Plan and Stock Incentive Plan and 57,636 stock options were available for future grant under the Stock Incentive Plan and none under the Option Plan.  Options will become vested and exercisable over a five year period and are generally exercisable for a period of ten years after the grant date.

 

A summary of option activity under the Company's Option Plan and Stock Incentive Plan of March 31, 2018 and 2017 and changes during the three months ended March 31, 2018 and 2017 is as follows:

	2018							2017
	Number  of Shares			Weighted Average Exercise  Price		Weighted Average Remaining Contractual Life (in  years)		Number of Shares			Weighted Average Exercise  Price		Weighted Average Remaining Contractual Life (in years)
Outstanding at the beginning of the year		265,302		$	6.74		3.2		316,348		$	6.49		3.8
Granted		-			-		-		-			-		-
Exercised		(52,862	)		5.00		-		(34,550	)		5.00		-
Forfeited		-			-		-		-			-		-
Outstanding at end of period		212,440		$	7.17		3.7		281,798		$	6.67		3.8
Exercisable at end of  period		182,600		$	7.03		3.4		221,158		$	6.29		3.2

27

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 10 – Stock Compensation Plans (Continued)

Stock Option and Stock Incentive Plans (Continued)

During both the three months ended March 31, 2018 and 2017, approximately $11,000 in compensation expense was recognized.  A tax benefit of approximately $1,000, was recognized during each of these periods.  As of March 31, 2018, approximately $6,000 in additional compensation expense will be recognized over the remaining service period of approximately 0.1 years.

Note 11 – Fair Value Measurements and Fair Values of Financial Instruments

Fair value estimates are based on quoted market prices, if available, quoted market prices of similar assets or liabilities, or the present value of expected future cash flows and other valuation techniques. These valuations are significantly affected by discount rates, cash flow assumptions, and risk assumptions used. Therefore, fair value estimates may not be substantiated by comparison to independent markets and are not intended to reflect the proceeds that may be realizable in an immediate settlement of the instruments.

Fair value is determined at one point in time and is not representative of future value. These amounts do not reflect the total value of a going concern organization. Management does not have the intention to dispose of a significant portion of its assets and liabilities and therefore, the unrealized gains or losses should not be interpreted as a forecast of future earnings and cash flows.

The following disclosures show the hierarchal disclosure framework associated with the level of pricing observations utilized in measuring assets and liabilities at fair value.  The three broad levels of pricing are as follows:

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

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

Level III: Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

This hierarchy requires the use of observable market data when available.

The following is a discussion of assets and liabilities measured at fair value on a recurring basis and valuation techniques applied:

Investment Securities Available-For-Sale: The fair value of securities available for sale are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities' relationship to other benchmark quoted prices.

28

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 11 – Fair Value Measurements and Fair Values of Financial Instruments (Continued)

We may be required from time to time to measure certain assets at fair value on a nonrecurring basis in accordance with U.S. GAAP. These adjustments to fair value usually result from application of lower-of-cost-or-market accounting or write-downs of individual assets.

Impaired Loans: Impaired loans are carried at the lower of cost or the fair value of the collateral for collateral-dependent loans less estimated costs to sell. Collateral is primarily in the form of real estate. The use of independent appraisals, discounted cash flow models and management's best judgment are significant inputs in arriving at the fair value measure of the underlying collateral and impaired loans are therefore classified within level 3 of the fair value hierarchy.

Other Real Estate Owned: Other real estate owned is carried at the lower of the investment in the real estate or the fair value of the real estate less estimated selling costs. The use of independent appraisals and management's best judgment are significant inputs in arriving at the fair value measure of the underlying collateral and therefore other real estate owned is classified within level 3 of the fair value hierarchy.

The table below sets forth the financial assets and liabilities that were accounted for on a recurring and nonrecurring basis by level within the fair value hierarchy as of March 31, 2018 (in thousands):

	March 31, 2018
	Fair Value Measurements Using:
	Total Fair Value		Quoted  Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable  Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association  mortgage-backed securities	$	5,490	$	-	$	5,490	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,281		-		1,281		-
Federal National Mortgage Association mortgage-backed securities		548		-		548		-
Debt securities, U.S. government agency		355		-		355		-
Total investment securities available for sale	$	7,674	$	-	$	7,674	$	-
Total recurring fair value measurements	$	7,674	$	-	$	7,674	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,866	$	--	$	-	$	2,866
Total nonrecurring fair value measurements	$	2,866	$	--	$	-	$	2,866

29

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 11 – Fair Value Measurements and Fair Values of Financial Instruments (Continued)

The table below sets forth the financial assets and liabilities that were accounted for on a recurring and nonrecurring basis by level within the fair value hierarchy as of December 31, 2017 (in thousands):

	December 31, 2017
	Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical  Assets (Level 1)		Significant Other Observable  Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association mortgage-backed securities	$	5,643	$	-	$	5,643	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,342		-		1,342		-
Federal National Mortgage Association mortgage-backed securities		570		-		570		-
Debt securities, U.S. government agency		357		-		357		-
Total investment securities available for sale	$	7,912	$	-	$	7,912	$	-
Total recurring fair value measurements	$	7,912	$	-	$	7,912	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,832	$	--	$	-	$	2,832
Total nonrecurring fair value measurements	$	2,832	$	--	$	-	$	2,832

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has used Level 3 inputs to determine fair value as of March 31, 2018 and December 31, 2017 (in thousands):

	March 31, 2018
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair  Value		Valuation Techniques	Unobservable  Input	Range (Weighted Average)
Impaired loans	$	2,866	Appraisal of collateral (1)	Appraisal adjustments (2)		8%-27% (1	%)

	December 31, 2017
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair  Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,832	Appraisal of collateral (1)	Appraisal adjustments (2)		0%-27% (1	%)

________________

(1) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are identifiable.

(2) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses.  The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percentage of the appraisal.

30

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 11 – Fair Value Measurements and Fair Values of Financial Instruments (Continued)

The estimated fair values of the Company's financial instruments that are not required to be measured or reported at fair value were as follows at March 31, 2018 and December 31, 2017 (in thousands):

							Fair Value Measurements at
							March 31, 2018
							Quoted Prices in			Significant
							Active Markets			Other
							for Identical			Observable			Unobservable
	Carrying			Fair Value			Assets			Inputs			Inputs
	Amount			Estimate			(Level 1)			(Level 2)			(Level 3)
Financial Assets
Cash and cash equivalents		$	16,931		$	16,931		$	16,931		$	-		$	-
Investment in interest-earning time deposits			4,920			4,944			-			-			4,944
Loans held for sale			4,941			5,060			5,060			-			-
Loans receivable, net			207,054			207,783			-			-			207,783
Accrued interest receivable			981			981			981			-			-
Investment in FHLB stock			1,234			1,234			1,234			-			-
Bank-owned life insurance			3,834			3,834			3,834			-			-
Financial Liabilities
Deposits			198,936			199,791			45,487			-			154,304
FHLB short-term borrowings			10,000			10,000			10,000			-			-
FHLB long-term borrowings			18,000			16,963			-			-			16,963
Accrued interest payable			174			174			174			-			-
Advances from borrowers for taxes and insurance			1,651			1,651			1,651

					Fair Value Measurements at
					December 31, 2017
					Quoted Prices in		Significant
					Active Markets		Other
					for Identical		Observable		Unobservable
	Carrying		Fair Value		Assets		Inputs		Inputs
	Amount		Estimate		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Cash and cash equivalents	$	7,910	$	7,910	$	7,910	$	-	$	-
Investment in interest-earning time deposits		4,879		4,912		-		-		4,912
Loans held for sale		7,006		7,232		7,232		-		-
Loans receivable, net		201,667		202,803		-		-		202,803
Accrued interest receivable		1,021		1,021		1,021		-		-
Investment in FHLB stock		1,234		1,234		1,234		-		-
Bank-owned life insurance		3,814		3,814		3,814		-		-
Financial Liabilities
Deposits		186,221		187,309		41,183		-		146,126
FHLB short-term borrowings		10,000		10,000		10,000		-		-
FHLB long-term borrowings		18,000		16,982		-		-		16,982
Accrued interest payable		167		167		167		-		-
Advances from borrowers for taxes and insurance		2,423		2,423		2,423

31

Quaint Oak Bancorp, Inc.

Notes to Unaudited Consolidated Financial Statements

Note 11 – Fair Value Measurements and Fair Values of Financial Instruments (Continued)

The following methods and assumptions were used to measure the fair value of financial instruments recorded at cost on the Company's consolidated balance sheets:

Cash and Cash Equivalents.  The carrying amounts reported in the consolidated balance sheets for cash and short-term instruments approximate those assets' fair values.

Interest-Earning Time Deposits. Fair values for interest-earning time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. The Company generally purchases amounts below the insured limit, limiting the amount of credit risk on these time deposits.

Loans Held for Sale.  Fair values of loans held for sale are based on commitments on hand from investors at prevailing market rates.

Loans Receivable, Net.  The fair values of loans are estimated using discounted cash flow methodology.  The discount rates take into account interest rates currently being offered to customers for loans with similar terms, the credit risk associated with the loan and market factors, including liquidity.  The valuation of the loan portfolio reflects discounts that the Company believes are consistent with transactions occurring in the market place for both performing and distressed loan types.  The carrying value that fair value is compared to is net of the allowance for loan losses and other associated premiums and discounts.  Due to the significant judgment involved in evaluating credit quality, loans are classified with Level 3 of the fair value hierarchy.

Accrued Interest Receivable.  The carrying amount of accrued interest receivable approximates its fair value.

Investment in Federal Home Loan Bank Stock.  The carrying amount of restricted investment in Federal Home Loan Bank stock approximates fair value, and considers the limited marketability of such securities.

Bank-Owned Life Insurance.  The carrying amount of the investment in bank-owned life insurance approximates its cash surrender value under the insurance policies.

Deposits.  The carrying amount is considered a reasonable estimate of fair value for demand savings deposit accounts.  The fair value of fixed maturity certificates of deposit is estimated by a discounted cash flow method using the rates currently offered for deposits of similar maturities.

Federal Home Loan Bank Borrowings.  Fair values of FHLB borrowings are estimated based on rates currently available to the Company for similar terms and remaining maturities.

Accrued Interest Payable.  The carrying amount of accrued interest payable approximates its fair value.

Advances from Borrowers for Taxes and Insurance.  The carrying amount of advances from borrowers for taxes and insurance approximates its fair value.

Off-Balance Sheet Financial Instruments. Off-balance sheet financial instruments consist of commitments to extend credit.  Fair values for commitments to extend credit are estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreement and the present credit standing of the counterparties.  The estimated fair value of the commitments to extend credit are insignificant and therefore are not presented in the above table.

32

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

Forward-Looking Statements Are Subject to Change

We make certain statements in this document as to what we expect may happen in the future. These statements usually contain the words "believe," "estimate," "project," "expect," "anticipate," "intend" or similar expressions. Because these statements look to the future, they are based on our current expectations and beliefs. Actual results or events may differ materially from those reflected in the forward-looking statements. You should be aware that our current expectations and beliefs as to future events are subject to change at any time, and we can give you no assurances that the future events will actually occur.

General

The Company was formed in connection with the Bank's conversion to a stock savings bank completed on July 3, 2007.  The Company's results of operations are dependent primarily on the results of the Bank, which is a wholly owned subsidiary of the Company.  The Bank's results of operations depend, to a large extent, on net interest income, which is the difference between the income earned on its loan and investment portfolios and the cost of funds, consisting of the interest paid on deposits and borrowings.  Results of operations are also affected by provisions for loan losses, fee income and other non-interest income and non-interest expense.  Non-interest expense principally consists of compensation, directors' fees and expenses, office occupancy and equipment expense, data processing expense, professional fees, advertising expense, FDIC deposit insurance assessment, and other expenses.  Our results of operations are also significantly affected by general economic and competitive conditions, particularly changes in interest rates, government policies and actions of regulatory authorities.  Future changes in applicable law, regulations or government policies may materially impact our financial condition and results of operations.

At March 31, 2018, the Bank has five wholly-owned subsidiaries, Quaint Oak Mortgage, LLC, Quaint Oak Real Estate, LLC, Quaint Oak Abstract, LLC, QOB Properties, LLC, and Quaint Oak Insurance Agency, LLC, each a Pennsylvania limited liability company.  The mortgage, real estate and abstract companies offer mortgage banking, real estate sales and title abstract services, respectively, in the Lehigh Valley region of Pennsylvania, and began operation in July 2009.  QOB Properties, LLC began operations in July 2012 and holds Bank properties acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure.  Quaint Oak Insurance Agency, LLC began operations in August 2016 and provides a broad range of personal and commercial insurance coverage solutions.

Critical Accounting Policies

The accounting and financial reporting policies of the Company conform to accounting principles generally accepted in the United States of America and to general practices within the banking industry. Accordingly, the consolidated financial statements require certain estimates, judgments, and assumptions, which are believed to be reasonable, based upon the information available. These estimates and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the periods presented. The following accounting policies comprise those that management believes are the most critical to aid in fully understanding and evaluating our reported financial results. These policies require numerous estimates or economic assumptions that may prove inaccurate or may be subject to variations which may significantly affect our reported results and financial condition for the period or in future periods.

33

Allowance for Loan Losses.  The allowance for loan losses represents management's estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans receivable. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Because all identified losses are immediately charged off, no portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses.

The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company's past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower's ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant revision as more information becomes available.

The allowance consists of specific, general and unallocated components. The specific component relates to loans that are designated as impaired. For loans that are designated as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers pools of loans by loan class. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These significant factors may include changes in lending policies and procedures, changes in existing general economic and business conditions affecting our primary lending areas, credit quality trends, collateral value, loan volumes and concentrations, seasoning of the loan portfolio, recent loss experience in particular segments of the portfolio, duration of the current business cycle and bank regulatory examination results. The applied loss factors are reevaluated quarterly to ensure their relevance in the current economic environment.  Residential owner occupied mortgage lending generally entails a lower risk of default than other types of lending. Consumer loans and commercial real estate loans generally involve more risk of collectability because of the type and nature of the collateral and, in certain cases, the absence of collateral. It is the Company's policy to establish a specific reserve for loss on any delinquent loan when it determines that a loss is probable. An unallocated component is maintained to cover uncertainties that could affect management's estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not considered impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower's prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan's effective interest rate or the fair value of the collateral if the loan is collateral dependent.  An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company's impaired loans are measured based on the estimated fair value of the loan's collateral.

34

A loan is identified as a troubled debt restructuring ("TDR") if the Company, for economic or legal reasons related to a debtor's financial difficulties, grants a concession to the debtor that it would not otherwise consider. Concessions granted under a TDR typically involve a temporary or permanent reduction in payments or interest rate or an extension of a loan's stated maturity date at less than a current market rate of interest. Loans identified as TDRs are designated as impaired.

For loans secured by real estate, estimated fair values are determined primarily through third-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimated costs to sell the property.

The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower's overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for all loans (except one-to-four family residential owner-occupied loans) where the total amount outstanding to any borrower or group of borrowers exceeds $500,000, or when credit deficiencies arise, such as delinquent loan payments. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans criticized special mention have potential weaknesses that deserve management's close attention. If uncorrected, the potential weaknesses may result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans not classified are rated pass. In addition, Federal regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses and may require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which may not be currently available to management. Based on management's comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate.

Income Taxes.  Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method.  Under this method, the net deferred tax asset or liability is determined based on the tax effects of the temporary differences between the book and tax bases of the various assets and liabilities and net operating loss carryforwards and gives current recognition to changes in tax rates and laws.  The realization of our deferred tax assets principally depends upon our achieving projected future taxable income.  We may change our judgments regarding future profitability due to future market conditions and other factors.  We may adjust our deferred tax asset balances if our judgments change.

35

Comparison of Financial Condition at March 31, 2018 and December 31, 2017

General.  The Company's total assets at March 31, 2018 were $251.6 million, an increase of $12.0 million, or 5.0%, from $239.6 million at December 31, 2017.  This growth in total assets was primarily due to a $9.0 million, or 114.0%, increase in cash and cash equivalents, and a $5.4 million, or 2.7%, increase in loans receivable, net, partially offset by a $2.1 million, or 29.5%, decrease in loans held for sale.

Cash and Cash Equivalents. Cash and cash equivalents increased $9.0 million, or 114.0%, from $7.9 million at December 31, 2017 to $16.9 million at March 31, 2018 with the expectation that excess liquidity will be used to fund loans.

Investment Securities Available for Sale.  Investment securities available for sale decreased $238,000, or 3.0%, from $7.9 million at December 31, 2017 to $7.7 million at March 31, 2018, due primarily to the principal repayments on these securities during the three months ended March 31, 2018.

Loans Held for Sale.  Loans held for sale decreased $2.1 million, or 29.5%, from $7.0 million at December 31, 2017 to $4.9 million at March 31, 2018 as the Bank's mortgage banking subsidiary, Quaint Oak Mortgage, LLC, originated $16.7 million of one-to-four family residential loans during the three months ended March 31, 2018 and sold $18.7 million of loans in the secondary market during this same period. In addition, the Bank originated $608,000 of equipment loans held for sale during the three months ended March 31, 2018 and sold $715,000 of equipment loans during this same period.

Loans Receivable, Net.  Loans receivable, net, increased $5.4 million, or 2.7%, to $207.1 million at March 31, 2018 from $201.7 million December 31, 2017.  This increase was funded primarily from deposits and proceeds from the sale of loans held for sale.  Increases within the portfolio occurred in commercial real estate loans which increased $4.2 million, or 4.5%, multi-family residential loans which increased $1.7 million, or 8.0%, commercial business loans which increased $1.6 million, or 13.4%, one-to-four family residential owner occupied loans which increased $635,000, or 11.2%, and construction loans which increased $577,000, or 3.7%.  These increases were partially offset by decreases of $2.9 million, or 5.7%, in one-to-four family residential non-owner occupied loans, $357,000, or 7.0%, in home equity loans, and $6,000, or 4.3%, in other consumer loans.  The Company continues its strategy of diversifying its loan portfolio with higher yielding and shorter-term loan products and selling substantially all of its newly originated one-to-four family owner-occupied loans into the secondary market.

Deposits.  Total deposits increased $12.7 million, or 6.8%, to $198.9 million at March 31, 2018 from $186.2 million at December 31, 2017. This increase in deposits was primarily attributable to increases of $8.4 million, or 5.8%, in certificates of deposit, $3.1 million, or 38.4% in non-interest bearing checking accounts, and $1.7 million, or 5.7%, in money market accounts, partially offset by a $379,000, or 16.1%, decrease in savings accounts and a $109,000, or 23.5%, decrease in passbook accounts.

Stockholders' Equity.  Total stockholders' equity increased $300,000, or 1.4%, to $22.5 million at March 31, 2018 from $22.2 million at December 31, 2017.  Contributing to the increase was net income for the three months ended March 31, 2018 of $288,000, the reissuance of treasury stock for exercised stock options of $264,000, common stock earned by participants in the employee stock ownership plan of $48,000, amortization of stock awards and options under our stock compensation plans of $32,000, the reissuance of treasury stock under the Bank's 401(k) Plan of $24,000, and other comprehensive income, net of $12,000.  These increases were partially offset by the purchase of treasury stock of $272,000 and by dividends paid of $96,000.

36

Comparison of Operating Results for the Three Months Ended March 31, 2018

General.  Net income amounted to $288,000 for the three months ended March 31, 2018, an increase of $117,000, or 68.4%, compared to net income of $171,000 for the three months ended March 31, 2017.  The increase in net income on a comparative quarterly basis was primarily the result of an increase in non-interest income of $385,000, an increase in net interest income of $158,000, and a decrease in the provision for income taxes of $19,000, partially offset by an increase in non-interest expense of $416,000 and an increase in the provision for loan losses of $29,000.

Net Interest Income.  Net interest income increased $158,000, or 8.7%, to $2.0 million for the three months ended March 31, 2018 from $1.8 million for the three months ended March 31, 2017.  The increase was driven by a $320,000, or 12.7%, increase in interest income, partially offset by a $162,000, or 23.3%, increase in interest expense.

Interest Income.  Interest income increased $320,000, or 12.7%, to $2.8 million for the three months ended March 31, 2018 from $2.5 million for the three months ended March 31, 2017. The increase in interest income was primarily due to a $26.1 million increase in average loans receivable, net, including loans held for sale, which increased from an average balance of $181.7 million for the three months ended March 31, 2017 to an average balance of $207.8 million for the three months ended March 31, 2018, and had the effect of increasing interest income $349,000.  Partially offsetting this increase was a 14 basis point decline in the yield on loans receivable, net, including loans held for sale, from 5.35% for the three months ended March 31, 2017 to 5.21% for the three months ended March 31, 2018, which had the effect of decreasing interest income by $70,000.

Interest Expense.  Interest expense increased $162,000, or 23.3%, to $856,000 for the three months ended March 31, 2018 from $694,000 for the three months ended March 31, 2017.  The increase in interest expense was primarily attributable to a $21.8 million increase in average interest-bearing liabilities, which increased from an average balance of $188.2 million for the three months ended March 31, 2017 to an average balance of $210.1 million for the three months ended March 31, 2018, and had the effect of increasing interest expense $86,000.  This increase in average interest-bearing liabilities was primarily attributable to a $10.8 million increase in average certificate of deposit accounts which increased from an average balance of $137.8 million for the three months ended March 31, 2017 to an average balance of $148.6 million for the three months ended March 31, 2018, and had the effect of increasing interest expense $46,000, and a $12.5 million increase in average Federal Home Loan Bank borrowings which increased from an average balance of $15.5 million for the three months ended March 31, 2017 to an average balance of $28.0 million for the three months ended March 31, 2018, and had the effect of increasing interest expense $43,000.  Also contributing to this increase was a 16 basis point increase in the average rate on interest-bearing liabilities, from 1.47% for the three months ended March 31, 2017 to 1.63% for the three months ended March 31, 2018, which had the effect of increasing interest expense by $76,000.  This increase in average rate was primarily attributable to an eleven basis point increase in rate on average certificate of deposit accounts, which increased from 1.69% for the three months ended March 31, 2017 to 1.80% for the three months ended March 31, 2018, and had the effect of increasing interest expense by $38,000, and a 62 basis point  increase in rate on average Federal Home Loan Bank short-term and long-term borrowings, which increased from 1.19% for the three months ended March 31, 2017 to 1.81% for the three months ended March 31, 2018, which had the effect of increasing interest expense by $37,000.

37

Average Balances, Net Interest Income, Yields Earned and Rates Paid. The following table shows for the periods indicated the total dollar amount of interest from average interest-earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities, expressed both in dollars and rates, and the net interest margin.  All average balances are based on daily balances.

	Three Months Ended March 31,
	2018							2017
	Average Balance		Interest		Average Yield/ Rate			Average Balance		Interest		Average Yield/ Rate
	(Dollars in thousands)
Interest-earning assets:
Due from banks, interest-bearing	$	12,413	$	50		1.61	%	$	10,363	$	23		0.89	%
Investment in interest-earning time deposits		4,884		22		1.80			6,067		25		1.65
Investment securities available for sale		7,810		35		1.79			9,407		30		1.28
Loans receivable, net (1) (2)  (3)		207,829		2,709		5.21			181,750		2,430		5.35
Investment in FHLB stock		1,235		19		6.15			713		7		3.93
Total interest-earning assets		234,171		2,835		4.84	%		208,300		2,515		4.83	%
Non-interest-earning assets		8,670							9,238
Total assets	$	242,841						$	217,538
Interest-bearing liabilities:
Passbook accounts	$	394	$	-		-	%	$	913	$	-		-	%
Savings accounts		2,004		1		0.20			1,781		1		0.22
Money market accounts		31,067		61		0.79			32,275		64		0.79
Certificate of deposit accounts		148,611		667		1.80			137,761		583		1.69
Total deposits		182,076		729		1.60			172,730		648		1.50
FHLB short-term borrowings		10,000		36		1.44			7,000		13		0.74
FHLB long-term borrowings		18,000		91		2.02			8,500		33		1.55
Total interest-bearing liabilities		210,076		856		1.63	%		188,230		694		1.47	%
Non-interest-bearing liabilities		10,401							8,248
Total liabilities		220,477							196,478
Stockholders' Equity		22,364							21,060
Total liabilities and Stockholders' Equity	$	242,841						$	217,538
Net interest-earning assets	$	24,095						$	20,070
Net interest income; average interest rate spread			$	1,979		3.21	%			$	1,821		3.36	%
Net interest margin (4)						3.38	%						3.50	%
Average interest-earning assets to average interest-      bearing liabilities						111.47	%						110.66	%

__________________

(1) Includes loans held for sale.

(2) Includes non-accrual loans during the respective periods.  Calculated net of deferred fees and discounts, loans in process and allowance for loan losses.

(3) Includes tax free municipal leases with an aggregate average balance of $34,000 and an average yield of 4.57% for the three months ended March 31, 2018 and an aggregate average balance of $86,000 and an average yield of 4.01% for the three months ended March 31, 2017.  The tax-exempt income from such loans has not been calculated on a tax equivalent basis.

 (4) Equals net interest income divided by average interest-earning assets.

Provision for Loan Losses.  The Company's provision for loan losses increased $29,000, or 69.0%, from $42,000 for the three months ended March 31, 2017 to $71,000 for the three months ended March 31, 2018, based on an evaluation of the allowance relative to such factors as volume of the loan portfolio, concentrations of credit risk, prevailing economic conditions, prior loan loss experience and amount of non-performing loans at March 31, 2018.

Non-performing loans amounted to $2.7 million, or 1.31% of net loans receivable at March 31, 2018, consisting of eight loans, four of which are on non-accrual status and four of which are 90 days or more past due and accruing interest. Comparably, non-performing loans amounted to $3.1 million, or 1.52% of net loans receivable at December 31, 2017, consisting of eleven loans, three of which were on non-accrual status and eight of which were 90 days or more past due and accruing interest.  The non-performing loans at March 31, 2018 include three one-to-four family owner occupied residential loans, two one-to-four family non-owner occupied residential loans, two construction loans, and one commercial real estate loan, and all are generally well-collateralized or adequately reserved for.  During the quarter ended March 31, 2018, two loans were placed on non-accrual status resulting in the reversal of approximately $16,000 of previously accrued interest income, and one loan was paid-off.  The allowance for loan losses as a percent of total loans receivable was 0.88% at March 31, 2018 and 0.89% at December 31, 2017.

38

Non-Interest Income.  Non-interest income increased $385,000, or 107.8%, for the three months ended March 31, 2018 over the comparable period in 2017 primarily due to a $213,000, or 197.2%, increase in net gain on loans held for sale, a $59,000 increase in the gain on the sales of other real estate owned, a $48,000, or 184.6%, increase on other fees and service charges, a $43,000, or 477.8%, increase in other non-interest income, and a $23,000 increase in the gain on sale of SBA loans.  The $59,000 gain on the sales of other real estate owned represents the recognition in the current quarter of gains on the sale of two properties that were deferred in prior years.

Non-Interest Expense.  Non-interest expense increased $416,000, or 22.0%, from $1.9 million for the three months ended March 31, 2017 to $2.3 million for the three months ended March 31, 2018.  Salaries and employee benefits expense accounted for $351,000 of the change as this expense increased 26.7%, from $1.3 million for the three months ended March 31, 2017 to $1.7 million for the three months ended March 31, 2018 due primarily to increased staff related to the continued expansion of the Company's mortgage banking and lending operations, and the expansion of our real estate subsidiary, a $39,000, or 83.0%, increase in data processing expense, a $38,000, or 27.5%, increase in other non-interest expense, a $15,000, or 38.5%, increase in advertising expense, a $5,000, or 3.4%, increase in occupancy and equipment expense, a $3,000, or 6.8%, increase in FDIC insurance assessment, and a $2,000, or 3.8%, increase in directors' fees and expenses.  These increases were partially offset by a $30,000, or 33.3%, decrease in professional fees and a $7,000 decrease in other real estate owned expense.

Provision for Income Tax.  The provision for income tax decreased $19,000, or 25.7%, from $74,000 for the three months ended March 31, 2017 to $55,000 for the three months ended March 31, 2018 as our effective tax rate decreased from 30.2% for the three months ended March 31, 2017 to 16.0% for the three months ended  March 31, 2018 primarily due to the decrease in the Company's income tax rate from 34% in 2017 to 21% in 2018 as a result of the Tax Cuts and Jobs Act which was signed into law on December 22, 2017, and a tax deduction taken in the first quarter of 2018 related to the exercise of non-qualified stock options during the three months ended March 31, 2018.

Liquidity  and Capital Resources

The Company's primary sources of funds are deposits, amortization and prepayment of loans and to a lesser extent, loan sales and other funds provided from operations.  While scheduled principal and interest payments on loans are a relatively predictable source of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions and competition.  The Company sets the interest rates on its deposits to maintain a desired level of total deposits.  In addition, the Company invests excess funds in short-term interest-earning assets that provide additional liquidity.  At March 31, 2018, the Company's cash and cash equivalents amounted to $16.9 million.  At such date, the Company also had $1.3 million invested in interest-earning time deposits maturing in one year or less.

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The Company uses its liquidity to fund existing and future loan commitments, to fund deposit outflows, to invest in other interest-earning assets and to meet operating expenses.  At March 31, 2018, Quaint Oak Bank had outstanding commitments to originate loans of $11.2 million and commitments under unused lines of credit of $15.8 million.

At March 31, 2018, certificates of deposit scheduled to mature in less than one year totaled $44.4 million.  Based on prior experience, management believes that a significant portion of such deposits will remain with us, although there can be no assurance that this will be the case.

In addition to cash flow from loan payments and prepayments and deposits, the Company has significant borrowing capacity available to fund liquidity needs.  If the Company requires funds beyond its ability to generate them internally, borrowing agreements exist with the Federal Home Loan Bank of Pittsburgh (FHLB), which provide an additional source of funds.  As of March 31, 2018, we had $28.0 million of borrowings from the FHLB and had $119.2 million in borrowing capacity. Under terms of the collateral agreement with the FHLB of Pittsburgh, we pledge residential mortgage loans as well as Quaint Oak Bank's FHLB stock as collateral for such advances.  In addition, as of March 31, 2018 Quaint Oak Bank had $863,000 in borrowing capacity with the Federal Reserve Bank of Philadelphia.  There were no borrowings under this facility at March 31, 2018.

Our stockholders' equity amounted to $22.5 million at March 31, 2018, an increase of $300,000, or 1.4%, from $22.2 million at December 31, 2017.  Contributing to the increase was net income for the three months ended March 31, 2018 of $288,000, the reissuance of treasury stock for exercised stock options of $264,000, common stock earned by participants in the employee stock ownership plan of $48,000, amortization of stock awards and options under our stock compensation plans of $32,000, the reissuance of treasury stock under the Bank's 401(k) Plan of $24,000, and other comprehensive income, net of $12,000.  These increases were partially offset by the purchase of treasury stock of $272,000 and by dividends paid of $96,000.  For further discussion of the stock compensation plans, see Note 10 in the Notes to Unaudited Consolidated Financial Statements contained elsewhere herein.

Quaint Oak Bank is required to maintain regulatory capital sufficient to meet tier 1 leverage, common equity tier 1 capital, tier 1 risk-based and total risk-based capital ratios of at least 4.00%, 4.50%, 6.00%, and 8.00%, respectively.  At March 31, 2018, Quaint Oak Bank exceeded each of its capital requirements with ratios of 8.41%, 11.24%, 11.24% and 12.28%, respectively. As a small savings and loan holding company eligible for exemption, the Company is not currently subject to any regulatory capital requirements.

Off-Balance Sheet Arrangements

In the normal course of operations, we engage in a variety of financial transactions that, in accordance with generally accepted accounting principles are not recorded in our financial statements.  These transactions involve, to varying degrees, elements of credit, interest rate, and liquidity risk.  Such transactions are used primarily to manage customers' requests for funding and take the form of loan commitments and lines of credit.  Our exposure to credit loss from non-performance by the other party to the above-mentioned financial instruments is represented by the contractual amount of those instruments.  We use the same credit policies in making commitments and conditional obligations as we do for on-balance sheet instruments.  In general, we do not require collateral or other security to support financial instruments with off–balance sheet credit risk.

Commitments.  At March 31, 2018, we had unfunded commitments under lines of credit of $15.8 million and $11.2 million of commitments to originate loans.  We had no commitments to advance additional amounts pursuant to outstanding lines of credit or undisbursed construction loans.

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Impact of Inflation and Changing Prices

The consolidated financial statements and related financial data presented herein have been prepared in accordance with accounting principles generally accepted in the United States of America which generally require the measurement of financial position and operating results in terms of historical dollars, without considering changes in relative purchasing power over time due to inflation. Unlike most industrial companies, virtually all of the Company's assets and liabilities are monetary in nature.  As a result, interest rates generally have a more significant impact on the Company's performance than does the effect of inflation. Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services, since such prices are affected by inflation to a larger extent than interest rates.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) as of March 31, 2018.  Based on their evaluation of the Company's disclosure controls and procedures, the Company's Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and regulations are operating in an effective manner.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Securities Exchange Act of 1934) occurred during the first fiscal quarter of fiscal 2018 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II

ITEM 1. LEGAL PROCEEDINGS

The Company is not involved in any pending legal proceedings other than routine legal proceedings occurring in the ordinary course of business, which involve amounts in the aggregate believed by management to be immaterial to the financial condition and operating results of the Company.

ITEM 1A. RISK FACTORS

Not applicable.

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

(a)          Not applicable.

(b)          Not applicable.

(c)          Purchases of Equity Securities

The Company's repurchases of its common stock made during the quarter ended March 31, 2018, including stock-for-stock option exercises of outstanding stock options, are set forth in the table below:

Period	Total Number  of Shares Purchased		Average  Price Paid per Share		Total Number of Shares Purchased  as Part of Publicly Announced Plans  or Programs		Maximum Number of Shares that May Yet Be  Purchased Under  the Plans or Programs (1)
January 1, 2018 – January 31, 2018		758	$	13.05		-		23,344
February 1, 2018 – February 28, 2018		10,083		13.85		-		23,344
March 1, 2018 – March 31, 2018		9,260		13.20		4,000		19,344
Total		20,101	$	13.52		4,000		19,344

Notes to this table:

(1) On February 21, 2014, the Board of Directors of Quaint Oak Bancorp approved its fourth share repurchase program which provides for the repurchase of up to 69,432 shares (adjusted to reflect the two-for-one stock split), or approximately 2.5% of the Company's then issued and outstanding shares of common stock, and announced the fourth repurchase program on Form 8-K filed on February 26, 2014.  The repurchase program does not have an expiration date.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

No.	Description
10.1	Employment Agreement by and between Quaint Oak Bank and William R. Gonzalez *
31.1	Rule 13a-14(d) and 15d-14(d) Certification of the Chief Executive Officer.
31.2	Rule 13a-14(d) and 15d-14(d) Certification of the Chief Financial Officer.
32.0	Section 1350 Certification.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema Document.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF	XBRL Taxonomy Extension Definitions Linkbase Document.

_____________________

* Denotes management compensation plan or arrangement.

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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.

Date:  May 14, 2018	By:	/s/Robert T. Strong
		Robert T. Strong President and Chief Executive Officer
Date:  May 14, 2018		/s/John J. Augustine
	By:	John J. Augustine Executive Vice President and Chief Financial Officer

EX-10.1

EXHIBIT 10.1

QUAINT OAK BANK

EMPLOYMENT AGREEMENT

FOR WILLIAM R. GONZALEZ

THIS EMPLOYMENT AGREEMENT (the "Agreement") between Quaint Oak Bank, a Pennsylvania-chartered stock savings bank with principal offices at 501 Knowles Avenue, Southampton, Pennsylvania 18966 (the "Bank"), and William R. Gonzalez (the "Executive"), is hereby adopted effective as of the 30^th day of March, 2018.

WHEREAS, the Executive is presently employed as Senior Vice President Business Development of the Bank;

WHEREAS, the Executive currently also serves as President and Chief Executive Officer of Quaint Oak Real Estate, LLC, Quaint Oak Abstract, LLC, Quaint Oak Mortgage, LLC, Quaint Oak Insurance Agency, LLC and QOB Properties, LLC each a subsidiary of the Bank (collectively, the "Subsidiaries") pursuant to an employment agreement dated July 1, 2009, as amended effective May 11, 2011 (the "Prior Agreement").

WHEREAS, the Executive and the Bank hereby agree that all prior agreements, oral or written, between the Bank and the Executive with respect to the matters agreed to herein, including without limitation the Prior Agreement, are hereby superseded and shall have no force or effect and all amounts owed to the Executive under the Prior Agreement have been satisfied;

WHEREAS, the Bank desires to be ensured of the Executive's continued active participation in the business of the Bank and the Subsidiaries as provided for in this Agreement; and

WHEREAS, the Executive is willing to serve the Bank and the Subsidiaries on the terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the mutual promises and agreements set forth herein, the parties hereby agree as follows:

1.          Definitions.  The following words and terms shall have the meanings set forth below for the purposes of this Agreement:

(a)          Average Annual Compensation.  The Executive's "Average Annual Compensation" for purposes of this Agreement shall be deemed to mean the average amount of compensation paid to the Executive by the Bank and any parent or subsidiary thereof during the most recent three calendar years immediately preceding the year in which the Date of Termination occurs and included in the Executive's gross income for tax purposes.

(b)          Base Salary.  "Base Salary" shall have the meaning set forth in Section 3(a) hereof.

(c)          Cause. Termination of the Executive's employment for "Cause" shall mean termination because of personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, conviction of a felony, intentional failure to perform stated duties, willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order, willful or intentional breach or neglect by the Executive of his duties, or a material breach of any provision of this Agreement.  For purposes of this Agreement, no act or failure to act on the Executive's part shall be considered "willful" unless done, or omitted to be done, by him not in good faith and without reasonable belief that this action or omission was in the best interest of the Bank; provided that any act or omission to act on the Executive's behalf in reliance upon an opinion of counsel to the Bank or counsel to the Executive shall not be deemed to be willful. The terms "incompetence" and "misconduct" shall be defined with reference to standards generally prevailing in the banking industry. In determining incompetence and misconduct, the Bank shall have the burden of proof with regard to the acts or omissions of the Executive and the standards prevailing in the banking industry.

(d)          Change in Control.  "Change in Control" shall mean a change in the ownership of the Corporation or the Bank, a change in the effective control of the Corporation or the Bank or a change in the ownership of a substantial portion of the assets of the Corporation or the Bank, in each case as provided under Section 409A of the Code and the regulations thereunder.

(e)          Code.  "Code" shall mean the Internal Revenue Code of 1986, as amended.

(f)          Corporation.  "Corporation" shall mean Quaint Oak Bancorp, Inc., the holding company for the Bank.

(g)          Date of Termination.  "Date of Termination" shall mean (i) if the Executive's employment is terminated for Cause, the date on which the Notice of Termination is given, and (ii) if the Executive's employment is terminated for any other reason, the date specified in such Notice of Termination.

(h)          Disability. "Disability" shall mean the Executive (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Bank.  In the event of any dispute between the Executive and the Bank as to the Executive's Disability, the matter shall be decided by a majority vote of a panel of physicians, one of whom shall be selected by the Executive, one of whom shall be selected by the Bank, and one of whom shall be selected by the other two physicians.  The physicians' fees and any other costs associated with the resolution of said dispute shall be borne by the Bank.

(i)          Good Reason.  "Good Reason" means the occurrence of any of the following events:

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              (i)           any material breach of this Agreement by the Bank, including without limitation any of the following: (A) a material diminution in the Executive's base compensation, (B) a material diminution in the Executive's authority, duties or responsibilities, or (C) any requirement that the Executive report to a corporate officer or employee of the Bank other than the President and Chief Executive Officer of the Bank, or

              (ii)          any material change in the geographic location at which the Executive must perform his services under this Agreement;

provided, however, that prior to any termination of employment for Good Reason, the Executive must first provide written notice to the Bank within ninety (90) days of the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Bank received the written notice from the Executive.  If the Bank remedies the condition within such thirty (30) day cure period, then no Good Reason shall be deemed to exist with respect to such condition.  If the Bank does not remedy the condition within such thirty (30) day cure period, then the Executive may deliver a Notice of Termination for Good Reason at any time within sixty (60) days following the expiration of such cure period.

(j)          Notice of Termination.  Any purported termination of the Executive's employment by the Bank for any reason, including without limitation for Cause or Disability, or by the Executive for any reason, including without limitation for Good Reason, shall be communicated by a written "Notice of Termination" to the other party hereto.  For purposes of this Agreement, a "Notice of Termination" shall mean a dated notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, (iii) specifies a Date of Termination, which shall be not less than thirty (30) nor more than ninety (90) days after such Notice of Termination is given, except in the case of the Bank's termination of the Executive's employment for Cause, which shall be effective immediately; and (iv) is given in the manner specified in Section 12 hereof.

(k)          Regulatory Agency.  "Regulatory Agency" means any governmental agency having regulatory or supervisory jurisdiction over the Bank at the time of reference.

2.          Term of Employment.

(a)          The Bank hereby employs the Executive as Senior Vice President Business Development, and the Executive hereby accepts said employment and agrees to render such services to the Bank on the terms and conditions set forth in this Agreement. Subject to the terms hereof, this Agreement shall terminate three (3) years after December 31, 2017.  Beginning on December 31, 2018 and on each December 31^st thereafter, the term of this Agreement shall be extended for a period of one additional year, provided that the Bank has not given notice to the Executive in writing at least 30 days, and not more than 90 days, prior to such December 31^st that the term of this Agreement shall not be extended further and/or the Executive has not given notice to the Bank of his election not to extend the term at least 30 days, and not more than 90 days, prior to any such December 31^st. If any party gives timely notice that the term will not be extended as of any such December 31^st, then this Agreement shall terminate at the conclusion of its remaining term.  References herein to the term of this Agreement shall refer both to the initial term and successive terms.

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(b)          During the term of this Agreement, the Executive shall perform such executive services for the Bank as is consistent with his title of Senior Vice President Business Development  and shall perform such executive services for the Subsidiaries as from time to time assigned to him by the Bank's President and Chief Executive Officer or the Board of Directors.

3.          Compensation and Benefits.

(a)          The Bank shall compensate and pay the Executive for his services during the term of this Agreement at a minimum base salary of One Hundred Fifty-Five Thousand Dollars ($155,000.00) per year ("Base Salary") payable no less frequently than in monthly installments, which may be increased from time to time in such amounts as may be determined by the Board of Directors of the Bank.  In addition to his Base Salary, the Executive shall be entitled to receive during the term of this Agreement such bonus payments as may be authorized and declared by the Board of Directors of the Bank in its sole discretion.

(b)          During the term of this Agreement, the Executive shall be entitled to participate in any benefit plans as the Bank may adopt for the benefit of its employees.  The Bank shall not make any changes in such benefit plans which would adversely affect the Executive's rights or benefits thereunder, unless such change occurs pursuant to a program applicable to all executive officers of the Bank and does not result in a proportionately greater adverse change in the rights of or benefits to the Executive as compared with any other executive officer of the Bank.  Nothing paid to the Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to the Executive pursuant to Section 3(a) hereof.

(c)          During the term of this Agreement, the Executive shall be entitled to paid annual vacation as approved from time to time by the Board of Directors of the Bank.  The timing of paid vacations shall be scheduled in a reasonable manner by the Executive.  The Executive shall not be entitled to receive any additional compensation from the Bank for failure to take a vacation, nor shall the Executive be able to accumulate unused vacation time from one year to the next, except to the extent authorized by the Board of Directors of the Bank.

(d)          Except as otherwise agreed between the Bank and the Subsidiaries and to the extent applicable, (i) the Executive's compensation, benefits, and severance and (ii) expenditures made by the Executive on behalf of the Bank, as set forth in this Agreement, shall be paid by the Bank and each of the Subsidiaries in the same proportions as the (A) time and services and (B) expenditures actually expended by the Executive on the business of the Bank and the business of each of the Subsidiaries, respectively. For this purpose, the Executive shall maintain, and provide to the Bank on at least a monthly basis, documentation of the time and expense expended by the Executive on the business of each of the Subsidiaries and the Bank.

4.          Expenses.  The Bank shall reimburse the Executive or otherwise provide for or pay for all reasonable expenses incurred by the Executive in furtherance of or in connection with the business of the Bank, including, but not by way of limitation, traveling expenses for attending annual and periodic meetings of trade associations, subject to such reasonable documentation and other limitations as may be established by management of the Bank.  If such expenses are paid in the first instance by the Executive, the Bank shall reimburse the Executive therefor.  Such reimbursement shall be made promptly by the Bank and, in any event, no later than March 15^th of the year immediately following the year in which such expenses were incurred.

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5.          Termination.

(a)          The Bank shall have the right, at any time upon prior Notice of Termination, to terminate the Executive's employment hereunder for any reason, including without limitation termination for Cause or Disability, and the Executive shall have the right, upon prior Notice of Termination, to terminate his employment hereunder for any reason.

(b)          In the event that (i) the Executive's employment is terminated by the Bank for Cause, or (ii) the Executive terminates his employment hereunder other than for Good Reason, the Executive shall have no right pursuant to this Agreement to compensation or other benefits for any period after the applicable Date of Termination.

(c)          In the event that the Executive's employment is terminated as a result of Disability during the term of this Agreement, then the Bank shall pay to the Executive the following: (i) in a lump sum within thirty (30) days following the Date of Termination, a cash severance amount equal to one times the Executive's then current Base Salary, plus (ii) in a lump sum payable at the time annual bonuses are normally paid, the pro rata portion of any annual bonus that the Executive would have earned for the year in which the Date of Termination occurs if he had remained in the employ of the Bank for the full calendar year, based upon the portion of the calendar year that the Executive was able to perform his duties prior to his termination due to Disability, provided that the pro rata bonus shall be paid no later than March 15^th of the year immediately following the year in which the Date of Termination occurs.

(d)          In the event that the Executive's employment is terminated as a result of the Executive's death during the term of this Agreement, then the Bank shall pay to the Executive's spouse or, if none, to his estate or legal representative, the following: (i) in a lump sum within thirty (30) days following the Date of Termination, a cash severance amount equal to one times the Executive's then current Base Salary, plus (ii) in a lump sum payable at the time annual bonuses are normally paid, the pro rata portion of any bonus that the Executive would have earned for the year in which the Date of Termination occurs if he had remained in the employ of the Bank for the full calendar year, based upon the portion of the calendar year that the Executive was able to perform his duties prior to his death, provided that the pro rata bonus shall be paid no later than March 15^th of the year immediately following the year in which the Date of Termination occurs.

(e)          In the event that either prior to or more than 24 months after a Change in Control the Executive's employment is terminated either (i) by the Bank for other than Cause, Disability or the Executive's death or (ii) by the Executive for Good Reason, then the Bank shall pay to the Executive, in a lump sum within thirty (30) days following the Date of Termination, a cash severance amount equal to three (3) times the Executive's then current Base Salary.

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(f)          In the event that either concurrently with or within 24 months after a Change in Control the Executive's employment is terminated either (i) by the Bank for other than Cause, Disability or the Executive's death or (ii) by the Executive for Good Reason, then the Bank shall pay to the Executive, in a lump sum within five (5) business days following the Date of Termination, a cash severance amount equal to 2.99 times the Executive's Average Annual Compensation, subject to the provisions of Section 6 hereof, if applicable.

(g)          Notwithstanding any other provision contained in this Agreement, if either (i) the time period for making any cash payment under either Section 5(e) or Section 5(f) commences in one calendar year and ends in the succeeding calendar year or (ii) in the event any payment under this Section 5 is made contingent upon the execution of a general release and the time period that the Executive has to consider the terms of such general release (including any revocation period under such release) commences in one calendar year and ends in the succeeding calendar year, then the payment shall not be paid until the succeeding calendar year.

6.          Limitation of Benefits under Certain Circumstances.  If any payment pursuant to Section 5 hereof, either alone or together with other payments and benefits which the Executive has the right to receive from the Bank or the Corporation, would constitute a "parachute payment" under Section 280G of the Code, then the payment payable by the Bank pursuant to Section 5 hereof shall be reduced by the minimum amount necessary to result in no portion of the payment payable by the Bank under Section 5 being non‑deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code.  The determination of any reduction in the payments to be made pursuant to Section 5 shall be based upon the opinion of independent tax counsel selected by the Bank and paid by the Bank.  Such counsel shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination, and may use such actuaries as such counsel deems necessary or advisable for the purpose.  Nothing contained in this Section 6 shall result in a reduction of any payments or benefits to which the Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 6, or a reduction in the payments specified in Section 5 below zero.

7.          Non-Disclosure, Non-Competition and Non-Solicitation Provisions.

(a)          The Executive acknowledges that he has acquired, and will continue to acquire while employed by the Bank and/or performing services for the Subsidiaries, special knowledge of the business, affairs, strategies and plans of the Bank and the Subsidiaries which has not been disclosed to the public and which constitutes confidential and proprietary business information owned by the Bank and the Subsidiaries, including but not limited to, information about the customers, customer lists, software, data, formulae, processes, inventions, trade secrets, marketing information and plans, and business strategies of the Bank and the Subsidiaries, and other information about the products and services offered or developed or planned to be offered or developed by the Bank and/or the Subsidiaries ("Confidential Information").  The Executive agrees that, without the prior written consent of the Bank, he shall not, during the term of his employment or at any time thereafter, in any manner directly or indirectly disclose any Confidential Information to any person or entity other than the Bank and the Subsidiaries.  Notwithstanding the foregoing, if the Executive is requested or required (including but not limited to by oral questions, interrogatories, requests for information or documents in legal proceeding, subpoena, civil investigative demand or other similar process) to disclose any Confidential Information, the Executive shall provide the Bank with prompt written notice of any such request or requirement so that the Bank may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Section 7(a). If, in the absence of a protective order or other remedy or the receipt of a waiver from the Bank, the Executive is nonetheless legally compelled to disclose Confidential Information to any tribunal or else stand liable for contempt or suffer other censure or penalty, the Executive may, without liability hereunder, disclose to such tribunal only that portion of the Confidential Information which is legally required to be disclosed, provided that the Executive exercise his best efforts to preserve the confidentiality of the Confidential Information, including without limitation by cooperating with the Bank to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information by such tribunal.  Notwithstanding anything to the contrary herein, the parties hereto agree that nothing contained in this Agreement limits the Executive's ability to report information to or file a charge or complaint with the Equal Employment Opportunity Commission, the Securities and Exchange Commission, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System or any other federal, state or local governmental agency or commission that has jurisdiction over the Bank or the Subsidiaries the "Government Agencies"). The Executive further understands that this Agreement does not limit his ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Bank. This Agreement does not limit the Executive's right to receive an award for information provided to any Government Agencies. In addition, pursuant to the Defend Trade Secrets Act of 2016, the Executive understands that an individual may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that (i) is made (A) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding.  Further, an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the employer's trade secrets to the attorney and use the trade secret information in the court proceeding if the individual (y) files any document containing the trade secret under seal; and (z) does not disclose the trade secret, except pursuant to court order.  On the Date of Termination, the Executive shall promptly deliver to the Bank all copies of documents or other records (including without limitation electronic records) containing any Confidential Information that is in his possession or under his control, and shall retain no written or electronic record of any Confidential Information.

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            (b)          Except as provided in Section 7(c) hereof, the Executive hereby covenants and agrees that, in the event of his termination of employment with the Bank for any reason prior to the expiration of the term of this Agreement, for a period of one year following the date of his termination of employment with the Bank, he shall not, without the written consent of the Bank, compete in any way with the Bank or any affiliate or entity related to the Bank or any affiliate, directly or indirectly, and will not consult with or have any interest in any business, firm, person, partnership, corporation or other entity, whether as an employee, officer, director, agent, security holder, creditor, consultant or otherwise, which competes with the Bank or any affiliate or related entity, directly or indirectly, in any aspect of the business of the Bank (a "Competing Business") that entails working within Philadelphia, Montgomery, Bucks, Lehigh, Berks, Lebanon, Dauphin, Lancaster, Chester, Delaware, Lackawanna, Schuylkill, Carbon, Luzerne, Monroe or Northampton Counties, Pennsylvania; provided, however, that this Section 7(b) shall not be deemed to prevent the Executive's ownership of not more than 1% of the capital stock of any publicly held entity.

(c)           As partial consideration for the severance payments and benefits to be provided to the Executive pursuant to Section 5 of this Agreement, the Executive agrees that during the three-year period next following the Date of Termination, the Executive shall not directly or indirectly (i) solicit or induce, or cause others to solicit or induce, any Executive of the Bank or any of the Subsidiaries to leave the employment of such entities, or (ii) solicit (whether by mail, telephone, personal meeting or any other means, excluding general solicitations of the public that are not based in whole or in part on any list of customers of the Bank or any of the Subsidiaries) any customer of the Bank or any of the Subsidiaries to transact business with any Competing Business, or to reduce or refrain from doing any business with the Bank or any of the Subsidiaries, or interfere with or damage (or attempt to interfere with or damage) any relationship between the Bank or any of the Subsidiaries and any such customers.

(d)          The Executive shall not be subject to the provisions of Sections 7(b) or 7(c) if the Executive's employment with the Bank is terminated by the Bank or the Executive concurrently with or within 24 months after a Change in Control.

(e)          The Executive expressly agrees that (i) in the event of a violation of these non-disclosure non-competition and non-solicitation provisions by the Executive, monetary damages alone will be inadequate to compensate the Bank, (ii) the Bank will be entitled to injunctive relief against the Executive in addition to any other remedies provided by law or in equity and (iii) the non-competition and non-solicitation obligations contained herein shall be extended by the length of time during which the Executive shall have been in breach thereof.

8.          Licenses.  During the Executive's term of employment hereunder, the Executive shall have and maintain all licenses as are necessary to render all such services to the Bank and the Subsidiaries contemplated by this Agreement.

9.          Mitigation; Exclusivity of Benefits.

(a)          The Executive shall not be required to mitigate the amount of any benefits hereunder by seeking other employment or otherwise, nor shall the amount of any such benefits be reduced by any compensation earned by the Executive as a result of employment by another employer after the Date of Termination or otherwise.

(b)          The specific arrangements referred to herein are not intended to exclude any other benefits which may be available to the Executive upon a termination of employment with the Bank pursuant to employee benefit plans of the Bank or otherwise.

10.          Withholding.  All payments required to be made by the Bank hereunder to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Bank may reasonably determine should be withheld pursuant to any applicable law or regulation.

7

            11.          Assignability.  The Bank may assign this Agreement and its rights and obligations hereunder in whole, but not in part, to any corporation, bank or other entity with or into which the Bank may hereafter merge or consolidate or to which the Bank may transfer all or substantially all of its assets, if in any such case said corporation, bank or other entity shall by operation of law or expressly in writing assume all obligations of the Bank hereunder as fully as if it had been originally made a party hereto, but may not otherwise assign this Agreement or its rights and obligations hereunder.  The Executive may not assign or transfer this Agreement or any rights or obligations hereunder.

            12.          Notice.  For the purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by certified or registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth below:

            To the Bank:                 Board of Directors

Quaint Oak Bank

501 Knowles Avenue

Southampton, Pennsylvania 18966

To the Executive:          William R. Gonzalez

At the address last appearing on the

personnel records of the Bank

13.          Amendment; Waiver.  No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by the Executive and such officer or officers as may be specifically designated by the Board of Directors of the Bank to sign on its behalf.  No waiver by any party hereto at any time of any breach by any other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.  In addition, notwithstanding anything in this Agreement to the contrary, the Bank may amend in good faith any terms of this Agreement, including retroactively, in order to comply with Section 409A of the Code.

14.          Governing Law.  The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the United States where applicable and otherwise by the substantive laws of the Commonwealth of Pennsylvania.

15.          Nature of Obligations.  Nothing contained herein shall create or require the Bank to create a trust of any kind to fund any benefits which may be payable hereunder, and to the extent that the Executive acquires a right to receive benefits from the Bank hereunder, such right shall be no greater than the right of any unsecured general creditor of the Bank.

16.          Headings.  The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

8

17.          Validity.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect.

18.          Changes in Statutes or Regulations. If any statutory or regulatory provision referenced herein is subsequently changed or re-numbered, or is replaced by a separate provision, then the references in this Agreement to such statutory or regulatory provision shall be deemed to be a reference to such section as amended, re-numbered or replaced.

19.          Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which together will constitute one and the same instrument.

20.          Regulatory Prohibitions and Actions.

(a)          Notwithstanding any other provision of this Agreement to the contrary, any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with Section 18(k) of the FDIA (12 U.S.C. §1828(k)) and the regulations promulgated thereunder, including 12 C.F.R. Part 359.  In the event of the Executive's termination of employment with the Bank for Cause, all employment relationships and managerial duties with the Bank shall immediately cease regardless of whether the Executive is in the employ of the Corporation following such termination.  Furthermore, following such termination for Cause, the Executive will not, directly or indirectly, influence or participate in the affairs or the operations of the Bank.

(b)          If the Bank is in default, as defined to mean an adjudication or other official determination of a court of competent jurisdiction or other public authority pursuant to which a conservator, receiver or other legal custodian is appointed for the Bank for the purpose of liquidation, all obligations under this Agreement shall terminate as of such date as a competent governmental authority may lawfully terminate this Agreement, but rights of the Executive to compensation earned prior to such termination shall not be affected.

(c)          If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank's affairs pursuant to notice served by any Regulatory Agency, then the Bank's obligations under this Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Bank shall (i) pay the Executive all the compensation withheld while contract obligations were suspended, and (ii) reinstate (in whole or in part) any of its obligations which were suspended.

(d)          If the Executive is removed from office and/or permanently prohibited from participating in the conduct of the Bank's affairs by an order issued by any Regulatory Agency, all obligations of the Bank under this Agreement shall terminate as of the effective date of the order, but rights of the Executive to compensation earned as of the Date of Termination shall not be affected.

(e)          All obligations under this Agreement are subject to termination by any Regulatory Agency in accordance with any applicable provisions of law or regulations granting such authority, but rights of the Executive to compensation earned as of the date of termination of the Agreement shall not be affected.

9

           21.          Entire Agreement.  This Agreement embodies the entire agreement between the Bank and the Executive with respect to the matters agreed to herein.  All prior agreements between the Bank and the Executive with respect to the matters agreed to herein, including but not limited to the Prior Agreement, are hereby superseded and shall have no force or effect.

[Signature page follows]

10

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

ATTEST:		QUAINT OAK BANK
By:	/s/Diane J. Colyer	By:	/s/Robert T. Strong
	Diane J. Colyer Corporate Secretary		Robert T. Strong President and Chief Executive Officer
		EXECUTIVE
		By:	/s/William R. Gonzalez
			William R. Gonzalez

11

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Robert T. Strong, certify that:

1.          I have reviewed this quarterly report on Form 10-Q of Quaint Oak Bancorp, Inc. (the "registrant");

2.          Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.          Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.          The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)          Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)          Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)          Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)          Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.          The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of 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 14, 2018	/s/Robert T. Strong
	Robert T. Strong President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, John J. Augustine certify that:

1.          I have reviewed this quarterly report on Form 10-Q of Quaint Oak Bancorp, Inc. (the "registrant");

2.          Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.          Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.          The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)          Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)          Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)          Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)          Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.          The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of 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 14, 2018	/s/John J. Augustine
	John J. Augustine Executive Vice President and Chief Financial Officer

EX-32.0

EXHIBIT 32.0

SECTION 1350 CERTIFICATION

Each of Robert T. Strong, President and Chief Executive Officer and John J. Augustine, Executive Vice President and Chief Financial Officer of Quaint Oak Bancorp, Inc. (the "Company"), hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) The quarterly report on Form 10-Q of the Company for the period ended March 31, 2018 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C 78m(a) or 78o(d); and

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

Date:  May 14, 2018	By:	/s/Robert T. Strong
		Robert T. Strong President and Chief Executive Officer
Date:  May 14, 2018	By:	/s/John J. Augustine
		John J. Augustine Executive Vice President and Chief Financial Officer

Note: A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act has been provided to Quaint Oak Bancorp, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 04, 2018
Document Information [Line Items]
Entity Registrant Name	QUAINT OAK BANCORP INC
Entity Central Index Key	0001391933
Trading Symbol	qnto
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		1,951,301
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Assets
Due from banks, non-interest-bearing	$ 350	$ 64
Due from banks, interest-bearing	16,581	7,846
Cash and cash equivalents	16,931	7,910
Investment in interest-earning time deposits	4,920	4,879
Investment securities available for sale	7,674	7,912
Loans held for sale	4,941	7,006
Loans receivable, net of allowance for loan losses (2018 $1,836; 2017 $1,812)	207,054	201,667
Accrued interest receivable	981	1,021
Investment in Federal Home Loan Bank stock, at cost	1,234	1,234
Bank-owned life insurance	3,834	3,814
Premises and equipment, net	2,010	1,988
Goodwill	515	515
Other intangible, net of accumulated amortization	404	416
Prepaid expenses and other assets	1,064	1,234
Total Assets	251,562	239,596
Liabilities
Non-interest bearing	11,013	7,956
Interest-bearing	187,923	178,265
Total deposits	198,936	186,221
Federal Home Loan Bank short-term borrowings	10,000	10,000
Federal Home Loan Bank long-term borrowings	18,000	18,000
Accrued interest payable	174	167
Advances from borrowers for taxes and insurance	1,651	2,423
Accrued expenses and other liabilities	316	600
Total Liabilities	229,077	217,411
Stockholders’ Equity
Preferred stock – $0.01 par value, 1,000,000 shares authorized; none issued or outstanding	0	0
Common stock – $0.01 par value; 9,000,000 shares authorized; 2,777,250 issued; 1,954,571 and 1,920,024 outstanding at March 31, 2018 and December 31, 2017, respectively	28	28
Additional paid-in capital	14,534	14,481
Treasury stock, at cost: 2018 822,679 shares; 2017 857,226 shares	(4,649)	(4,675)
Unallocated common stock held by:
Employee Stock Ownership Plan (ESOP)	(236)	(253)
Recognition & Retention Plan Trust (RRP)	(24)	(24)
Accumulated other comprehensive loss	(3)	(15)
Retained earnings	12,835	12,643
Total Stockholders' Equity	22,485	22,185
Total Liabilities and Stockholders’ Equity	$ 251,562	$ 239,596

XML

Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Loans receivable, allowance for loan losses	$ 1,836	$ 1,812
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	9,000,000	9,000,000
Common stock, shares issued (in shares)	2,777,250	2,777,250
Common stock, shares outstanding (in shares)	1,954,571	1,920,024
Treasury stock, at cost, shares (in shares)	822,679	857,226

XML

Consolidated Statements of Income (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Interest Income
Interest on loans	$ 2,709,000	$ 2,430,000
Interest and dividends on time deposits and investment securities	126,000	85,000
Total Interest Income	2,835,000	2,515,000
Interest Expense
Interest on deposits	729,000	648,000
Interest on Federal Home Loan Bank short-term borrowings	36,000	13,000
Interest on Federal Home Loan Bank long-term borrowings	91,000	33,000
Total Interest Expense	856,000	694,000
Net Interest Income	1,979,000	1,821,000
Provision for Loan Losses	71,000	42,000
Net Interest Income after Provision for Loan Losses	1,908,000	1,779,000
Non-Interest Income
Insurance commissions	79,000	77,000
Income from bank-owned life insurance	20,000	22,000
Net gain on loans held for sale	321,000	108,000
Gain on the sale of SBA loans	23,000
Gain on sales of other real estate owned	63,000	4,000
Other	52,000	9,000
Total Non-Interest Income	742,000	357,000
Non-Interest Expense
Salaries and employee benefits	1,668,000	1,317,000
Directors’ fees and expenses	54,000	52,000
Occupancy and equipment	150,000	145,000
Data processing	86,000	47,000
Professional fees	60,000	90,000
FDIC deposit insurance assessment	47,000	44,000
Other real estate owned expenses		7,000
Advertising	54,000	39,000
Amortization of other intangible	12,000	12,000
Other	176,000	138,000
Total Non-Interest Expense	2,307,000	1,891,000
Income before Income Taxes	343,000	245,000
Income Taxes	55,000	74,000
Net Income	$ 288,000	$ 171,000
Earnings per share – basic (in dollars per share)	$ 0.15	$ 0.09
Average shares outstanding - basic (in shares)	1,881,865	1,838,125
Earnings per share - diluted (in dollars per share)	$ 0.14	$ 0.09
Average shares outstanding - diluted (in shares)	1,990,290	1,980,217
Mortgage Banking and Abstract Fees [Member]
Non-Interest Income
Mortgage banking and abstract fees	$ 110,000	$ 111,000
Other Fees and Services Fees [Member]
Non-Interest Income
Mortgage banking and abstract fees	$ 74,000	$ 26,000

XML

Consolidated Statements of Comprehensive Income (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net Income	$ 288,000	$ 171,000
Other Comprehensive Income:
Unrealized gains on investment securities available for sale	15,000	20,000
Income tax effect	(3,000)	(7,000)
Net other comprehensive income	12,000	13,000
Total Comprehensive Income	$ 300,000	$ 184,000

XML

Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($)	The 401(k) Plan [Member] Common Stock [Member]	The 401(k) Plan [Member] Additional Paid-in Capital [Member]	The 401(k) Plan [Member] Treasury Stock [Member]	The 401(k) Plan [Member]	The 2008 Stock Option Plan [Member] Common Stock [Member]	The 2008 Stock Option Plan [Member] Additional Paid-in Capital [Member]	The 2008 Stock Option Plan [Member] Treasury Stock [Member]	The 2008 Stock Option Plan [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Unallocated Common Stock Held by Benefit Plans [Member]	Accumulated Common Stock Held by Benefit Plans [Member]	Retained Earnings [Member]	Total
Net Income															$ 171,000
Other comprehensive income, net															$ 13,000
BALANCE (in shares) at Dec. 31, 2017									1,920,024						1,920,024
Balance at the beginning of the period at Dec. 31, 2017									$ 28,000	$ 14,481,000	$ (4,675,000)	$ (277,000)	$ (15,000)	$ 12,643,000	$ 22,185,000
Common stock allocated by ESOP										31,000		17,000			48,000
Treasury stock purchase (in shares)									(20,101)
Treasury stock purchase											(272,000)				(272,000)
Reissuance of treasury stock (in shares)	1,786				52,862
Reissuance of treasury stock		$ 14,000	$ 10,000	$ 24,000		$ (24,000)	$ 288,000	$ 264,000
Stock based compensation expense										32,000					32,000
Cash dividends declared														(96,000)	(96,000)
Net Income														288,000	288,000
Other comprehensive income, net													12,000		$ 12,000
BALANCE (in shares) at Mar. 31, 2018									1,954,571						1,954,571
Balance at the end of the period at Mar. 31, 2018									$ 28,000	$ 14,534,000	$ (4,649,000)	$ (260,000)	$ (3,000)	$ 12,835,000	$ 22,485,000

XML

Consolidated Statement of Stockholders' Equity (Unaudited) (Parentheticals)	3 Months Ended
	Mar. 31, 2018 $ / shares
Retained Earnings [Member]
Cash dividends declared, per share (in dollars per share)	$ 0.05

XML

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flows from Operating Activities
Net Income	$ 288,000	$ 171,000
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	71,000	42,000
Depreciation expense	51,000	45,000
Amortization of other intangible	12,000	12,000
Net amortization of securities premiums	5,000	5,000
Accretion of deferred loan fees and costs, net	(83,000)	(84,000)
Stock-based compensation expense	80,000	77,000
Net gain on loans held for sale	(321,000)	(108,000)
Loans held for sale-originations	(17,320,000)	(8,030,000)
Loans held for sale-proceeds	19,706,000	10,776,000
Gain on the sale of SBA loans	(23,000)
Net gain on sale and write-downs of other real estate owned	(63,000)	(4,000)
Increase in the cash surrender value of bank-owned life insurance	(20,000)	(22,000)
Changes in assets and liabilities which provided (used) cash:
Accrued interest receivable	40,000	(16,000)
Prepaid expenses and other assets	167,000	99,000
Accrued interest payable	7,000	(1,000)
Accrued expenses and other liabilities	(284,000)	(111,000)
Net Cash Provided by Operating Activities	2,313,000	2,851,000
Cash Flows from Investing Activities
Purchase of interest-earning time deposits	(541,000)	(290,000)
Redemption of interest-earning time deposits	500,000	1,029,000
Principal repayments of investment securities available for sale	248,000	354,000
Net increase in loans receivable	(5,352,000)	(7,255,000)
Proceeds from the sale of other real estate owned	63,000	81,000
Capitalized expenditures on other real estate owned		(6,000)
Purchase of premises and equipment	(73,000)	(172,000)
Net Cash Used in Investing Activities	(5,155,000)	(6,259,000)
Cash Flows from Financing Activities
Net increase in demand deposits and savings accounts	4,303,000	3,010,000
Net increase in certificate accounts	8,412,000	615,000
Dividends paid	(96,000)	(75,000)
Purchase of treasury stock	(272,000)
Proceeds from the reissuance of treasury stock	24,000	22,000
Proceeds from the exercise of stock options	264,000	172,000
Decrease in advances from borrowers for taxes and insurance	(772,000)	(703,000)
Net Cash Provided by Financing Activities	11,863,000	3,041,000
Net Increase (Decrease) in Cash and Cash Equivalents	9,021,000	(367,000)
Cash and Cash Equivalents – Beginning of Year	7,910,000	9,300,000
Cash and Cash Equivalents – End of Year	16,931,000	8,933,000
Cash payments for interest	849,000	695,000
Cash payments for income taxes	$ 30,000	$ 25,000

XML

Note 1 - Financial Statement Presentation and Significant Accounting Policies

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]

Note

1

– Financial Statement Presentation and Significant Accounting Policies

Basis of Financial Presentation.

The consolidated financial statements include the accounts of Quaint Oak Bancorp, Inc., a Pennsylvania chartered corporation (the "Company" or "Quaint Oak Bancorp") and its wholly owned subsidiary, Quaint Oak Bank, a Pennsylvania chartered stock savings bank, along with its wholly owned subsidiaries. At

March 31, 2018,

the Bank has

five

wholly-owned subsidiaries, Quaint Oak Mortgage, LLC, Quaint Oak Real Estate, LLC, Quaint Oak Abstract, LLC, QOB Properties, LLC, and Quaint Oak Insurance Agency, LLC, each a Pennsylvania limited liability company. The mortgage, real estate and abstract companies offer mortgage banking, real estate sales and title abstract services, respectively, in the Lehigh Valley region of Pennsylvania, and began operation in

July 2009.

QOB Properties, LLC began operations in

July 2012

and holds Bank properties acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure. Quaint Oak Insurance Agency, LLC began operations in

August 2016

and provides a broad range of personal and commercial insurance coverage solutions. All significant intercompany balances and transactions have been eliminated.

The Bank is subject to regulation by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. Pursuant to the Bank’s election under Section

10

(l) of the Home Owners’ Loan Act, the Company is a savings and loan holding company regulated by the Board of Governors of the Federal Reserve System. The market area served by the Bank is principally Bucks County, Pennsylvania and to a lesser extent, Montgomery and Philadelphia Counties in Pennsylvania. The Bank has

two

locations: the main office location in Southampton, Pennsylvania and a regional banking office in the Lehigh Valley area of Pennsylvania. The principal deposit products offered by the Bank are certificates of deposit, money market accounts, non-interest bearing checking accounts for businesses and consumers, and savings accounts. The principal loan products offered by the Bank are fixed and adjustable rate residential and commercial mortgages, construction loans, commercial business loans, home equity loans, and lines of credit.

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP) for interim information and with the instructions to Form

10

-Q, as applicable to a smaller reporting company. Accordingly, they do

not

include all the information and footnotes required by US GAAP for complete financial statements.

The foregoing consolidated financial statements are unaudited; but in the opinion of management include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation thereof. The balances as of

December 31, 2017

have been derived from the audited financial statements. These financial statements should be read in conjunction with the financial statements and notes thereto included in Quaint Oak Bancorp’s

2017

Annual Report on Form

10

-K. The results of operations for the

three

months ended

March 31, 2018

are

not

necessarily indicative of the results that

may

be expected for the year ending

December 31, 2018.

Use of Estimates in the Preparation of Financial Statements.

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Company’s most significant estimates are the determination of the allowance for loan losses and the valuation of deferred tax assets.

Loans Receivable.

Loans receivable that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of an allowance for loan losses and any deferred fees and costs. Interest income is accrued on the unpaid principal balance. Loan origination fees and costs are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Bank is generally amortizing these amounts over the contractual life of the loan.

The loans receivable portfolio is segmented into residential loans, commercial real estate loans, construction loans, commercial business loans, and consumer loans. The residential loan segment has

two

classes:

one

-to-

four

family residential owner occupied loans and

one

-to-

four

residential family non-owner occupied loans. The commercial real estate loan segment consists of the following classes: multi-family (

five

or more) residential, commercial real estate and commercial lines of credit. Construction loans are generally granted for the purpose of building a single residential home. Commercial business loans are loans to businesses for working capital, purchase of a business, tenant improvements, receivables, purchase of inventory, and for the purchase of business essential equipment. Business essential equipment is equipment necessary for a business to support or assist with the day-to-day operation or profitability of the business. The consumer loan segment consists of the following classes: home equity loans and other consumer loans. Included in the home equity class are home equity loans and home equity lines of credit. Included in the other consumer are loans secured by saving accounts.

The accrual of interest is generally discontinued when principal or interest has become

90

days past due unless the loan is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against the allowance for loan losses. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management’s judgment as to the collectability of principal. Generally, a loan is restored to accrual status when the obligation is brought current, it has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is

no

longer in doubt.

Allowance for Loan Losses.

The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans receivable. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Because all identified losses are immediately charged off,

no

portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses.

The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that

may

affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that

may

be susceptible to significant revision as more information becomes available.

The allowance consists of specific, general and unallocated components. The specific component relates to loans that are designated as impaired. For loans that are designated as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers pools of loans by loan class. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These significant factors

may

include changes in lending policies and procedures, changes in existing general economic and business conditions affecting our primary lending areas, credit quality trends, collateral value, loan volumes and concentrations, seasoning of the loan portfolio, recent loss experience in particular segments of the portfolio, duration of the current business cycle and bank regulatory examination results. The applied loss factors are reevaluated quarterly to ensure their relevance in the current economic environment. Residential owner occupied mortgage lending generally entails a lower risk of default than other types of lending. Consumer loans and commercial real estate loans generally involve more risk of collectability because of the type and nature of the collateral and, in certain cases, the absence of collateral. It is the Company’s policy to establish a specific reserve for loss on any delinquent loan when it determines that a loss is probable. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are

not

considered impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral.

A loan is identified as a troubled debt restructuring (“TDR”) if the Company, for economic or legal reasons related to a debtor’s financial difficulties, grants a concession to the debtor that it would

not

otherwise consider. Concessions granted under a TDR typically involve a temporary or permanent reduction in payments or interest rate or an extension of a loan’s stated maturity date at less than a current market rate of interest. Loans identified as TDRs are designated as impaired.

For loans secured by real estate, estimated fair values are determined primarily through

third

-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimatedcosts to sell the property.

The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for all loans (except

one

-to-

four

family residential owner-occupied loans) where the total amount outstanding to any borrower or group of borrowers exceeds

$500,000,

or when credit deficiencies arise, such as delinquent loan payments. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans criticized as special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses

may

result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans

not

classified are rated pass. In addition, Federal regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses and

may

require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which

may

not

be currently available to management. Based on management’s comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate.

Loans Held for Sale

.

Loans originated by the Bank’s mortgage banking subsidiary, Quaint Oak Mortgage, LLC, are intended for sale in the secondary market and are carried at the lower of cost or fair value (LOCOM). Gains and losses on loan sales (sales proceeds minus carrying value) are recorded in noninterest income, and direct loan origination costs, commissions and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan. To a lesser extent, the Bank originates equipment loans for sale primarily to other financial institutions.

Federal Home Loan Bank Stock

.

Federal law requires a member institution of the Federal Home Loan Bank (FHLB) system to hold restricted stock of its district Federal Home Loan Bank according to a predetermined formula. FHLB stock is carried at cost and evaluated for impairment. When evaluating FHLB stock for impairment, its value is determined based on the ultimate recoverability of the par value of the stock. We evaluate our holdings of FHLB stock for impairment each reporting period.

No

impairment charges were recognized on FHLB stock during the

three

months ended

March 31, 2018

and

2017.

Bank Owned Life Insurance (BOLl).

The Company purchases bank owned life insurance as a mechanism for funding various employee benefit costs. The Company is the beneficiary of these policies that insure the lives of certain officers of its subsidiaries. The Company has recognized the cash surrender value under the insurance policies as an asset in the consolidated balance sheets. Changes in the cash surrender value are recorded in non-interest income in the consolidated statements of income.

Intangible Assets.

Intangible assets on the consolidated balance sheets represent the acquisition by Quaint Oak Insurance Agency of the renewal rights to the book of business produced and serviced by Signature Insurance Services, LLC on

August 1, 2016

at a total cost of

$1.0

million. Based on a valuation,

$515,000

of the purchase price was determined to be goodwill and

$485,000

was determined to be related to the renewal rights to the book of business and deemed an other intangible asset. The renewal rights are being amortized over a

ten

year period based upon the annual retention rate of the book of business.

The Company will complete a goodwill and other intangible asset analysis at least on an annual basis or more often if events and circumstances indicate that there

may

be impairment.

Other Real Estate Owned

, Net

.

Other real estate owned or foreclosed assets are comprised of property acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure and loans classified as in-substance foreclosures. A loan is classified as in-substance foreclosure when the Bank has taken possession of the collateral regardless of whether formal foreclosure proceedings take place. Other real estate properties are initially recorded at fair value, net of estimated selling costs at the date of foreclosure, establishing a new cost basis. After foreclosure, valuations are periodically performed by management and the real estate is carried at the lower of cost or fair value less estimated costs to sell. Net revenue and expenses from operations and additions to the valuation allowance are included in other expenses. The Company has

no

other real estate owned as of

March 31, 2018

or

December 31, 2017.

Share

-Based Compensation.

Compensation expense for share-based compensation awards is based on the grant date fair value of the award. That cost is recognized over the period during which an employee is required to provide service in exchange for the award.

At

March 31, 2018,

the Company has outstanding equity awards under

three

share-based plans: the

2008

Recognition and Retention Plan (“RRP”), the

2008

Stock Option Plan, and the

2013

Stock Incentive Plan. Awards under these plans were made in

May 2008

and

2013.

These plans are more fully described in Note

10.

The Company also has an employee stock ownership plan (“ESOP”). This plan is more fully described in Note

10.

As ESOP shares are committed to be released and allocated among participants, the Company recognizes compensation expense equal to the average market price of the shares over the period earned.

Comprehensive Income

.

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

Earnings

per Share.

Amounts reported in earnings per share reflect earnings available to common stockholders’ for the period divided by the weighted average number of shares of common stock outstanding during the period, exclusive of unearned ESOP shares, unvested restricted stock (RRP) shares and treasury shares. Stock options and unvested restricted stock are regarded as potential common stock and are considered in the diluted earnings per share calculations to the extent they would have a dilutive effect if converted to common stock, computed using the “treasury stock” method.

Revenue from Contracts with Customers

.

The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic

606,

“Revenue from Contracts with Customers” (“Topic

606”

)

. Under Topic

606,

the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has

not

been recognized in the current reporting period that results from performance obligations satisfied in previous periods.

The Company’s primary sources of revenue are derived from interest and dividends earned on loans, and investment securities, gains on the sale of loans, income from bank-owned life insurance, and other financial instruments that are

not

within the scope of Topic

606.

  The main types of non-interest income within the scope of the standard are as follows:

Service Charges on Deposits: The Bank has contracts with its commercial checking deposit customers where fees are charged if the account balance falls below predetermined levels defined as compensating balances. These agreements can be cancelled at any time by either the Bank or the deposit customer. Revenue from these transactions is recognized on a monthly basis as the Bank has an unconditional right to the fee consideration. The Bank also has transaction fees related to specific transactions or activities resulting from customer request or activity that include overdraft fees, wire fees, and other transaction fees. All of these fees are attributable to specific performance obligations of the Bank where the revenue is recognized at a defined point in time, completion of the requested service/transaction.

Insurance Commissions

: 

Insurance income generally consist of commissions from the sale of insurance policies and performance-based commissions from insurance companies.  The Bank recognizes commission income from the sale of insurance policies when it acts as an agent between the insurance carrier and policyholder, arranging for the insurance carrier to provide policies to policyholders, and acts on behalf of the insurance carrier by providing customer service to the policyholder during the policy period. Commission income is recognized over time, using the output method of time elapsed, which corresponds with the underlying insurance policy period, for which the Bank is obligated to perform under contract with the insurance carrier. Commission income is variable, as it is comprised of a certain percentage of the underlying policy premium. The Bank estimates the variable consideration based upon the "most likely amount" method, and does

not

expect or anticipate a significant reversal of revenue in future periods, based upon historical experience.  Payment is due from the insurance carrier for commission income once the insurance policy has been sold. The Bank has elected to apply a practical expedient related to capitalizable costs, which are the commissions paid to insurance producers, and will expense these commissions paid to insurance producers as incurred, as these costs are related to the commission income and would have been amortized within

one

year or less if they had been capitalized, the same period over which the commission income was earned. Performance-based commissions from insurance companies are recognized at a point in time, when received, and

no

contingencies remain.

Recent Accounting Pronouncements.  

In

January 2016,

the FASB issued ASU

2016

-

01,

Financial Instruments – Overall (Subtopic

825

-

10

):  Recognition and Measurement of Financial Assets and Financial Liabilities

.  This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments.  Among other things, this Update (a) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (b) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (c) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are

not

public business entities; (d) eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (e) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (f) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; and (g) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.

The Bank has adopted this standard effective

January 1, 2018. 

On a prospective basis, the Bank implemented changes to the measurement of the fair value of financial instruments using an exit price notion for disclosure purposes included in Note

11

to the financial statements.  The Bank estimated the fair value based on guidance from ASC

820

-

10,

Fair Value Measurements

, which defines fair value as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is

no

active observable market for sale information on community bank loans and, thus, Level III fair value procedures were utilized, primarily in the use of present value techniques incorporating assumptions that market participants would use in estimating fair values. In the absence of reliable market information, the Bank used its own assumptions in an effort to determine a reasonable estimate of fair value.

In

February 2016,

the FASB issued ASU

2016

-

02,

Leases (Topic

842

)

. The standard requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. A short-term lease is defined as

one

in which (a) the lease term is

12

months or less and (b) there is

not

an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For short-term leases, lessees

may

elect to recognize lease payments over the lease term on a straight-line basis. For public business entities, the amendments in this Update are effective for fiscal years beginning after

December 15, 2018,

and interim periods within those years. The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is currently assessing the practical expedients it

may

elect at adoption, but does

not

anticipate the amendments will have a significant impact to the financial statements. Based on the Company’s preliminary analysis of its current portfolio, the impact to the Company’s balance sheet is estimated to result in less than a

1%

increase in assets and liabilities. The Company also anticipates additional disclosures to be provided at adoption.

In

June 2016,

the FASB issued ASU

2016

-

13,

Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments

, which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be effected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. ASU

2016

-

13

is effective for annual and interim periods beginning after

December 15, 2019,

and early adoption is permitted for annual and interim periods beginning after

December 15, 2018.

With certain exceptions, transition to the new requirements will be through a cumulative effect adjustment to opening retained earnings as of the beginning of the

first

reporting period in which the guidance is adopted. We expect to recognize a

one

-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the

first

reporting period in which the new standard is effective, but cannot yet determine the magnitude of any such

one

-time adjustment or the overall impact of the new guidance on the consolidated financial statements.

In

January 2017,

the FASB issued ASU

2017

-

04,

Simplifying the Test for Goodwill Impairment

. To simplify the subsequent measurement of goodwill, the FASB eliminated Step

2

from the goodwill impairment test. In computing the implied fair value of goodwill under Step

2,

an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the loss recognized should

not

exceed the total amount of goodwill allocated to that reporting unit. A public business entity that is a U.S. Securities and Exchange Commission (“SEC”) filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after

December 15, 2019.

This Update is

not

expected to have a significant impact on the Company’s financial statements.

In

March 2017,

the FASB issued ASU

2017

-

08,

Receivables – Nonrefundable Fees and Other Costs (Subtopic

310

-

20

).

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. For public business entities, the amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2018.

Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity should apply the amendments in this Update on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Additionally, in the period of adoption, an entity should provide disclosures about a change in accounting principle. This Update is

not

expected to have a significant impact on the Company’s financial statements.

In

January 2018,

the FASB issued ASU

2018

-

01,

Leases (Topic

842

), which provides an optional transition practical expedient to

not

evaluate under Topic

842

existing or expired land easements that were

not

previously accounted for as leases under the current lease guidance in Topic

840.

An entity that elects this practical expedient should evaluate new or modified land easements under Topic

842

beginning at the date the entity adopts Topic

842;

otherwise, an entity should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic

842

to assess whether they meet the definition of a lease. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements in ASU

2016

-

02.

This Update is

not

expected to have a significant impact on the Company’s financial statements

Reclassifications.

Certain items in the

2017

consolidated financial statements have been reclassified to conform to the presentation in the

2018

consolidated financial statements. Such reclassifications did

not

have a material impact on the presentation of the overall financial statements. The reclassifications had

no

effect on net income or stockholders’ equity.

XML

Note 2 - Earnings Per Share

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Earnings Per Share [Text Block]

Note

2

– Earnings Per Share

Earnings per share (“EPS”) consists of

two

separate components, basic EPS and diluted EPS. Basic EPS is computed based on the weighted average number of shares of common stock outstanding for each period presented. Diluted EPS is calculated based on the weighted average number of shares of common stock outstanding plus dilutive common stock equivalents (“CSEs”). CSEs consist of shares that are assumed to have been purchased with the proceeds from the exercise of stock options, as well as unvested restricted stock (RRP) shares. Common stock equivalents which are considered antidilutive are

not

included for the purposes of this calculation. For the

three

months ended

March 31, 2018

and

2017,

all unvested restricted stock program awards and outstanding stock options representing shares were dilutive.

The following table sets forth the composition of the weighted average shares (denominator) used in the basic and dilutive earnings per share computations.

	For the Three Months Ended March 3 1 ,
	201 8		201 7
Net Income	$	288,000	$	171,000
Weighted average shares outstanding – basic		1,881,865		1,838,125
Effect of dilutive common stock equivalents		108,425		142,092
Adjusted weighted average shares outstanding – diluted		1,990,290		1,980,217
Basic earnings per share	$	0.15	$	0.09
Diluted earnings per share	$	0.14	$	0.09

XML

Note 3 - Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Comprehensive Income (Loss) Note [Text Block]

Note

3

– Accumulated Other Comprehensive

Loss

The following table presents the changes in accumulated other comprehensive loss by component, net of tax, for the

three

months ended

March 31, 2018

and

2017

(in thousands):

	Unrealized Gains (Losses) on Investment Securities Available for Sale (1)
	For the Three Months Ended March 31,
	201 8			201 7
Balance at the beginning of the period	$	(15	)	$	(38	)
Other comprehensive income before classifications		12			13
Amount reclassified from accumulated other comprehensive income		-			-
Total other comprehensive income		12			13
Balance at the end of the period	$	(3	)	$	(25	)

(

1

)     All amounts are net of tax. Amounts in parentheses indicate debits.

XML

Note 4 - Investment in Interest-earning Time Deposits

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Investments and Other Noncurrent Assets [Text Block]

N

o

te

4

– Investment in Interest-Earning Time Deposits

The investment in interest-earning time deposits as of

March 31, 2018

and

December 

31,

2017,

by contractual maturity, are shown below (in thousands):

	March 31 , 201 8		December 31, 201 7
Due in one year or less	$	1,332	$	761
Due after one year through five years		3,588		4,118
Total	$	4,920	$	4,879

XML

Note 5 - Investment Securities Available for Sale

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

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

N

ote

5

– Investment Securities

Available for Sale

The amortized cost, gross unrealized gains and losses, and fair value of investment securities available for sale at

March 31, 2018

and

December 31, 2017

are summarized below (in thousands): 

	March 31, 201 8
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,462	$	28	$	-		$	5,490
Federal Home Loan Mortgage Corporation securities		1,309		-		(28	)		1,281
Federal National Mortgage Association securities		547		1					548
Total mortgage-backed securities		7,318		29		(28	)		7,319
Debt securities:
U.S. government agency		360		-		(5	)		355
Total available-for-sale-securities	$	7,678	$	29	$	(33	)	$	7,674

	December 31, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,624	$	19	$	--		$	5,643
Federal Home Loan Mortgage Corporation securities		1,377		--		(35	)		1,342
Federal National Mortgage Association securities		570		--		--			570
Total mortgage-backed securities		7,571		19		(35	)		7,555
Debt securities:
U.S. government agency		360		--		(3	)		357
Total available-for-sale-securities	$	7,931	$	19	$	(38	)	$	7,912

The amortized cost and fair value of debt securities at

March 31, 2018,

by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers

may

have the right to call or prepay obligations with or without call or prepayment penalties (in thousands):

	Available for Sale
	Amortized Cost		Fair Value
Due after one year through five years	$	360	$	355
Due after ten years		7,318		7,319
Total	$	7,678	$	7,674

The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position at

March 31, 2018

and

December 31, 2017 (

in thousands):

	March 31 , 201 8
			Less than Twelve Months				Twelve Months or Greater					Total
	Number of Securities		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Federal Home Loan Mortgage Corporation mortgage-backed securities		2	$	--	$	--	$	1,281	$	(28	)	$	1,281	$	(28	)
Debt securities, U.S. government agency		1		--		--		355		(5	)		355		(5	)
Total		3	$	--	$	--	$	1,636	$	(33	)	$	1,699	$	(33	)

	December 31 , 201 7
			Less than Twelve Months				Twelve Months or Greater					Total
	Number of Securities		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Federal Home Loan Mortgage Corporation mortgage-backed securities		2	$	--	$	--	$	1,342	$	(35	)	$	1,342	$	(35	)
Debt securities, U.S. government agency		1		--		--		357		(3	)		357		(3	)
Total		3	$	--	$	--	$	1,699	$	(38	)	$	1,699	$	(38	)

At

March 31, 2018,

there were

three

securities in an unrealized loss position that at such date had an aggregate depreciation of

1.97%

from the Company’s amortized cost basis. Management believes that the estimated fair value of the securities disclosed above is primarily dependent on the movement of market interest rates. Management evaluated the length of time and the extent to which the fair value has been less than cost and the financial condition and near term prospects of the issuer, including any specific events which

may

influence the operations of the issuer. The Company has the ability and intent to hold the securities until the anticipated recovery of fair value occurs. Management does

not

believe any individual unrealized loss as of

March 31, 2018

represents an other-than-temporary impairment. There were

no

impairment charges recognized during the

three

months ended

March 31, 2018

or

2017.

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Note 6 - Loans Receivable, Net and Allowance for Loan Losses

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Financing Receivables [Text Block]

N

ote

6

- Loans Receivable, Net and Allowance for Loan Losses

The composition of net loans receivable is as follows:

	March 31, 201 8			December 31, 201 7
Real estate loans:
One-to-four family residential:
Owner occupied	$	6,316		$	5,681
Non-owner occupied		48,902			51,833
Total one-to-four family residential		55,218			57,514
Multi-family (five or more) residential		23,447			21,715
Commercial real estate		96,396			92,234
Construction		16,209			15,632
Home equity		4,772			5,129
Total real estate loans		196,042			192,224
Commercial business		13,559			11,954
Other consumer		132			138
Total Loans		209,733			204,316
Deferred loan fees and costs		(843	)		(837	)
Allowance for loan losses		(1,836	)		(1,812	)
Net Loans	$	207,054		$	201,667

The following tables present the classes of the loan portfolio summarized by the aggregate pass rating and the classified ratings of special mention, substandard and doubtful within the Company’s internal risk rating system as of

March 31, 2018

and

December 

31,

2017

(in thousands): 

	March 31, 201 8
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,894	$	180	$	242	$	-	$	6,316
One-to-four family residential non-owner occupied		48,562		28		312		-		48,902
Multi-family residential		23,447		-		-		-		23,447
Commercial real estate		94,193		2,101		102		-		96,396
Construction		14,150		-		2,059		-		16,209
Home equity		4,772		-		-		-		4,772
Commercial business		13,029		530		-		-		13,559
Other consumer		132		-		-		-		132
Total	$	204,179	$	2,839	$	2,715	$	-	$	209,733

	December 31, 201 7
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,258	$	423	$	-	$	-	$	5,681
One-to-four family residential non-owner occupied		51,372		29		432		-		51,833
Multi-family residential		21,715		-		-		-		21,715
Commercial real estate		91,549		399		286		-		92,234
Construction		13,562		-		2,070		-		15,632
Home equity		5,129		-		-		-		5,129
Commercial business		11,419		535		-		-		11,954
Other consumer		138		-		-		-		138
Total	$	200,142	$	1,386	$	2,788	$	--	$	204,316

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was

not

necessary as of

March 31, 2018

as well as the average recorded investment and related interest income for the period then ended (in thousands):

	March 31, 201 8
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		325		325		-		326		3
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		-		-
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		93		93		25		94		2
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		418		418		25		420		5
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,896	$	2,896	$	30	$	2,906	$	8

The following table presents impaired loans by class, segregated by those for which a specific allowance was required and those for which a specific allowance was

not

necessary as of

December 31, 2017

as well as the average recorded investment and related interest income for the year then ended (in thousands):

	December 31, 201 7
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		442		442		-		937		24
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		398		38
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		214		214		70		214		5
Multi-family residential		--		--		-		-		-
Commercial real estate		133		133		1		395		9
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		656		656		70		1,151		29
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		1		793		47
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,903	$	2,903	$	71	$	4,055	$	139

The loan portfolio also includes certain loans that have been modified in a troubled debt restructuring, where economic concessions have been granted to borrowers who have experienced or are expected to experience financial difficulties. These concessions typically result from loss mitigation activities and could include reductions in the interest rate, payment extensions, forbearance, or other actions. At

March 31, 2018,

the Company had

six

loans totaling

$595,000

that were identified as troubled debt restructurings. All

six

of these loans were performing in accordance with their modified terms. At

December 31, 2017,

the Company had

eight

loans totaling

$714,000

that were identified as troubled debt restructurings. If a TDR is placed on non-accrual it is

not

reverted back to accruing status until the borrower makes timely payments as contracted for at least

six

months and future collection under the revised terms is probable. During the

three

months ended

March 31, 2018,

no

new loans were identified as TDRs and

two

loans previously identified as TDRs were paid off.

The following tables present the Company’s TDR loans as of

March 31, 2018

and

December 31, 2017 (

dollar amounts in thousands):

	March 31, 201 8
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		3		418		-		418		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		5
Construction		-		-		-		-		-
Home equity		2		44		-		44		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		6	$	595	$	-	$	595	$	30

	December 31, 2017
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		5		536		-		536		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		1
Construction		-		-		-		-		-
Home equity		2		45		-		45		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		8	$	714	$	-	$	714	$	26

The contractual aging of the TDRs in the table above as of

March 31, 2018

and

December 31, 2017

is as follows (in thousands):

	March 31, 201 8
	Accruing Past Due Less than 30 Days		Past Due 30-89 Days		90 Days or More Past Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		418		-		-		-		418
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		44		-		-		-		44
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	595	$	-	$	-	$	-	$	595

	December 31, 201 7
	Accruing Past Due Less than 30 Days		Past Due 30-89 Days		90 Days or More Past Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		536		-		-		-		536
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		45		-		-		-		45
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	714	$	-	$	-	$	-	$	714

Any reserve for an impaired TDR loan is based upon the present value of the future expected cash flows discounted at the loan’s original effective rate or upon the fair value of the collateral less costs to sell, if the loan is deemed collateral dependent. At

March 31, 2018

there were

no

commitments to lend additional funds to debtors whose loan terms have been modified as TDRs.

The general practice of the Bank is to work with borrowers so that they are able to pay back their loan in full. If a borrower continues to be delinquent or cannot meet the terms of a TDR modification and the loan is determined to be uncollectible, the loan will be charged off.

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the

three

months ended

March 31, 2018

and recorded investment in loans receivable as of

March 31, 2018 (

in thousands):

	March 31, 201 8
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non- Owner Occupied			Multi- Family Residential		Commercial Real Estate		Construction		Home Equity			Commercial Business and Other Consumer		Unallocated			Total
Allowance for loan losses:
Beginning balance	$	48	$	540		$	152	$	687	$	136	$	27		$	140	$	82		$	1,812
Charge-offs		-		(47	)		-		-		-		-			-		-			(47	)
Recoveries		-		-			-		-		-		-			-		-			-
Provision		6		2			12		33		6		(1	)		30		(17	)		71
Ending balance	$	54	$	495		$	164	$	720	$	142	$	26		$	170	$	65		$	1,836
Ending balance evaluated for impairment
Individually	$	-	$	25		$	-	$	5	$	-	$	-		$	-	$	-		$	30
Collectively	$	54	$	470		$	164	$	715	$	142	$	26		$	170	$	65		$	1,806
Loans receivable:
Ending balance	$	6,316	$	48,902		$	23,447	$	96,396	$	16,209	$	4,772		$	13,691	$	-		$	209,733
Ending balance evaluated for impairment
Individually	$	242	$	418		$	-	$	133	$	2,059	$	44		$	-	$	-		$	2,896
Collectively	$	6,074	$	48,484		$	23,447	$	96,263	$	14,150	$	4,728		$	13,691	$	-		$	206,837

The Bank allocated increased allowance for loan loss provisions to the commercial real estate , commercial business and multi-family residential portfolio classes for the

three

months ended

March 31, 2018,

due primarily to increased balances and delinquencies in these portfolio classes.

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the

three

months ended

March 31, 2017 (

in thousands):

	March 31, 20 17
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non-Owner Occupied		Multi-Family Residential		Commercial Real Estate			Construction			Home Equity		Commercial Business and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503	$	103	$	616		$	138		$	37	$	87	$	80	$	1,605
Charge-offs		-		-		-		-			-			-		-		-		-
Recoveries		-		-		-		3			-			-		-		-		3
Provision		3		21		5		(7	)		(11	)		14		7		10		42
Ending balance	$	44	$	524	$	108	$	612		$	127		$	51	$	94	$	90	$	1,650
Ending balance evaluated for impairment
Individually	$	-	$	16	$	-	$	24		$	-		$	-	$	-	$	-	$	40
Collectively	$	44	$	508	$	108	$	588		$	127		$	51	$	94	$	90	$	1,610

The Bank allocated increased allowance for loan loss provisions to the

1

-

4

family residential non-owner occupied and home equity portfolio classes for the

three

months ended

March 31, 2017,

due primarily to increased delinquencies in these portfolio classes. The Bank allocated decreased allowance for loan loss provisions to the construction portfolio class for the

three

months ended

March 31, 2017,

due primarily to decreased delinquencies in this portfolio class. The Bank allocated decreased allowance for loan loss provisions to the commercial real estate portfolio class for the

three

months ended

March 31, 2017,

due to changes to qualitative factors in this portfolio class.

Following is a summary, by loan portfolio class, of changes in the allowance for loan losses for the year ended

December 31, 2017

and recorded investment in loans receivable based on impairment evaluation as of

December 31, 2017 (

in thousands):

	December 31, 201 7
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non-Owner Occupied			Multi-Family Residential		Commercial Real Estate			Construction			Home Equity			Commercial Business and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503		$	103	$	616		$	138		$	37		$	87	$	80	$	1,605
Charge-offs		-		(56	)		-		(24	)		-			-			-		-		(80	)
Recoveries		-		-			-		3			-			-			-		-		3
Provision		7		93			49		92			(2	)		(10	)		53		2		284
Ending balance	$	48	$	540		$	152	$	687		$	136		$	27		$	140	$	82	$	1,812
Ending balance evaluated for impairment
Individually	$	-	$	70		$	-	$	1		$	-		$	-		$	-	$	-	$	71
Collectively	$	48	$	470		$	152	$	686		$	136		$	27		$	140	$	82	$	1,741
Loans receivable:
Ending balance	$	5,681	$	51,833		$	21,715	$	92,234		$	15,632		$	5,129		$	12,092	$	-	$	204,316
Ending balance evaluated for impairment
Individually	$	-	$	656		$	-	$	133		$	2,069		$	45		$	-	$	-	$	2,903
Collectively	$	5,681	$	51,177		$	21,715	$	92,101		$	13,563		$	5,084		$	12,092	$	-	$	201,413

The Bank allocated increased allowance for loan loss provisions to the commercial real estate, commercial business, and multi-family portfolio classes for the year ended

December 31, 2017,

due primarily to increased balances in these portfolio classes. The Bank allocated increased allowance for loan loss provisions to the

1

-

4

family residential non-owner occupied portfolio class for the year ended

December 31, 2017,

due primarily to increased specific reserves in this portfolio class.

The following table presents nonaccrual loans by classes of the loan portfolio as of

March 31, 2018

and

December 31, 2017 (

in thousands):

	March 31, 201 8		December 31, 201 7
One-to-four family residential owner occupied	$	242	$	-
One-to-four family residential non-owner occupied		-		120
Multi-family residential		-		-
Commercial real estate		-		-
Construction		2,059		2,069
Home equity		-		-
Commercial business		-		-
Other consumer		-		-
Total	$	2,301	$	2,189

Non-performing loans, which consist of non-accruing loans plus accruing loans

90

days or more past due, amounted to

$2.7

million and

$3.1

million at

March 31, 2018

and

December 31, 2017,

respectively. For the delinquent loans in our portfolio, we have considered our ability to collect the past due interest, as well as the principal balance of the loan, in order to determine whether specific loans should be placed on non-accrual status. In cases where our evaluations have determined that the principal and interest balances are collectible, we have continued to accrue interest.

For the

three

months ended

March 31, 2018

and

2017

there was

no

interest income recognized on non-accrual loans on a cash basis. Interest income foregone on non-accrual loans was approximately

$44,000

and

$43,000

for the

three

months ended

March 31, 2018

and

2017,

respectively.

The performance and credit quality of the loan portfolio is also monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. The following tables present the classes of the loan portfolio summarized by the past due status as of

March 31, 2018

and

December 31, 2017 (

in thousands):

	March 31, 201 8
	30- 89 Days Past Due		90 Days or M ore Pas t Due		Total Past Due		Current		Total Loans Receivable		Loans Receivable 90 Days or More Past Due and Accruing
One-to-four family residential owner occupied	$	497	$	422	$	919	$	5,97	$	6,316	$	180
One-to-four family residential non-owner occupied		1,022		181		1,203		47,699		48,902		181
Multi-family residential		73		-		73		23,374		23,447		-
Commercial real estate		2,378		42		2,420		93,976		96,396		42
Construction		850		2,059		2,909		13,300		16,209		-
Home equity		33		-		33		4,739		4,772		-
Commercial business		468		-		468		13,091		13,559		-
Other consumer		-		-		-		132		132		-
Total	$	5,321	$	2,704	$	8,025	$	201,708	$	209,733	$	403

	December 31, 201 7
	30- 89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans Receivable		Loans Receivable 90 Days or More Past Due and Accruing
One-to-four family residential owner occupied	$	670	$	423	$	1,093	$	4,588	$	5,681	$	423
One-to-four family residential non-owner occupied		969		337		1,306		50,527		51,833		217
Multi-family residential		313		-		313		21,402		21,715		-
Commercial real estate		505		241		746		91,488		92,234		241
Construction		407		2,069		2,476		13,156		15,632		-
Home equity		51		-		51		5,078		5,129		-
Commercial business		-		-		-		11,954		11,954		-
Other consumer		-		-		-		138		138		-
Total	$	2,915	$	3,070	$	5,985	$	198,331	$	204,316	$	881

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Note 7 - Goodwill and Other Intangible, Net

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

Note

7

–

Goodwill and Other Intangible, Net

On

August 1, 2016,

Quaint Oak Insurance Agency, LLC began operations by acquiring the renewal rights to the book of business produced and serviced by an independent insurance agency located in New Britain, Pennsylvania, that provides a broad range of personal and commercial insurance coverage solutions. The Company paid

$1.0

million for these rights. Based on a valuation,

$515,000

of the purchase price was determined to be goodwill and

$485,000

was determined to be related to the renewal rights to the book of business and deemed to be an other intangible asset. This other intangible asset is being amortized over a

ten

year period based upon the annual retention rate of the book of business. The balance of other intangible asset at

March 31, 2018

was

$404,000

net of accumulated amortization of

$81,000.

Amortization expense for the

three

months ended

March 31, 2018

amounted to

$12,000.

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Note 8 - Deposits

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Deposit Liabilities Disclosures [Text Block]

N

ote

8

– Deposits

Deposits consist of the following classifications (in thousands):

	March 31, 201 8		December 31, 201 7
Non-interest bearing checking accounts	$	11,013	$	7,956
Passbook accounts		354		463
Savings accounts		1,974		2,353
Money market accounts		32,145		30,411
Certificates of deposit		153,450		145,038
Total deposits	$	198,936	$	186,221

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Note 9 - Borrowings

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Debt Disclosure [Text Block]

N

ote

9

–

Borrowings

Federal Home Loan Bank advances consist of the following at

March 31, 2018

and

December 31, 2017 (

in thousands):

	March 31 , 201 8					December 31, 201 7
	Amount		Weighted Interest Rate			Amount		Weighted Interest Rate
Short-term borrowings	$	10,000		1.87	%	$	10,000		1.54	%
Fixed rate borrowings maturing:
2018		3,000		1.46			3,000		1.46
2019		3,000		1.86			3,000		1.86
2020		2,000		2.00			2,000		2.00
2021		3,000		2.05			3,000		2.05
2022		3,000		2.18			3,000		2.18
2023		3,000		2.33			3,000		2.33
2024		1,000		2.54			1,000		2.54
Total FHLB long-term debt	$	18,000		2.01	%	$	18,000		2.01	%

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Note 10 - Stock Compensation Plans

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note

1

0

– Stock Compensation Plans

Employee Stock Ownership Plan

The Company maintains an Employee Stock Ownership Plan (ESOP) for the benefit of employees who meet the eligibility requirements of the plan. Using proceeds from a loan from the Company, the ESOP purchased

8%,

or

222,180

shares of the Company’s then outstanding common stock in the open market during

2007.

The Bank makes cash contributions to the ESOP on a quarterly basis sufficient to enable the ESOP to make the required loan payments to the Company. The loan bears an interest rate of

7.75%

per annum, with principal and interest to be paid quarterly in equal installments over

15

years. The loan is secured by the unallocated shares of common stock held by the ESOP.

Shares of the Company’s common stock purchased by the ESOP are held in a suspense account and reported as unallocated common stock held by the ESOP in stockholders’ equity until released for allocation to participants. As the debt is repaid, shares are released from collateral and are allocated to each eligible participant based on the ratio of each such participant’s base compensation to the total base compensation of eligible plan participants. As the unearned shares are committed to be released and allocated among participants, the Company recognizes compensation expense equal to the average market value of the shares, and the shares become outstanding for earnings per share computations. During the

three

months ended

March 31, 2018

and

2017,

the Company recognized

$48,000

and

$45,000

of ESOP expense, respectively.

Recognition & Retention

and Stock Incentive

Plan

s

In

May 2008,

the shareholders of Quaint Oak Bancorp approved the adoption of the

2008

Recognition and Retention Plan (the “RRP”) and Trust Agreement. In order to fund the RRP, the

2008

Recognition and Retention Plan Trust acquired

111,090

shares of the Company’s stock in the open market at an average price of

$4.68

totaling

$520,000.

In

May 2013,

the shareholders of Quaint Oak Bancorp approved the adoption of the

2013

Stock Incentive Plan (the “Stock Incentive Plan”). The Stock Incentive Plan provides that

no

more than

48,750,

or

25%,

of the shares

may

be granted as restricted stock awards.

As of

March 31, 2018,

a total of

10,061

share awards were unvested under the RRP and Stock Incentive Plan and up to

21,608

share awards were available for future grant under the Stock Incentive Plan and

none

under the RRP. The RRP and Stock Incentive Plan share awards have vesting periods of

five

years.

A summary of the status of the share awards under the RRP and Stock Incentive Plan as of

March 31, 2018

and

2017

and changes during the

three

months ended

March 31, 2018

and

2017

is as follows:

	March 31, 201 8				March 31, 201 7
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Unvested at the beginning of the period		10,061	$	8.10		20,524	$	8.10
Granted		-		-		-		-
Vested		-		-		-		-
Forfeited		-		-		-		-
Unvested at the end of the period		10,061	$	8.10		20,524	$	8.10

Compensation expense on the restricted stock awards is recognized ratably over the

five

year vesting period in an amount which is equal to the fair value of the common stock at the date of grant. During both the

three

months ended

March 31, 2018

and

2017,

the Company recognized approximately

$21,000

of compensation expense. A tax benefit of approximately

$4,000

and

$7,000

was recognized during the

three

months ended

March 31, 2018

and

2017,

respectively. As of

March 31, 2018,

approximately

$10,000

in additional compensation expense will be recognized over the remaining service period of approximately

0.1

years.

Stock Option

and Stock Incentive Plans

In

May 2008,

the shareholders of Quaint Oak Bancorp approved the adoption of the

2008

Stock Option Plan (the “Option Plan”). The Option Plan authorizes the grant of stock options to officers, employees and directors of the Company to acquire

277,726

shares of common stock with an exercise price

no

less than the fair market value on the date of the grant. The Stock Incentive Plan approved by shareholders in

May 2013

covered a total of

195,000

shares, of which

48,750

may

be restricted stock awards, for a balance of

146,250

stock options assuming all the restricted shares are awarded.

For grants in

May 2008,

the Compensation Committee of the Board of Directors determined to grant the stock options at an exercise price equal to

$5.00

per share (split-adjusted) which is higher than the fair market value of the common stock on the grant date. All incentive stock options issued under the Option Plan and the Stock Incentive Plan are intended to comply with the requirements of Section

422

of the Internal Revenue Code.

As of

March 31, 2018,

a total of

212,440

grants of stock options were outstanding under the Option Plan and Stock Incentive Plan and

57,636

stock options were available for future grant under the Stock Incentive Plan and

none

under the Option Plan. Options will become vested and exercisable over a

five

year period and are generally exercisable for a period of

ten

years after the grant date.

 

A summary of option activity under the Company’s Option Plan and Stock Incentive Plan of

March 31, 2018

and

2017

and changes during the

three

months ended

March 31, 2018

and

2017

is as follows:

	201 8							201 7
	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
Outstanding at the beginning of the year		265,302		$	6.74		3.2		316,348		$	6.49		3.8
Granted		-			-		-		-			-		-
Exercised		(52,862	)		5.00		-		(34,550	)		5.00		-
Forfeited		-			-		-		-			-		-
Outstanding at end of period		212,440		$	7.17		3.7		281,798		$	6.67		3.8
Exercisable at end of period		182,600		$	7.03		3.4		221,158		$	6.29		3.2

During both the

three

months ended

March 31, 2018

and

2017,

approximately

$11,000

in compensation expense was recognized. A tax benefit of approximately

$1,000

,

was recognized during each of these periods. As of

March 31, 2018,

approximately

$6,000

in additional compensation expense will be recognized over the remaining service period of approximately

0.1

years.

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Note 11 - Fair Value Measurements and Fair Values of Financial Instruments

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Fair Value Disclosures [Text Block]

Note

1

1

– Fair Value Measurements and Fair Values of Financial Instruments

Fair value estimates are based on quoted market prices, if available, quoted market prices of similar assets or liabilities, or the present value of expected future cash flows and other valuation techniques. These valuations are significantly affected by discount rates, cash flow assumptions, and risk assumptions used. Therefore, fair value estimates

may

not

be substantiated by comparison to independent markets and are

not

intended to reflect the proceeds that

may

be realizable in an immediate settlement of the instruments.

Fair value is determined at

one

point in time and is

not

representative of future value. These amounts do

not

reflect the total value of a going concern organization. Management does

not

have the intention to dispose of a significant portion of its assets and liabilities and therefore, the unrealized gains or losses should

not

be interpreted as a forecast of future earnings and cash flows.

The following disclosures show the hierarchal disclosure framework associated with the level of pricing observations utilized in measuring assets and liabilities at fair value. The

three

broad levels of pricing are as follows:

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

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

Level III: Valuations derived from valuation techniques in which

one

or more significant inputs or significant value drivers are unobservable.

This hierarchy requires the use of observable market data when available.

The following is a discussion of assets and liabilities measured at fair value on a recurring basis and valuation techniques applied:

Investment Securities Available-For-Sale:

The fair value of securities available for sale are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level

1

), or matrix pricing (Level

2

), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices.

We

may

be required from time to time to measure certain assets at fair value on a nonrecurring basis in accordance with U.S. GAAP. These adjustments to fair value usually result from application of lower-of-cost-or-market accounting or write-downs of individual assets.

Impaired Loans:

Impaired loans are carried at the lower of cost or the fair value of the collateral for collateral-dependent loans less estimated costs to sell. Collateral is primarily in the form of real estate. The use of independent appraisals, discounted cash flow models and management’s best judgment are significant inputs in arriving at the fair value measure of the underlying collateral and impaired loans are therefore classified within level

3

of the fair value hierarchy.

Other Real Estate Owned:

Other real estate owned is carried at the lower of the investment in the real estate or the fair value of the real estate less estimated selling costs. The use of independent appraisals and management’s best judgment are significant inputs in arriving at the fair value measure of the underlying collateral and therefore other real estate owned is classified within level

3

of the fair value hierarchy.

The table below sets forth the financial assets and liabilities that were accounted for on a recurring and nonrecurring basis by level within the fair value hierarchy as of

March 31, 2018 (

in thousands):

	March 3 1, 2018
	Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association mortgage-backed securities	$	5,490	$	-	$	5,490	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,281		-		1,281		-
Federal National Mortgage Association mortgage-backed securities		548		-		548		-
Debt securities, U.S. government agency		355		-		355		-
Total investment securities available for sale	$	7,674	$	-	$	7,674	$	-
Total recurring fair value measurements	$	7,674	$	-	$	7,674	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,866	$	--	$	-	$	2,866
Total nonrecurring fair value measurements	$	2,866	$	--	$	-	$	2,866

The table below sets forth the financial assets and liabilities that were accounted for on a recurring and nonrecurring basis by level within the fair value hierarchy as of

December 31, 2017 (

in thousands):

	Dec ember 3 1, 2017
	Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association mortgage-backed securities	$	5,643	$	-	$	5,643	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,342		-		1,342		-
Federal National Mortgage Association mortgage-backed securities		570		-		570		-
Debt securities, U.S. government agency		357		-		357		-
Total investment securities available for sale	$	7,912	$	-	$	7,912	$	-
Total recurring fair value measurements	$	7,912	$	-	$	7,912	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,832	$	--	$	-	$	2,832
Total nonrecurring fair value measurements	$	2,832	$	--	$	-	$	2,832

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has used Level

3

inputs to determine fair value as of

March 31, 2018

and

December 31, 2017 (

in thousands):

	March 31, 201 8
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,866	Appraisal of collateral (1)	Appraisal adjustments (2)	8%	-	27%	(1%)

	December 31, 201 7
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,832	Appraisal of collateral (1)	Appraisal adjustments (2)	0%	-	27%	(1%)

( 1 ) Fair value is generally determined through independent appraisals of the underlying collateral, which generally include various Level 3 inputs which are identifiable.

( 2 ) Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of liquidation expenses and other appraisal adjustments are presented as a percentage of the appraisal.

The estimated fair values of the Company’s financial instruments that are

not

required to be measured or reported at fair value were as follows at

March 31, 2018

and

December 

31,

2017

(in thousands):

					Fair Value Measurements at
					March 31, 201 8
	Carrying Amount		Fair Value Estimate		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	16,931	$	16,931	$	16,931	$	-	$	-
Investment in interest-earning time deposits		4,920		4,944		-		-		4,944
Loans held for sale		4,941		5,060		5,060		-		-
Loans receivable, net		207,054		207,783		-		-		207,783
Accrued interest receivable		981		981		981		-		-
Investment in FHLB stock		1,234		1,234		1,234		-		-
Bank-owned life insurance		3,834		3,834		3,834		-		-
Financial Liabilities
Deposits		198,936		199,791		45,487		-		154,304
FHLB short-term borrowings		10,000		10,000		10,000		-		-
FHLB long-term borrowings		18,000		16,963		-		-		16,963
Accrued interest payable		174		174		174		-		-
Advances from borrowers for taxes and insurance		1,651		1,651		1,651

					Fair Value Measurements at
					December 31, 201 7
	Carrying Amount		Fair Value Estimate		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	7,910	$	7,910	$	7,910	$	-	$	-
Investment in interest-earning time deposits		4,879		4,912		-		-		4,912
Loans held for sale		7,006		7,232		7,232		-		-
Loans receivable, net		201,667		202,803		-		-		202,803
Accrued interest receivable		1,021		1,021		1,021		-		-
Investment in FHLB stock		1,234		1,234		1,234		-		-
Bank-owned life insurance		3,814		3,814		3,814		-		-
Financial Liabilities
Deposits		186,221		187,309		41,183		-		146,126
FHLB short-term borrowings		10,000		10,000		10,000		-		-
FHLB long-term borrowings		18,000		16,982		-		-		16,982
Accrued interest payable		167		167		167		-		-
Advances from borrowers for taxes and insurance		2,423		2,423		2,423

The following methods and assumptions were used to measure the fair value of financial instruments recorded at cost on the Company’s consolidated balance sheets:

Cash and Cash Equivalents.

The carrying amounts reported in the consolidated balance sheets for cash and short-term instruments approximate those assets’ fair values.

Interest-Earning Time Deposits.

Fair values for interest-earning time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered in the market on certificates to a schedule of aggregated expected monthly maturities on time deposits. The Company generally purchases amounts below the insured limit, limiting the amount of credit risk on these time deposits.

Loans Held for Sale

. Fair values of loans held for sale are based on commitments on hand from investors at prevailing market rates.

Loans Receivable, Net.

The fair values of loans are estimated using discounted cash flow methodology. The discount rates take into account interest rates currently being offered to customers for loans with similar terms, the credit risk associated with the loan and market factors, including liquidity. The valuation of the loan portfolio reflects discounts that the Company believes are consistent with transactions occurring in the market place for both performing and distressed loan types. The carrying value that fair value is compared to is net of the allowance for loan losses and other associated premiums and discounts. Due to the significant judgment involved in evaluating credit quality, loans are classified with Level

3

of the fair value hierarchy.

Accrued Interest Receivable.

The carrying amount of accrued interest receivable approximates its fair value.

Investment in Federal Home Loan Bank Stock.

The carrying amount of restricted investment in Federal Home Loan Bank stock approximates fair value, and considers the limited marketability of such securities.

Bank-Owned Life Insurance.

The carrying amount of the investment in bank-owned life insurance approximates its cash surrender value under the insurance policies.

Deposits.

The carrying amount is considered a reasonable estimate of fair value for demand savings deposit accounts. The fair value of fixed maturity certificates of deposit is estimated by a discounted cash flow method using the rates currently offered for deposits of similar maturities.

Federal Home Loan Bank Borrowings.

Fair values of FHLB borrowings are estimated based on rates currently available to the Company for similar terms and remaining maturities.

Accrued Interest Payable.

The carrying amount of accrued interest payable approximates its fair value.

Advances from Borrowers for Taxes and Insurance.  

The carrying amount of advances from borrowers for taxes and insurance approximates its fair value.

Off-Balance Sheet Financial Instruments.

Off-balance sheet financial instruments consist of commitments to extend credit. Fair values for commitments to extend credit are estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreement and the present credit standing of the counterparties. The estimated fair value of the commitments to extend credit are insignificant and therefore are

not

presented in the above table.

XML

Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Basis of Financial Presentation.

The consolidated financial statements include the accounts of Quaint Oak Bancorp, Inc., a Pennsylvania chartered corporation (the "Company" or "Quaint Oak Bancorp") and its wholly owned subsidiary, Quaint Oak Bank, a Pennsylvania chartered stock savings bank, along with its wholly owned subsidiaries. At

March 31, 2018,

the Bank has

five

wholly-owned subsidiaries, Quaint Oak Mortgage, LLC, Quaint Oak Real Estate, LLC, Quaint Oak Abstract, LLC, QOB Properties, LLC, and Quaint Oak Insurance Agency, LLC, each a Pennsylvania limited liability company. The mortgage, real estate and abstract companies offer mortgage banking, real estate sales and title abstract services, respectively, in the Lehigh Valley region of Pennsylvania, and began operation in

July 2009.

QOB Properties, LLC began operations in

July 2012

and holds Bank properties acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure. Quaint Oak Insurance Agency, LLC began operations in

August 2016

and provides a broad range of personal and commercial insurance coverage solutions. All significant intercompany balances and transactions have been eliminated.

The Bank is subject to regulation by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation. Pursuant to the Bank’s election under Section

10

(l) of the Home Owners’ Loan Act, the Company is a savings and loan holding company regulated by the Board of Governors of the Federal Reserve System. The market area served by the Bank is principally Bucks County, Pennsylvania and to a lesser extent, Montgomery and Philadelphia Counties in Pennsylvania. The Bank has

two

locations: the main office location in Southampton, Pennsylvania and a regional banking office in the Lehigh Valley area of Pennsylvania. The principal deposit products offered by the Bank are certificates of deposit, money market accounts, non-interest bearing checking accounts for businesses and consumers, and savings accounts. The principal loan products offered by the Bank are fixed and adjustable rate residential and commercial mortgages, construction loans, commercial business loans, home equity loans, and lines of credit.

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP) for interim information and with the instructions to Form

10

-Q, as applicable to a smaller reporting company. Accordingly, they do

not

include all the information and footnotes required by US GAAP for complete financial statements.

The foregoing consolidated financial statements are unaudited; but in the opinion of management include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation thereof. The balances as of

December 31, 2017

have been derived from the audited financial statements. These financial statements should be read in conjunction with the financial statements and notes thereto included in Quaint Oak Bancorp’s

2017

Annual Report on Form

10

-K. The results of operations for the

three

months ended

March 31, 2018

are

not

necessarily indicative of the results that

may

be expected for the year ending

December 31, 2018.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates in the Preparation of Financial Statements.

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. The Company’s most significant estimates are the determination of the allowance for loan losses and the valuation of deferred tax assets.

Finance, Loans and Leases Receivable, Policy [Policy Text Block]

Loans Receivable.

Loans receivable that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at their outstanding unpaid principal balances, net of an allowance for loan losses and any deferred fees and costs. Interest income is accrued on the unpaid principal balance. Loan origination fees and costs are deferred and recognized as an adjustment of the yield (interest income) of the related loans. The Bank is generally amortizing these amounts over the contractual life of the loan.

The loans receivable portfolio is segmented into residential loans, commercial real estate loans, construction loans, commercial business loans, and consumer loans. The residential loan segment has

two

classes:

one

-to-

four

family residential owner occupied loans and

one

-to-

four

residential family non-owner occupied loans. The commercial real estate loan segment consists of the following classes: multi-family (

five

or more) residential, commercial real estate and commercial lines of credit. Construction loans are generally granted for the purpose of building a single residential home. Commercial business loans are loans to businesses for working capital, purchase of a business, tenant improvements, receivables, purchase of inventory, and for the purchase of business essential equipment. Business essential equipment is equipment necessary for a business to support or assist with the day-to-day operation or profitability of the business. The consumer loan segment consists of the following classes: home equity loans and other consumer loans. Included in the home equity class are home equity loans and home equity lines of credit. Included in the other consumer are loans secured by saving accounts.

The accrual of interest is generally discontinued when principal or interest has become

90

days past due unless the loan is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest credited to income in the current year is reversed and unpaid interest accrued in prior years is charged against the allowance for loan losses. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management’s judgment as to the collectability of principal. Generally, a loan is restored to accrual status when the obligation is brought current, it has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is

no

longer in doubt.

Loans and Leases Receivable, Allowance for Loan Losses Policy [Policy Text Block]

Allowance for Loan Losses.

The allowance for loan losses represents management’s estimate of losses inherent in the loan portfolio as of the balance sheet date and is recorded as a reduction to loans receivable. The allowance for loan losses is increased by the provision for loan losses, and decreased by charge-offs, net of recoveries. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance. All, or part, of the principal balance of loans receivable are charged off to the allowance as soon as it is determined that the repayment of all, or part, of the principal balance is highly unlikely. Because all identified losses are immediately charged off,

no

portion of the allowance for loan losses is restricted to any individual loan or groups of loans, and the entire allowance is available to absorb any and all loan losses.

The allowance for loan losses is maintained at a level considered adequate to provide for losses that can be reasonably anticipated. Management performs a quarterly evaluation of the adequacy of the allowance. The allowance is based on the Company’s past loan loss experience, known and inherent risks in the portfolio, adverse situations that

may

affect the borrower’s ability to repay, the estimated value of any underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors. This evaluation is inherently subjective as it requires material estimates that

may

be susceptible to significant revision as more information becomes available.

The allowance consists of specific, general and unallocated components. The specific component relates to loans that are designated as impaired. For loans that are designated as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers pools of loans by loan class. These pools of loans are evaluated for loss exposure based upon historical loss rates for each of these categories of loans, adjusted for qualitative factors. These significant factors

may

include changes in lending policies and procedures, changes in existing general economic and business conditions affecting our primary lending areas, credit quality trends, collateral value, loan volumes and concentrations, seasoning of the loan portfolio, recent loss experience in particular segments of the portfolio, duration of the current business cycle and bank regulatory examination results. The applied loss factors are reevaluated quarterly to ensure their relevance in the current economic environment. Residential owner occupied mortgage lending generally entails a lower risk of default than other types of lending. Consumer loans and commercial real estate loans generally involve more risk of collectability because of the type and nature of the collateral and, in certain cases, the absence of collateral. It is the Company’s policy to establish a specific reserve for loss on any delinquent loan when it determines that a loss is probable. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are

not

considered impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate or the fair value of the collateral if the loan is collateral dependent. An allowance for loan losses is established for an impaired loan if its carrying value exceeds its estimated fair value. The estimated fair values of substantially all of the Company’s impaired loans are measured based on the estimated fair value of the loan’s collateral.

A loan is identified as a troubled debt restructuring (“TDR”) if the Company, for economic or legal reasons related to a debtor’s financial difficulties, grants a concession to the debtor that it would

not

otherwise consider. Concessions granted under a TDR typically involve a temporary or permanent reduction in payments or interest rate or an extension of a loan’s stated maturity date at less than a current market rate of interest. Loans identified as TDRs are designated as impaired.

For loans secured by real estate, estimated fair values are determined primarily through

third

-party appraisals. When a real estate secured loan becomes impaired, a decision is made regarding whether an updated certified appraisal of the real estate is necessary. This decision is based on various considerations, including the age of the most recent appraisal, the loan-to-value ratio based on the original appraisal and the condition of the property. Appraised values are discounted to arrive at the estimated selling price of the collateral, which is considered to be the estimated fair value. The discounts also include estimatedcosts to sell the property.

The allowance calculation methodology includes further segregation of loan classes into risk rating categories. The borrower’s overall financial condition, repayment sources, guarantors and value of collateral, if appropriate, are evaluated annually for all loans (except

one

-to-

four

family residential owner-occupied loans) where the total amount outstanding to any borrower or group of borrowers exceeds

$500,000,

or when credit deficiencies arise, such as delinquent loan payments. Credit quality risk ratings include regulatory classifications of special mention, substandard, doubtful and loss. Loans criticized as special mention have potential weaknesses that deserve management’s close attention. If uncorrected, the potential weaknesses

may

result in deterioration of the repayment prospects. Loans classified substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They include loans that are inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified doubtful have all the weaknesses inherent in loans classified substandard with the added characteristic that collection or liquidation in full, on the basis of current conditions and facts, is highly improbable. Loans classified as a loss are considered uncollectible and are charged to the allowance for loan losses. Loans

not

classified are rated pass. In addition, Federal regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses and

may

require the Company to recognize additions to the allowance based on their judgments about information available to them at the time of their examination, which

may

not

be currently available to management. Based on management’s comprehensive analysis of the loan portfolio, management believes the current level of the allowance for loan losses is adequate.

Finance, Loan and Lease Receivables, Held-for-sale, Policy [Policy Text Block]

Loans Held for Sale

.

Loans originated by the Bank’s mortgage banking subsidiary, Quaint Oak Mortgage, LLC, are intended for sale in the secondary market and are carried at the lower of cost or fair value (LOCOM). Gains and losses on loan sales (sales proceeds minus carrying value) are recorded in noninterest income, and direct loan origination costs, commissions and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan. To a lesser extent, the Bank originates equipment loans for sale primarily to other financial institutions.

Federal Home Loan Bank Stock [Policy Text Block]

Federal Home Loan Bank Stock

.

Federal law requires a member institution of the Federal Home Loan Bank (FHLB) system to hold restricted stock of its district Federal Home Loan Bank according to a predetermined formula. FHLB stock is carried at cost and evaluated for impairment. When evaluating FHLB stock for impairment, its value is determined based on the ultimate recoverability of the par value of the stock. We evaluate our holdings of FHLB stock for impairment each reporting period.

No

impairment charges were recognized on FHLB stock during the

three

months ended

March 31, 2018

and

2017.

Bank Owned Life Insurance [Policy Text Block]

Bank Owned Life Insurance (BOLl).

The Company purchases bank owned life insurance as a mechanism for funding various employee benefit costs. The Company is the beneficiary of these policies that insure the lives of certain officers of its subsidiaries. The Company has recognized the cash surrender value under the insurance policies as an asset in the consolidated balance sheets. Changes in the cash surrender value are recorded in non-interest income in the consolidated statements of income.

Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block]

Intangible Assets.

Intangible assets on the consolidated balance sheets represent the acquisition by Quaint Oak Insurance Agency of the renewal rights to the book of business produced and serviced by Signature Insurance Services, LLC on

August 1, 2016

at a total cost of

$1.0

million. Based on a valuation,

$515,000

of the purchase price was determined to be goodwill and

$485,000

was determined to be related to the renewal rights to the book of business and deemed an other intangible asset. The renewal rights are being amortized over a

ten

year period based upon the annual retention rate of the book of business.

The Company will complete a goodwill and other intangible asset analysis at least on an annual basis or more often if events and circumstances indicate that there

may

be impairment.

Loans and Leases Receivable, Real Estate Acquired Through Foreclosure, Policy [Policy Text Block]

Other Real Estate Owned

, Net

.

Other real estate owned or foreclosed assets are comprised of property acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure and loans classified as in-substance foreclosures. A loan is classified as in-substance foreclosure when the Bank has taken possession of the collateral regardless of whether formal foreclosure proceedings take place. Other real estate properties are initially recorded at fair value, net of estimated selling costs at the date of foreclosure, establishing a new cost basis. After foreclosure, valuations are periodically performed by management and the real estate is carried at the lower of cost or fair value less estimated costs to sell. Net revenue and expenses from operations and additions to the valuation allowance are included in other expenses. The Company has

no

other real estate owned as of

March 31, 2018

or

December 31, 2017.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Share

-Based Compensation.

Compensation expense for share-based compensation awards is based on the grant date fair value of the award. That cost is recognized over the period during which an employee is required to provide service in exchange for the award.

At

March 31, 2018,

the Company has outstanding equity awards under

three

share-based plans: the

2008

Recognition and Retention Plan (“RRP”), the

2008

Stock Option Plan, and the

2013

Stock Incentive Plan. Awards under these plans were made in

May 2008

and

2013.

These plans are more fully described in Note

10.

The Company also has an employee stock ownership plan (“ESOP”). This plan is more fully described in Note

10.

As ESOP shares are committed to be released and allocated among participants, the Company recognizes compensation expense equal to the average market price of the shares over the period earned.

Comprehensive Income, Policy [Policy Text Block]

Comprehensive Income

.

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

Earnings Per Share, Policy [Policy Text Block]

Earnings

per Share.

Amounts reported in earnings per share reflect earnings available to common stockholders’ for the period divided by the weighted average number of shares of common stock outstanding during the period, exclusive of unearned ESOP shares, unvested restricted stock (RRP) shares and treasury shares. Stock options and unvested restricted stock are regarded as potential common stock and are considered in the diluted earnings per share calculations to the extent they would have a dilutive effect if converted to common stock, computed using the “treasury stock” method.

Revenue from Contract with Customer [Policy Text Block]

Revenue from Contracts with Customers

.

The Company records revenue from contracts with customers in accordance with Accounting Standards Codification Topic

606,

“Revenue from Contracts with Customers” (“Topic

606”

)

. Under Topic

606,

the Company must identify the contract with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract, and recognize revenue when (or as) the Company satisfies a performance obligation. Significant revenue has

not

been recognized in the current reporting period that results from performance obligations satisfied in previous periods.

The Company’s primary sources of revenue are derived from interest and dividends earned on loans, and investment securities, gains on the sale of loans, income from bank-owned life insurance, and other financial instruments that are

not

within the scope of Topic

606.

  The main types of non-interest income within the scope of the standard are as follows:

Service Charges on Deposits: The Bank has contracts with its commercial checking deposit customers where fees are charged if the account balance falls below predetermined levels defined as compensating balances. These agreements can be cancelled at any time by either the Bank or the deposit customer. Revenue from these transactions is recognized on a monthly basis as the Bank has an unconditional right to the fee consideration. The Bank also has transaction fees related to specific transactions or activities resulting from customer request or activity that include overdraft fees, wire fees, and other transaction fees. All of these fees are attributable to specific performance obligations of the Bank where the revenue is recognized at a defined point in time, completion of the requested service/transaction.

Insurance Commissions

: 

Insurance income generally consist of commissions from the sale of insurance policies and performance-based commissions from insurance companies.  The Bank recognizes commission income from the sale of insurance policies when it acts as an agent between the insurance carrier and policyholder, arranging for the insurance carrier to provide policies to policyholders, and acts on behalf of the insurance carrier by providing customer service to the policyholder during the policy period. Commission income is recognized over time, using the output method of time elapsed, which corresponds with the underlying insurance policy period, for which the Bank is obligated to perform under contract with the insurance carrier. Commission income is variable, as it is comprised of a certain percentage of the underlying policy premium. The Bank estimates the variable consideration based upon the "most likely amount" method, and does

not

expect or anticipate a significant reversal of revenue in future periods, based upon historical experience.  Payment is due from the insurance carrier for commission income once the insurance policy has been sold. The Bank has elected to apply a practical expedient related to capitalizable costs, which are the commissions paid to insurance producers, and will expense these commissions paid to insurance producers as incurred, as these costs are related to the commission income and would have been amortized within

one

year or less if they had been capitalized, the same period over which the commission income was earned. Performance-based commissions from insurance companies are recognized at a point in time, when received, and

no

contingencies remain.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements.  

In

January 2016,

the FASB issued ASU

2016

-

01,

Financial Instruments – Overall (Subtopic

825

-

10

):  Recognition and Measurement of Financial Assets and Financial Liabilities

.  This Update applies to all entities that hold financial assets or owe financial liabilities and is intended to provide more useful information on the recognition, measurement, presentation, and disclosure of financial instruments.  Among other things, this Update (a) requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; (b) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (c) eliminates the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are

not

public business entities; (d) eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; (e) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; (f) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements; and (g) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.

The Bank has adopted this standard effective

January 1, 2018. 

On a prospective basis, the Bank implemented changes to the measurement of the fair value of financial instruments using an exit price notion for disclosure purposes included in Note

11

to the financial statements.  The Bank estimated the fair value based on guidance from ASC

820

-

10,

Fair Value Measurements

, which defines fair value as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is

no

active observable market for sale information on community bank loans and, thus, Level III fair value procedures were utilized, primarily in the use of present value techniques incorporating assumptions that market participants would use in estimating fair values. In the absence of reliable market information, the Bank used its own assumptions in an effort to determine a reasonable estimate of fair value.

In

February 2016,

the FASB issued ASU

2016

-

02,

Leases (Topic

842

)

. The standard requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. A short-term lease is defined as

one

in which (a) the lease term is

12

months or less and (b) there is

not

an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For short-term leases, lessees

may

elect to recognize lease payments over the lease term on a straight-line basis. For public business entities, the amendments in this Update are effective for fiscal years beginning after

December 15, 2018,

and interim periods within those years. The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is currently assessing the practical expedients it

may

elect at adoption, but does

not

anticipate the amendments will have a significant impact to the financial statements. Based on the Company’s preliminary analysis of its current portfolio, the impact to the Company’s balance sheet is estimated to result in less than a

1%

increase in assets and liabilities. The Company also anticipates additional disclosures to be provided at adoption.

In

June 2016,

the FASB issued ASU

2016

-

13,

Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments

, which changes the impairment model for most financial assets. This Update is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The underlying premise of the Update is that financial assets measured at amortized cost should be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The allowance for credit losses should reflect management’s current estimate of credit losses that are expected to occur over the remaining life of a financial asset. The income statement will be effected for the measurement of credit losses for newly recognized financial assets, as well as the expected increases or decreases of expected credit losses that have taken place during the period. ASU

2016

-

13

is effective for annual and interim periods beginning after

December 15, 2019,

and early adoption is permitted for annual and interim periods beginning after

December 15, 2018.

With certain exceptions, transition to the new requirements will be through a cumulative effect adjustment to opening retained earnings as of the beginning of the

first

reporting period in which the guidance is adopted. We expect to recognize a

one

-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the

first

reporting period in which the new standard is effective, but cannot yet determine the magnitude of any such

one

-time adjustment or the overall impact of the new guidance on the consolidated financial statements.

In

January 2017,

the FASB issued ASU

2017

-

04,

Simplifying the Test for Goodwill Impairment

. To simplify the subsequent measurement of goodwill, the FASB eliminated Step

2

from the goodwill impairment test. In computing the implied fair value of goodwill under Step

2,

an entity had to perform procedures to determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the loss recognized should

not

exceed the total amount of goodwill allocated to that reporting unit. A public business entity that is a U.S. Securities and Exchange Commission (“SEC”) filer should adopt the amendments in this Update for its annual or any interim goodwill impairment tests in fiscal years beginning after

December 15, 2019.

This Update is

not

expected to have a significant impact on the Company’s financial statements.

In

March 2017,

the FASB issued ASU

2017

-

08,

Receivables – Nonrefundable Fees and Other Costs (Subtopic

310

-

20

).

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. For public business entities, the amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after

December 15, 2018.

Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity should apply the amendments in this Update on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. Additionally, in the period of adoption, an entity should provide disclosures about a change in accounting principle. This Update is

not

expected to have a significant impact on the Company’s financial statements.

In

January 2018,

the FASB issued ASU

2018

-

01,

Leases (Topic

842

), which provides an optional transition practical expedient to

not

evaluate under Topic

842

existing or expired land easements that were

not

previously accounted for as leases under the current lease guidance in Topic

840.

An entity that elects this practical expedient should evaluate new or modified land easements under Topic

842

beginning at the date the entity adopts Topic

842;

otherwise, an entity should evaluate all existing or expired land easements in connection with the adoption of the new lease requirements in Topic

842

to assess whether they meet the definition of a lease. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements in ASU

2016

-

02.

This Update is

not

expected to have a significant impact on the Company’s financial statements

Reclassification, Policy [Policy Text Block]

Reclassifications.

Certain items in the

2017

consolidated financial statements have been reclassified to conform to the presentation in the

2018

consolidated financial statements. Such reclassifications did

not

have a material impact on the presentation of the overall financial statements. The reclassifications had

no

effect on net income or stockholders’ equity.

XML

Note 2 - Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

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

	For the Three Months Ended March 3 1 ,
	201 8		201 7
Net Income	$	288,000	$	171,000
Weighted average shares outstanding – basic		1,881,865		1,838,125
Effect of dilutive common stock equivalents		108,425		142,092
Adjusted weighted average shares outstanding – diluted		1,990,290		1,980,217
Basic earnings per share	$	0.15	$	0.09
Diluted earnings per share	$	0.14	$	0.09

XML

Note 3 - Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

	Unrealized Gains (Losses) on Investment Securities Available for Sale (1)
	For the Three Months Ended March 31,
	201 8			201 7
Balance at the beginning of the period	$	(15	)	$	(38	)
Other comprehensive income before classifications		12			13
Amount reclassified from accumulated other comprehensive income		-			-
Total other comprehensive income		12			13
Balance at the end of the period	$	(3	)	$	(25	)

XML

Note 4 - Investment in Interest-earning Time Deposits (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

Investments in Interest-Earning Time Deposits by Contractual Maturity [Table Text Block]

	March 31 , 201 8		December 31, 201 7
Due in one year or less	$	1,332	$	761
Due after one year through five years		3,588		4,118
Total	$	4,920	$	4,879

XML

Note 5 - Investment Securities Available for Sale (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

Available-for-sale Securities [Table Text Block]

	March 31, 201 8
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,462	$	28	$	-		$	5,490
Federal Home Loan Mortgage Corporation securities		1,309		-		(28	)		1,281
Federal National Mortgage Association securities		547		1					548
Total mortgage-backed securities		7,318		29		(28	)		7,319
Debt securities:
U.S. government agency		360		-		(5	)		355
Total available-for-sale-securities	$	7,678	$	29	$	(33	)	$	7,674

	December 31, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Available for Sale:
Mortgage-backed securities:
Governmental National Mortgage Association securities	$	5,624	$	19	$	--		$	5,643
Federal Home Loan Mortgage Corporation securities		1,377		--		(35	)		1,342
Federal National Mortgage Association securities		570		--		--			570
Total mortgage-backed securities		7,571		19		(35	)		7,555
Debt securities:
U.S. government agency		360		--		(3	)		357
Total available-for-sale-securities	$	7,931	$	19	$	(38	)	$	7,912

Investments Classified by Contractual Maturity Date [Table Text Block]

	Available for Sale
	Amortized Cost		Fair Value
Due after one year through five years	$	360	$	355
Due after ten years		7,318		7,319
Total	$	7,678	$	7,674

Schedule of Unrealized Loss on Investments [Table Text Block]

	March 31 , 201 8
			Less than Twelve Months				Twelve Months or Greater					Total
	Number of Securities		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Federal Home Loan Mortgage Corporation mortgage-backed securities		2	$	--	$	--	$	1,281	$	(28	)	$	1,281	$	(28	)
Debt securities, U.S. government agency		1		--		--		355		(5	)		355		(5	)
Total		3	$	--	$	--	$	1,636	$	(33	)	$	1,699	$	(33	)

	December 31 , 201 7
			Less than Twelve Months				Twelve Months or Greater					Total
	Number of Securities		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Federal Home Loan Mortgage Corporation mortgage-backed securities		2	$	--	$	--	$	1,342	$	(35	)	$	1,342	$	(35	)
Debt securities, U.S. government agency		1		--		--		357		(3	)		357		(3	)
Total		3	$	--	$	--	$	1,699	$	(38	)	$	1,699	$	(38	)

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

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

	March 31, 201 8			December 31, 201 7
Real estate loans:
One-to-four family residential:
Owner occupied	$	6,316		$	5,681
Non-owner occupied		48,902			51,833
Total one-to-four family residential		55,218			57,514
Multi-family (five or more) residential		23,447			21,715
Commercial real estate		96,396			92,234
Construction		16,209			15,632
Home equity		4,772			5,129
Total real estate loans		196,042			192,224
Commercial business		13,559			11,954
Other consumer		132			138
Total Loans		209,733			204,316
Deferred loan fees and costs		(843	)		(837	)
Allowance for loan losses		(1,836	)		(1,812	)
Net Loans	$	207,054		$	201,667

Financing Receivable Credit Quality Indicators [Table Text Block]

	March 31, 201 8
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,894	$	180	$	242	$	-	$	6,316
One-to-four family residential non-owner occupied		48,562		28		312		-		48,902
Multi-family residential		23,447		-		-		-		23,447
Commercial real estate		94,193		2,101		102		-		96,396
Construction		14,150		-		2,059		-		16,209
Home equity		4,772		-		-		-		4,772
Commercial business		13,029		530		-		-		13,559
Other consumer		132		-		-		-		132
Total	$	204,179	$	2,839	$	2,715	$	-	$	209,733

	December 31, 201 7
	Pass		Special Mention		Substandard		Doubtful		Total
One-to-four family residential owner occupied	$	5,258	$	423	$	-	$	-	$	5,681
One-to-four family residential non-owner occupied		51,372		29		432		-		51,833
Multi-family residential		21,715		-		-		-		21,715
Commercial real estate		91,549		399		286		-		92,234
Construction		13,562		-		2,070		-		15,632
Home equity		5,129		-		-		-		5,129
Commercial business		11,419		535		-		-		11,954
Other consumer		138		-		-		-		138
Total	$	200,142	$	1,386	$	2,788	$	--	$	204,316

Impaired Financing Receivables [Table Text Block]

	March 31, 201 8
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		325		325		-		326		3
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		-		-
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		93		93		25		94		2
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	242	$	242	$	-	$	242	$	-
One-to-four family residential non-owner occupied		418		418		25		420		5
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		5		133		2
Construction		2,059		2,059		-		2,067		-
Home equity		44		44		-		44		1
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,896	$	2,896	$	30	$	2,906	$	8

	December 31, 201 7
	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		442		442		-		937		24
Multi-family residential		-		-		-		-		-
Commercial real estate		-		-		-		398		38
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
With an allowance recorded:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		214		214		70		214		5
Multi-family residential		--		--		-		-		-
Commercial real estate		133		133		1		395		9
Construction		-		-		-		-		-
Home equity		-		-		-		-		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total:
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		656		656		70		1,151		29
Multi-family residential		-		-		-		-		-
Commercial real estate		133		133		1		793		47
Construction		2,069		2,069		-		2,064		58
Home equity		45		45		-		47		5
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	2,903	$	2,903	$	71	$	4,055	$	139

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

	March 31, 201 8
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		3		418		-		418		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		5
Construction		-		-		-		-		-
Home equity		2		44		-		44		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		6	$	595	$	-	$	595	$	30

	December 31, 2017
	Number of Contracts		Recorded Investment		Non- Accrual		Accruing		Related Allowance
One-to-four family residential owner occupied		-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		5		536		-		536		25
Multi-family residential		-		-		-		-		-
Commercial real estate		1		133		-		133		1
Construction		-		-		-		-		-
Home equity		2		45		-		45		-
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total		8	$	714	$	-	$	714	$	26

Contractual Aging of Troubled Debt Restructurings [Table Text Block]

	March 31, 201 8
	Accruing Past Due Less than 30 Days		Past Due 30-89 Days		90 Days or More Past Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		418		-		-		-		418
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		44		-		-		-		44
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	595	$	-	$	-	$	-	$	595

	December 31, 201 7
	Accruing Past Due Less than 30 Days		Past Due 30-89 Days		90 Days or More Past Due		Non- Accrual		Total
One-to-four family residential owner occupied	$	-	$	-	$	-	$	-	$	-
One-to-four family residential non-owner occupied		536		-		-		-		536
Multi-family residential		-		-		-		-		-
Commercial real estate		133		-		-		-		133
Construction		-		-		-		-		-
Home equity		45		-		-		-		45
Commercial business		-		-		-		-		-
Other consumer		-		-		-		-		-
Total	$	714	$	-	$	-	$	-	$	714

Schedule of Credit Losses for Financing Receivables, Current [Table Text Block]

	March 31, 201 8
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non- Owner Occupied			Multi- Family Residential		Commercial Real Estate		Construction		Home Equity			Commercial Business and Other Consumer		Unallocated			Total
Allowance for loan losses:
Beginning balance	$	48	$	540		$	152	$	687	$	136	$	27		$	140	$	82		$	1,812
Charge-offs		-		(47	)		-		-		-		-			-		-			(47	)
Recoveries		-		-			-		-		-		-			-		-			-
Provision		6		2			12		33		6		(1	)		30		(17	)		71
Ending balance	$	54	$	495		$	164	$	720	$	142	$	26		$	170	$	65		$	1,836
Ending balance evaluated for impairment
Individually	$	-	$	25		$	-	$	5	$	-	$	-		$	-	$	-		$	30
Collectively	$	54	$	470		$	164	$	715	$	142	$	26		$	170	$	65		$	1,806
Loans receivable:
Ending balance	$	6,316	$	48,902		$	23,447	$	96,396	$	16,209	$	4,772		$	13,691	$	-		$	209,733
Ending balance evaluated for impairment
Individually	$	242	$	418		$	-	$	133	$	2,059	$	44		$	-	$	-		$	2,896
Collectively	$	6,074	$	48,484		$	23,447	$	96,263	$	14,150	$	4,728		$	13,691	$	-		$	206,837

	March 31, 20 17
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non-Owner Occupied		Multi-Family Residential		Commercial Real Estate			Construction			Home Equity		Commercial Business and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503	$	103	$	616		$	138		$	37	$	87	$	80	$	1,605
Charge-offs		-		-		-		-			-			-		-		-		-
Recoveries		-		-		-		3			-			-		-		-		3
Provision		3		21		5		(7	)		(11	)		14		7		10		42
Ending balance	$	44	$	524	$	108	$	612		$	127		$	51	$	94	$	90	$	1,650
Ending balance evaluated for impairment
Individually	$	-	$	16	$	-	$	24		$	-		$	-	$	-	$	-	$	40
Collectively	$	44	$	508	$	108	$	588		$	127		$	51	$	94	$	90	$	1,610

	December 31, 201 7
	1-4 Family Residential Owner Occupied		1-4 Family Residential Non-Owner Occupied			Multi-Family Residential		Commercial Real Estate			Construction			Home Equity			Commercial Business and Other Consumer		Unallocated		Total
Allowance for loan losses:
Beginning balance	$	41	$	503		$	103	$	616		$	138		$	37		$	87	$	80	$	1,605
Charge-offs		-		(56	)		-		(24	)		-			-			-		-		(80	)
Recoveries		-		-			-		3			-			-			-		-		3
Provision		7		93			49		92			(2	)		(10	)		53		2		284
Ending balance	$	48	$	540		$	152	$	687		$	136		$	27		$	140	$	82	$	1,812
Ending balance evaluated for impairment
Individually	$	-	$	70		$	-	$	1		$	-		$	-		$	-	$	-	$	71
Collectively	$	48	$	470		$	152	$	686		$	136		$	27		$	140	$	82	$	1,741
Loans receivable:
Ending balance	$	5,681	$	51,833		$	21,715	$	92,234		$	15,632		$	5,129		$	12,092	$	-	$	204,316
Ending balance evaluated for impairment
Individually	$	-	$	656		$	-	$	133		$	2,069		$	45		$	-	$	-	$	2,903
Collectively	$	5,681	$	51,177		$	21,715	$	92,101		$	13,563		$	5,084		$	12,092	$	-	$	201,413

Schedule of Financing Receivables, Non Accrual Status [Table Text Block]

	March 31, 201 8		December 31, 201 7
One-to-four family residential owner occupied	$	242	$	-
One-to-four family residential non-owner occupied		-		120
Multi-family residential		-		-
Commercial real estate		-		-
Construction		2,059		2,069
Home equity		-		-
Commercial business		-		-
Other consumer		-		-
Total	$	2,301	$	2,189

Past Due Financing Receivables [Table Text Block]

	March 31, 201 8
	30- 89 Days Past Due		90 Days or M ore Pas t Due		Total Past Due		Current		Total Loans Receivable		Loans Receivable 90 Days or More Past Due and Accruing
One-to-four family residential owner occupied	$	497	$	422	$	919	$	5,97	$	6,316	$	180
One-to-four family residential non-owner occupied		1,022		181		1,203		47,699		48,902		181
Multi-family residential		73		-		73		23,374		23,447		-
Commercial real estate		2,378		42		2,420		93,976		96,396		42
Construction		850		2,059		2,909		13,300		16,209		-
Home equity		33		-		33		4,739		4,772		-
Commercial business		468		-		468		13,091		13,559		-
Other consumer		-		-		-		132		132		-
Total	$	5,321	$	2,704	$	8,025	$	201,708	$	209,733	$	403

	December 31, 201 7
	30- 89 Days Past Due		90 Days or More Past Due		Total Past Due		Current		Total Loans Receivable		Loans Receivable 90 Days or More Past Due and Accruing
One-to-four family residential owner occupied	$	670	$	423	$	1,093	$	4,588	$	5,681	$	423
One-to-four family residential non-owner occupied		969		337		1,306		50,527		51,833		217
Multi-family residential		313		-		313		21,402		21,715		-
Commercial real estate		505		241		746		91,488		92,234		241
Construction		407		2,069		2,476		13,156		15,632		-
Home equity		51		-		51		5,078		5,129		-
Commercial business		-		-		-		11,954		11,954		-
Other consumer		-		-		-		138		138		-
Total	$	2,915	$	3,070	$	5,985	$	198,331	$	204,316	$	881

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Note 8 - Deposits (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

Deposit Liabilities, Type [Table Text Block]

	March 31, 201 8		December 31, 201 7
Non-interest bearing checking accounts	$	11,013	$	7,956
Passbook accounts		354		463
Savings accounts		1,974		2,353
Money market accounts		32,145		30,411
Certificates of deposit		153,450		145,038
Total deposits	$	198,936	$	186,221

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Note 9 - Borrowings (Tables)

3 Months Ended

Mar. 31, 2018

Federal Home Loan Bank Advances [Member]

Notes Tables

Schedule of Long-term Debt Instruments [Table Text Block]

	March 31 , 201 8					December 31, 201 7
	Amount		Weighted Interest Rate			Amount		Weighted Interest Rate
Short-term borrowings	$	10,000		1.87	%	$	10,000		1.54	%
Fixed rate borrowings maturing:
2018		3,000		1.46			3,000		1.46
2019		3,000		1.86			3,000		1.86
2020		2,000		2.00			2,000		2.00
2021		3,000		2.05			3,000		2.05
2022		3,000		2.18			3,000		2.18
2023		3,000		2.33			3,000		2.33
2024		1,000		2.54			1,000		2.54
Total FHLB long-term debt	$	18,000		2.01	%	$	18,000		2.01	%

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Note 10 - Stock Compensation Plans (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

Share-based Compensation, Activity [Table Text Block]

	March 31, 201 8				March 31, 201 7
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Unvested at the beginning of the period		10,061	$	8.10		20,524	$	8.10
Granted		-		-		-		-
Vested		-		-		-		-
Forfeited		-		-		-		-
Unvested at the end of the period		10,061	$	8.10		20,524	$	8.10

Share-based Compensation, Stock Options, Activity [Table Text Block]

	201 8							201 7
	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
Outstanding at the beginning of the year		265,302		$	6.74		3.2		316,348		$	6.49		3.8
Granted		-			-		-		-			-		-
Exercised		(52,862	)		5.00		-		(34,550	)		5.00		-
Forfeited		-			-		-		-			-		-
Outstanding at end of period		212,440		$	7.17		3.7		281,798		$	6.67		3.8
Exercisable at end of period		182,600		$	7.03		3.4		221,158		$	6.29		3.2

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Note 11 - Fair Value Measurements and Fair Values of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2018

Notes Tables

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

	March 3 1, 2018
	Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association mortgage-backed securities	$	5,490	$	-	$	5,490	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,281		-		1,281		-
Federal National Mortgage Association mortgage-backed securities		548		-		548		-
Debt securities, U.S. government agency		355		-		355		-
Total investment securities available for sale	$	7,674	$	-	$	7,674	$	-
Total recurring fair value measurements	$	7,674	$	-	$	7,674	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,866	$	--	$	-	$	2,866
Total nonrecurring fair value measurements	$	2,866	$	--	$	-	$	2,866

	Dec ember 3 1, 2017
	Fair Value Measurements Using:
	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Recurring fair value measurements
Investment securities available for sale
Governmental National Mortgage Association mortgage-backed securities	$	5,643	$	-	$	5,643	$	-
Federal Home Loan Mortgage Corporation mortgage-backed securities		1,342		-		1,342		-
Federal National Mortgage Association mortgage-backed securities		570		-		570		-
Debt securities, U.S. government agency		357		-		357		-
Total investment securities available for sale	$	7,912	$	-	$	7,912	$	-
Total recurring fair value measurements	$	7,912	$	-	$	7,912	$	-
Nonrecurring fair value measurements
Impaired loans	$	2,832	$	--	$	-	$	2,832
Total nonrecurring fair value measurements	$	2,832	$	--	$	-	$	2,832

Fair Value Measurement Inputs and Valuation Techniques [Table Text Block]

	March 31, 201 8
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,866	Appraisal of collateral (1)	Appraisal adjustments (2)	8%	-	27%	(1%)

	December 31, 201 7
	Quantitative Information About Level 3 Fair Value Measurements
	Total Fair Value		Valuation Techniques	Unobservable Input	Range (Weighted Average)
Impaired loans	$	2,832	Appraisal of collateral (1)	Appraisal adjustments (2)	0%	-	27%	(1%)

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

					Fair Value Measurements at
					March 31, 201 8
	Carrying Amount		Fair Value Estimate		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	16,931	$	16,931	$	16,931	$	-	$	-
Investment in interest-earning time deposits		4,920		4,944		-		-		4,944
Loans held for sale		4,941		5,060		5,060		-		-
Loans receivable, net		207,054		207,783		-		-		207,783
Accrued interest receivable		981		981		981		-		-
Investment in FHLB stock		1,234		1,234		1,234		-		-
Bank-owned life insurance		3,834		3,834		3,834		-		-
Financial Liabilities
Deposits		198,936		199,791		45,487		-		154,304
FHLB short-term borrowings		10,000		10,000		10,000		-		-
FHLB long-term borrowings		18,000		16,963		-		-		16,963
Accrued interest payable		174		174		174		-		-
Advances from borrowers for taxes and insurance		1,651		1,651		1,651

					Fair Value Measurements at
					December 31, 201 7
	Carrying Amount		Fair Value Estimate		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	7,910	$	7,910	$	7,910	$	-	$	-
Investment in interest-earning time deposits		4,879		4,912		-		-		4,912
Loans held for sale		7,006		7,232		7,232		-		-
Loans receivable, net		201,667		202,803		-		-		202,803
Accrued interest receivable		1,021		1,021		1,021		-		-
Investment in FHLB stock		1,234		1,234		1,234		-		-
Bank-owned life insurance		3,814		3,814		3,814		-		-
Financial Liabilities
Deposits		186,221		187,309		41,183		-		146,126
FHLB short-term borrowings		10,000		10,000		10,000		-		-
FHLB long-term borrowings		18,000		16,982		-		-		16,982
Accrued interest payable		167		167		167		-		-
Advances from borrowers for taxes and insurance		2,423		2,423		2,423

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Note 1 - Financial Statement Presentation and Significant Accounting Policies (Details Textual)		3 Months Ended
	Aug. 01, 2016 USD ($)	Mar. 31, 2018 USD ($)	Mar. 31, 2017 USD ($)	Mar. 31, 2016 USD ($)	Dec. 31, 2017 USD ($)
Number of Wholly-Owned Subsidiaries		5
Number of Subsidiary Branch Offices		2
Threshold for Loans to be Evaluated Annually, Minimum		$ 500,000
Impairment of Federal Home Loan Bank Stock			$ 0	$ 0
Mortgage Loans in Process of Foreclosure, Amount		$ 0			$ 0
Number of Share-Based Plans		3
Accounting Standards Update 2016-02 [Member]
New Accounting Pronouncement, Estimated Increase in Assets and Liabilities		1.00%
Signature Insurance Services, LLC [Member]
Payments to Acquire Businesses, Gross	$ 1,000,000
Goodwill, Acquired During Period	515,000
Signature Insurance Services, LLC [Member] | Other Intangible Assets [Member]
Finite-lived Intangible Assets Acquired	$ 485,000
Finite-Lived Intangible Asset, Useful Life	10 years

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Note 2 - Earnings Per Share - Weighted Average Shares Used in Basic and Dilutive Earnings Per Share Computations (Details) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net Income	$ 288,000	$ 171,000
Weighted average shares outstanding – basic (in shares)	1,881,865	1,838,125
Effect of dilutive common stock equivalents (in shares)	108,425	142,092
Adjusted weighted average shares outstanding – diluted (in shares)	1,990,290	1,980,217
Basic earnings per share (in dollars per share)	$ 0.15	$ 0.09
Diluted earnings per share (in dollars per share)	$ 0.14	$ 0.09

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Note 3 - Accumulated Other Comprehensive Income (Loss) - Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
Balance at the beginning of the period		$ 22,185
Balance at the end of the period		22,485
Accumulated Net Investment Gain (Loss) Attributable to Parent [Member]
Balance at the beginning of the period	[1]	(15)	$ (38)
Other comprehensive income before classifications	[1]	12	13
Amount reclassified from accumulated other comprehensive income	[1]
Total other comprehensive income	[1]	12	13
Balance at the end of the period	[1]	$ (3)	$ (25)

[1] All amounts are net of tax. Amounts in parentheses indicate debits.

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Note 4 - Investment in Interest-earning Time Deposits - Investment in Interest-earnings Time Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Due in one year or less	$ 1,332		$ 761
Due after one year through five years	3,588		4,118
Total	$ 4,920	$ 4,879	$ 4,879

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Note 5 - Investment Securities Available for Sale (Details Textual) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2017
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions	3		3
Percentage of Aggregate Depreciation Held by Debt Securities	1.97%
Other than Temporary Impairment Losses, Investments, Total	$ 0	$ 0

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Note 5 - Investment Securities Available for Sale - Amortized Cost and Fair Value of Investment Securities Available for Sale (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Amortized cost	$ 7,678	$ 7,931
Gross unrealized gains	29	19
Gross unrealized losses	(33)	(38)
Fair value	7,674	7,912
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Amortized cost	7,318	7,571
Gross unrealized gains	29	19
Gross unrealized losses	(28)	(35)
Fair value	7,319	7,555
US Government Agencies Debt Securities [Member]
Amortized cost	360	360
Gross unrealized gains
Gross unrealized losses	(5)	(3)
Fair value	355	357
Government National Mortgage Association (GNMA) Insured Loans [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Amortized cost	5,462	5,624
Gross unrealized gains	28	19
Gross unrealized losses
Fair value	5,490	5,643
Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Amortized cost	1,309	1,377
Gross unrealized gains
Gross unrealized losses	(28)	(35)
Fair value	1,281	1,342
Federal National Mortgage Association (FNMA) Insured Loans [Member] | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Amortized cost	547	570
Gross unrealized gains	1
Gross unrealized losses
Fair value	$ 548	$ 570

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Note 5 - Investment Securities Available for Sale - Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Due after one year through five years, amortized cost	$ 360
Due after one year through five years, fair value	355
Due after ten years, amortized cost	7,318
Due after ten years, fair value	7,319
Total, amortized cost	7,678	$ 7,931
Total, fair value	$ 7,674	$ 7,912

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Note 5 - Investment Securities Available for Sale - Gross Unrealized Losses and Fair Value (Details) $ in Thousands	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Number of securities	3	3
Fair value, less than twelve months
Gross unrealized losses, less than twelve months
Fair value, twelve months or greater	1,636	1,699
Gross unrealized losses, twelve months or greater	(33)	(38)
Fair value	1,699	1,699
Gross unrealized losses	(33)	(38)
Fair value	$ 1,699	$ 1,699
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member]
Number of securities	2	2
Fair value, less than twelve months
Gross unrealized losses, less than twelve months
Fair value, twelve months or greater	1,281	1,342
Gross unrealized losses, twelve months or greater	(28)	(35)
Fair value	1,281	1,342
Gross unrealized losses	(28)	(35)
Fair value	$ 1,281	$ 1,342
US Government Agencies Debt Securities [Member]
Number of securities	1	1
Fair value, less than twelve months
Gross unrealized losses, less than twelve months
Fair value, twelve months or greater	355	357
Gross unrealized losses, twelve months or greater	(5)	(3)
Fair value	355	357
Gross unrealized losses	(5)	(3)
Fair value	$ 355	$ 357

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Note 6 - Loans Receivable, Net and Allowance for Loan Losses (Details Textual)	3 Months Ended
	Mar. 31, 2018 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2017 USD ($)
Troubled Debt Restructuring, Number of Contracts	6		8
Financing Receivable, Modifications, Recorded Investment	$ 595,000		$ 714,000
Financing Receivable, Modifications, Number of Contracts	0
Financing Receivable, Modifications, Number of Contracts Paid-off	2
Loans and Leases Receivable, Impaired, Commitment to Lend	$ 0
Loans and Leases Receivable, Gross, Total	209,733,000		204,316,000
Impaired Financing Receivable, Interest Income, Cash Basis Method, Total	0	$ 0
Loans and Leases Receivable, Impaired, Interest Lost on Nonaccrual Loans	44,000	$ 43,000
Nonperforming Financial Instruments [Member]
Loans and Leases Receivable, Gross, Total	$ 2,700,000		$ 3,100,000

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Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Composition of Net Loans Receivable (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016
Loans	$ 209,733	$ 204,316
Deferred loan fees and costs	(843)	(837)
Allowance for loan losses	(1,836)	(1,812)	$ (1,650)	$ (1,605)
Net Loans	207,054	201,667
Real Estate Portfolio Segment [Member]
Loans	196,042	192,224
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Loans	6,316	5,681
Allowance for loan losses	(54)	(48)	(44)	(41)
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Loans	48,902	51,833
Allowance for loan losses	(495)	(540)	(524)	(503)
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Loans [Member]
Loans	55,218	57,514
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Loans	23,447	21,715
Allowance for loan losses	(164)	(152)	(108)	(103)
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Loans	96,396	92,234
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Loans	16,209	15,632
Allowance for loan losses	(142)	(136)	(127)	(138)
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Loans	4,772	5,129
Allowance for loan losses	(26)	(27)	$ (51)	$ (37)
Commercial Portfolio Segment [Member]
Loans	13,559	11,954
Consumer Portfolio Segment [Member]
Loans	$ 132	$ 138

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Loan Portfolio by Credit Rating (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Loans	$ 209,733	$ 204,316
Pass [Member]
Loans	204,179	200,142
Special Mention [Member]
Loans	2,839	1,386
Substandard [Member]
Loans	2,715	2,788
Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member]
Loans	196,042	192,224
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Loans	6,316	5,681
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Pass [Member]
Loans	5,894	5,258
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Special Mention [Member]
Loans	180	423
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Substandard [Member]
Loans	242
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Loans	48,902	51,833
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Pass [Member]
Loans	48,562	51,372
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Special Mention [Member]
Loans	28	29
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Substandard [Member]
Loans	312	432
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Loans	23,447	21,715
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Pass [Member]
Loans	23,447	21,715
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Special Mention [Member]
Loans
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Substandard [Member]
Loans
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Loans	96,396	92,234
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Pass [Member]
Loans	94,193	91,549
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Special Mention [Member]
Loans	2,101	399
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Substandard [Member]
Loans	102	286
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Loans	16,209	15,632
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Pass [Member]
Loans	14,150	13,562
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Special Mention [Member]
Loans
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Substandard [Member]
Loans	2,059	2,070
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Doubtful [Member]
Loans
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Loans	4,772	5,129
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Pass [Member]
Loans	4,772	5,129
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Special Mention [Member]
Loans
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Substandard [Member]
Loans
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Doubtful [Member]
Loans
Commercial Portfolio Segment [Member]
Loans	13,559	11,954
Commercial Portfolio Segment [Member] | Pass [Member]
Loans	13,029	11,419
Commercial Portfolio Segment [Member] | Special Mention [Member]
Loans	530	535
Commercial Portfolio Segment [Member] | Substandard [Member]
Loans
Commercial Portfolio Segment [Member] | Doubtful [Member]
Loans
Consumer Portfolio Segment [Member]
Loans	132	138
Consumer Portfolio Segment [Member] | Pass [Member]
Loans	132	138
Consumer Portfolio Segment [Member] | Special Mention [Member]
Loans
Consumer Portfolio Segment [Member] | Substandard [Member]
Loans
Consumer Portfolio Segment [Member] | Doubtful [Member]
Loans

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Impaired Loans by Loan Portfolio Class (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Related allowance	$ 30	$ 71
Recorded investment	2,896	2,903
Unpaid principal balance	2,896	2,903
Average recorded investment	2,906	4,055
Interest income recognized	8	139
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Recorded investment, with no related allowance recorded	242
Unpaid principal balance, with no related allowance recorded	242
Average recorded investment, with no related allowance recorded	242
Interest income recognized, with no related allowance recorded
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment	242
Unpaid principal balance	242
Average recorded investment	242
Interest income recognized
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Recorded investment, with no related allowance recorded	325	442
Unpaid principal balance, with no related allowance recorded	325	442
Average recorded investment, with no related allowance recorded	326	937
Interest income recognized, with no related allowance recorded	3	24
Recorded investment, with an allowance recorded	93	214
Unpaid principal balance, with an allowance recorded	93	214
Related allowance	25	70
Average recorded investment, with an allowance recorded	94	214
Interest income recognized, with an allowance recorded	2	5
Recorded investment	418	656
Unpaid principal balance	418	656
Average recorded investment	420	1,151
Interest income recognized	5	29
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Recorded investment, with no related allowance recorded
Unpaid principal balance, with no related allowance recorded
Average recorded investment, with no related allowance recorded
Interest income recognized, with no related allowance recorded
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment
Unpaid principal balance
Average recorded investment
Interest income recognized
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Recorded investment, with no related allowance recorded
Unpaid principal balance, with no related allowance recorded
Average recorded investment, with no related allowance recorded		398
Interest income recognized, with no related allowance recorded		38
Recorded investment, with an allowance recorded	133	133
Unpaid principal balance, with an allowance recorded	133	133
Related allowance	5	1
Average recorded investment, with an allowance recorded	133	395
Interest income recognized, with an allowance recorded	2	9
Recorded investment	133	133
Unpaid principal balance	133	133
Average recorded investment	133	793
Interest income recognized	2	47
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Recorded investment, with no related allowance recorded	2,059	2,069
Unpaid principal balance, with no related allowance recorded	2,059	2,069
Average recorded investment, with no related allowance recorded	2,067	2,064
Interest income recognized, with no related allowance recorded		58
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment	2,059	2,069
Unpaid principal balance	2,059	2,069
Average recorded investment	2,067	2,064
Interest income recognized		58
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Recorded investment, with no related allowance recorded	44	45
Unpaid principal balance, with no related allowance recorded	44	45
Average recorded investment, with no related allowance recorded	44	47
Interest income recognized, with no related allowance recorded	1	5
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment	44	45
Unpaid principal balance	44	45
Average recorded investment	44	47
Interest income recognized	1	5
Commercial Portfolio Segment [Member]
Recorded investment, with no related allowance recorded
Unpaid principal balance, with no related allowance recorded
Average recorded investment, with no related allowance recorded
Interest income recognized, with no related allowance recorded
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment
Unpaid principal balance
Average recorded investment
Interest income recognized
Consumer Portfolio Segment [Member]
Recorded investment, with no related allowance recorded
Unpaid principal balance, with no related allowance recorded
Average recorded investment, with no related allowance recorded
Interest income recognized, with no related allowance recorded
Recorded investment, with an allowance recorded
Unpaid principal balance, with an allowance recorded
Related allowance
Average recorded investment, with an allowance recorded
Interest income recognized, with an allowance recorded
Recorded investment
Unpaid principal balance
Average recorded investment
Interest income recognized

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Troubled Debt Restructuring Loans (Details)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Troubled debt restructuring, number of contracts	6	8
Troubled debt restructuring, recorded investment	$ 595,000	$ 714,000
Troubled debt restructuring, related allowance	30,000	26,000
Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Accruing Instrument [Member]
Troubled debt restructuring, recorded investment	$ 595,000	$ 714,000
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Troubled debt restructuring, number of contracts
Troubled debt restructuring, recorded investment
Troubled debt restructuring, related allowance
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Troubled debt restructuring, number of contracts	3	5
Troubled debt restructuring, recorded investment	$ 418,000	$ 536,000
Troubled debt restructuring, related allowance	25,000	25,000
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment	$ 418,000	$ 536,000
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Troubled debt restructuring, number of contracts
Troubled debt restructuring, recorded investment
Troubled debt restructuring, related allowance
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Troubled debt restructuring, number of contracts	1	1
Troubled debt restructuring, recorded investment	$ 133,000	$ 133,000
Troubled debt restructuring, related allowance	5,000	1,000
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment	$ 133,000	$ 133,000
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Troubled debt restructuring, number of contracts
Troubled debt restructuring, recorded investment
Troubled debt restructuring, related allowance
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Troubled debt restructuring, number of contracts	2	2
Troubled debt restructuring, recorded investment	$ 44,000	$ 45,000
Troubled debt restructuring, related allowance
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment	$ 44,000	$ 45,000
Commercial Portfolio Segment [Member]
Troubled debt restructuring, number of contracts
Troubled debt restructuring, recorded investment
Troubled debt restructuring, related allowance
Commercial Portfolio Segment [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Commercial Portfolio Segment [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment
Consumer Portfolio Segment [Member]
Troubled debt restructuring, number of contracts
Troubled debt restructuring, recorded investment
Troubled debt restructuring, related allowance
Consumer Portfolio Segment [Member] | Nonaccruing Instrument [Member]
Troubled debt restructuring, recorded investment
Consumer Portfolio Segment [Member] | Accruing Instrument [Member]
Troubled debt restructuring, recorded investment

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Contractual Aging of the TDRs (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment	595,000	714,000
Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due	595,000	714,000
Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment	418,000	536,000
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due	418,000	536,000
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment	133,000	133,000
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due	133,000	133,000
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment	44,000	45,000
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due	44,000	45,000
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Commercial Portfolio Segment [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment
Commercial Portfolio Segment [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due
Commercial Portfolio Segment [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Commercial Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due
Consumer Portfolio Segment [Member]
Troubled debt restructurings, non-accrual
Troubled debt restructuring, recorded investment
Consumer Portfolio Segment [Member] | Financing Receivables, 1 to 29 Days Past Due [Member]
Troubled debt restructurings, past due
Consumer Portfolio Segment [Member] | Financing Receivables, 30 to 89 Days Past Due [Member]
Troubled debt restructurings, past due
Consumer Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Troubled debt restructurings, past due

XML

Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Changes in the Allowance for Loan Losses and Recorded Investment in Loans Receivable (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Allowance for loan losses, beginning balance	$ 1,812	$ 1,605	$ 1,605
Charge-offs	(47)		(80)
Recoveries		3	3
Provision	71	42	284
Allowance for loan losses, ending balance	1,836	1,650	1,812
Allowance for loan losses, individually evaluated for impairment	30	40	71
Allowance for loan losses, collectively evaluated for impairment	1,806	1,610	1,741
Loans receivable, ending balance	209,733		204,316
Loans receivable, individually evaluated for impairment	2,896		2,903
Loans receivable, collectively evaluated for impairment	206,837		201,413
Loans and Leases Receivable, Gross, Total	209,733		204,316
Real Estate Portfolio Segment [Member]
Loans receivable, ending balance	196,042		192,224
Loans and Leases Receivable, Gross, Total	196,042		192,224
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Allowance for loan losses, beginning balance	48	41	41
Charge-offs
Recoveries
Provision	6	3	7
Allowance for loan losses, ending balance	54	44	48
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	54	44	48
Loans receivable, ending balance	6,316		5,681
Loans receivable, individually evaluated for impairment	242
Loans receivable, collectively evaluated for impairment	6,074		5,681
Loans and Leases Receivable, Gross, Total	6,316		5,681
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Allowance for loan losses, beginning balance	540	503	503
Charge-offs	(47)		(56)
Recoveries
Provision	2	21	93
Allowance for loan losses, ending balance	495	524	540
Allowance for loan losses, individually evaluated for impairment	25	16	70
Allowance for loan losses, collectively evaluated for impairment	470	508	470
Loans receivable, ending balance	48,902		51,833
Loans receivable, individually evaluated for impairment	418		656
Loans receivable, collectively evaluated for impairment	48,484		51,177
Loans and Leases Receivable, Gross, Total	48,902		51,833
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Allowance for loan losses, beginning balance	152	103	103
Charge-offs
Recoveries
Provision	12	5	49
Allowance for loan losses, ending balance	164	108	152
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	164	108	152
Loans receivable, ending balance	23,447		21,715
Loans receivable, individually evaluated for impairment
Loans receivable, collectively evaluated for impairment	23,447		21,715
Loans and Leases Receivable, Gross, Total	23,447		21,715
Real Estate Portfolio Segment [Member] | Commercial Real Estate and Lines of Credit [Member]
Allowance for loan losses, beginning balance	687	616	616
Charge-offs			(24)
Recoveries		3	3
Provision	33	(7)	92
Allowance for loan losses, ending balance	720	612	687
Allowance for loan losses, individually evaluated for impairment	5	24	1
Allowance for loan losses, collectively evaluated for impairment	715	588	686
Loans receivable, ending balance	96,396		92,234
Loans receivable, individually evaluated for impairment	133		133
Loans receivable, collectively evaluated for impairment	96,263		92,101
Loans and Leases Receivable, Gross, Total	96,396		92,234
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Allowance for loan losses, beginning balance	136	138	138
Charge-offs
Recoveries
Provision	6	(11)	(2)
Allowance for loan losses, ending balance	142	127	136
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	142	127	136
Loans receivable, ending balance	16,209		15,632
Loans receivable, individually evaluated for impairment	2,059		2,069
Loans receivable, collectively evaluated for impairment	14,150		13,563
Loans and Leases Receivable, Gross, Total	16,209		15,632
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Allowance for loan losses, beginning balance	27	37	37
Charge-offs
Recoveries
Provision	(1)	14	(10)
Allowance for loan losses, ending balance	26	51	27
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	26	51	27
Loans receivable, ending balance	4,772		5,129
Loans receivable, individually evaluated for impairment	44		45
Loans receivable, collectively evaluated for impairment	4,728		5,084
Loans and Leases Receivable, Gross, Total	4,772		5,129
Commercial and Consumer Portfolio Segments [Member]
Allowance for loan losses, beginning balance	140	87	87
Charge-offs
Recoveries
Provision	30	7	53
Allowance for loan losses, ending balance	170	94	140
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	170	94	140
Loans receivable, ending balance	13,691		12,092
Loans receivable, individually evaluated for impairment
Loans receivable, collectively evaluated for impairment	13,691		12,092
Loans and Leases Receivable, Gross, Total	13,691		12,092
Unallocated Financing Receivables [Member]
Allowance for loan losses, beginning balance	82	80	80
Charge-offs
Recoveries
Provision	(17)	10	2
Allowance for loan losses, ending balance	65	90	82
Allowance for loan losses, individually evaluated for impairment
Allowance for loan losses, collectively evaluated for impairment	65	$ 90	82
Loans receivable, ending balance
Loans receivable, individually evaluated for impairment
Loans receivable, collectively evaluated for impairment
Loans and Leases Receivable, Gross, Total

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Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Non-accrual Loans by Class of Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Loans	$ 2,301	$ 2,189
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Loans	242
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Loans		120
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Loans
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Loans
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Loans	2,059	2,069
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Loans
Commercial Portfolio Segment [Member]
Loans
Consumer Portfolio Segment [Member]
Loans

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Note 6 - Loans Receivable, Net and Allowance for Loan Losses - Loan Portfolio Summarized by Past Due Status (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Loans, past due	$ 8,025	$ 5,985
Loans, current	201,708	198,331
Loans	209,733	204,316
Loans > 90 days and accruing	403	881
The 30 to 89 Days Delinquent [Member]
Loans, past due	5,321	2,915
Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due	2,704	3,070
Real Estate Portfolio Segment [Member]
Loans	196,042	192,224
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member]
Loans, past due	919	1,093
Loans, current	597	4,588
Loans	6,316	5,681
Loans > 90 days and accruing	180	423
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	497	670
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Owner Occupied Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due	422	423
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member]
Loans, past due	1,203	1,306
Loans, current	47,699	50,527
Loans	48,902	51,833
Loans > 90 days and accruing	181	217
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	1,022	969
Real Estate Portfolio Segment [Member] | One-to-four Family Residential Non-owner Occupied Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due	181	337
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member]
Loans, past due	73	313
Loans, current	23,374	21,402
Loans	23,447	21,715
Loans > 90 days and accruing
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	73	313
Real Estate Portfolio Segment [Member] | Multi-family (Five Or More) Residential Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member]
Loans, past due	2,420	746
Loans, current	93,976	91,488
Loans	96,396	92,234
Loans > 90 days and accruing	42	241
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	2,378	505
Real Estate Portfolio Segment [Member] | Commercial Real Estate Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due	42	241
Real Estate Portfolio Segment [Member] | Construction Loans [Member]
Loans, past due	2,909	2,476
Loans, current	13,300	13,156
Loans	16,209	15,632
Loans > 90 days and accruing
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	850	407
Real Estate Portfolio Segment [Member] | Construction Loans [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due	2,059	2,069
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member]
Loans, past due	33	51
Loans, current	4,739	5,078
Loans	4,772	5,129
Loans > 90 days and accruing
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	33	51
Real Estate Portfolio Segment [Member] | Home Equity Loan [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due
Commercial Portfolio Segment [Member]
Loans, past due	468
Loans, current	13,091	11,954
Loans	13,559	11,954
Loans > 90 days and accruing
Commercial Portfolio Segment [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due	468
Commercial Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due
Consumer Portfolio Segment [Member]
Loans, past due
Loans, current	132	138
Loans	132	138
Loans > 90 days and accruing
Consumer Portfolio Segment [Member] | The 30 to 89 Days Delinquent [Member]
Loans, past due
Consumer Portfolio Segment [Member] | Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Loans, past due

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Note 7 - Goodwill and Other Intangible, Net (Details Textual) - USD ($)		3 Months Ended
	Aug. 01, 2016	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Finite-Lived Intangible Assets, Net, Ending Balance		$ 404,000		$ 416,000
Amortization of Intangible Assets, Total		12,000	$ 12,000
Other Intangible Assets [Member]
Finite-Lived Intangible Assets, Net, Ending Balance		404,000
Finite-Lived Intangible Assets, Accumulated Amortization		$ 81,000
Signature Insurance Services, LLC [Member]
Payments to Acquire Businesses, Gross	$ 1,000,000
Goodwill, Acquired During Period	515,000
Signature Insurance Services, LLC [Member] | Other Intangible Assets [Member]
Finite-lived Intangible Assets Acquired	$ 485,000
Finite-Lived Intangible Asset, Useful Life	10 years

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Note 8 - Deposits - Summary of Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Non-interest bearing checking accounts, amount	$ 11,013	$ 7,956
Money market accounts, amount	32,145	30,411
Certificates of deposit	153,450	145,038
Total deposits	198,936	186,221
Passbook Accounts [Member]
Interest-bearing deposits, amount	354	463
Savings Accounts [Member]
Interest-bearing deposits, amount	$ 1,974	$ 2,353

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Note 9 - Borrowings - Federal Home Loan Bank Long-term Borrowings (Details) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Short-term borrowings, amount	$ 10	$ 10
Short-term borrowings, , weighted interest rate	1.87%	1.54%
2018, amount	$ 3	$ 3
2018, weighted interest rate	1.46%	1.46%
2019, amount	$ 3	$ 3
2019, weighted interest rate	1.86%	1.86%
2020, amount	$ 2	$ 2
2020, weighted interest rate	2.00%	2.00%
2021, amount	$ 3	$ 3
2021, weighted interest rate	2.05%	2.05%
2022, amount	$ 3	$ 3
2022, weighted interest rate	2.18%	2.18%
2023, amount	$ 3	$ 3
2023, weighted interest rate	2.33%	2.33%
2024, amount	$ 1	$ 1
2024, weighted interest rate	2.54%	2.54%
Total FHLB long-term debt, amount	$ 18	$ 18
Total FHLB long-term debt, weighted interest rate	2.01%	2.01%

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Note 10 - Stock Compensation Plans (Details Textual) - USD ($)	1 Months Ended		3 Months Ended		12 Months Ended
	May 31, 2013	May 31, 2008	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2007	Dec. 31, 2017	Dec. 31, 2016
Employee Stock Ownership Plan (ESOP), Compensation Expense			$ 48,000	$ 45,000
Restricted Stock [Member]
Allocated Share-based Compensation Expense, Total			21,000	21,000
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense			4,000	7,000
Employee Stock Option [Member]
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense			$ 1,000	1,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition			36 days
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period			10 years
Allocated Share-based Compensation Expense, Net of Tax			$ 11,000	$ 11,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options			$ 6,000
Employee Stock Option [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period			5 years
The 2008 Recognition and Retention Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award		111,090
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased		$ 4.68
Employee Service Share-based Compensation, Cash Flow Effect, Cash Used to Settle Awards		$ 520,000
The 2013 Stock Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	195,000
The 2013 Stock Incentive Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	48,750
Percentage of Shares May Be Granted As Restricted Stock Awards	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant			21,608
The 2013 Stock Incentive Plan [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross	146,250
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant			57,636
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance			212,440
The RRP and Stock Incentive Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number, Ending Balance			10,061	20,524		10,061	20,524
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant			0
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period			5 years
The RRP and Stock Incentive Plan [Member] | Restricted Stock [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period			5 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options			$ 10,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition			36 days
The 2008 Stock Option Plan [Member] | Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant			0
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized		277,726
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price		$ 5
Employee Stock Ownership Plan [Member]
Percentage of Company Shares Purchased by ESOP					8.00%
Employee Stock Ownership Plan (ESOP), Shares Contributed to ESOP					222,180
ESOP Loan Interest Rate					7.75%
Employee Stock Ownership Plan (ESOP), Loan Term					15 years

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Note 10 - Stock Compensation Plans - Status of Shares Under the RRP and Stock Incentive Plan (Details) - The RRP and Stock Incentive Plan [Member] - Restricted Stock [Member] - $ / shares	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Unvested at the beginning of the period (in shares)	10,061	20,524
Unvested at the beginning of the period (in dollars per share)	$ 8.10	$ 8.10
Granted, number of shares (in shares)
Granted, weighted average grant date fair value (in dollars per share)
Vested, number of shares (in shares)
Vested, weighted average grant date fair value (in dollars per share)
Forfeited, number of shares (in shares)
Forfeited, weighted average grant date fair value (in dollars per share)
Unvested at the end of the period (in shares)	10,061	20,524
Unvested at the end of the period (in dollars per share)	$ 8.10	$ 8.10

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Note 10 - Stock Compensation Plans - Summary of Option Activity (Details) - Employee Stock Option [Member] - The Option Plan and Stock Incentive Plan [Member] - $ / shares	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017	Dec. 31, 2016
Outstanding at the beginning of the year, number of shares (in shares)	265,302	316,348	316,348
Outstanding at the beginning of the year, weighted average exercise price (in dollars per share)	$ 6.74	$ 6.49	$ 6.49
Outstanding at the beginning of the year, weighted average remaining contractual life (Year)	3 years 255 days	3 years 292 days	3 years 73 days	3 years 292 days
Granted, number of shares (in shares)
Granted, weighted average exercise price (in dollars per share)
Exercised, number of shares (in shares)	(52,862)	(34,550)
Exercised, weighted average exercise price (in dollars per share)	$ 5	$ 5
Forfeited, number of shares (in shares)
Forfeited, weighted average exercise price (in dollars per share)
Outstanding at end of period, number of shares (in shares)	212,440	281,798	265,302	316,348
Outstanding at end of period, weighted average exercise price (in dollars per share)	$ 7.17	$ 6.67	$ 6.74	$ 6.49
Exercisable at end of period, number of shares (in shares)	182,600	221,158
Exercisable at end of period, weighted average exercise price (in dollars per share)	$ 7.03	$ 6.29
Exercisable at end of period, weighted average remaining contractual life (Year)	3 years 146 days	3 years 73 days

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Note 11 - Fair Value Measurements and Fair Values of Financial Instruments - Financial Assets and Liabilities on a Recurring and Nonrecurring (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Fair value	$ 7,674	$ 7,912
Fair Value, Measurements, Recurring [Member]
Fair value	7,674	7,912
Total recurring fair value measurements	7,674	7,912
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair value
Total recurring fair value measurements
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair value	7,674	7,912
Total recurring fair value measurements	7,674	7,912
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair value
Total recurring fair value measurements
Fair Value, Measurements, Nonrecurring [Member]
Total recurring fair value measurements	2,866	2,832
Impaired loans	2,866	2,832
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member]
Total recurring fair value measurements
Impaired loans
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member]
Total recurring fair value measurements
Impaired loans
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member]
Total recurring fair value measurements	2,866	2,832
Impaired loans	2,866	2,832
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member]
Fair value	7,319	7,555
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Government National Mortgage Association (GNMA) Insured Loans [Member]
Fair value	5,490	5,643
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Government National Mortgage Association (GNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member]
Fair value	5,490	5,643
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Government National Mortgage Association (GNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair value
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Government National Mortgage Association (GNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair value	5,490	5,643
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Government National Mortgage Association (GNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair value
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member]
Fair value	1,281	1,342
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member]
Fair value	1,281	1,342
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair value
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair value	1,281	1,342
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal Home Loan Mortgage Corporation (FHLMC) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair value
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal National Mortgage Association (FNMA) Insured Loans [Member]
Fair value	548	570
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal National Mortgage Association (FNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member]
Fair value	548	570
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal National Mortgage Association (FNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair value
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal National Mortgage Association (FNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair value	548	570
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises [Member] | Federal National Mortgage Association (FNMA) Insured Loans [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair value
US Government Agencies Debt Securities [Member]
Fair value	355	357
US Government Agencies Debt Securities [Member] | Fair Value, Measurements, Recurring [Member]
Fair value	355	357
US Government Agencies Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair value
US Government Agencies Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair value	355	357
US Government Agencies Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair value

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Note 11 - Fair Value Measurements and Fair Values of Financial Instruments - Additional Quantitative Information About Assets Measured at Fair Value on a Nonrecurring Basis (Details) - Appraisal of Collateral [Member] $ in Thousands	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Total fair value	$ 2,866	$ 2,832
Meaurement Input, Appraisal Adjustments Rate [Member]
Unobservable input, range
Minimum [Member] | Meaurement Input, Appraisal Adjustments Rate [Member]
Unobservable input, range	8	0
Maximum [Member] | Meaurement Input, Appraisal Adjustments Rate [Member]
Unobservable input, range	27	27
Weighted Average [Member] | Meaurement Input, Appraisal Adjustments Rate [Member]
Unobservable input, range	(1)	1

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Note 11 - Fair Value Measurements and Fair Values of Financial Instruments - Estimated Fair Values of Financial Instruments (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Fair value	$ 7,674,000	$ 7,912,000
Accrued interest receivable	981,000	1,021,000
Bank-owned life insurance	3,834,000	3,814,000
Reported Value Measurement [Member]
Cash and cash equivalents	16,931,000	7,910,000
Investment in interest-earning time deposits	4,920,000	4,879,000
Fair value	4,941,000	7,006,000
Loans receivable, net	207,054,000	201,667,000
Accrued interest receivable	981,000	1,021,000
Investment in FHLB stock	1,234,000	1,234,000
Bank-owned life insurance	3,834,000	3,814,000
Deposits	198,936,000	186,221,000
FHLB short-term borrowings	10,000,000	10,000,000
FHLB long-term borrowings	18,000,000	18,000,000
Accrued interest payable	174,000	167,000
Advances from borrowers for taxes and insurance	1,651	2,423
Estimate of Fair Value Measurement [Member]
Cash and cash equivalents	16,931,000	7,910,000
Investment in interest-earning time deposits	4,944,000	4,912,000
Fair value	5,060,000	7,232,000
Loans receivable, net	207,783,000	202,803,000
Accrued interest receivable	981,000	1,021,000
Investment in FHLB stock	1,234,000	1,234,000
Bank-owned life insurance	3,834,000	3,814,000
Deposits	199,791,000	187,309,000
FHLB short-term borrowings	10,000,000	10,000,000
FHLB long-term borrowings	16,963,000	16,982,000
Accrued interest payable	174,000	167,000
Advances from borrowers for taxes and insurance	1,651	2,423
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member]
Cash and cash equivalents	16,931,000	7,910,000
Investment in interest-earning time deposits
Fair value	5,060,000	7,232,000
Loans receivable, net
Accrued interest receivable	981,000	1,021,000
Investment in FHLB stock	1,234,000	1,234,000
Bank-owned life insurance	3,834,000	3,814,000
Deposits	45,487,000	41,183,000
FHLB short-term borrowings	10,000,000	10,000,000
FHLB long-term borrowings
Accrued interest payable	174,000	167,000
Advances from borrowers for taxes and insurance	1,651	2,423
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member]
Cash and cash equivalents
Investment in interest-earning time deposits
Fair value
Loans receivable, net
Accrued interest receivable
Investment in FHLB stock
Bank-owned life insurance
Deposits
FHLB short-term borrowings
FHLB long-term borrowings
Accrued interest payable
Advances from borrowers for taxes and insurance
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member]
Cash and cash equivalents
Investment in interest-earning time deposits	4,944,000	4,912,000
Fair value
Loans receivable, net	207,783,000	202,803,000
Accrued interest receivable
Investment in FHLB stock
Bank-owned life insurance
Deposits	154,304,000	146,126,000
FHLB short-term borrowings
FHLB long-term borrowings	16,963,000	16,982,000
Accrued interest payable
Advances from borrowers for taxes and insurance