10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x Quarterly Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2014

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 No. 001-35034

Wolverine Bancorp, Inc.

(Exact name of registrant as specified in its charter)

Maryland	27-3939016
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
5710 Eastman Avenue, Midland, Michigan	48640
(Address of Principal Executive Offices)	Zip Code

(989) 631-4280

(Registrant’s telephone number)

N/A

(Former name or former address, 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 requirements for the past 90 days.    YES  x    NO  ¨.

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

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

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

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

The number of shares outstanding of the Registrant’s common stock, $0.01 per share, as of August 12, 2014, was 2,280,844.

Wolverine Bancorp, Inc.

Form 10-Q

Index

		Page
	Part I. Financial Information
Item 1.	Condensed Consolidated Financial Statements
	Condensed Consolidated Balance Sheets as of June 30, 2014 (unaudited) and December 31, 2013		1
	Condensed Consolidated Statements of Income and Comprehensive Income for the three months and six months ended June 30, 2014 and 2013 (unaudited)		2
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2014 and 2013 (unaudited)		3
	Condensed Consolidated Statement of Changes in Stockholders’ Equity for the six months ended June 30, 2014 (unaudited)		4
	Notes to Condensed Consolidated Financial Statements (unaudited)		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		32
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		38
Item 4.	Controls and Procedures		39
	Part II. Other Information
Item 1.	Legal Proceedings		39
Item 1A.	Risk Factors		39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		39
Item 3.	Defaults upon Senior Securities		40
Item 4.	Mine Safety Disclosures		40
Item 5.	Other Information		40
Item 6.	Exhibits		40
	Signature Page		41

Wolverine Bancorp, Inc.

Condensed Consolidated Balance Sheets

(Amounts in Thousands, except per share data)

Assets

	June 30, 2014			December 31, 2013
	(Unaudited)
Cash and due from banks	$	502		$	791
Interest-earning demand deposits		37,664			25,390
Cash and cash equivalents		38,166			26,181
Held to maturity securities		57			123
Loans held for sale		1,883			1,325
Loans, net of allowance for loan losses of $8,108 and $7,597		286,927			259,381
Premises and equipment, net		1,452			1,569
Federal Home Loan Bank stock		3,320			3,320
Other real estate owned		604			872
Accrued interest receivable		817			699
Other assets		4,535			4,291
Total assets	$	337,761		$	297,761
Liabilities and Stockholders’ Equity
Liabilities
Deposits	$	221,235		$	172,983
Federal Home Loan Bank advances		52,000			61,994
Interest payable and other liabilities		3,670			2,459
Total liabilities		276,905			237,436
Commitments and Contingencies
Stockholders’ Equity
Common Stock, $0.01 par value per share:
Authorized – 100,000,000 shares
Issued and outstanding – 2,280,844 and 2,297,725 at June 30, 2014 and December 31,2013		23			23
Additional paid-in capital		18,698			18,952
Unearned employee stock ownership plan (ESOP)		(1,666	)		(1,666	)
Retained earnings		43,801			43,016
Total stockholders’ equity		60,856			60,325
Total liabilities and stockholders’ equity	$	337,761		$	297,761

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

1

Wolverine Bancorp, Inc.

Condensed Consolidated Statements of Income and Comprehensive Income

(Amounts in Thousands, except per share data)

	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
	(Unaudited)				(Unaudited)
Interest and Dividend Income
Loans	$	3,605	$	3,321	$	6,965	$	6,631
Investment securities and other		66		84		116		128
Total interest and dividend income		3,671		3,405		7,081		6,759
Interest Expense
Deposits		294		209		485		433
Borrowings		507		587		1,037		1,169
Total interest expense		801		796		1,522		1,602
Net Interest Income		2,870		2,609		5,559		5,157
Provision for Loan Losses		195		350		495		675
Net Interest Income After Provision for Loan Losses		2,675		2,259		5,064		4,482
Noninterest Income
Service charges and fees		54		56		105		110
Net gain on loan sales		171		434		291		970
Net gain (loss) on sale of real estate owned		23		6		3		100
Other		47		74		77		125
Total noninterest income		295		570		476		1,305
Noninterest Expense
Salaries and employee benefits		1,298		1,348		2,529		2,640
Net occupancy and equipment expense		227		231		448		409
Information technology expense		62		57		122		114
Federal deposit insurance corporation premiums		61		51		114		109
Professional and services fees		102		55		252		184
Other real estate owned expense		39		11		58		29
Loan legal expense		34		52		47		99
Advertising expense		52		69		92		134
Michigan business tax		45		46		97		93
Other		286		271		552		539
Total noninterest expense		2,206		2,191		4,311		4,350
Income Before Income Tax		764		638		1,229		1,437
Provision for Income Taxes		284		202		444		476
Net Income and Comprehensive Income	$	480	$	436	$	785	$	961
Earnings Per Share:
Basic	$	0.23	$	0.19	$	0.37	$	0.42
Diluted	$	0.23	$	0.19	$	0.37	$	0.42

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

2

Wolverine Bancorp, Inc.

Condensed Consolidated Statement of Cash Flows

(Amounts in Thousands)

	Six months ended June 30,
	2014			2013
	(Unaudited)
Operating Activities
Net income	$	785		$	961
Items not requiring (providing) cash
Depreciation		127			103
Provision for loan losses		495			675
Amortization of Federal Home Loan Bank advance prepayment penalty		6			34
Gain on other real estate owned		(3	)		(100	)
Loans originated for sale		(9,515	)		(37,362	)
Proceeds from loans sold		9,248			39,052
Net gain on sale of loans		(291	)		(970	)
Share based compensation		160			165
Changes in
Interest receivable and other assets		(345	)		312
Interest payable and other liabilities		1,211			1,420
Net cash provided by operating activities		1,878			4,290
Investing Activities
Proceeds from calls, maturities and pay-downs of held to maturity securities		66			69
Net change in loans		(28,312	)		8,884
Proceeds from sale of real estate owned		525			636
Purchase of premises and equipment		(10	)		(63	)
Net cash provided (used) by investing activities		(27,731	)		9,526
Financing Activities
Net change in demand deposits, money market, checking and savings accounts		12,818			(3,374	)
Net change in certificates of deposit		35,434			3,319
Repayment of Federal Home Loan Bank advances		(10,000	)		—
Proceeds from stock options exercised		28			—
Purchase of common stock		(442	)		(661	)
Net cash provided (used) by financing activities		37,838			(716	)
Change in Cash and Cash Equivalents		11,985			13,100
Cash and Cash Equivalents, Beginning of Period		26,181			16,552
Cash and Cash Equivalents, End of Period	$	38,166		$	29,652
Supplemental Disclosures of Cash Flows Information
Interest paid	$	1,521		$	1,606
Income taxes paid		600			860
Loans transferred to real estate owned		255			81

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

3

Wolverine Bancorp, Inc.

Condensed Consolidated Statement of Change in Stockholders’ Equity

(Amounts in Thousands, except share data)

(Unaudited)

	Common Stock		Additional Paid-in Capital			Unearned ESOP Shares			Retained Earnings		Total Stockholders’ Equity
Balances at January 1, 2014	$	23	$	18,952		$	(1,666	)	$	43,016	$	60,325
Net income		—		—			—			785		785
Purchase of 16,000 shares of common stock		—		(442	)		—			—		(442	)
Share based compensation expense		—		160			—			—		160
Exercised options		—		28			—			—		28
Balances at June 30, 2014	$	23	$	18,698		$	(1,666	)	$	43,801	$	60,856

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

4

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Note 1: Basis of Presentation

The unaudited condensed consolidated financial statements of Wolverine Bancorp, Inc. (the “Company”), the holding company of Wolverine Bank (the “Bank”), have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) believed necessary for a fair presentation have been included. The condensed consolidated balance sheet of the Company as of December 31, 2013 has been derived from the audited consolidated balance sheet of the Company as of that date. Operating results for the six month period ended June 30, 2014 is not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto filed as part of our Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 31, 2014.

Note 2: Accounting Developments

Financial Accounting Standards Board (“FASB”)

In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-04, “Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure,” to reduce diversity by clarifying when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan receivable should be derecognized and the real estate property recognized. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

In January 2014, the FASB issued ASU 2014-01, “Accounting for Investments in Qualified Affordable Housing Projects,” to permit entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. The ASU modifies the conditions that an entity must meet to be eligible to use a method other than the equity or cost methods to account for qualified affordable housing project investments. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

Accounting Standards Update No. 2014-08- Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity – In April 2014, FASB issued ASU 2014-08. This update seeks to better define the groups of assets which qualify for discontinued operations, in order to ease the burden and cost for prepares and stakeholders. This issue changed “the criteria for reporting discontinued operations” and related reporting requirements, including the provision for disclosures about the “disposal of and individually significant component of an entity that does not qualify for discontinued operations presentation.”

The amendments in this Update are effective for fiscal years beginning after December 15, 2014. Early adoption is permitted only for disposals or classifications as held for sale. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

5

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Accounting Standards Update No. 2014-09- Revenue from Contracts with Customers – In May 2014, FASB, in joint cooperation with IASB, issued ASU 2014-09. The topic of Revenue Recognition had become broad, with several other regulatory agencies issuing standards which lacked cohesion. The new guidance establishes a “common framework” and “reduces the number of requirements to which an entity must consider in recognizing revenue” and yet provides improved disclosures to assist stakeholders reviewing financial statements.

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2016. Early adoption is not permitted. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

Accounting Standards Update No. 2014-11- Transfers and Servicing – In June 2014, FASB, issued ASU 2014-11. This update addresses the concerns of stakeholders’ by changing the accounting practices surrounding repurchase agreements. The new guidance changes the “accounting for repurchase-to-maturity transactions and linked repurchase financings to secured borrowing accounting, which is consistent with the accounting for other repurchase agreements.”

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2015. Early adoption is prohibited. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

Accounting Standards Update No. 2014-12- Compensation – Stock Compensation – In June 2014, FASB, issued ASU 2014-12. This update defines the accounting treatment for share-based payments and “resolves the diverse accounting treatment of those awards in practice.” The new requirement mandates that “a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition.” Compensation cost will now be recognized in the period in which it becomes likely that the performance target will be met.

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2015. Early adoption is permitted. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

6

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Note 3: Securities

The amortized cost and approximate fair values of securities are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Approximate Fair Value
Held to Maturity Securities:
June 30, 2014
Municipal	$	57	$	—	$	—	$	57
December 31, 2013
Municipal	$	123	$	—	$	—	$	123

The amortized cost and fair value of securities at June 30, 2014, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2014
	Amortized Cost		Fair Value
Within one year	$	57	$	57
Totals	$	57	$	57

There were no sales of securities during the three or six months ended June 30, 2014 and 2013.

7

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Note 4: Loans and Allowance for Loan Losses

Categories of loans include:

	June 30, 2014		December 31, 2013
Real Estate
One-to four-family	$	50,397	$	49,726
Home equity		7,219		7,912
Commercial mortgage loans
Commercial real estate		147,191		126,154
Multifamily		60,248		62,790
Land		9,568		9,734
Construction		23,609		8,669
Commercial Non-mortgage		12,801		7,226
Consumer		1,144		1,167
Total loans		312,177		273,378
Less
Net deferred loan fees, premiums and discounts		633		467
Undisbursed portion of loans		16,509		5,933
Allowance for loan losses		8,108		7,597
Net loans	$	286,927	$	259,381

The risk characteristics of each loan portfolio segment are as follows:

1-4 Family, Home Equity, and Consumer

With respect to residential loans that are secured by one-to four-family residences and are primarily owner-occupied, we generally establish a maximum loan-to-value ratio and require PMI if that ratio is exceeded. Home equity loans are typically secured by a subordinate interest in one-to four-family residences, and consumer loans are typically secured by consumer assets such as automobiles or recreational vehicles. Some consumer loans are unsecured such as small installment loans. Repayment of these loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties.

Home equity loans secured by second mortgages have greater risk than one- to four-family residential mortgage loans secured by first mortgages. We face the risk that the collateral will be insufficient to compensate us for loan losses and costs of foreclosure. When customers default on their loans, we attempt to foreclose on the property and resell the property as soon as possible to minimize foreclosure and carrying costs. However, the value of the collateral may not be sufficient to compensate us for the amount of the unpaid loan and we may be unsuccessful in recovering the remaining balance from those customers. Particularly with respect to our home equity loans, decreases in real estate values could adversely affect the value of property used as collateral for our loans.

8

Wolverine Bancorp, Inc.

Form 10-Q

(Amounts in Thousands)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Consumer and other loans generally have greater risk compared to longer-term loans secured by improved, owner-occupied real estate, particularly consumer loans that are secured by rapidly depreciable assets, such as automobiles. In these cases, any repossessed collateral for a defaulted loan may not provide an adequate source of repayment of the outstanding loan balance. As a result, consumer loan collections are dependent on the borrower’s continuing financial stability and thus are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy.

Commercial real estate and multifamily

Commercial real estate and multifamily loans generally have greater credit risk than the owner-occupied one- to four-family residential mortgage loans that we originate for retention in our loan portfolio. Repayment of these loans generally depends, in large part, on sufficient income from the property securing the loan or the borrower’s business to cover operating expenses and debt service. These types of loans typically involve larger loan balances to single borrowers or groups of related borrowers compared to one- to four-family residential mortgage loans. Changes in economic conditions that are beyond the control of the borrower may affect the value of the security for the loan, the future cash flow of the affected property or business, or the marketability of a construction project with respect to loans originated for the acquisition and development of property. Additionally, due to declining property values in our primary market area and in Michigan, the loan to value ratios of many of our commercial real estate and multifamily loans have increased significantly from the loan to value ratios that were assigned to these loans at the time of origination.

Land

Land loans generally have greater credit risk than the owner-occupied one-to four-family residential mortgage loans that we originate for retention in our portfolio. Repayment of these loans generally depends, in large part, on the sale of the land. The sale of land can either take place when the land is undeveloped, or developed. Generally, other cash flow sources of the borrower are utilized to make additional payments on land loans. Changes in economic conditions that are beyond the control of the borrower may affect the value of the security for the loan, the future cash flow of the affected property or business, or the marketability of a construction project with respect to loans originated for the acquisition and development of property. Additionally, due to declining property values in our primary market area and in Michigan, the loan to value ratios of many of our land loans have increased significantly from the loan to value ratios that were assigned to these loans at the time of origination.

Construction

Construction loans include those for one- to four-family residential properties and commercial properties, including multifamily loans and commercial “mixed-use” buildings and homes built by developers on speculation. With respect to construction loans for one- to four-family residential properties and which are primarily owner-occupied, we generally establish a maximum loan-to-value ratio and require PMI if that ratio is exceeded. These are generally “interest-only” loans during the construction period which typically does not exceed nine months. Construction loans for commercial real estate are made in accordance with a schedule reflecting the cost of construction, and are generally limited to a 75% loan-to-completed appraised value ratio. For all construction loans, we generally require that a commitment for permanent financing be in place prior to closing the construction loan

9

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Repayment of one-to four-family residential property loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas such as unemployment levels. Repayment of commercial property loans and homes built by developers on speculation is normally expected from the property’s eventual rental income, income from the borrower’s operations, the personal resources of the guarantor, or the sale of the subject property. Generally, before making a commitment to fund a construction loan, we require an appraisal of the property by a state-certified or state-licensed appraiser. We generally review and inspect properties before disbursement of funds during the term of the construction loan.

Construction financing generally involves greater credit risk than long-term financing on improved, owner-occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the value of the property at completion of construction compared to the estimated cost (including interest) of construction and other assumptions. If the estimate of construction cost is inaccurate, we may be required to advance additional funds beyond the amount originally committed in order to protect the value of the property. Moreover, if the estimated value of the completed project is inaccurate, the borrower may hold a property with a value that is insufficient to assure full repayment of the construction loan upon the sale of the property. Construction loans also expose us to the risk that improvements will not be completed on time in accordance with specifications and projected costs. In addition, the ultimate sale or rental of the property may not occur as anticipated.

Commercial non-mortgage

Commercial non-mortgage loans generally have a greater credit risk than residential mortgage loans. Unlike residential mortgage loans, which generally are made on the basis of the borrower’s ability to make repayment from his or her employment and other income, and which are secured by real property whose value tends to be more easily ascertainable, commercial non-mortgage loans are of higher risk and typically are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business.

As a result, the availability of funds for the repayment of commercial non-mortgage loans may be substantially dependent on the success of the business itself. Further, the collateral securing the loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business. In determining the appropriate level of allowance for loan loss, we analyze various components of our portfolio. The following components are analyzed: all substandard loans on an individual basis; all loans that are designated special mention or closely monitored; loans not classified according to purpose or collateral type; and overdrawn deposit account balances.

We also factor in historical loss experience and qualitative considerations, including trends in charge offs and recoveries; trends in delinquencies and impaired/classified loans; effects of credit concentrations; changes in underwriting standards and loan review system; experience in lending staff; current industry conditions; and current market conditions.

In instances where risk and loss exposure is clearly identified with a particular asset, the asset or a portion of the asset will be charged off.

10

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of June 30, 2014, December 31, 2013 and June 30, 2013:

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily			Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,354		$	251		$	2,861	$	1,514		$	1,145	$	285	$	157	$	30		$	7,597
Provision charged to expense		(363	)		(97	)		311		(181	)		221		523		96		(15	)		495
Losses charged off		(30	)		—			—		—			—		—		—		(1	)		(31	)
Recoveries		26			—			7		—			11		—		—		3			47
Balance, end of period	$	987		$	154		$	3,179	$	1,333		$	1,377	$	808	$	253	$	17		$	8,108
Ending Balance: individually evaluated for impairment	$	—		$	—		$	200	$	100		$	850	$	500	$	—	$	—		$	1,650
Ending balance: collectively evaluated for impairment	$	987		$	154		$	2,979	$	1,233		$	527	$	308	$	253	$	17		$	6,458
Loans:
Ending Balance	$	50,397		$	7,219		$	147,191	$	60,248		$	9,568	$	23,609	$	12,801	$	1,144		$	312,177
Ending Balance: individually evaluated for impairment	$	1,449		$	63		$	9,779	$	8,316		$	3,888	$	5,349	$	595	$	—		$	29,439
Ending Balance: collectively evaluated for impairment	$	48,948		$	7,156		$	137,412	$	51,932		$	5,680	$	18,260	$	12,206	$	1,144		$	282,738

11

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Loan Class	1-4 Family			Home Equity		Commercial Real Estate			Multifamily			Land			Construction		Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,006		$	148	$	3,475		$	1,338		$	1,422		$	390	$	126	$	14		$	7,919
Provision charged to expense		(5	)		6		(300	)		(5	)		(49	)		419		126		3			195
Losses charged off		(30	)		—		—			—			—			—		—		(1	)		(31	)
Recoveries		16			—		4			—			4			—		—		1			25
Balance, end of period	$	987		$	154	$	3,179		$	1,333		$	1,377		$	808	$	253	$	17		$	8,108

12

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily		Land		Construction			Commercial Non- Mortgage			Consumer			Total
Year to date analysis as of December 31, 2013
Allowance for loan losses:
Balance, beginning of year	$	1,433		$	266		$	2,663	$	1,497	$	312	$	302		$	166		$	32		$	6,671
Provision charged to expense		116			(16	)		98		17		651		(17	)		(14	)		(5	)		830
Losses charged off		(210	)		—			—		—		—		—			—			(2	)		(212	)
Recoveries		15			1			100		—		182		—			5			5			308
Balance, end of year	$	1,354		$	251		$	2,861	$	1,514	$	1,145	$	285		$	157		$	30		$	7,597
Ending Balance: individually evaluated for impairment	$	—		$	—		$	345	$	100	$	850	$	—		$	—		$	—		$	1,295
Ending balance: collectively evaluated for impairment	$	1,354		$	251		$	2,516	$	1,414	$	295	$	285		$	157		$	30		$	6,302
Loans:
Ending Balance	$	49,726		$	7,912		$	126,154	$	62,790	$	9,734	$	8,669		$	7,226		$	1,167		$	273,378
Ending Balance: individually evaluated for impairment	$	2,494		$	—		$	11,067	$	8,462	$	4,162		—		$	600		$	—		$	26,785
Ending Balance: collectively evaluated for impairment	$	47,232		$	7,912		$	115,087	$	54,328	$	5,572	$	8,669		$	6,626		$	1,167		$	246,593

13

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Loan Class	1-4 Family			Home Equity		Commercial Real Estate		Multifamily		Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,433		$	266	$	2,663	$	1,497	$	312	$	302	$	166	$	32		$	6,671
Provision charged to expense		—			—		—		—		675		—		—		—			675
Losses charged off		(12	)		—		—		—		—		—		—		(2	)		(14	)
Recoveries		6			1		42		—		—		—		—		3			52
Balance, end of period	$	1,427		$	267	$	2,705	$	1,497	$	987	$	302	$	166	$	33		$	7,384
Ending Balance: individually evaluated for impairment	$	9		$	—	$	238	$	48	$	840	$	—	$	15	$	—		$	1,150
Ending balance: collectively evaluated for impairment	$	1,418		$	267	$	2,467	$	1,449	$	147	$	302	$	151	$	33		$	6,234
Loans:
Ending Balance	$	52,937		$	8,135	$	105,975	$	62,618	$	9,896	$	13,677	$	3,589	$	1,157		$	257,984
Ending Balance: individually evaluated for impairment	$	2,519		$	—	$	11,383	$	8,597	$	4,588	$	325	$	957	$	—		$	28,369
Ending Balance: collectively evaluated for impairment	$	50,418		$	8,135	$	94,592	$	54,021	$	5,308	$	13,352	$	2,632	$	1,157		$	229,615

Loan Class	1-4 Family			Home Equity			Commercial Real Estate			Multifamily			Land		Construction			Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,445		$	292		$	2,856		$	1,655		$	265	$	351		$	93	$	32		$	6,989
Provision charged to expense		(21	)		(26	)		(193	)		(158	)		722		(49	)		73		2			350
Losses charged off		—			—			—			—			—		—			—		(2	)		(2	)
Recoveries		3			1			42			—			—		—			—		1			47
Balance, end of period	$	1,427		$	267		$	2,705		$	1,497		$	987	$	302		$	166	$	33		$	7,384

14

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Consistent with regulatory guidance, charge offs on all loan segments are taken when specific loans, or portions thereof, are considered uncollectible. Our policy is to promptly charge these loans off in the period the uncollectible loss is reasonably determined.

For all loan portfolio segments except one-to-four family residential loans and consumer loans, we promptly charge off loans, or portions thereof, when available information confirms that specific loans are uncollectible based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower’s ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral.

We charge off one-to-four family residential and consumer loans, or portions thereof, when we reasonably determine the amount of the loss. We adhere to timeframes established by applicable regulatory guidance which provides for the charge off of one-to-four family first and junior lien mortgages to the net realizable value less costs to sell when the loan is 180 days past due, charge off of unsecured open-end loans when the loan is 180 days past due, and charge down to the net realizable value when other secured loans are 120 days past due. Loans at these respective delinquency thresholds for which we can clearly document that the loan is both well-secured and in the process of collection, such that collection will occur regardless of delinquency status, need not be charged off.

The following table presents the credit risk profile of our loan portfolio based on rating category and payment activity as of June 30, 2014 and December 31, 2013:

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	47,216	$	45,735	$	7,219	$	7,806	$	130,383	$	107,825	$	46,678	$	48,808
Pass (Closely Monitored)		1,709		1,827		—		106		3,762		4,081		8,850		9,170
Special Mention		419		818		—		—		4,211		4,992		—		—
Substandard		1,053		1,346		—		—		8,835		9,256		4,720		4,812
Doubtful		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—
	$	50,397	$	49,726	$	7,219	$	7,912	$	147,191	$	126,154	$	60,248	$	62,790

15

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2014		2013		2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	4,162	$	3,742	$	18,260	$	8,669	$	12,073	$	6,540	$	1,144	$	1,167	$	267,135	$	230,292
Pass (Closely Monitored)		2,165		1,830		—		—		133		55		—		—		16,619		17,069
Special Mention		—		43		—		—		27		36		—		—		4,657		5,889
Substandard		3,241		4,119		5,349		—		568		595		—		—		23,766		20,128
Doubtful		—		—		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—		—		—
	$	9,568	$	9,734	$	23,609	$	8,669	$	12,801	$	7,226	$	1,144	$	1,167	$	312,177	$	273,378

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation and current economic trends, among other factors. We analyze loans individually by classifying the loans as to credit risk. This analysis is performed during the loan approval process and is updated as circumstances warrant.

The Pass asset quality rating encompasses assets that have performed as expected. These assets generally do not have delinquency or servicing issues. Loans assigned this rating include loans to borrowers possessing solid credit quality with acceptable risk. Borrowers in these grades are differentiated from higher grades on the basis of size (capital and/or revenue), leverage, asset quality, stability of the industry or specific market area and quality/coverage of collateral. These borrowers generally have a history of consistent earnings and reasonable leverage.

The Closely Monitored asset quality rating encompasses assets that have been brought to the attention of management and may, if not corrected, warrant a more serious quality rating by management. These assets are usually in the first phase of a deficiency situation and may possess similar criteria as Special Mention assets. This grade includes loans to borrowers which require special monitoring because of deteriorating financial results, declining credit ratings, decreasing cash flow, increasing leverage, marginal collateral coverage or industry stress that has resulted or may result in a changing overall risk profile.

The Special Mention asset quality rating encompasses assets that have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. This grade is intended to include loans to borrowers whose credit quality has clearly deteriorated and where risk of further decline is possible unless active measures are taken to correct the situation. Weaknesses are considered potential at this state and are not yet fully defined.

16

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The Substandard asset quality rating encompasses assets that are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any; assets having a well-defined weakness(es) based upon objective evidence; assets characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected; or the possibility that liquidation will not be timely. Loans categorized in this grade possess a well defined credit weakness and the likelihood of repayment from the primary source is uncertain. Significant financial deterioration has occurred and very close attention is warranted to ensure the full repayment without loss. Collateral coverage may be marginal and the accrual of interest has been suspended.

The Doubtful asset quality rating encompasses assets that have all of the weaknesses of those classified as Substandard. In addition, these weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

The Loss asset quality rating encompasses assets that are considered uncollectible and of such little value that their continuance as assets of the Bank is not warranted. A loss classification does not mean that an asset has no recovery or salvage value; instead, it means that it is not practical or desirable to defer writing off or reserving all or a portion of a basically worthless asset, even though partial recovery may be realized in the future.

The following table is a summary of our past due and non-accrual loans as of June 30, 2014 and December 31, 2013:

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
1-4 Family	$	86	$	—	$	138	$	224	$	50,173	$	50,397	$	—	$	138
Home Equity		—		—		—		—		7,219		7,219		—		—
Commercial Real Estate		181		504		44		729		146,462		147,191		—		713
Multifamily		—		—		—		—		60,248		60,248		—		—
Land		49		—		3,165		3,214		6,354		9,568		—		4,007
Construction		—		—		—		—		23,609		23,609		—		—
Commercial Non-Mortgage		—		—		27		27		12,774		12,801		—		143
Consumer		—		—		—		—		1,144		1,144		—		—
Total	$	316	$	504	$	3,374	$	4,194	$	307,983	$	312,177	$	—	$	5,001

17

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
As of December 31, 2013:
1-4 Family	$	217	$	—	$	254	$	471	$	49,255	$	49,726	$	—	$	254
Home Equity		—		—		—		—		7,912		7,912		—		—
Commercial Real Estate		716		667		49		1,432		124,722		126,154		—		779
Multifamily		—		—		1,363		1,363		61,427		62,790		1,363		—
Land		—		—		4,068		4,068		5,666		9,734		27		4,041
Construction		—		—		—		—		8,669		8,669		—		—
Commercial Non-Mortgage		—		—		36		36		7,190		7,226		—		157
Consumer		—		—		—		—		1,167		1,167		—		—
Total	$	933	$	667	$	5,770	$	7,370	$	266,008	$	273,378	$	1,390	$	5,231

Nonaccrual Loan and Past Due Loans. The accrual of interest is discontinued on all loan classes at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. The entire balance of a loan is considered delinquent if the minimum payment contractually required to be made is not received by the specified due date.

All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. Subsequent payments on non-accrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured. Nonaccrual loans are returned to accrual status when, in the opinion of management, the financial position of the borrower indicates there is no longer any reasonable doubt as to the timely collection of interest or principal. We generally require a period of satisfactory performance of not less than six months before returning a nonaccrual loan to accrual status.

A loan is considered impaired, in accordance with the impairment accounting guidance (ASC 310-10-35-16), when based on current information and events, it is probable we will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include non-performing commercial loans but also include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties. These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection. Interest income on loans individually classified as impaired is recognized on a cash basis after all past due and current principal payments have been made.

18

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The following table presents impaired loans at June 30, 2014:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	1,269	$	1,579	$	—	$	1,472	$	1,780	$	16	$	37
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		6,741		9,180		—		7,036		7,607		110		175
Multifamily		6,971		7,786		—		7,002		7,034		123		205
Land		696		1,070		—		701		912		—		1
Construction		—		1		—		—		—		—		—
Commercial Non-Mortgage		251		251		—		254		244		2		5
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family		180		180		—		180		181		3		5
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,038		3,054		200		3,058		3,085		38		101
Multifamily		1,345		1,345		100		1,348		1,353		20		41
Land		3,192		4,531		850		3,290		3,342		1		1
Construction		5,349		5,349		500		2,674		1,783		64		64
Commercial Non-Mortgage		344		344		—		350		358		4		9
Consumer		—		—		—		—		—		—		—
Total
1-4 Family	$	1,449	$	1,759	$	—	$	1,652	$	1,961	$	19	$	42
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		9,779		12,234		200		10,094		10,692		148		276
Multifamily		8,316		9,131		100		8,350		8,387		143		246
Land		3,888		5,601		850		3,991		4,254		1		2
Construction		5,349		5,350		500		2,674		1,783		64		64
Commercial Non-Mortgage		595		595		—		604		602		6		14
Consumer		—		—		—		—		—		—		—
Total	$	29,439	$	34,734	$	1,650	$	27,429	$	27,744	$	382	$	645

19

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The following table presents impaired loans at December 31, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		YTD Average Balance		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		7,128		9,152		—		7,630		315
Multifamily		7,099		7,914		—		7,325		409
Land		742		1,672		—		913		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Loans with a specific valuation allowance
1-4 Family		—		—		—		—		—
Home Equity		—		—		—				—
Commercial Real Estate		3,939		3,939		345		2,843		218
Multifamily		1,363		1,363		100		1,100		33
Land		3,420		4,730		850		3,641		—
Construction		—		—		—		—		—
Commercial Non-Mortgage		—		—		—		—		—
Consumer		—		—		—		—		—
Totals
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		11,067		13,091		345		10,473		533
Multifamily		8,462		9,277		100		8,425		442
Land		4,162		6,402		850		4,554		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Total	$	26,785	$	32,082	$	1,295	$	26,850	$	1,278

20

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The following table presents impaired loans at June 30, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,456	$	2,665	$	—	$	2,711	$	2,767	$	28	$	180
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		7,607		9,776		—		9,495		6,989		176		266
Multifamily		7,768		8,584		—		10,431		8,637		112		217
Land		971		2,980		—		6,260		7,033		55		274
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		539		641		—		552		275		6		29
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family	$	63	$	63	$	9	$	103	$	142	$	2	$	2
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,776		3,776		238		3,762		4,978		56		90
Multifamily		829		829		48		836		840		14		18
Land		3,617		4,910		840		1,665		839		26		289
Construction		—		—		—		—		—		—		—
Commercial Non-Mortgage		418		418		15		425		492		8		6
Consumer		—		—		—		—		—		—
Total
1-4 Family	$	2,519	$	2,728	$	9	$	2,814	$	2,909	$	30	$	182
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		11,383		13,552		238		13,257		11,967		232		356
Multifamily		8,597		9,413		48		11,267		9,477		126		235
Land		4,588		7,890		840		7,925		7,872		81		563
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		957		1,059		15		977		767		14		35
Consumer		—		—		—		—		—		—		—
Total	$	28,369	$	34,969	$	1,150	$	36,458	$	33,115	$	484	$	1,375

21

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Interest payments on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assumed, in which case interest is recognized on a cash basis and is reasonable compared to interest income noted above.

Troubled Debt Restructuring (TDR)

We may grant a concession or modification for economic or legal reasons related to a borrower’s financial condition that we would not otherwise consider resulting in a modified loan which is then identified as a troubled debt restructuring. We may modify loans through rate reductions, short-term extensions of maturity, interest only payments, or payment modifications to better match the timing of cash flows due under the modified terms with the cash flows from the borrowers’ operations. Loan modifications are intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral.

We identify loans for potential restructure primarily through direct communication with the borrower and evaluation of the borrower’s financial statements, revenue projections, tax returns, and credit reports. Even if the borrower is not presently in default, management will consider the likelihood that cash flow shortages, adverse economic conditions, and negative trends may result in a payment default in the near future.

For one-to-four family residential and home equity lines of credit, a restructure often occurs with past due loans and may be offered as an alternative to foreclosure. There are other situations where borrowers, who are not past due, experience a sudden job loss, become over-extended with credit obligations, or other problems, have indicated that they will be unable to make the required monthly payment and request payment relief.

When considering a loan restructure, management will determine if: (i) the financial distress is short or long term; (ii) loan concessions are necessary; and (iii) the restructure is a viable solution.

When a loan is restructured, the new terms often require a reduced monthly debt service payment. No TDRs that were on non-accrual status at the time the concessions were granted have been returned to accrual status. For commercial loans, management completes an analysis of the operating entity’s ability to repay the debt. If the operating entity is capable of servicing the new debt service requirements and the underlying collateral value is believed to be sufficient to repay the debt in the event of a future default, the new loan can be placed on accrual status after six months of performance with the new loan terms. To date, there have been no commercial loans restructured and immediately placed on accrual status after the execution of the TDR.

For retail loans, an analysis of the individual’s ability to service the new required payments is performed. If the borrower is capable of servicing the newly restructured debt and the underlying collateral value is believed to be sufficient to repay the debt in the event of a future default, the new loan can be placed on accrual status after six months of performance to the new loan terms. The reason for the TDR is also considered, such as paying past due real estate taxes or payments caused by a temporary job loss, when determining whether a retail TDR loan could be returned to accrual status. Retail TDRs remain on nonaccrual status until sufficient payments have been made to bring the past due principal and interest current and/or after six months of performance to the new loan terms at which point the loan could be transferred to accrual status.

22

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

There were no loans that were restructured as TDRs during the three months ended June 30, 2014.

The following table summarizes the loans that were restructured as TDRs during the three and six months ended June 30, 2014:

	Three Months Ended						Six Months Ended
	June 30, 2014						June 30, 2014
			Balance		Balance				Balance		Balance
			prior to		after				prior to		after
	Count		TDR		TDR		Count		TDR		TDR
	(Dollars in thousands)
Commercial real estate		1		900		900		1		900		900
Total loans		1	$	900	$	900		1	$	900	$	900

We had no TDRs that had payment defaults during the three months ended June 2014 and 2013. Default occurs when a TDR is 90 days or more past due, transferred to nonaccrual status, or transferred to other real estate owned within twelve months of restructuring.

Management monitors the TDRs based on the type of modification or concession granted to the borrower. These types of modifications may include rate reductions, payment/term extensions, forgiveness of principal, forbearance, and other applicable actions. Management predominantly utilizes rate reductions and lower monthly payments, either from a longer amortization period or interest only repayment schedule, because these concessions provide needed payment relief without risking the loss of principal. Management will also agree to a forbearance agreement when it is deemed appropriate to avoid foreclosure.

23

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Note 5: Disclosures About Fair Value of Assets and Liabilities

ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Topic 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1	Quoted prices in active markets for identical assets or liabilities.
Level 2	Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
Level 3	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

Following is a description of the valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying consolidated balance sheets, as well as the general classification of such assets under the valuation hierarchy. We have no assets or liabilities measured at fair value on a recurring basis and no liabilities measured at fair value on a nonrecurring basis.

Nonrecurring Measurements

The following table presents the fair value measurements of assets and liabilities recognized in the accompanying consolidated balance sheets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2014 and December 31, 2013.

			Fair Value Measurements Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2014
Collateral-dependent Impaired loans	$	43	$	—	$	—	$	43
December 31, 2013
Collateral-dependent Impaired loans	$	7,681	$	—	$	—	$	7,681

24

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Collateral-dependent Impaired Loans

The estimated fair value of collateral-dependent impaired loans is based on the appraised fair value of the collateral, less estimated cost to sell. Collateral-dependent impaired loans are classified within Level 3 of the fair value hierarchy.

The Company considers the appraisal or an evaluation as the starting point for determining fair value and then considers other factors and events in the environment that may affect the fair value. Appraisals of the collateral underlying collateral-dependent loans are obtained when the loan is determined to be collateral-dependent or subsequently as deemed necessary and approved by management. Appraisals are reviewed for accuracy and consistency by the Credit Analysis department. Typically, appraisers are selected from the list of approved appraisers maintained by the Underwriting department. The appraised values may be reduced by discounts to consider a lack of marketability or estimated cost to sell if repayment or satisfaction of the loan is dependent on the sale of the collateral. These discounts and estimates are developed by the Credit Analysis department and approved by management.

Unobservable (Level 3) inputs

The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than good will at June 30, 2014 and December 31, 2013.

	Collateral-dependent Impaired Loans
	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
As of June 30, 2014 Collateral-dependent impaired loans	$	43	Market comparable properties	Marketability discount	10%(10%)
December 31, 2013 Collateral-dependent impaired loans	$	7,681	Market comparable properties	Marketability discount	9%-46% (34%)

25

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Fair Value of Financial Instruments

The following table presents estimated fair values of our financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value at the individual dates. The fair values of certain of these instruments were calculated by discounting expected cash flows, which involves significant judgments by management and uncertainties. Because no market exists for certain of these financial instruments and because management does not intend to sell these financial instruments, we do not know whether the fair values shown below represent values at which the respective financial instruments could be sold individually or in the aggregate.

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of June 30, 2014
Financial assets
Cash and cash equivalents	$	38,166	$	38,166	$	—	$	—
Held to maturity securities		57		—		57		—
Loans held for sale		1,883		—		1,883		—
Loans, net of allowance for loan losses		286,927		—		—		289,814
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		817		817		—		—
Financial liabilities
Deposits		221,235		89,643		—		110,296
Federal Home Loan Bank advances		52,000		—		52,555		—
Interest payable		139		139		—		—

26

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of December 31, 2013
Financial assets
Cash and cash equivalents	$	26,181	$	26,181	$	—	$	—
Held to maturity securities		123		—		123		—
Loans held for sale		1,325		—		1,330		—
Loans, net of allowance for loan losses		276,965		—		—		280,407
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		699		699		—		—
Financial liabilities
Deposits	$	172,983	$	99,121	$	—	$	74,339
Federal Home Loan Bank advances		61,994		—		60,653		—
Interest payable		138		138		—		—

The following methods and assumptions were used to estimate the fair value of all other financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value.

Cash and Cash Equivalents, Federal Home Loan Bank Stock, Interest Receivable, and Interest Payable

The carrying amount approximates fair value.

Held to Maturity Securities

Fair values equal quoted market prices, if available. If quoted market prices are not available, fair value is estimated based on quoted market prices of similar securities.

Loans Held for Sale

Fair value is estimated using quoted market prices from the secondary market.

27

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Loans

The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Loans with similar characteristics were aggregated for purposes of the calculations.

Deposits

Deposits include demand deposits, savings accounts, checking accounts and certain money market deposits. The carrying amount approximates fair value. The fair value of fixed-maturity time deposits is estimated using a discounted cash flow calculation that applies the rates currently offered for deposits of similar remaining maturities.

Federal Home Loan Bank Advances

Rates currently available to us for debt with similar terms and remaining maturities are used to estimate the fair value of existing debt.

Commitments to Originate Loans, Letters of Credit and Lines of Credit

Loan commitments and letters-of-credit generally have short-term, variable rate features and contain clauses which limit our exposure to changes in customer credit quality. Accordingly, their carrying values, which are immaterial at the respective balance sheet dates, are reasonable estimates of fair value.

Note 6: Earnings Per Share (In thousands except per share amounts)

Basic earnings per common share (“EPS”) excludes dilution and is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock options) were exercised or converted into additional common shares that would then share in the earnings of the entity. Diluted EPS is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year, plus an incremental number of common-equivalent shares computed using the treasury stock method.

Unvested share-based payment awards, which include the right to receive non-forfeitable dividends or dividend equivalents, are considered to participate with common stock in undistributed earnings for purposes of computing EPS. Accordingly, the Company is required to calculate basic and diluted EPS using the two-class method. Restricted stock awards granted by the Company are considered participating securities. Calculations of EPS under the two-class method (i) exclude from the numerator any dividends paid or owed on participating securities and any undistributed earnings considered to be attributable to participating securities and (ii) exclude from the denominator the dilutive impact of the participating securities.

Unearned ESOP shares, which are not vested and unvested restricted stock awards are excluded from the computation of average shares outstanding.

28

Wolverine Bancorp, Inc.

Form 10-Q

(Table Amounts in Thousands Except Per Share Amounts)

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

Earnings per share analysis for three months ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Three months ended June 30, 2014			Three months ended June 30, 2013
Net income	$	480		$	436
Income allocated to participating securities		(14	)		(15	)
Income attributable to common shareholders		466			421
Weighted average shares outstanding (in thousands)		2,288			2,439
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,062			2,262
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,074			2,262
Basic EPS	$	.23		$	.19
Diluted EPS	$	.23		$	.19

Six Months Ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Six Months Ended June 30, 2014			Six Months Ended June 30, 2013
Net income	$	785		$	961
Income allocated to participating securities		(22	)		(32	)
Income attributable to common shareholders		763			929
Weighted average shares outstanding (in thousands)		2,292			2,447
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,066			2,270
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,078			2,270
Basic EPS	$	.37		$	.42
Diluted EPS	$	.37		$	.42

29

Wolverine Bancorp, Inc.

Form 10-Q

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

(Dollars in Thousands)

Note 7: Share-Based Compensation

In May 2013, the Company’s stockholders approved the Wolverine Bancorp, Inc. 2013 Equity Incentive Plan (“Plan”) which provides for awards of stock options and restricted stock to key officers and outside directors. The cost of the Plan is based on the fair value of the awards on the grant date. The fair value of restricted stock awards is based on the closing price of the Company’s stock on the grant date. The fair value of stock options is estimated using a Black-Scholes option pricing model using assumptions for dividend yield, stock price volatility, risk-free interest rate, and option term. These assumptions are based on management’s judgments regarding future events, are subjective in nature, and contain uncertainties inherent in an estimate. The cost of the awards are being recognized on a straight-line basis over the five-year vesting period during which participants are required to provide services in exchange for the awards.

Until such time as awards of stock are granted and vest or options are exercised, shares of the Company’s common stock under the Plan shall be authorized but unissued shares. The maximum number of shares authorized under the plan is 351,050. Total share-based compensation expense for the six months ended June 30, 2014 and 2013 was $160 and $165 respectively.

Stock Options

The table below presents the stock option activity for the period shown:

	Options			Weighted average exercise price		Remaining contractual life (years)		Aggregate intrinsic value
Options outstanding at January 1, 2014		129,080		$	17.30		9	$	516
Granted		2,350			22.01		—		—
Exercised		(4,001	)		17.32		—		—
Forfeited		(1,968	)		17.50		—		—
Expired		—			—		—		—
Options outstanding at June 30, 2014		125,461		$	17.38		9	$	667
Exercisable at June 30, 2014		23,820		$	17.30		8.14	$	129

As of June 30, 2014, the Company had $201 of unrecognized compensation expense related to stock options. The total fair value of shares vested for the six months ended June 30, 2014 was $541. Stock option expense for the three and six months ended June 30, 2014 was $16 and $31 respectively. Stock option expense for the three and six months ended June 30, 2013 was $17 and $36.

30

Wolverine Bancorp, Inc.

Form 10-Q

Notes to Condensed Consolidated Interim Financial Statements (Unaudited)

The fair value of the Company’s stock options granted on May 30, 2014 was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		18.02	%
Risk-free interest rate		2.14	%
Expected dividend yield		1.90	%
Expected life (in years)		7.50
Exercise price for the stock options	$	22.01

Expected volatility — Based on the historical volatility of share price.

Risk-free interest rate — Based on the U.S. Treasury yield curve and expected life of the options at the time of grant.

Expected dividend yield — The Company currently does not pay a dividend; therefore, the expected dividend yield was estimated for the portion of the life of the options that the Company expects to pay a dividend.

Expected life — Based on an average of the five year vesting period and the ten year contractual term of the stock option plan.

Exercise price for the stock options — Based on the closing price of the Company’s stock on the date of grant.

Restricted Stock Awards

Restricted stock awards are accounted for as fixed grants using the fair value of the Company’s stock at the time of grant. Unvested restricted stock awards may not be disposed of or transferred during the vesting period. Restricted stock awards carry with them the right to receive dividends.

The table below presents the restricted stock award activity for the period shown:

	Service- Based Restricted stock awards			Weighted average grant date fair value
Non-vested at January 1, 2014		59,723		$	17.33
Granted		1,175			22.01
Vested		(229	)		18.82
Forfeited		—			—
Non-vested at June 30, 2014		60,669		$	17.41

As of June 30, 2014, the Company had $838 of unrecognized compensation expense related to restricted stock awards. The cost of the restricted stock awards will be amortized in monthly installments over the five-year vesting period. Restricted stock expense for three months and six months ended June 30, 2014 was $63 and $129 respectively. Restricted stock expense for the three and six months ended June 30, 2013 was $66 and $129.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

Management’s discussion and analysis of the financial condition at June 30, 2014 and the results of operations for the three and six months ended June 30, 2014 and 2013 is intended to assist in understanding our financial condition and results of operations. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto, appearing on Part I, Item 1 of this quarterly report on Form 10-Q.

Management’s Discussion and Analysis of Financial Condition and Results of Operations (the “MD&A”) is designed to provide a narrative on our financial condition, results of operations, liquidity, critical accounting policies, off-balance sheet arrangements and the future impact of accounting standards. It is useful to read our MD&A in conjunction with the consolidated financial statements contained in Part I in this Quarterly Report on Form 10-Q (this “Form 10-Q”), our Annual Report on Form 10-K for the year ended December 31, 2013 (the “Form 10-K”), and our other reports on Forms 10-Q and current reports on Forms 8-K and other publicly available information

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “will,” “may” and words of similar meaning. These forward-looking statements include, but are not limited to:

• statements of our goals, intentions and expectations;

• statements regarding our business plans, prospects, growth and operating strategies;

• statements regarding the asset quality of our loan and investment portfolios; and

• estimates of our risks and future costs and benefits.

These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this quarterly report.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

• general economic conditions, either nationally or in our market areas, that are worse than expected;

• competition among depository and other financial institutions;

• changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments;

• adverse changes in the securities markets;

• changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;

• our ability to enter new markets successfully and capitalize on growth opportunities;

32

• our ability to successfully integrate acquired entities, if any;

• changes in consumer spending, borrowing and savings habits;

• changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission and the Public Company Accounting Oversight Board;

• changes in our organization, compensation and benefit plans;

• changes in our financial condition or results of operations that reduce capital; and

• changes in the financial condition or future prospects of issuers of securities that we own.

Because of these and a wide variety of other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements.

Critical Accounting Policies

We consider accounting policies that require management to exercise significant judgment or discretion or make significant assumptions that have, or could have, a material impact on the carrying value of certain assets or on income, to be critical accounting policies. We consider the following to be our critical accounting policies.

Allowance for Loan Losses. We believe that the allowance for loan losses and related provision for loan losses are particularly susceptible to change in the near term, due to changes in credit quality which are evidenced by trends in charge offs and in the volume and severity of past due loans. In addition, our portfolio is comprised of a substantial amount of commercial real estate loans which generally have greater credit risk than one- to four-family residential mortgage and consumer loans because these loans generally have larger principal balances and are non-homogenous.

The allowance for loan losses is maintained at a level to cover probable credit losses inherent in the loan portfolio at the balance sheet date. Based on our estimate of the level of allowance for loan losses required, we record a provision for loan losses as a charge to earnings to maintain the allowance for loan losses at an appropriate level. The estimate of our credit losses is applied to two general categories of loans:

• loans that we evaluate individually for impairment under ASC 310-10, “Receivables;” and

• groups of loans with similar risk characteristics that we evaluate collectively for impairment under ASC 450-20, “Loss Contingencies.”

The allowance for loan losses is evaluated on a regular basis by management and reflects consideration of all significant factors that affect the collectability of the loan portfolio. The factors used to evaluate the collectability of the loan portfolio include, but are not limited to, current economic conditions, our historical loss experience, the nature and volume of the loan portfolio, the financial strength of the borrower, and estimated value of any underlying collateral. This evaluation is inherently subjective as it requires estimates that are subject to significant revision as more information becomes available. Actual loan losses may be significantly more than the allowance for loan losses we have established which could have a material negative effect on our financial results. See also “Business of Wolverine Bank—Allowance for Loan Losses.”

Income Tax Accounting. The provision for income taxes is based upon income in our consolidated financial statements, rather than amounts reported on our income tax return. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable

33

income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on our deferred tax assets and liabilities is recognized as income or expense in the period that includes the enactment date. Under U.S. GAAP, a valuation allowance is required to be recognized if it is more likely than not that a deferred tax asset will not be realized. The determination as to whether we will be able to realize the deferred tax assets is highly subjective and dependent upon judgment concerning our evaluation of both positive and negative evidence, our forecasts of future income, applicable tax planning strategies, and assessments of current and future economic and business conditions. Positive evidence includes the existence of taxes paid in available carryback years as well as the probability that taxable income will be generated in future periods, while negative evidence includes any cumulative losses in the current year and prior two years and general business and economic trends. Any reduction in estimated future taxable income may require us to record a valuation allowance against our deferred tax assets. Any required valuation allowance would result in additional income tax expense in the period and could have a significant impact on our future earnings. Positions taken in our tax returns may be subject to challenge by the taxing authorities upon examination. The benefit of an uncertain tax position is initially recognized in the financial statements only when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions are both initially and subsequently measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement with the tax authority, assuming full knowledge of the position and all relevant facts. Differences between our position and the position of tax authorities could result in a reduction of a tax benefit or an increase to a tax liability, which could adversely affect our future income tax expense.

We believe our tax policies and practices are critical accounting policies because the determination of our tax provision and current and deferred tax assets and liabilities have a material impact on our net income and the carrying value of our assets. We believe our tax liabilities and assets are properly recorded in the consolidated financial statements at June 30, 2014 and December 31, 2013 and no valuation allowance was necessary.

Comparison of Financial Condition at June 30, 2014 and December 31, 2013

Total assets increased $40.0 million, or 13.4%, to $337.8 million at June 30, 2014 from $297.7 million at December 31, 2013. The increase was primarily a result of a $27.5 million increase in net loans.

Loans held for sale increased $558,000, or 42.1%, to $1.9 million at June 30, 2014 from $1.3 million at December 31, 2013.

Net loans increased $27.5 million, or 10.6%, to $286.9 million at June 30, 2014 from $259.4 million at December 31, 2013. Commercial real estate loans increased $21.0 million, or 16.7%, and construction loans increased $14.9 million, or 172.3%, partially offset by a decrease of $2.5 million, or 4.0%, in multifamily loans.

The undisbursed portion of loans increased $10.6 million to $16.5 million at June 30, 2014 from $5.9 million at December 31, 2013 due primarily to a net increase in undisbursed construction loans of $8.1 million.

Securities held to maturity, consisting of one municipal security at June 30, 2014, decreased $66,000, or 53.7%, to $57,000 from $123,000 at December 31, 2013 due to a principal paydown.

Other real estate owned decreased $268,000, or 30.7%, to $604,000 at June 30, 2014, from $872,000 at December 31, 2013 resulting from one loan transferred to REO totaling $255,000 and eight sales totaling $374,000.

Other assets, consisting primarily of net deferred and accrued federal taxes, increased $244,000, or 5.7%, to $4.5 million at June 30, 2014, from $4.3 million at December 31, 2013 primarily due to a $89,000 increase in accrued federal income taxes, a $43,000 increase in prepaid service maintenance contracts, and a $32,000 increase in prepaid bond and insurance premiums.

34

Deposits increased $48.2 million to $221.2 million at June 30, 2014 from $173.0 million at December 31, 2013 primarily to fund new loan growth. Core deposits (consisting of interest-bearing and noninterest-bearing checking accounts, money market accounts and savings accounts) increased $15.5 million.

Certificates of deposit increased $35.4 million, or 48.0%, to $109.3 million at June 30, 2014 from $73.9 million at December 31, 2013 to fund new loan growth. Certificate deposit of growth in 2014 consists of both in-market and out-of-market deposits. Out-of-market deposits were primarily issued through two vehicles, a deposit listing service and brokered deposits. Deposit listing services are used by financial institutions to both issue and purchase certificate of deposits directly from other companies, primarily financial institutions. Financial institutions can also use brokers as a mechanism to raise funds. The total amount of deposits issued through a deposit listing service was $18.7 million with a weighted average rate of 1.22%. The total amount of brokered deposits issued in 2014 was $11.4 million with a weighted average rate of 1.42%. The average original maturity of these deposits is approximately three years.

Federal Home Loan Bank advances decreased $10.0 million from $62.0 million at December 31, 2013 to $52.0 million at June 30, 2014 due to the payoff of a $10.0 million advance at maturity.

Interest payable and other liabilities, consisting primarily of liabilities for checks and money orders and accrued expenses increased $1.2 million, or 49.2%, to $3.7 million at June 30, 2014 from $2.5 million primarily due to a $1.4 million increase in prepaid taxes and insurances, partially offset by a decrease of $442,000 in liability for checks and money orders.

Total stockholders’ equity increased $531,000, or 0.9%, to $60.9 million at June 30, 2014 from $60.3 million at December 31, 2013 primarily due to net income of $785,000.

Comparison of Operating Results for the Three Months Ended June 30, 2014 and 2013

General. We recorded net income of $480,000 for the three months ended June 30, 2014 compared to net income of $436,000 for the three months ended June 30, 2013 primarily due to a decrease in net gains on loan sales. Gain on loan sales decreased $263,000 to $171,000 for the three months ended June 30, 2014 from $434,000 for the three months ended June 30, 2013. This was partially offset by an increase of $261,000 in net interest income from loans from $2.6 million to $2.9 million.

We have experienced significant declines in residential mortgage originations primarily due to decreased refinance activity, a slow real estate purchase market, and higher interest rates as compared to 2012 and early 2013. To offset the decline in mortgage activity, management embarked on several cost savings measures in late 2013 and the beginning of the first quarter of 2014. This included a reorganization of bank personnel and a redesign of operational processes aimed at reallocating resources to areas of need and creating efficiencies that will not only reduce operational costs, but also reduce loan processing time. The full impact of these measures should be realized in the second half of 2014, management estimates annualized savings of approximately $745,000 of salaries and benefits expenses.

Interest and Dividend Income. Interest and dividend income increased $266,000, or 7.8%, to $3.7 million for the three months ended June 30, 2014. Average balances increased $48.7 million in interest-earning assets to $329.7 million for the three months ended June 30, 2014 from $279.4 million for the three months ended June 30, 2013. This was partially offset by a decrease of 35 basis points in the average yield on earning assets to 4.45% during the 2014 period from 4.83% during the 2013 period as a result of a low-interest rate environment.

Average net loans increased $35.1 million, or 14.2%, to $282.9 million for the three months ended June 30, 2014 from $246.0 million for the three months ended June 30, 2013. As a result, interest income on loans increased $284,000, or 8.6%, to $3.6 million for the three months ended June 30, 2014. This was partially offset by the average yield on loans decreasing 26 basis points to 5.10% for the three months ended June 30, 2014 from 5.40% for the three months ended June 30, 2013. The decrease in average yield on loans was attributable to a continuing low interest rate environment.

Income from dividends and municipal bonds decreased $18,000 to $66,000 for the period ended June 30, 2014 from $84,000 for the three months ended June 30, 2013 due primarily to a decrease in dividends received from service corp.

Interest Expense. Interest expense increased $5,000, or 0.6%, to $801,000 for the three months ended June 30, 2014 from $796,000 for the three months ended June 30, 2013. Interest expense on deposits increased $85,000 to $294,000 for the three months ended June 30, 2014 from $209,000 for the

35

three months ended June 30, 2013. This was offset by a decrease in interest expense on borrowed funds of $80,000 to $507,000 for the three months ended June 30, 2014 from $587,000 for the three months ended June 30, 2013, due to the payoff of a $10.0 million maturing advance.

Average interest-bearing liabilities increased $52.2 million, or 23.5%, to $273.9 million for the three months ended June 30, 2014 from $221.7 million for the three months ended June 30, 2013. The average rate paid on these liabilities decreased 27 basis points to 1.17% from 1.44%. Interest expense on certificates of deposit increased $83,000, or 56.1%, to $229,000 for the three months ended June 30, 2014 from $146,000 for the three months ended June 30, 2013. The average balance of certificates of deposits increased to $110.8 million for the three months ended June 30, 2014, from $61.0 million for the three months ended June 30, 2013. Additionally, the rate on certificates of deposit decreased 13 basis points to 0.83% for the three months ended June 30, 2014 from 0.96% for the three months ended June 30, 2013 reflecting the continuing low interest rate environment.

The average balance of core deposits, consisting of checking accounts, money market accounts and savings accounts, increased $12.2 million, or 12.4%, to $111.0 million for the three months ended June 30, 2014 from $98.8 million for the three months ended June 30, 2013. The interest on core deposits increased $4,000 to $66,000 for the three months ended June 30, 2014 from $62,000 for three months ended June 30, 2013. The rate on core deposits for the three months ended June 30, 2014 decreased one basis points to 0.24% from 0.25% for the three months ended June 30, 2013.

Net Interest Income. Net interest income increased $261,000, or 10.0%, to $2.9 million for the three months ended June 30, 2014 from $2.6 million for the three months ended June 30, 2013, as our average net loans increased to $282.9 million from $247.8 million. Changes in net interest income are influenced by a variety of factors, including changes in the level and mix of interest-earning assets and interest-bearing liabilities, the level and direction of interest rates, the difference between short-term and long-term interest rates and the general strength of the economy.

Provision for Loan Losses. Based on our analysis of the factors described in “Critical Accounting Policies — Allowance for Loan Losses,” in our Annual Report on Form 10-K for 2013, we recorded a provision for loan losses of $195,000 for the three months ended June 30, 2014 and a provision for loan losses of $350,000 for the three months ended June 30, 2013. We have continued with additional provisions in 2014 primarily due to additional growth in loans. However, management is still concerned with elevated levels of non-performing assets, delinquencies and classified assets as well the Michigan economy, elevated levels of unemployment, and some declining collateral values. At June 30, 2014, non-performing loans totaled $5.6 million, or 2.0% of total loans, as compared to $7.2 million, or 2.8% of total loans, at June 30, 2013. The allowance for loan losses to total loans receivable decreased to 2.75% at June 30, 2014 from 2.9% for the period ended June 30,2013.

All loans rated substandard are reviewed for impairment at least quarterly. Overall, management continues to focus on resolving non-performing assets and improving asset quality. In addition to our collections department personnel in working out loans, we continue to involve business development officers and, on significant assets, underwriters and senior management.

Noninterest Income. Noninterest income decreased $275,000, or 48.3%, to $295,000 for the three months ended June 30, 2014 from $570,000 for the three months ended June 30, 2013. The decrease was primarily due to net gains on loan sales, which decrease $263,000 due to a decline in mortgage activity.

Noninterest Expense. Noninterest expense increased $15,000, or 0.7% for the three months ended June 30, 2014 as compared to the three months ended June 30, 2013. This was due to an increase of $47,000 in professional and service fees and a $28,000 increase in other real estate owned expense. This was offset by a decrease in salaries and employee benefits expense of $50,000, or 3.7%.

Income Tax Expense. We recorded $284,000 of income tax expense for the three months ended June 30, 2014 compared to $202,000 of income tax expense for the three months ended June 30, 2013. Our effective tax rate was 37.1% for the three months ended June 30, 2014 and 31.6% for the three months ended June 30, 2013.

36

Comparison of Operating Results for the Six Months Ended June 30, 2014 and 2014

General. We recorded net income of $785,000 for the six months ended June 30, 2014 compared to net income of $961,000 for the six months ended June 30, 2013. Net interest income increased $402,000 to $5.6 million for the six months ended June 30, 2014 from $5.2 million for the six months ended June 30, 2013, and other noninterest income decreased $829,000 to $476,000 for the six months ended June 30, 2014 from $1.3 million for the year earlier period.

Interest and Dividend Income. Interest and dividend income increased $322,000, or 4.8%, to $7.1 million for the six months ended June 30, 2014 from $6.8 million for the six months ended June 30, 2013, as the average balance of interest-earning assets increased $32.2 million to $312.1 million for the six months ended June 30, 2014 from $279.0 million for the six months ended June 30, 2013, and the average yield on interest-earning assets decreased 30 basis points to 4.54% during the 2014 period from 4.84% during the 2013 period. The decrease in our average yield on interest-earning assets was due primarily to the decrease in yield on net loans.

Interest income on loans increased $334,000, or 5.0%, to $7.0 million for the six months ended June 30, 2014 from $6.6 million for the six months ended June 30, 2013, as the average yield on loans decreased 29 basis points to 5.04% for the six months ended June 30, 2014 from 5.33% for the six months ended June 30, 2013 reflecting the lower market interest rate environment.

Interest income on investment securities and other interest-earning assets, and dividends on FHLB of Indianapolis stock decreased $12,000, or 9.4%, to $116,000 for the six months ended June 30, 2014 from $128,000 for the six months ended June 30, 2013. This decrease was primarily attributable to a decrease in dividends received from service corporation.

Interest Expense. Interest expense decreased $80,000, or 5.0%, to $1.5 million for the six months ended June 30, 2014 from $1.6 million for the six months ended June 30, 2013, as the average rate paid on these liabilities decreased 26 basis points to 1.19% from 1.45%, partially offset by an increase in interest-bearing liabilities of $35.2 million, or 15.9%, to $256.6 million for the six months ended June 30, 2014 from $221.4 million for the six months ended June 30, 2013.

The average balance of our core deposits, consisting of checking accounts, money market accounts and savings accounts, increased $11.5 million, or 11.9%, to $108.5 million for the six months ended June 30, 2014 from $97.0 million for the six months ended June 30, 2013. Also, the interest on core deposits increased $3,000 to $123,000 for the 2014 period from $120,000 for the 2013 period.

Interest expense on certificates of deposits increased $48,000 or 15.3% to $361,000 for the six months ended June 30, 2014 from $313,000 for the six months ended June 30, 2013. This was primarily due to an increase in the average balance of certificates of deposits of $33.7 million to $96.2 million for the 2014 period, from $62.5 million for the 2013 period. Also the yield on certificates of deposit decreased 25 basis points to 0.75% for the 2014 period from 1.00% for the 2013 period.

Net Interest Income. Net interest income increased $402,000, or 7.8%, to $5.6 million for the six months ended June 30, 2014 from $5.2 million for the six months ended June 30, 2013, as our average net loans increased $26.3 million from $250.1 million to $276.4 million, our net interest rate spread decreased 5 basis points to 3.35% from 3.40% and our net interest margin decreased 11 basis points to 3.47% from 3.56%. The increase in net interest income reflected the increase in net loans, historical restructuring of FHLB advances; paying off of our maturing, higher interest rate FHLB advances; and managing the maturities of higher interest rate certificates of deposit; managing the inflow, interest rates, and term structure of new deposits; offset by our ongoing interest rate risk strategy of selling in the secondary market long-term, fixed-rate one- to four-family residential mortgage loans during the current low interest rate environment.

37

Provision for Loan Losses. Based on our analysis of the factors described in “Critical Accounting Policies — Allowance for Loan Losses,” in the December 31, 2013 Annual Report on Form 10-K, we recorded a provision for loan losses of $495,000 for the six months ended June 30, 2014 and a provision for loan losses of $675,000 for the six months ended June 30, 2013. We have continued with additional provisions in 2014 because of loan growth, elevated levels of non-performing assets, delinquencies and classified assets, as well as continued concerns about the Michigan economy, elevated levels of unemployment, and some declining collateral values.

The allowance for loan losses as a percentage of non-performing loans increased to 145.9% at June 30, 2014 from 79.3% at June 30, 2013. To the best of our knowledge, we have provided for all losses that are both probable and reasonable to estimate at June 30, 2014 and 2013.

Noninterest Income. Noninterest income decreased $829,000, or 63.5%, to $476,000 for the six months ended June 30, 2014 from $1.3 million for the six months ended June 30, 2013. The decrease was primarily attributable to a decrease of $679,000 in gain on sale of mortgage loans, and a decrease of $97,000 in net gain on the sale of other real estate owned.

Noninterest Expense. Noninterest expense remained constant at $4.3 million for the six months ended June 30, 2013 to the six months ended June 30, 2014.

Income Tax Expense. We recorded a $444,000 income tax expense for the six months ended June 30, 2014 compared to a $476,000 income tax expense for the 2013 period, reflecting the income of $1.2 million before income tax expense during the six months ended June 30, 2014 versus income before income tax of $1.4 million for the six months ended June 30, 2013. Our effective tax expense rate was 36.1% for the six months ended June 30, 2014 compared to an effective tax expense rate of 33.1% for the six months ended June 30, 2013.

Asset Quality

Other real estate owned totaled $604,000, or 0.2% of total assets, at June 30, 2014 compared to $872,000, or 0.3% of total assets at December 31, 2013. The largest relationship as of June 30, 2014 was $426,900, or 71.0% of other real estate owned, which consisted of an office building and vacant lots.

Non-performing assets, which includes non-performing loans, other real estate owned and troubled debt restructurings, totaled $6.3 million, or 1.9% of total assets, at June 30, 2014 compared to $7.1 million, or 2.4% of total assets, at December 31, 2013. We believe that the decreases in nonperforming assets are a sign of improvement in the credit quality of our loan portfolio. However, our level of nonperforming assets has remained elevated, compared to historical levels, due to the unfavorable economic climate within the State of Michigan.

Our largest substandard relationship as of June 30, 2014 has a total balance of $5.3 million or $4.1 million net of funds held in escrow and on deposit, and this loan was downgraded to substandard during the second quarter of 2014. The loan is current with payments and property taxes. The borrower has the capacity and global cash flow and so far as demonstrated the willingness to keep payments current. If this situation deteriorates further, and thus jeopardize the full collection of principal and interest, it would mean changing the loan to non-accrual. Of the $23.9 million loans rated substandard, approximately $19.3 million are performing.

At June 30, 2014, we had three loans, totaling $215,000, for which we had temporarily extended the maturities while working on the loan renewal process. During the renewal process, the borrowers continue repayment according to the original loan terms which are at market interest rates. At June 30, 2014, none of these loans was considered substandard or a troubled debt restructuring, and all of these loans were considered performing at June 30, 2014.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable, as the Registrant is a smaller reporting company.

38

Item 4. Controls and Procedures

An evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer and the Chief Operating Officer and Treasurer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended) as of June 30, 2014. Based on that evaluation, our management, including the Chief Executive Officer and the Chief Operating Officer and Treasurer, concluded that our disclosure controls and procedures were effective.

During the quarter ended June 30, 2014, there were no changes in our internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Part II – Other Information

Item 1. Legal Proceedings

We are subject to various legal actions arising in the normal course of business. In the opinion of management, the resolution of these legal actions is not expected to have a material adverse effect on our financial condition or results of operations.

Item 1A. Risk Factors

Not applicable, as the Registrant is a smaller reporting company.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) There were no sales of unregistered securities during the period covered by this Report.

(b) Not applicable.

(c) The following table presents for the periods indicated a summary of the purchases made by or on behalf of the company of shares of its common stock.

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)(2)
April 1, 2014 through April 30, 2014		—	$	—		—		79,355
May 1, 2014 through May 31, 2014		16,000	$	22.17		16,000		63,355
June 1, 2014 through June 30, 2014		—	$	—		—		63,355
		16,000				16,000

(1) The Company’s board of directors approved a stock repurchase program on December 10, 2012 for the repurchase of 122,954 shares of common stock.

(2) The Company’s board of directors approved a stock repurchase program on December 9, 2013 for the repurchase of 119,167 shares of common stock.

Item 3. Defaults Upon Senior Securities

None.

39

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	INS XBRL Instance
101	SCH XBRL Taxonomy Extension Schema
101	CAL XBRL Taxonomy Extension Calculation
101	DEF XBRL Taxonomy Extension Definition
101	LAB XBRL Taxonomy Extension Label
101	PRE XBRL Taxonomy Extension Presentation

40

SIGNATURES

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

	WOLVERINE BANCORP, INC.
Date: August 14, 2014	/s/ David H. Dunn
	David H. Dunn
	President and Chief Executive Officer
Date: August 14, 2014	/s/ Rick A. Rosinski
	Rick A. Rosinski
	Chief Operating Officer and Treasurer

41

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, David H. Dunn, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Wolverine Bancorp, Inc.;

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

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

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15(d)-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-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 subsidiary, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

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

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

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

5. The registrant’s other certifying officer and I have disclosed, based on the Bank’s most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

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

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

Date: August 14, 2014	/s/ David H. Dunn
	David H. Dunn
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Rick A. Rosinski, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Wolverine Bancorp, Inc.;

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

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

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15(d)-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-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 subsidiary, 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 financial quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on the Bank’s most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

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

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

Date: August 14, 2014	/s/ Rick A. Rosinski
	Rick A. Rosinski
	Chief Operating Officer and Treasurer

EX-32

Exhibit 32

Certification of Chief Executive Officer and Chief Financial Officer

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

David H. Dunn, President and Chief Executive Officer of Wolverine Bancorp, Inc., (the “Company”) and Rick A. Rosinski, Chief Operating Officer and Treasurer of the Company, each certify in his capacity as an officer of the Company that he has reviewed the quarterly report on Form 10-Q for the quarter ended June 30, 2014 (the “Report”) and that to the best of his knowledge:

1. the Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; 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: August 14, 2014	/s/ David H. Dunn
	David H. Dunn
	President and Chief Executive Officer
Date: August 14, 2014	/s/ Rick A. Rosinski
	Rick A. Rosinski
	Chief Operating Officer and Treasurer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Earnings Per Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income	$ 480	$ 436	$ 785	$ 961
Income allocated to participating securities	(14)	(15)	(22)	(32)
Income attributable to common shareholders	$ 466	$ 421	$ 763	$ 929
Weighted average shares outstanding	2,288	2,439	2,292	2,447
Less: average unearned ESOP and unvested restricted stock	(226)	(177)	(226)	(177)
Average Shares	2,062	2,262	2,066	2,270
Effect of diluted based awards	12		12
Average common and common-equivalent shares for diluted EPS	2,074	2,262	2,078	2,270
Basic EPS	$ 0.23	$ 0.19	$ 0.37	$ 0.42
Diluted EPS	$ 0.23	$ 0.19	$ 0.37	$ 0.42

XML

Financing Receivables and Allowance for Credit Losses on Financing Receivables (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	$ 7,919	$ 6,989	$ 7,597	$ 6,671	$ 6,671
Provision charged to expense	195	350	495	675	830
Losses charged off	(31)	(2)	(31)	(14)	(212)
Recoveries	25	47	47	52	308
Balance, end of period	8,108	7,384	8,108	7,384	7,597
Ending Balance: individually evaluated for impairment	1,650	1,150	1,650	1,150	1,295
Ending balance: collectively evaluated for impairment	6,458	6,234	6,458	6,234	6,302
Loans:
Ending Balance	312,177	257,984	312,177	257,984	273,378
Ending Balance: individually evaluated for impairment	29,439	28,369	29,439	28,369	26,785
Ending Balance: collectively evaluated for impairment	282,738	229,615	282,738	229,615	246,593
Real Estate, One-to four-family
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	1,006	1,445	1,354	1,433	1,433
Provision charged to expense	(5)	(21)	(363)		116
Losses charged off	(30)		(30)	(12)	(210)
Recoveries	16	3	26	6	15
Balance, end of period	987	1,427	987	1,427	1,354
Ending Balance: individually evaluated for impairment		9		9
Ending balance: collectively evaluated for impairment	987	1,418	987	1,418	1,354
Loans:
Ending Balance	50,397	52,937	50,397	52,937	49,726
Ending Balance: individually evaluated for impairment	1,449	2,519	1,449	2,519	2,494
Ending Balance: collectively evaluated for impairment	48,948	50,418	48,948	50,418	47,232
Real Estate, Home equity
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	148	292	251	266	266
Provision charged to expense	6	(26)	(97)		(16)
Recoveries		1		1	1
Balance, end of period	154	267	154	267	251
Ending balance: collectively evaluated for impairment	154	267	154	267	251
Loans:
Ending Balance	7,219	8,135	7,219	8,135	7,912
Ending Balance: individually evaluated for impairment	63		63
Ending Balance: collectively evaluated for impairment	7,156	8,135	7,156	8,135	7,912
Commercial mortgage loans, Commercial real estate
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	3,475	2,856	2,861	2,663	2,663
Provision charged to expense	(300)	(193)	311		98
Recoveries	4	42	7	42	100
Balance, end of period	3,179	2,705	3,179	2,705	2,861
Ending Balance: individually evaluated for impairment	200	238	200	238	345
Ending balance: collectively evaluated for impairment	2,979	2,467	2,979	2,467	2,516
Loans:
Ending Balance	147,191	105,975	147,191	105,975	126,154
Ending Balance: individually evaluated for impairment	9,779	11,383	9,779	11,383	11,067
Ending Balance: collectively evaluated for impairment	137,412	94,592	137,412	94,592	115,087
Commercial mortgage loans, Multifamily
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	1,338	1,655	1,514	1,497	1,497
Provision charged to expense	(5)	(158)	(181)		17
Balance, end of period	1,333	1,497	1,333	1,497	1,514
Ending Balance: individually evaluated for impairment	100	48	100	48	100
Ending balance: collectively evaluated for impairment	1,233	1,449	1,233	1,449	1,414
Loans:
Ending Balance	60,248	62,618	60,248	62,618	62,790
Ending Balance: individually evaluated for impairment	8,316	8,597	8,316	8,597	8,462
Ending Balance: collectively evaluated for impairment	51,932	54,021	51,932	54,021	54,328
Commercial mortgage loans, Land
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	1,422	265	1,145	312	312
Provision charged to expense	(49)	722	221	675	651
Recoveries	4		11		182
Balance, end of period	1,377	987	1,377	987	1,145
Ending Balance: individually evaluated for impairment	850	840	850	840	850
Ending balance: collectively evaluated for impairment	527	147	527	147	295
Loans:
Ending Balance	9,568	9,896	9,568	9,896	9,734
Ending Balance: individually evaluated for impairment	3,888	4,588	3,888	4,588	4,162
Ending Balance: collectively evaluated for impairment	5,680	5,308	5,680	5,308	5,572
Construction
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	390	351	285	302	302
Provision charged to expense	419	(49)	523		(17)
Balance, end of period	808	302	808	302	285
Ending Balance: individually evaluated for impairment	500		500
Ending balance: collectively evaluated for impairment	308	302	308	302	285
Loans:
Ending Balance	23,609	13,677	23,609	13,677	8,669
Ending Balance: individually evaluated for impairment	5,349	325	5,349	325
Ending Balance: collectively evaluated for impairment	18,260	13,352	18,260	13,352	8,669
Commercial Non-mortgage
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	126	93	157	166	166
Provision charged to expense	126	73	96		(14)
Recoveries					5
Balance, end of period	253	166	253	166	157
Ending Balance: individually evaluated for impairment		15		15
Ending balance: collectively evaluated for impairment	253	151	253	151	157
Loans:
Ending Balance	12,801	3,589	12,801	3,589	7,226
Ending Balance: individually evaluated for impairment	595	957	595	957	600
Ending Balance: collectively evaluated for impairment	12,206	2,632	12,206	2,632	6,626
Consumer
Financing Receivable, Allowance for Credit Losses [Line Items]
Balance, beginning of period	14	32	30	32	32
Provision charged to expense	3	2	(15)		(5)
Losses charged off	(1)	(2)	(1)	(2)	(2)
Recoveries	1	1	3	3	5
Balance, end of period	17	33	17	33	30
Ending balance: collectively evaluated for impairment	17	33	17	33	30
Loans:
Ending Balance	1,144	1,157	1,144	1,157	1,167
Ending Balance: collectively evaluated for impairment	$ 1,144	$ 1,157	$ 1,144	$ 1,157	$ 1,167

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Summary of Restricted Stock Award Activity (Detail) (Restricted Stock, USD $)	6 Months Ended
	Jun. 30, 2014
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested at January 1, 2014	59,723
Granted	1,175
Vested	(229)
Forfeited
Non-vested at June 30, 2014	60,669
Weighted average grant date fair value, Non-vested at January 1, 2014	$ 17.33
Weighted average grant date fair value, Granted	$ 22.01
Weighted average grant date fair value, Vested	$ 18.82
Weighted average grant date fair value, Forfeited
Weighted average grant date fair value, Non-vested at June 30, 2014	$ 17.41

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Accounting Developments

6 Months Ended

Jun. 30, 2014

Accounting Developments

Note 2: Accounting Developments

Financial Accounting Standards Board (“FASB”)

In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-04, “Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure,” to reduce diversity by clarifying when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan receivable should be derecognized and the real estate property recognized. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

In January 2014, the FASB issued ASU 2014-01, “Accounting for Investments in Qualified Affordable Housing Projects,” to permit entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. The ASU modifies the conditions that an entity must meet to be eligible to use a method other than the equity or cost methods to account for qualified affordable housing project investments. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

Accounting Standards Update No. 2014-08- Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity – In April 2014, FASB issued ASU 2014-08. This update seeks to better define the groups of assets which qualify for discontinued operations, in order to ease the burden and cost for prepares and stakeholders. This issue changed “the criteria for reporting discontinued operations” and related reporting requirements, including the provision for disclosures about the “disposal of and individually significant component of an entity that does not qualify for discontinued operations presentation.”

The amendments in this Update are effective for fiscal years beginning after December 15, 2014. Early adoption is permitted only for disposals or classifications as held for sale. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

Accounting Standards Update No. 2014-09- Revenue from Contracts with Customers – In May 2014, FASB, in joint cooperation with IASB, issued ASU 2014-09. The topic of Revenue Recognition had become broad, with several other regulatory agencies issuing standards which lacked cohesion. The new guidance establishes a “common framework” and “reduces the number of requirements to which an entity must consider in recognizing revenue” and yet provides improved disclosures to assist stakeholders reviewing financial statements.

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2016. Early adoption is not permitted. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

Accounting Standards Update No. 2014-11- Transfers and Servicing – In June 2014, FASB, issued ASU 2014-11. This update addresses the concerns of stakeholders’ by changing the accounting practices surrounding repurchase agreements. The new guidance changes the “accounting for repurchase-to-maturity transactions and linked repurchase financings to secured borrowing accounting, which is consistent with the accounting for other repurchase agreements.”

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2015. Early adoption is prohibited. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

Accounting Standards Update No. 2014-12- Compensation – Stock Compensation – In June 2014, FASB, issued ASU 2014-12. This update defines the accounting treatment for share-based payments and “resolves the diverse accounting treatment of those awards in practice.” The new requirement mandates that “a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition.” Compensation cost will now be recognized in the period in which it becomes likely that the performance target will be met.

The amendments in this Update are effective for annual reporting periods beginning after December 15, 2015. Early adoption is permitted. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

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Summary of Loans Restructured as TDRs (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jun. 30, 2014 Contract	Jun. 30, 2014 Contract
Financing Receivable, Modifications [Line Items]
Count	1	1
Balance prior to TDR	$ 900	$ 900
Balance after TDR	900	900
Commercial Real Estate
Financing Receivable, Modifications [Line Items]
Count	1	1
Balance prior to TDR	900	900
Balance after TDR	$ 900	$ 900

XML

Summary of Impaired Loans by Class (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Financing Receivable, Recorded Investment, Past Due [Line Items]
Recorded Balance	$ 29,439	$ 28,369	$ 29,439	$ 28,369	$ 26,785
Unpaid Principal Balance	34,734	34,969	34,734	34,969	32,082
Specific Allowance	1,650	1,150	1,650	1,150	1,295
QTD Average Balance	27,429	36,458	27,744	33,115	26,850
QTD Interest Income	382	484	645	1,375	1,278
Real Estate, One-to four-family
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	1,269	2,456	1,269	2,456	2,494
Loans without a specific valuation allowance, Unpaid Principal Balance	1,579	2,665	1,579	2,665	2,712
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	1,472	2,711	1,780	2,767	2,668
Loans without a specific valuation allowance, QTD Interest Income	16	28	37	180	225
Loans with a specific valuation allowance, Recorded Balance	180	63	180	63
Loans with a specific valuation allowance, Unpaid Principal Balance	180	63	180	63
Loans with a specific valuation allowance, Specific Allowance		9		9
Loans with a specific valuation allowance, QTD Average Balance	180	103	181	142
Loans with a specific valuation allowance, QTD Interest Income	3	2	5	2
Recorded Balance	1,449	2,519	1,449	2,519	2,494
Unpaid Principal Balance	1,759	2,728	1,759	2,728	2,712
Specific Allowance		9		9
QTD Average Balance	1,652	2,814	1,961	2,909	2,668
QTD Interest Income	19	30	42	182	225
Real Estate, Home equity
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	63		63
Loans without a specific valuation allowance, Unpaid Principal Balance	63		63
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	64		65
Loans without a specific valuation allowance, QTD Interest Income	1		1
Recorded Balance	63		63
Unpaid Principal Balance	63		63
QTD Average Balance	64		65
QTD Interest Income	1		1
Commercial mortgage loans, Commercial real estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	6,741	7,607	6,741	7,607	7,128
Loans without a specific valuation allowance, Unpaid Principal Balance	9,180	9,776	9,180	9,776	9,152
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	7,036	9,495	7,607	6,989	7,630
Loans without a specific valuation allowance, QTD Interest Income	110	176	175	266	315
Loans with a specific valuation allowance, Recorded Balance	3,038	3,776	3,038	3,776	3,939
Loans with a specific valuation allowance, Unpaid Principal Balance	3,054	3,776	3,054	3,776	3,939
Loans with a specific valuation allowance, Specific Allowance	200	238	200	238	345
Loans with a specific valuation allowance, QTD Average Balance	3,058	3,762	3,085	4,978	2,843
Loans with a specific valuation allowance, QTD Interest Income	38	56	101	90	218
Recorded Balance	9,779	11,383	9,779	11,383	11,067
Unpaid Principal Balance	12,234	13,552	12,234	13,552	13,091
Specific Allowance	200	238	200	238	345
QTD Average Balance	10,094	13,257	10,692	11,967	10,473
QTD Interest Income	148	232	276	356	533
Commercial mortgage loans, Multifamily
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	6,971	7,768	6,971	7,768	7,099
Loans without a specific valuation allowance, Unpaid Principal Balance	7,786	8,584	7,786	8,584	7,914
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	7,002	10,431	7,034	8,637	7,325
Loans without a specific valuation allowance, QTD Interest Income	123	112	205	217	409
Loans with a specific valuation allowance, Recorded Balance	1,345	829	1,345	829	1,363
Loans with a specific valuation allowance, Unpaid Principal Balance	1,345	829	1,345	829	1,363
Loans with a specific valuation allowance, Specific Allowance	100	48	100	48	100
Loans with a specific valuation allowance, QTD Average Balance	1,348	836	1,353	840	1,100
Loans with a specific valuation allowance, QTD Interest Income	20	14	41	18	33
Recorded Balance	8,316	8,597	8,316	8,597	8,462
Unpaid Principal Balance	9,131	9,413	9,131	9,413	9,277
Specific Allowance	100	48	100	48	100
QTD Average Balance	8,350	11,267	8,387	9,477	8,425
QTD Interest Income	143	126	246	235	442
Commercial mortgage loans, Land
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	696	971	696	971	742
Loans without a specific valuation allowance, Unpaid Principal Balance	1,070	2,980	1,070	2,980	1,672
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	701	6,260	912	7,033	913
Loans without a specific valuation allowance, QTD Interest Income		55	1	274	48
Loans with a specific valuation allowance, Recorded Balance	3,192	3,617	3,192	3,617	3,420
Loans with a specific valuation allowance, Unpaid Principal Balance	4,531	4,910	4,531	4,910	4,730
Loans with a specific valuation allowance, Specific Allowance	850	840	850	840	850
Loans with a specific valuation allowance, QTD Average Balance	3,290	1,665	3,342	839	3,641
Loans with a specific valuation allowance, QTD Interest Income	1	26	1	289
Recorded Balance	3,888	4,588	3,888	4,588	4,162
Unpaid Principal Balance	5,601	7,890	5,601	7,890	6,402
Specific Allowance	850	840	850	840	850
QTD Average Balance	3,991	7,925	4,254	7,872	4,554
QTD Interest Income	1	81	2	563	48
Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance		325		325
Loans without a specific valuation allowance, Unpaid Principal Balance	1	327	1	327
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance		218		123
Loans without a specific valuation allowance, QTD Interest Income		1		4
Loans with a specific valuation allowance, Recorded Balance	5,349		5,349
Loans with a specific valuation allowance, Unpaid Principal Balance	5,349		5,349
Loans with a specific valuation allowance, Specific Allowance	500		500
Loans with a specific valuation allowance, QTD Average Balance	2,674		1,783
Loans with a specific valuation allowance, QTD Interest Income	64		64
Recorded Balance	5,349	325	5,349	325
Unpaid Principal Balance	5,350	327	5,350	327
Specific Allowance	500		500
QTD Average Balance	2,674	218	1,783	123
QTD Interest Income	64	1	64	4
Commercial Non-mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Recorded Balance	251	539	251	539	600
Loans without a specific valuation allowance, Unpaid Principal Balance	251	641	251	641	600
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance	254	552	244	275	726
Loans without a specific valuation allowance, QTD Interest Income	2	6	5	29	30
Loans with a specific valuation allowance, Recorded Balance	344	418	344	418
Loans with a specific valuation allowance, Unpaid Principal Balance	344	418	344	418
Loans with a specific valuation allowance, Specific Allowance		15		15
Loans with a specific valuation allowance, QTD Average Balance	350	425	358	492
Loans with a specific valuation allowance, QTD Interest Income	4	8	9	6
Recorded Balance	595	957	595	957	600
Unpaid Principal Balance	595	1,059	595	1,059	600
Specific Allowance		15		15
QTD Average Balance	604	977	602	767	726
QTD Interest Income	6	14	14	35	30
Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans without a specific valuation allowance, Specific Allowance
Loans without a specific valuation allowance, QTD Average Balance					4
QTD Average Balance					$ 4

XML

Summary of Fair Value Measurements of Assets and Liabilities Nonrecurring Basis (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items]
Collateral-dependent Impaired loans, fair value	$ 43	$ 7,681
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items]
Collateral-dependent Impaired loans, fair value	43	7,681
Fair Value, Measurements, Nonrecurring | Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Line Items]
Collateral-dependent Impaired loans, fair value	$ 43	$ 7,681

XML

Summary of Quantitative Information about Unobservable Inputs used in Recurring and Nonrecurring Level Three Fair Value Measurements Other Than Goodwill (Detail) (Significant Unobservable Inputs (Level 3), USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Quantitative Information About Significant Unobservable Inputs [Line Items]
Collateral-dependent impaired loans	$ 43	$ 7,681
Valuation Technique	Market comparable properties	Market comparable properties
Unobservable Inputs	Marketability discount	Marketability discount
Minimum
Quantitative Information About Significant Unobservable Inputs [Line Items]
Range (Weighted Average)		9.00%
Maximum
Quantitative Information About Significant Unobservable Inputs [Line Items]
Range (Weighted Average)	10.00%	46.00%
Weighted Average
Quantitative Information About Significant Unobservable Inputs [Line Items]
Range (Weighted Average)	10.00%	34.00%

XML

Basis of Presentation

6 Months Ended

Jun. 30, 2014

Basis of Presentation

Note 1: Basis of Presentation

The unaudited condensed consolidated financial statements of Wolverine Bancorp, Inc. (the “Company”), the holding company of Wolverine Bank (the “Bank”), have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) believed necessary for a fair presentation have been included. The condensed consolidated balance sheet of the Company as of December 31, 2013 has been derived from the audited consolidated balance sheet of the Company as of that date. Operating results for the six month period ended June 30, 2014 is not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto filed as part of our Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 31, 2014.

XML

Summary of Estimated Fair Values of Company's Financial Instruments (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Financial assets
Held to maturity securities	$ 57	$ 123
Interest receivable	817	699
Carrying Amount
Financial assets
Cash and cash equivalents	38,166	26,181
Held to maturity securities	57	123
Loans held for sale	1,883	1,325
Loans, net of allowance for loan losses	286,927	276,965
Federal Home Loan Bank stock	3,320	3,320
Interest receivable	817	699
Financial liabilities
Deposits	221,235	172,983
Federal Home Loan Bank advances	52,000	61,994
Interest payable	139	138
Fair Value Measurement | Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets
Cash and cash equivalents	38,166	26,181
Interest receivable	817	699
Financial liabilities
Deposits	89,643	99,121
Interest payable	139	138
Fair Value Measurement | Significant Other Observable Inputs (Level 2)
Financial assets
Held to maturity securities	57	123
Loans held for sale	1,883	1,330
Federal Home Loan Bank stock	3,320	3,320
Financial liabilities
Federal Home Loan Bank advances	52,555	60,653
Fair Value Measurement | Significant Unobservable Inputs (Level 3)
Financial assets
Loans, net of allowance for loan losses	289,814	280,407
Financial liabilities
Deposits	$ 110,296	$ 74,339

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Assets
Cash and due from banks	$ 502	$ 791
Interest-earning demand deposits	37,664	25,390
Cash and cash equivalents	38,166	26,181
Held to maturity securities	57	123
Loans held for sale	1,883	1,325
Loans, net of allowance for loan losses of $8,108 and $7,597	286,927	259,381
Premises and equipment, net	1,452	1,569
Federal Home Loan Bank stock	3,320	3,320
Other real estate owned	604	872
Accrued interest receivable	817	699
Other assets	4,535	4,291
Total assets	337,761	297,761
Liabilities
Deposits	221,235	172,983
Federal Home Loan Bank advances	52,000	61,994
Interest payable and other liabilities	3,670	2,459
Total liabilities	276,905	237,436
Commitments and Contingencies
Stockholders' Equity
Common Stock, $0.01 par value per share: Authorized - 100,000,000 shares Issued and outstanding - 2,280,844 and 2,297,725 at June 30, 2014 and December 31,2013	23	23
Additional paid-in capital	18,698	18,952
Unearned employee stock ownership plan (ESOP)	(1,666)	(1,666)
Retained earnings	43,801	43,016
Total stockholders' equity	60,856	60,325
Total liabilities and stockholders' equity	$ 337,761	$ 297,761

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Condensed Consolidated Statement of Change in Stockholders' Equity (USD $) In Thousands	Total	Common Stock	Additional Paid-in Capital	Unearned ESOP Shares	Retained Earnings
Balances at Dec. 31, 2013	$ 60,325	$ 23	$ 18,952	$ (1,666)	$ 43,016
Net income	785				785
Purchase of 16,000 shares of common stock	(442)		(442)
Share based compensation expense	160		160
Exercised options	28		28
Balances at Jun. 30, 2014	$ 60,856	$ 23	$ 18,698	$ (1,666)	$ 43,801

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Stock Option Activity (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Option
Options outstanding at January 1, 2014	129,080
Granted	2,350
Exercised	(4,001)
Forfeited	(1,968)
Expired
Options outstanding at June 30, 2014	125,461	129,080
Exercisable at June 30, 2014	23,820
Weighted average exercise price
Options outstanding at January 1, 2014	$ 17.30
Granted	$ 22.01
Exercised	$ 17.32
Forfeited	$ 17.50
Expired
Options outstanding at June 30, 2014	$ 17.38	$ 17.30
Exercisable at June 30, 2014	$ 17.30
Remaining contractual life (year)
Options outstanding at January 1, 2014	9 years	9 years
Exercisable at June 30, 2014	8 years 1 month 21 days
Aggregate Intrinsic Value
Options outstanding at January 1, 2014	$ 516
Options outstanding at June 30, 2014	667	516
Exercisable at June 30, 2014	$ 129

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Securities - Additional Information (Detail) (USD $)	Jun. 30, 2014	Jun. 30, 2013
Schedule of Available-for-sale Securities [Line Items]
Sale of securities	$ 0	$ 0

XML

Assumption Used in Black-Scholes Option Pricing Formula (Detail) (USD $)	0 Months Ended
	May 30, 2014	May 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	18.02%
Risk-free interest rate	2.14%
Expected dividend yield	1.90%
Expected life (in years)	7 years 6 months
Exercise price for the stock options		$ 22.01

XML

Loans and Allowance for Loan Losses - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014
Loans [Line Items]
Percentage of construction loans for commercial real estate of loan-to-completed appraised value ratio			75.00%
Maximum period for construction loans			9 months
Charge down to the net realizable value			Other secured loans are 120 days past due
Period for charge off of unsecured open end loans			180 days
Charge off of one-to-four family first and junior lien mortgages to the net realizable value less costs to sell			180 days
Period for charge down of secured loans to net realizable value			90 days
Minimum period for realizable of Troubled Debt Restructuring loans into nonaccrual status or default loans	90 days
Default Balance	$ 0	$ 0
Troubled Debt Restructuring
Loans [Line Items]
Minimum realizable period for new loan into accrual status under performance with new loan terms			6 months
Minimum
Loans [Line Items]
Period for discontinuation of accrual of interest on all loan classes			6 months

XML

Condensed Consolidated Statement of Change in Stockholders' Equity (Parenthetical)	6 Months Ended
	Jun. 30, 2014
Treasury stock, shares purchased	16,000

XML

Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Allowance for loan losses	$ 8,108	$ 7,597
Common Stock, par value	$ 0.01	$ 0.01
Common Stock, shares authorized	100,000,000	100,000,000
Common Stock, shares issued	2,280,844	2,297,725
Common Stock, shares outstanding	2,280,844	2,297,725

XML

Disclosures About Fair Value of Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Fair Value Measurements of Assets and Liabilities Nonrecurring Basis

The following table presents the fair value measurements of assets and liabilities recognized in the accompanying consolidated balance sheets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2014 and December 31, 2013.

			Fair Value Measurements Using
	Fair  Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2014
Collateral-dependent Impaired loans	$	43	$	—	$	—	$	43
December 31, 2013
Collateral-dependent Impaired loans	$	7,681	$	—	$	—	$	7,681

Summary of quantitative Information about Unobservable Inputs used in Recurring and Nonrecurring Level Three Fair Value Measurements Other than Goodwill

The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than good will at June 30, 2014 and December 31, 2013.

	Collateral-dependent Impaired Loans
	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
As of June 30, 2014 Collateral-dependent impaired loans	$	43	Market comparable properties	Marketability discount	10%(10%)
December 31, 2013 Collateral-dependent impaired loans	$	7,681	Market comparable properties	Marketability discount	9%-46% (34%)

Summary of Estimated Fair Values of Company's Financial Instruments

The following table presents estimated fair values of our financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value at the individual dates. The fair values of certain of these instruments were calculated by discounting expected cash flows, which involves significant judgments by management and uncertainties. Because no market exists for certain of these financial instruments and because management does not intend to sell these financial instruments, we do not know whether the fair values shown below represent values at which the respective financial instruments could be sold individually or in the aggregate.

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of June 30, 2014
Financial assets
Cash and cash equivalents	$	38,166	$	38,166	$	—	$	—
Held to maturity securities		57		—		57		—
Loans held for sale		1,883		—		1,883		—
Loans, net of allowance for loan losses		286,927		—		—		289,814
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		817		817		—		—
Financial liabilities
Deposits		221,235		89,643		—		110,296
Federal Home Loan Bank advances		52,000		—		52,555		—
Interest payable		139		139		—		—

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of December 31, 2013
Financial assets
Cash and cash equivalents	$	26,181	$	26,181	$	—	$	—
Held to maturity securities		123		—		123		—
Loans held for sale		1,325		—		1,330		—
Loans, net of allowance for loan losses		276,965		—		—		280,407
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		699		699		—		—
Financial liabilities
Deposits	$	172,983	$	99,121	$	—	$	74,339
Federal Home Loan Bank advances		61,994		—		60,653		—
Interest payable		138		138		—		—

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Aug. 12, 2014
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Trading Symbol	WBKC
Entity Registrant Name	WOLVERINE BANCORP, INC.
Entity Central Index Key	0001500836
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		2,280,844

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2014

Earnings Per Share

Earnings per share analysis for three months ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Three months ended June 30, 2014			Three months ended June 30, 2013
Net income	$	480		$	436
Income allocated to participating securities		(14	)		(15	)
Income attributable to common shareholders		466			421
Weighted average shares outstanding (in thousands)		2,288			2,439
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,062			2,262
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,074			2,262
Basic EPS	$	.23		$	.19
Diluted EPS	$	.23		$	.19

Six Months Ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Six Months Ended June 30, 2014			Six Months Ended June 30, 2013
Net income	$	785		$	961
Income allocated to participating securities		(22	)		(32	)
Income attributable to common shareholders		763			929
Weighted average shares outstanding (in thousands)		2,292			2,447
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,066			2,270
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,078			2,270
Basic EPS	$	.37		$	.42
Diluted EPS	$	.37		$	.42

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Condensed Consolidated Statements of Income and Comprehensive Income (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Interest and Dividend Income
Loans	$ 3,605	$ 3,321	$ 6,965	$ 6,631
Investment securities and other	66	84	116	128
Total interest and dividend income	3,671	3,405	7,081	6,759
Interest Expense
Deposits	294	209	485	433
Borrowings	507	587	1,037	1,169
Total interest expense	801	796	1,522	1,602
Net Interest Income	2,870	2,609	5,559	5,157
Provision for Loan Losses	195	350	495	675
Net Interest Income After Provision for Loan Losses	2,675	2,259	5,064	4,482
Noninterest Income
Service charges and fees	54	56	105	110
Net gain on loan sales	171	434	291	970
Net gain (loss) on sale of real estate owned	23	6	3	100
Other	47	74	77	125
Total noninterest income	295	570	476	1,305
Noninterest Expense
Salaries and employee benefits	1,298	1,348	2,529	2,640
Net occupancy and equipment expense	227	231	448	409
Information technology expense	62	57	122	114
Federal deposit insurance corporation premiums	61	51	114	109
Professional and services fees	102	55	252	184
Other real estate owned expense	39	11	58	29
Loan legal expense	34	52	47	99
Advertising expense	52	69	92	134
Michigan business tax	45	46	97	93
Other	286	271	552	539
Total noninterest expense	2,206	2,191	4,311	4,350
Income Before Income Tax	764	638	1,229	1,437
Provision for Income Taxes	284	202	444	476
Net Income and Comprehensive Income	$ 480	$ 436	$ 785	$ 961
Earnings Per Share:
Basic	$ 0.23	$ 0.19	$ 0.37	$ 0.42
Diluted	$ 0.23	$ 0.19	$ 0.37	$ 0.42

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Disclosures About Fair Value of Assets and Liabilities

6 Months Ended

Jun. 30, 2014

Disclosures About Fair Value of Assets and Liabilities

Note 5: Disclosures About Fair Value of Assets and Liabilities

ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Topic 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1	Quoted prices in active markets for identical assets or liabilities.
Level 2	Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
Level 3	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities

Following is a description of the valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying consolidated balance sheets, as well as the general classification of such assets under the valuation hierarchy. We have no assets or liabilities measured at fair value on a recurring basis and no liabilities measured at fair value on a nonrecurring basis.

Nonrecurring Measurements

The following table presents the fair value measurements of assets and liabilities recognized in the accompanying consolidated balance sheets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2014 and December 31, 2013.

			Fair Value Measurements Using
	Fair  Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2014
Collateral-dependent Impaired loans	$	43	$	—	$	—	$	43
December 31, 2013
Collateral-dependent Impaired loans	$	7,681	$	—	$	—	$	7,681

Collateral-dependent Impaired Loans

The estimated fair value of collateral-dependent impaired loans is based on the appraised fair value of the collateral, less estimated cost to sell. Collateral-dependent impaired loans are classified within Level 3 of the fair value hierarchy.

The Company considers the appraisal or an evaluation as the starting point for determining fair value and then considers other factors and events in the environment that may affect the fair value. Appraisals of the collateral underlying collateral-dependent loans are obtained when the loan is determined to be collateral-dependent or subsequently as deemed necessary and approved by management. Appraisals are reviewed for accuracy and consistency by the Credit Analysis department. Typically, appraisers are selected from the list of approved appraisers maintained by the Underwriting department. The appraised values may be reduced by discounts to consider a lack of marketability or estimated cost to sell if repayment or satisfaction of the loan is dependent on the sale of the collateral. These discounts and estimates are developed by the Credit Analysis department and approved by management.

Unobservable (Level 3) inputs

The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than good will at June 30, 2014 and December 31, 2013.

	Collateral-dependent Impaired Loans
	Fair Value		Valuation Technique	Unobservable Inputs	Range (Weighted Average)
As of June 30, 2014 Collateral-dependent impaired loans	$	43	Market comparable properties	Marketability discount	10%(10%)
December 31, 2013 Collateral-dependent impaired loans	$	7,681	Market comparable properties	Marketability discount	9%-46% (34%)

Fair Value of Financial Instruments

The following table presents estimated fair values of our financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value at the individual dates. The fair values of certain of these instruments were calculated by discounting expected cash flows, which involves significant judgments by management and uncertainties. Because no market exists for certain of these financial instruments and because management does not intend to sell these financial instruments, we do not know whether the fair values shown below represent values at which the respective financial instruments could be sold individually or in the aggregate.

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of June 30, 2014
Financial assets
Cash and cash equivalents	$	38,166	$	38,166	$	—	$	—
Held to maturity securities		57		—		57		—
Loans held for sale		1,883		—		1,883		—
Loans, net of allowance for loan losses		286,927		—		—		289,814
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		817		817		—		—
Financial liabilities
Deposits		221,235		89,643		—		110,296
Federal Home Loan Bank advances		52,000		—		52,555		—
Interest payable		139		139		—		—

			Fair Value Measurements Using
	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of December 31, 2013
Financial assets
Cash and cash equivalents	$	26,181	$	26,181	$	—	$	—
Held to maturity securities		123		—		123		—
Loans held for sale		1,325		—		1,330		—
Loans, net of allowance for loan losses		276,965		—		—		280,407
Federal Home Loan Bank stock		3,320		—		3,320		—
Interest receivable		699		699		—		—
Financial liabilities
Deposits	$	172,983	$	99,121	$	—	$	74,339
Federal Home Loan Bank advances		61,994		—		60,653		—
Interest payable		138		138		—		—

The following methods and assumptions were used to estimate the fair value of all other financial instruments recognized in the accompanying consolidated balance sheets at amounts other than fair value.

Cash and Cash Equivalents, Federal Home Loan Bank Stock, Interest Receivable, and Interest Payable

The carrying amount approximates fair value.

Held to Maturity Securities

Fair values equal quoted market prices, if available. If quoted market prices are not available, fair value is estimated based on quoted market prices of similar securities.

Loans Held for Sale

Fair value is estimated using quoted market prices from the secondary market.

Loans

The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. Loans with similar characteristics were aggregated for purposes of the calculations.

Deposits

Deposits include demand deposits, savings accounts, checking accounts and certain money market deposits. The carrying amount approximates fair value. The fair value of fixed-maturity time deposits is estimated using a discounted cash flow calculation that applies the rates currently offered for deposits of similar remaining maturities.

Federal Home Loan Bank Advances

Rates currently available to us for debt with similar terms and remaining maturities are used to estimate the fair value of existing debt.

Commitments to Originate Loans, Letters of Credit and Lines of Credit

Loan commitments and letters-of-credit generally have short-term, variable rate features and contain clauses which limit our exposure to changes in customer credit quality. Accordingly, their carrying values, which are immaterial at the respective balance sheet dates, are reasonable estimates of fair value.

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Loans and Allowance for Loan Losses

6 Months Ended

Jun. 30, 2014

Loans and Allowance for Loan Losses

Note 4: Loans and Allowance for Loan Losses

Categories of loans include:

	June 30, 2014		December 31, 2013
Real Estate
One-to four-family	$	50,397	$	49,726
Home equity		7,219		7,912
Commercial mortgage loans
Commercial real estate		147,191		126,154
Multifamily		60,248		62,790
Land		9,568		9,734
Construction		23,609		8,669
Commercial Non-mortgage		12,801		7,226
Consumer		1,144		1,167
Total loans		312,177		273,378
Less
Net deferred loan fees, premiums and discounts		633		467
Undisbursed portion of loans		16,509		5,933
Allowance for loan losses		8,108		7,597
Net loans	$	286,927	$	259,381

The risk characteristics of each loan portfolio segment are as follows:

1-4 Family, Home Equity, and Consumer

With respect to residential loans that are secured by one-to four-family residences and are primarily owner-occupied, we generally establish a maximum loan-to-value ratio and require PMI if that ratio is exceeded. Home equity loans are typically secured by a subordinate interest in one-to four-family residences, and consumer loans are typically secured by consumer assets such as automobiles or recreational vehicles. Some consumer loans are unsecured such as small installment loans. Repayment of these loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas such as unemployment levels. Repayment can also be impacted by changes in property values on residential properties.

Home equity loans secured by second mortgages have greater risk than one- to four-family residential mortgage loans secured by first mortgages. We face the risk that the collateral will be insufficient to compensate us for loan losses and costs of foreclosure. When customers default on their loans, we attempt to foreclose on the property and resell the property as soon as possible to minimize foreclosure and carrying costs. However, the value of the collateral may not be sufficient to compensate us for the amount of the unpaid loan and we may be unsuccessful in recovering the remaining balance from those customers. Particularly with respect to our home equity loans, decreases in real estate values could adversely affect the value of property used as collateral for our loans.

Consumer and other loans generally have greater risk compared to longer-term loans secured by improved, owner-occupied real estate, particularly consumer loans that are secured by rapidly depreciable assets, such as automobiles. In these cases, any repossessed collateral for a defaulted loan may not provide an adequate source of repayment of the outstanding loan balance. As a result, consumer loan collections are dependent on the borrower’s continuing financial stability and thus are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy.

Commercial real estate and multifamily

Commercial real estate and multifamily loans generally have greater credit risk than the owner-occupied one- to four-family residential mortgage loans that we originate for retention in our loan portfolio. Repayment of these loans generally depends, in large part, on sufficient income from the property securing the loan or the borrower’s business to cover operating expenses and debt service. These types of loans typically involve larger loan balances to single borrowers or groups of related borrowers compared to one- to four-family residential mortgage loans. Changes in economic conditions that are beyond the control of the borrower may affect the value of the security for the loan, the future cash flow of the affected property or business, or the marketability of a construction project with respect to loans originated for the acquisition and development of property. Additionally, due to declining property values in our primary market area and in Michigan, the loan to value ratios of many of our commercial real estate and multifamily loans have increased significantly from the loan to value ratios that were assigned to these loans at the time of origination.

Land

Land loans generally have greater credit risk than the owner-occupied one-to four-family residential mortgage loans that we originate for retention in our portfolio. Repayment of these loans generally depends, in large part, on the sale of the land. The sale of land can either take place when the land is undeveloped, or developed. Generally, other cash flow sources of the borrower are utilized to make additional payments on land loans. Changes in economic conditions that are beyond the control of the borrower may affect the value of the security for the loan, the future cash flow of the affected property or business, or the marketability of a construction project with respect to loans originated for the acquisition and development of property. Additionally, due to declining property values in our primary market area and in Michigan, the loan to value ratios of many of our land loans have increased significantly from the loan to value ratios that were assigned to these loans at the time of origination.

Construction

Construction loans include those for one- to four-family residential properties and commercial properties, including multifamily loans and commercial “mixed-use” buildings and homes built by developers on speculation. With respect to construction loans for one- to four-family residential properties and which are primarily owner-occupied, we generally establish a maximum loan-to-value ratio and require PMI if that ratio is exceeded. These are generally “interest-only” loans during the construction period which typically does not exceed nine months. Construction loans for commercial real estate are made in accordance with a schedule reflecting the cost of construction, and are generally limited to a 75% loan-to-completed appraised value ratio. For all construction loans, we generally require that a commitment for permanent financing be in place prior to closing the construction loan

Repayment of one-to four-family residential property loans is primarily dependent on the personal income of the borrowers, which can be impacted by economic conditions in their market areas such as unemployment levels. Repayment of commercial property loans and homes built by developers on speculation is normally expected from the property’s eventual rental income, income from the borrower’s operations, the personal resources of the guarantor, or the sale of the subject property. Generally, before making a commitment to fund a construction loan, we require an appraisal of the property by a state-certified or state-licensed appraiser. We generally review and inspect properties before disbursement of funds during the term of the construction loan.

Construction financing generally involves greater credit risk than long-term financing on improved, owner-occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the value of the property at completion of construction compared to the estimated cost (including interest) of construction and other assumptions. If the estimate of construction cost is inaccurate, we may be required to advance additional funds beyond the amount originally committed in order to protect the value of the property. Moreover, if the estimated value of the completed project is inaccurate, the borrower may hold a property with a value that is insufficient to assure full repayment of the construction loan upon the sale of the property. Construction loans also expose us to the risk that improvements will not be completed on time in accordance with specifications and projected costs. In addition, the ultimate sale or rental of the property may not occur as anticipated.

Commercial non-mortgage

Commercial non-mortgage loans generally have a greater credit risk than residential mortgage loans. Unlike residential mortgage loans, which generally are made on the basis of the borrower’s ability to make repayment from his or her employment and other income, and which are secured by real property whose value tends to be more easily ascertainable, commercial non-mortgage loans are of higher risk and typically are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business.

As a result, the availability of funds for the repayment of commercial non-mortgage loans may be substantially dependent on the success of the business itself. Further, the collateral securing the loans may depreciate over time, may be difficult to appraise and may fluctuate in value based on the success of the business. In determining the appropriate level of allowance for loan loss, we analyze various components of our portfolio. The following components are analyzed: all substandard loans on an individual basis; all loans that are designated special mention or closely monitored; loans not classified according to purpose or collateral type; and overdrawn deposit account balances.

We also factor in historical loss experience and qualitative considerations, including trends in charge offs and recoveries; trends in delinquencies and impaired/classified loans; effects of credit concentrations; changes in underwriting standards and loan review system; experience in lending staff; current industry conditions; and current market conditions.

In instances where risk and loss exposure is clearly identified with a particular asset, the asset or a portion of the asset will be charged off.

The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of June 30, 2014, December 31, 2013 and June 30, 2013:

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily			Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,354		$	251		$	2,861	$	1,514		$	1,145	$	285	$	157	$	30		$	7,597
Provision charged to expense		(363	)		(97	)		311		(181	)		221		523		96		(15	)		495
Losses charged off		(30	)		—			—		—			—		—		—		(1	)		(31	)
Recoveries		26			—			7		—			11		—		—		3			47
Balance, end of period	$	987		$	154		$	3,179	$	1,333		$	1,377	$	808	$	253	$	17		$	8,108
Ending Balance: individually evaluated for impairment	$	—		$	—		$	200	$	100		$	850	$	500	$	—	$	—		$	1,650
Ending balance: collectively evaluated for impairment	$	987		$	154		$	2,979	$	1,233		$	527	$	308	$	253	$	17		$	6,458
Loans:
Ending Balance	$	50,397		$	7,219		$	147,191	$	60,248		$	9,568	$	23,609	$	12,801	$	1,144		$	312,177
Ending Balance: individually evaluated for impairment	$	1,449		$	63		$	9,779	$	8,316		$	3,888	$	5,349	$	595	$	—		$	29,439
Ending Balance: collectively evaluated for impairment	$	48,948		$	7,156		$	137,412	$	51,932		$	5,680	$	18,260	$	12,206	$	1,144		$	282,738

Loan Class	1-4 Family			Home Equity		Commercial Real Estate			Multifamily			Land			Construction		Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,006		$	148	$	3,475		$	1,338		$	1,422		$	390	$	126	$	14		$	7,919
Provision charged to expense		(5	)		6		(300	)		(5	)		(49	)		419		126		3			195
Losses charged off		(30	)		—		—			—			—			—		—		(1	)		(31	)
Recoveries		16			—		4			—			4			—		—		1			25
Balance, end of period	$	987		$	154	$	3,179		$	1,333		$	1,377		$	808	$	253	$	17		$	8,108

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily		Land		Construction			Commercial Non- Mortgage			Consumer			Total
Year to date analysis as of December 31, 2013
Allowance for loan losses:
Balance, beginning of year	$	1,433		$	266		$	2,663	$	1,497	$	312	$	302		$	166		$	32		$	6,671
Provision charged to expense		116			(16	)		98		17		651		(17	)		(14	)		(5	)		830
Losses charged off		(210	)		—			—		—		—		—			—			(2	)		(212	)
Recoveries		15			1			100		—		182		—			5			5			308
Balance, end of year	$	1,354		$	251		$	2,861	$	1,514	$	1,145	$	285		$	157		$	30		$	7,597
Ending Balance: individually evaluated for impairment	$	—		$	—		$	345	$	100	$	850	$	—		$	—		$	—		$	1,295
Ending balance: collectively evaluated for impairment	$	1,354		$	251		$	2,516	$	1,414	$	295	$	285		$	157		$	30		$	6,302
Loans:
Ending Balance	$	49,726		$	7,912		$	126,154	$	62,790	$	9,734	$	8,669		$	7,226		$	1,167		$	273,378
Ending Balance: individually evaluated for impairment	$	2,494		$	—		$	11,067	$	8,462	$	4,162		—		$	600		$	—		$	26,785
Ending Balance: collectively evaluated for impairment	$	47,232		$	7,912		$	115,087	$	54,328	$	5,572	$	8,669		$	6,626		$	1,167		$	246,593

Loan Class	1-4 Family			Home Equity		Commercial Real Estate		Multifamily		Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,433		$	266	$	2,663	$	1,497	$	312	$	302	$	166	$	32		$	6,671
Provision charged to expense		—			—		—		—		675		—		—		—			675
Losses charged off		(12	)		—		—		—		—		—		—		(2	)		(14	)
Recoveries		6			1		42		—		—		—		—		3			52
Balance, end of period	$	1,427		$	267	$	2,705	$	1,497	$	987	$	302	$	166	$	33		$	7,384
Ending Balance: individually evaluated for impairment	$	9		$	—	$	238	$	48	$	840	$	—	$	15	$	—		$	1,150
Ending balance: collectively evaluated for impairment	$	1,418		$	267	$	2,467	$	1,449	$	147	$	302	$	151	$	33		$	6,234
Loans:
Ending Balance	$	52,937		$	8,135	$	105,975	$	62,618	$	9,896	$	13,677	$	3,589	$	1,157		$	257,984
Ending Balance: individually evaluated for impairment	$	2,519		$	—	$	11,383	$	8,597	$	4,588	$	325	$	957	$	—		$	28,369
Ending Balance: collectively evaluated for impairment	$	50,418		$	8,135	$	94,592	$	54,021	$	5,308	$	13,352	$	2,632	$	1,157		$	229,615

Loan Class	1-4 Family			Home Equity			Commercial Real Estate			Multifamily			Land		Construction			Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,445		$	292		$	2,856		$	1,655		$	265	$	351		$	93	$	32		$	6,989
Provision charged to expense		(21	)		(26	)		(193	)		(158	)		722		(49	)		73		2			350
Losses charged off		—			—			—			—			—		—			—		(2	)		(2	)
Recoveries		3			1			42			—			—		—			—		1			47
Balance, end of period	$	1,427		$	267		$	2,705		$	1,497		$	987	$	302		$	166	$	33		$	7,384

Consistent with regulatory guidance, charge offs on all loan segments are taken when specific loans, or portions thereof, are considered uncollectible. Our policy is to promptly charge these loans off in the period the uncollectible loss is reasonably determined.

For all loan portfolio segments except one-to-four family residential loans and consumer loans, we promptly charge off loans, or portions thereof, when available information confirms that specific loans are uncollectible based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower’s ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral.

We charge off one-to-four family residential and consumer loans, or portions thereof, when we reasonably determine the amount of the loss. We adhere to timeframes established by applicable regulatory guidance which provides for the charge off of one-to-four family first and junior lien mortgages to the net realizable value less costs to sell when the loan is 180 days past due, charge off of unsecured open-end loans when the loan is 180 days past due, and charge down to the net realizable value when other secured loans are 120 days past due. Loans at these respective delinquency thresholds for which we can clearly document that the loan is both well-secured and in the process of collection, such that collection will occur regardless of delinquency status, need not be charged off.

The following table presents the credit risk profile of our loan portfolio based on rating category and payment activity as of June 30, 2014 and December 31, 2013:

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	47,216	$	45,735	$	7,219	$	7,806	$	130,383	$	107,825	$	46,678	$	48,808
Pass (Closely Monitored)		1,709		1,827		—		106		3,762		4,081		8,850		9,170
Special Mention		419		818		—		—		4,211		4,992		—		—
Substandard		1,053		1,346		—		—		8,835		9,256		4,720		4,812
Doubtful		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—
	$	50,397	$	49,726	$	7,219	$	7,912	$	147,191	$	126,154	$	60,248	$	62,790

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2014		2013		2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	4,162	$	3,742	$	18,260	$	8,669	$	12,073	$	6,540	$	1,144	$	1,167	$	267,135	$	230,292
Pass (Closely Monitored)		2,165		1,830		—		—		133		55		—		—		16,619		17,069
Special Mention		—		43		—		—		27		36		—		—		4,657		5,889
Substandard		3,241		4,119		5,349		—		568		595		—		—		23,766		20,128
Doubtful		—		—		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—		—		—
	$	9,568	$	9,734	$	23,609	$	8,669	$	12,801	$	7,226	$	1,144	$	1,167	$	312,177	$	273,378

We categorize loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation and current economic trends, among other factors. We analyze loans individually by classifying the loans as to credit risk. This analysis is performed during the loan approval process and is updated as circumstances warrant.

The Pass asset quality rating encompasses assets that have performed as expected. These assets generally do not have delinquency or servicing issues. Loans assigned this rating include loans to borrowers possessing solid credit quality with acceptable risk. Borrowers in these grades are differentiated from higher grades on the basis of size (capital and/or revenue), leverage, asset quality, stability of the industry or specific market area and quality/coverage of collateral. These borrowers generally have a history of consistent earnings and reasonable leverage.

The Closely Monitored asset quality rating encompasses assets that have been brought to the attention of management and may, if not corrected, warrant a more serious quality rating by management. These assets are usually in the first phase of a deficiency situation and may possess similar criteria as Special Mention assets. This grade includes loans to borrowers which require special monitoring because of deteriorating financial results, declining credit ratings, decreasing cash flow, increasing leverage, marginal collateral coverage or industry stress that has resulted or may result in a changing overall risk profile.

The Special Mention asset quality rating encompasses assets that have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. This grade is intended to include loans to borrowers whose credit quality has clearly deteriorated and where risk of further decline is possible unless active measures are taken to correct the situation. Weaknesses are considered potential at this state and are not yet fully defined.

The Substandard asset quality rating encompasses assets that are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any; assets having a well-defined weakness(es) based upon objective evidence; assets characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected; or the possibility that liquidation will not be timely. Loans categorized in this grade possess a well defined credit weakness and the likelihood of repayment from the primary source is uncertain. Significant financial deterioration has occurred and very close attention is warranted to ensure the full repayment without loss. Collateral coverage may be marginal and the accrual of interest has been suspended.

The Doubtful asset quality rating encompasses assets that have all of the weaknesses of those classified as Substandard. In addition, these weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

The Loss asset quality rating encompasses assets that are considered uncollectible and of such little value that their continuance as assets of the Bank is not warranted. A loss classification does not mean that an asset has no recovery or salvage value; instead, it means that it is not practical or desirable to defer writing off or reserving all or a portion of a basically worthless asset, even though partial recovery may be realized in the future.

The following table is a summary of our past due and non-accrual loans as of June 30, 2014 and December 31, 2013:

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
1-4 Family	$	86	$	—	$	138	$	224	$	50,173	$	50,397	$	—	$	138
Home Equity		—		—		—		—		7,219		7,219		—		—
Commercial Real Estate		181		504		44		729		146,462		147,191		—		713
Multifamily		—		—		—		—		60,248		60,248		—		—
Land		49		—		3,165		3,214		6,354		9,568		—		4,007
Construction		—		—		—		—		23,609		23,609		—		—
Commercial Non-Mortgage		—		—		27		27		12,774		12,801		—		143
Consumer		—		—		—		—		1,144		1,144		—		—
Total	$	316	$	504	$	3,374	$	4,194	$	307,983	$	312,177	$	—	$	5,001

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
As of December 31, 2013:
1-4 Family	$	217	$	—	$	254	$	471	$	49,255	$	49,726	$	—	$	254
Home Equity		—		—		—		—		7,912		7,912		—		—
Commercial Real Estate		716		667		49		1,432		124,722		126,154		—		779
Multifamily		—		—		1,363		1,363		61,427		62,790		1,363		—
Land		—		—		4,068		4,068		5,666		9,734		27		4,041
Construction		—		—		—		—		8,669		8,669		—		—
Commercial Non-Mortgage		—		—		36		36		7,190		7,226		—		157
Consumer		—		—		—		—		1,167		1,167		—		—
Total	$	933	$	667	$	5,770	$	7,370	$	266,008	$	273,378	$	1,390	$	5,231

Nonaccrual Loan and Past Due Loans. The accrual of interest is discontinued on all loan classes at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. The entire balance of a loan is considered delinquent if the minimum payment contractually required to be made is not received by the specified due date.

All interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. Subsequent payments on non-accrual loans are recorded as a reduction of principal, and interest income is recorded only after principal recovery is reasonably assured. Nonaccrual loans are returned to accrual status when, in the opinion of management, the financial position of the borrower indicates there is no longer any reasonable doubt as to the timely collection of interest or principal. We generally require a period of satisfactory performance of not less than six months before returning a nonaccrual loan to accrual status.

A loan is considered impaired, in accordance with the impairment accounting guidance (ASC 310-10-35-16), when based on current information and events, it is probable we will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include non-performing commercial loans but also include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties. These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection. Interest income on loans individually classified as impaired is recognized on a cash basis after all past due and current principal payments have been made.

The following table presents impaired loans at June 30, 2014:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	1,269	$	1,579	$	—	$	1,472	$	1,780	$	16	$	37
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		6,741		9,180		—		7,036		7,607		110		175
Multifamily		6,971		7,786		—		7,002		7,034		123		205
Land		696		1,070		—		701		912		—		1
Construction		—		1		—		—		—		—		—
Commercial Non-Mortgage		251		251		—		254		244		2		5
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family		180		180		—		180		181		3		5
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,038		3,054		200		3,058		3,085		38		101
Multifamily		1,345		1,345		100		1,348		1,353		20		41
Land		3,192		4,531		850		3,290		3,342		1		1
Construction		5,349		5,349		500		2,674		1,783		64		64
Commercial Non-Mortgage		344		344		—		350		358		4		9
Consumer		—		—		—		—		—		—		—
Total
1-4 Family	$	1,449	$	1,759	$	—	$	1,652	$	1,961	$	19	$	42
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		9,779		12,234		200		10,094		10,692		148		276
Multifamily		8,316		9,131		100		8,350		8,387		143		246
Land		3,888		5,601		850		3,991		4,254		1		2
Construction		5,349		5,350		500		2,674		1,783		64		64
Commercial Non-Mortgage		595		595		—		604		602		6		14
Consumer		—		—		—		—		—		—		—
Total	$	29,439	$	34,734	$	1,650	$	27,429	$	27,744	$	382	$	645

The following table presents impaired loans at December 31, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		YTD Average Balance		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		7,128		9,152		—		7,630		315
Multifamily		7,099		7,914		—		7,325		409
Land		742		1,672		—		913		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Loans with a specific valuation allowance
1-4 Family		—		—		—		—		—
Home Equity		—		—		—				—
Commercial Real Estate		3,939		3,939		345		2,843		218
Multifamily		1,363		1,363		100		1,100		33
Land		3,420		4,730		850		3,641		—
Construction		—		—		—		—		—
Commercial Non-Mortgage		—		—		—		—		—
Consumer		—		—		—		—		—
Totals
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		11,067		13,091		345		10,473		533
Multifamily		8,462		9,277		100		8,425		442
Land		4,162		6,402		850		4,554		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Total	$	26,785	$	32,082	$	1,295	$	26,850	$	1,278

The following table presents impaired loans at June 30, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,456	$	2,665	$	—	$	2,711	$	2,767	$	28	$	180
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		7,607		9,776		—		9,495		6,989		176		266
Multifamily		7,768		8,584		—		10,431		8,637		112		217
Land		971		2,980		—		6,260		7,033		55		274
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		539		641		—		552		275		6		29
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family	$	63	$	63	$	9	$	103	$	142	$	2	$	2
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,776		3,776		238		3,762		4,978		56		90
Multifamily		829		829		48		836		840		14		18
Land		3,617		4,910		840		1,665		839		26		289
Construction		—		—		—		—		—		—		—
Commercial Non-Mortgage		418		418		15		425		492		8		6
Consumer		—		—		—		—		—		—
Total
1-4 Family	$	2,519	$	2,728	$	9	$	2,814	$	2,909	$	30	$	182
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		11,383		13,552		238		13,257		11,967		232		356
Multifamily		8,597		9,413		48		11,267		9,477		126		235
Land		4,588		7,890		840		7,925		7,872		81		563
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		957		1,059		15		977		767		14		35
Consumer		—		—		—		—		—		—		—
Total	$	28,369	$	34,969	$	1,150	$	36,458	$	33,115	$	484	$	1,375

Interest payments on impaired loans are typically applied to principal unless collectability of the principal amount is reasonably assumed, in which case interest is recognized on a cash basis and is reasonable compared to interest income noted above.

Troubled Debt Restructuring (TDR)

We may grant a concession or modification for economic or legal reasons related to a borrower’s financial condition that we would not otherwise consider resulting in a modified loan which is then identified as a troubled debt restructuring. We may modify loans through rate reductions, short-term extensions of maturity, interest only payments, or payment modifications to better match the timing of cash flows due under the modified terms with the cash flows from the borrowers’ operations. Loan modifications are intended to minimize the economic loss and to avoid foreclosure or repossession of the collateral.

We identify loans for potential restructure primarily through direct communication with the borrower and evaluation of the borrower’s financial statements, revenue projections, tax returns, and credit reports. Even if the borrower is not presently in default, management will consider the likelihood that cash flow shortages, adverse economic conditions, and negative trends may result in a payment default in the near future.

For one-to-four family residential and home equity lines of credit, a restructure often occurs with past due loans and may be offered as an alternative to foreclosure. There are other situations where borrowers, who are not past due, experience a sudden job loss, become over-extended with credit obligations, or other problems, have indicated that they will be unable to make the required monthly payment and request payment relief.

When considering a loan restructure, management will determine if: (i) the financial distress is short or long term; (ii) loan concessions are necessary; and (iii) the restructure is a viable solution.

When a loan is restructured, the new terms often require a reduced monthly debt service payment. No TDRs that were on non-accrual status at the time the concessions were granted have been returned to accrual status. For commercial loans, management completes an analysis of the operating entity’s ability to repay the debt. If the operating entity is capable of servicing the new debt service requirements and the underlying collateral value is believed to be sufficient to repay the debt in the event of a future default, the new loan can be placed on accrual status after six months of performance with the new loan terms. To date, there have been no commercial loans restructured and immediately placed on accrual status after the execution of the TDR.

For retail loans, an analysis of the individual’s ability to service the new required payments is performed. If the borrower is capable of servicing the newly restructured debt and the underlying collateral value is believed to be sufficient to repay the debt in the event of a future default, the new loan can be placed on accrual status after six months of performance to the new loan terms. The reason for the TDR is also considered, such as paying past due real estate taxes or payments caused by a temporary job loss, when determining whether a retail TDR loan could be returned to accrual status. Retail TDRs remain on nonaccrual status until sufficient payments have been made to bring the past due principal and interest current and/or after six months of performance to the new loan terms at which point the loan could be transferred to accrual status.

There were no loans that were restructured as TDRs during the three months ended June 30, 2014.

The following table summarizes the loans that were restructured as TDRs during the three and six months ended June 30, 2014:

	Three Months Ended						Six Months Ended
	June 30, 2014						June 30, 2014
			Balance		Balance				Balance		Balance
			prior to		after				prior to		after
	Count		TDR		TDR		Count		TDR		TDR
	(Dollars in thousands)
Commercial real estate		1		900		900		1		900		900
Total loans		1	$	900	$	900		1	$	900	$	900

We had no TDRs that had payment defaults during the three months ended June 2014 and 2013. Default occurs when a TDR is 90 days or more past due, transferred to nonaccrual status, or transferred to other real estate owned within twelve months of restructuring.

Management monitors the TDRs based on the type of modification or concession granted to the borrower. These types of modifications may include rate reductions, payment/term extensions, forgiveness of principal, forbearance, and other applicable actions. Management predominantly utilizes rate reductions and lower monthly payments, either from a longer amortization period or interest only repayment schedule, because these concessions provide needed payment relief without risking the loss of principal. Management will also agree to a forbearance agreement when it is deemed appropriate to avoid foreclosure.

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Summary of Loans by Categories of Loans Class (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 312,177	$ 273,378	$ 257,984
Less net deferred loan fees, premiums and discounts	633	467
Less undisbursed portion of loans	16,509	5,933
Less allowance for loan losses	8,108	7,597
Net loans	286,927	259,381
Real Estate, One-to four-family
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	50,397	49,726	52,937
Real Estate, Home equity
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	7,219	7,912	8,135
Commercial mortgage loans, Commercial real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	147,191	126,154	105,975
Commercial mortgage loans, Multifamily
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	60,248	62,790	62,618
Commercial mortgage loans, Land
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	9,568	9,734	9,896
Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	23,609	8,669	13,677
Commercial Non-mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	12,801	7,226	3,589
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 1,144	$ 1,167	$ 1,157

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Share-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Stock Option Activity

The table below presents the stock option activity for the period shown:

	Options			Weighted average exercise price		Remaining contractual life (years)		Aggregate intrinsic value
Options outstanding at January 1, 2014		129,080		$	17.30		9	$	516
Granted		2,350			22.01		—		—
Exercised		(4,001	)		17.32		—		—
Forfeited		(1,968	)		17.50		—		—
Expired		—			—		—		—
Options outstanding at June 30, 2014		125,461		$	17.38		9	$	667
Exercisable at June 30, 2014		23,820		$	17.30		8.14	$	129

Assumptions Used in Black-Scholes Option Pricing Formula

The following assumptions were used in the formula:

Expected volatility		18.02	%
Risk-free interest rate		2.14	%
Expected dividend yield		1.90	%
Expected life (in years)		7.50
Exercise price for the stock options	$	22.01

Summary of Restricted Stock Award Activity

The table below presents the restricted stock award activity for the period shown:

	Service- Based Restricted stock awards			Weighted average grant date fair value
Non-vested at January 1, 2014		59,723		$	17.33
Granted		1,175			22.01
Vested		(229	)		18.82
Forfeited		—			—
Non-vested at June 30, 2014		60,669		$	17.41

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Securities (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Amortized Cost and Approximate Fair Values of Held to Maturity Securities

The amortized cost and approximate fair values of securities are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Approximate Fair Value
Held to Maturity Securities:
June 30, 2014
Municipal	$	57	$	—	$	—	$	57
December 31, 2013
Municipal	$	123	$	—	$	—	$	123

Summary of Amortized Cost and Fair Value of Held to Maturity Securities by Contractual Maturity

The amortized cost and fair value of securities at June 30, 2014, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2014
	Amortized Cost		Fair Value
Within one year	$	57	$	57
Totals	$	57	$	57

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Earnings Per Share

6 Months Ended

Jun. 30, 2014

Earnings Per Share

Note 6: Earnings Per Share (In thousands except per share amounts)

Basic earnings per common share (“EPS”) excludes dilution and is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock options) were exercised or converted into additional common shares that would then share in the earnings of the entity. Diluted EPS is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year, plus an incremental number of common-equivalent shares computed using the treasury stock method.

Unvested share-based payment awards, which include the right to receive non-forfeitable dividends or dividend equivalents, are considered to participate with common stock in undistributed earnings for purposes of computing EPS. Accordingly, the Company is required to calculate basic and diluted EPS using the two-class method. Restricted stock awards granted by the Company are considered participating securities. Calculations of EPS under the two-class method (i) exclude from the numerator any dividends paid or owed on participating securities and any undistributed earnings considered to be attributable to participating securities and (ii) exclude from the denominator the dilutive impact of the participating securities.

Unearned ESOP shares, which are not vested and unvested restricted stock awards are excluded from the computation of average shares outstanding.

Earnings per share analysis for three months ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Three months ended June 30, 2014			Three months ended June 30, 2013
Net income	$	480		$	436
Income allocated to participating securities		(14	)		(15	)
Income attributable to common shareholders		466			421
Weighted average shares outstanding (in thousands)		2,288			2,439
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,062			2,262
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,074			2,262
Basic EPS	$	.23		$	.19
Diluted EPS	$	.23		$	.19

Six Months Ended June 30, 2014 and 2013 is as follows (dollars in thousands, except per share data):

	Six Months Ended June 30, 2014			Six Months Ended June 30, 2013
Net income	$	785		$	961
Income allocated to participating securities		(22	)		(32	)
Income attributable to common shareholders		763			929
Weighted average shares outstanding (in thousands)		2,292			2,447
Less: average unearned ESOP and unvested restricted stock		(226	)		(177	)
Average Shares		2,066			2,270
Effect of diluted based awards		12			—
Average common and common-equivalent shares for diluted EPS (in thousands)		2,078			2,270
Basic EPS	$	.37		$	.42
Diluted EPS	$	.37		$	.42

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Share-Based Compensation

6 Months Ended

Jun. 30, 2014

Share-Based Compensation

Note 7: Share-Based Compensation

In May 2013, the Company’s stockholders approved the Wolverine Bancorp, Inc. 2013 Equity Incentive Plan (“Plan”) which provides for awards of stock options and restricted stock to key officers and outside directors. The cost of the Plan is based on the fair value of the awards on the grant date. The fair value of restricted stock awards is based on the closing price of the Company’s stock on the grant date. The fair value of stock options is estimated using a Black-Scholes option pricing model using assumptions for dividend yield, stock price volatility, risk-free interest rate, and option term. These assumptions are based on management’s judgments regarding future events, are subjective in nature, and contain uncertainties inherent in an estimate. The cost of the awards are being recognized on a straight-line basis over the five-year vesting period during which participants are required to provide services in exchange for the awards.

Until such time as awards of stock are granted and vest or options are exercised, shares of the Company’s common stock under the Plan shall be authorized but unissued shares. The maximum number of shares authorized under the plan is 351,050. Total share-based compensation expense for the six months ended June 30, 2014 and 2013 was $160 and $165 respectively.

Stock Options

The table below presents the stock option activity for the period shown:

	Options			Weighted average exercise price		Remaining contractual life (years)		Aggregate intrinsic value
Options outstanding at January 1, 2014		129,080		$	17.30		9	$	516
Granted		2,350			22.01		—		—
Exercised		(4,001	)		17.32		—		—
Forfeited		(1,968	)		17.50		—		—
Expired		—			—		—		—
Options outstanding at June 30, 2014		125,461		$	17.38		9	$	667
Exercisable at June 30, 2014		23,820		$	17.30		8.14	$	129

As of June 30, 2014, the Company had $201 of unrecognized compensation expense related to stock options. The total fair value of shares vested for the six months ended June 30, 2014 was $541. Stock option expense for the three and six months ended June 30, 2014 was $16 and $31 respectively. Stock option expense for the three and six months ended June 30, 2013 was $17 and $36.

The fair value of the Company’s stock options granted on May 30, 2014 was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		18.02	%
Risk-free interest rate		2.14	%
Expected dividend yield		1.90	%
Expected life (in years)		7.50
Exercise price for the stock options	$	22.01

Expected volatility — Based on the historical volatility of share price.

Risk-free interest rate — Based on the U.S. Treasury yield curve and expected life of the options at the time of grant.

Expected dividend yield — The Company currently does not pay a dividend; therefore, the expected dividend yield was estimated for the portion of the life of the options that the Company expects to pay a dividend.

Expected life — Based on an average of the five year vesting period and the ten year contractual term of the stock option plan.

Exercise price for the stock options — Based on the closing price of the Company’s stock on the date of grant.

Restricted Stock Awards

Restricted stock awards are accounted for as fixed grants using the fair value of the Company’s stock at the time of grant. Unvested restricted stock awards may not be disposed of or transferred during the vesting period. Restricted stock awards carry with them the right to receive dividends.

The table below presents the restricted stock award activity for the period shown:

	Service- Based Restricted stock awards			Weighted average grant date fair value
Non-vested at January 1, 2014		59,723		$	17.33
Granted		1,175			22.01
Vested		(229	)		18.82
Forfeited		—			—
Non-vested at June 30, 2014		60,669		$	17.41

As of June 30, 2014, the Company had $838 of unrecognized compensation expense related to restricted stock awards. The cost of the restricted stock awards will be amortized in monthly installments over the five-year vesting period. Restricted stock expense for three months and six months ended June 30, 2014 was $63 and $129 respectively. Restricted stock expense for the three and six months ended June 30, 2013 was $66 and $129.

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Loans and Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2014

Summary of Loans by Categories of Loans Class

Categories of loans include:

	June 30, 2014		December 31, 2013
Real Estate
One-to four-family	$	50,397	$	49,726
Home equity		7,219		7,912
Commercial mortgage loans
Commercial real estate		147,191		126,154
Multifamily		60,248		62,790
Land		9,568		9,734
Construction		23,609		8,669
Commercial Non-mortgage		12,801		7,226
Consumer		1,144		1,167
Total loans		312,177		273,378
Less
Net deferred loan fees, premiums and discounts		633		467
Undisbursed portion of loans		16,509		5,933
Allowance for loan losses		8,108		7,597
Net loans	$	286,927	$	259,381

Financing Receivables and Allowance for Credit Losses on Financing Receivables

The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of June 30, 2014, December 31, 2013 and June 30, 2013:

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily			Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,354		$	251		$	2,861	$	1,514		$	1,145	$	285	$	157	$	30		$	7,597
Provision charged to expense		(363	)		(97	)		311		(181	)		221		523		96		(15	)		495
Losses charged off		(30	)		—			—		—			—		—		—		(1	)		(31	)
Recoveries		26			—			7		—			11		—		—		3			47
Balance, end of period	$	987		$	154		$	3,179	$	1,333		$	1,377	$	808	$	253	$	17		$	8,108
Ending Balance: individually evaluated for impairment	$	—		$	—		$	200	$	100		$	850	$	500	$	—	$	—		$	1,650
Ending balance: collectively evaluated for impairment	$	987		$	154		$	2,979	$	1,233		$	527	$	308	$	253	$	17		$	6,458
Loans:
Ending Balance	$	50,397		$	7,219		$	147,191	$	60,248		$	9,568	$	23,609	$	12,801	$	1,144		$	312,177
Ending Balance: individually evaluated for impairment	$	1,449		$	63		$	9,779	$	8,316		$	3,888	$	5,349	$	595	$	—		$	29,439
Ending Balance: collectively evaluated for impairment	$	48,948		$	7,156		$	137,412	$	51,932		$	5,680	$	18,260	$	12,206	$	1,144		$	282,738

Loan Class	1-4 Family			Home Equity		Commercial Real Estate			Multifamily			Land			Construction		Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2014
Allowance for loan losses:
Balance, beginning of period	$	1,006		$	148	$	3,475		$	1,338		$	1,422		$	390	$	126	$	14		$	7,919
Provision charged to expense		(5	)		6		(300	)		(5	)		(49	)		419		126		3			195
Losses charged off		(30	)		—		—			—			—			—		—		(1	)		(31	)
Recoveries		16			—		4			—			4			—		—		1			25
Balance, end of period	$	987		$	154	$	3,179		$	1,333		$	1,377		$	808	$	253	$	17		$	8,108

Loan Class	1-4 Family			Home Equity			Commercial Real Estate		Multifamily		Land		Construction			Commercial Non- Mortgage			Consumer			Total
Year to date analysis as of December 31, 2013
Allowance for loan losses:
Balance, beginning of year	$	1,433		$	266		$	2,663	$	1,497	$	312	$	302		$	166		$	32		$	6,671
Provision charged to expense		116			(16	)		98		17		651		(17	)		(14	)		(5	)		830
Losses charged off		(210	)		—			—		—		—		—			—			(2	)		(212	)
Recoveries		15			1			100		—		182		—			5			5			308
Balance, end of year	$	1,354		$	251		$	2,861	$	1,514	$	1,145	$	285		$	157		$	30		$	7,597
Ending Balance: individually evaluated for impairment	$	—		$	—		$	345	$	100	$	850	$	—		$	—		$	—		$	1,295
Ending balance: collectively evaluated for impairment	$	1,354		$	251		$	2,516	$	1,414	$	295	$	285		$	157		$	30		$	6,302
Loans:
Ending Balance	$	49,726		$	7,912		$	126,154	$	62,790	$	9,734	$	8,669		$	7,226		$	1,167		$	273,378
Ending Balance: individually evaluated for impairment	$	2,494		$	—		$	11,067	$	8,462	$	4,162		—		$	600		$	—		$	26,785
Ending Balance: collectively evaluated for impairment	$	47,232		$	7,912		$	115,087	$	54,328	$	5,572	$	8,669		$	6,626		$	1,167		$	246,593

Loan Class	1-4 Family			Home Equity		Commercial Real Estate		Multifamily		Land		Construction		Commercial Non- Mortgage		Consumer			Total
Year to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,433		$	266	$	2,663	$	1,497	$	312	$	302	$	166	$	32		$	6,671
Provision charged to expense		—			—		—		—		675		—		—		—			675
Losses charged off		(12	)		—		—		—		—		—		—		(2	)		(14	)
Recoveries		6			1		42		—		—		—		—		3			52
Balance, end of period	$	1,427		$	267	$	2,705	$	1,497	$	987	$	302	$	166	$	33		$	7,384
Ending Balance: individually evaluated for impairment	$	9		$	—	$	238	$	48	$	840	$	—	$	15	$	—		$	1,150
Ending balance: collectively evaluated for impairment	$	1,418		$	267	$	2,467	$	1,449	$	147	$	302	$	151	$	33		$	6,234
Loans:
Ending Balance	$	52,937		$	8,135	$	105,975	$	62,618	$	9,896	$	13,677	$	3,589	$	1,157		$	257,984
Ending Balance: individually evaluated for impairment	$	2,519		$	—	$	11,383	$	8,597	$	4,588	$	325	$	957	$	—		$	28,369
Ending Balance: collectively evaluated for impairment	$	50,418		$	8,135	$	94,592	$	54,021	$	5,308	$	13,352	$	2,632	$	1,157		$	229,615

Loan Class	1-4 Family			Home Equity			Commercial Real Estate			Multifamily			Land		Construction			Commercial Non- Mortgage		Consumer			Total
Quarter to date analysis as of June 30, 2013
Allowance for loan losses:
Balance, beginning of period	$	1,445		$	292		$	2,856		$	1,655		$	265	$	351		$	93	$	32		$	6,989
Provision charged to expense		(21	)		(26	)		(193	)		(158	)		722		(49	)		73		2			350
Losses charged off		—			—			—			—			—		—			—		(2	)		(2	)
Recoveries		3			1			42			—			—		—			—		1			47
Balance, end of period	$	1,427		$	267		$	2,705		$	1,497		$	987	$	302		$	166	$	33		$	7,384

Credit Risk Profile of our Loan Portfolio Based on Rating Category and Payment Activity

The following table presents the credit risk profile of our loan portfolio based on rating category and payment activity as of June 30, 2014 and December 31, 2013:

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	47,216	$	45,735	$	7,219	$	7,806	$	130,383	$	107,825	$	46,678	$	48,808
Pass (Closely Monitored)		1,709		1,827		—		106		3,762		4,081		8,850		9,170
Special Mention		419		818		—		—		4,211		4,992		—		—
Substandard		1,053		1,346		—		—		8,835		9,256		4,720		4,812
Doubtful		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—
	$	50,397	$	49,726	$	7,219	$	7,912	$	147,191	$	126,154	$	60,248	$	62,790

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2014		2013		2014		2013		2014		2013		2014		2013		2014		2013
Pass	$	4,162	$	3,742	$	18,260	$	8,669	$	12,073	$	6,540	$	1,144	$	1,167	$	267,135	$	230,292
Pass (Closely Monitored)		2,165		1,830		—		—		133		55		—		—		16,619		17,069
Special Mention		—		43		—		—		27		36		—		—		4,657		5,889
Substandard		3,241		4,119		5,349		—		568		595		—		—		23,766		20,128
Doubtful		—		—		—		—		—		—		—		—		—		—
Loss		—		—		—		—		—		—		—		—		—		—
	$	9,568	$	9,734	$	23,609	$	8,669	$	12,801	$	7,226	$	1,144	$	1,167	$	312,177	$	273,378

Summary of Our Past due and Non-Accrual Loans

The following table is a summary of our past due and non-accrual loans as of June 30, 2014 and December 31, 2013:

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
1-4 Family	$	86	$	—	$	138	$	224	$	50,173	$	50,397	$	—	$	138
Home Equity		—		—		—		—		7,219		7,219		—		—
Commercial Real Estate		181		504		44		729		146,462		147,191		—		713
Multifamily		—		—		—		—		60,248		60,248		—		—
Land		49		—		3,165		3,214		6,354		9,568		—		4,007
Construction		—		—		—		—		23,609		23,609		—		—
Commercial Non-Mortgage		—		—		27		27		12,774		12,801		—		143
Consumer		—		—		—		—		1,144		1,144		—		—
Total	$	316	$	504	$	3,374	$	4,194	$	307,983	$	312,177	$	—	$	5,001

	30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days		Total Past Due		Current		Total Loans Receivable		Total Loans>90 Days & Accruing		Total Nonaccrual
As of December 31, 2013:
1-4 Family	$	217	$	—	$	254	$	471	$	49,255	$	49,726	$	—	$	254
Home Equity		—		—		—		—		7,912		7,912		—		—
Commercial Real Estate		716		667		49		1,432		124,722		126,154		—		779
Multifamily		—		—		1,363		1,363		61,427		62,790		1,363		—
Land		—		—		4,068		4,068		5,666		9,734		27		4,041
Construction		—		—		—		—		8,669		8,669		—		—
Commercial Non-Mortgage		—		—		36		36		7,190		7,226		—		157
Consumer		—		—		—		—		1,167		1,167		—		—
Total	$	933	$	667	$	5,770	$	7,370	$	266,008	$	273,378	$	1,390	$	5,231

Summary of Impaired Loans by Class

The following table presents impaired loans at June 30, 2014:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	1,269	$	1,579	$	—	$	1,472	$	1,780	$	16	$	37
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		6,741		9,180		—		7,036		7,607		110		175
Multifamily		6,971		7,786		—		7,002		7,034		123		205
Land		696		1,070		—		701		912		—		1
Construction		—		1		—		—		—		—		—
Commercial Non-Mortgage		251		251		—		254		244		2		5
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family		180		180		—		180		181		3		5
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,038		3,054		200		3,058		3,085		38		101
Multifamily		1,345		1,345		100		1,348		1,353		20		41
Land		3,192		4,531		850		3,290		3,342		1		1
Construction		5,349		5,349		500		2,674		1,783		64		64
Commercial Non-Mortgage		344		344		—		350		358		4		9
Consumer		—		—		—		—		—		—		—
Total
1-4 Family	$	1,449	$	1,759	$	—	$	1,652	$	1,961	$	19	$	42
Home Equity		63		63		—		64		65		1		1
Commercial Real Estate		9,779		12,234		200		10,094		10,692		148		276
Multifamily		8,316		9,131		100		8,350		8,387		143		246
Land		3,888		5,601		850		3,991		4,254		1		2
Construction		5,349		5,350		500		2,674		1,783		64		64
Commercial Non-Mortgage		595		595		—		604		602		6		14
Consumer		—		—		—		—		—		—		—
Total	$	29,439	$	34,734	$	1,650	$	27,429	$	27,744	$	382	$	645

The following table presents impaired loans at December 31, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		YTD Average Balance		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		7,128		9,152		—		7,630		315
Multifamily		7,099		7,914		—		7,325		409
Land		742		1,672		—		913		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Loans with a specific valuation allowance
1-4 Family		—		—		—		—		—
Home Equity		—		—		—				—
Commercial Real Estate		3,939		3,939		345		2,843		218
Multifamily		1,363		1,363		100		1,100		33
Land		3,420		4,730		850		3,641		—
Construction		—		—		—		—		—
Commercial Non-Mortgage		—		—		—		—		—
Consumer		—		—		—		—		—
Totals
1-4 Family	$	2,494	$	2,712	$	—	$	2,668	$	225
Home Equity		—		—		—		—		—
Commercial Real Estate		11,067		13,091		345		10,473		533
Multifamily		8,462		9,277		100		8,425		442
Land		4,162		6,402		850		4,554		48
Construction		—		—		—		—		—
Commercial Non-Mortgage		600		600		—		726		30
Consumer		—		—		—		4		—
Total	$	26,785	$	32,082	$	1,295	$	26,850	$	1,278

The following table presents impaired loans at June 30, 2013:

	Recorded Balance		Unpaid Principal Balance		Specific Allowance		QTD Average Balance		YTD Average Balance		QTD Interest Income		YTD Interest Income
Loans without a specific valuation allowance
1-4 Family	$	2,456	$	2,665	$	—	$	2,711	$	2,767	$	28	$	180
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		7,607		9,776		—		9,495		6,989		176		266
Multifamily		7,768		8,584		—		10,431		8,637		112		217
Land		971		2,980		—		6,260		7,033		55		274
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		539		641		—		552		275		6		29
Consumer		—		—		—		—		—		—		—
Loans with a specific valuation allowance
1-4 Family	$	63	$	63	$	9	$	103	$	142	$	2	$	2
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		3,776		3,776		238		3,762		4,978		56		90
Multifamily		829		829		48		836		840		14		18
Land		3,617		4,910		840		1,665		839		26		289
Construction		—		—		—		—		—		—		—
Commercial Non-Mortgage		418		418		15		425		492		8		6
Consumer		—		—		—		—		—		—
Total
1-4 Family	$	2,519	$	2,728	$	9	$	2,814	$	2,909	$	30	$	182
Home Equity		—		—		—		—		—		—		—
Commercial Real Estate		11,383		13,552		238		13,257		11,967		232		356
Multifamily		8,597		9,413		48		11,267		9,477		126		235
Land		4,588		7,890		840		7,925		7,872		81		563
Construction		325		327		—		218		123		1		4
Commercial Non-Mortgage		957		1,059		15		977		767		14		35
Consumer		—		—		—		—		—		—		—
Total	$	28,369	$	34,969	$	1,150	$	36,458	$	33,115	$	484	$	1,375

Summary of Loans Restructured as TDRs

The following table summarizes the loans that were restructured as TDRs during the three and six months ended June 30, 2014:

	Three Months Ended						Six Months Ended
	June 30, 2014						June 30, 2014
			Balance		Balance				Balance		Balance
			prior to		after				prior to		after
	Count		TDR		TDR		Count		TDR		TDR
	(Dollars in thousands)
Commercial real estate		1		900		900		1		900		900
Total loans		1	$	900	$	900		1	$	900	$	900

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Share-Based Compensation - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amortization period of stock options			5 years
Maximum Number of shares authorized under plan	351,050		351,050
Share based compensation expense			$ 160	$ 165
Unrecognized compensation expense related to stock options	201		201
Fair value of shares vested			541
Stock option expense	16	17	31	36
Contractual term of stock option plan			10 years
Unrecognized compensation expense	838		838
Amortization period of stock options			5 years
Restricted stock expense	$ 63	$ 66	$ 129	$ 129

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Summary of Amortized Cost and Fair Value of Held to Maturity Securities by Contractual Maturity (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Schedule of Held-to-maturity Securities [Line Items]
Held to Maturity Securities, Contractual Maturity, Within one year, Amortized Cost	$ 57
Held to Maturity Securities, Amortized cost	57	123
Held to Maturity Securities, Contractual Maturity, Within one year, Fair Value	57
Held to Maturity Securities, Fair Value, Total	$ 57

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Credit Risk Profile of Our Loan Portfolio Based on Rating Category and Payment Activity (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	$ 312,177	$ 273,378	$ 257,984
Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	267,135	230,292
Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	16,619	17,069
Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	4,657	5,889
Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	23,766	20,128
Commercial mortgage loans, Land
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	9,568	9,734	9,896
Commercial mortgage loans, Land | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	4,162	3,742
Commercial mortgage loans, Land | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	2,165	1,830
Commercial mortgage loans, Land | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable		43
Commercial mortgage loans, Land | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	3,241	4,119
Construction
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	23,609	8,669	13,677
Construction | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	18,260	8,669
Construction | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	5,349
Commercial Non-mortgage
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	12,801	7,226	3,589
Commercial Non-mortgage | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	12,073	6,540
Commercial Non-mortgage | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	133	55
Commercial Non-mortgage | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	27	36
Commercial Non-mortgage | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	568	595
Consumer
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	1,144	1,167	1,157
Consumer | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	1,144	1,167
Real Estate, One-to four-family
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	50,397	49,726	52,937
Real Estate, One-to four-family | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	47,216	45,735
Real Estate, One-to four-family | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	1,709	1,827
Real Estate, One-to four-family | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	419	818
Real Estate, One-to four-family | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	1,053	1,346
Real Estate, Home equity
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	7,219	7,912	8,135
Real Estate, Home equity | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	7,219	7,806
Real Estate, Home equity | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable		106
Commercial mortgage loans, Commercial real estate
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	147,191	126,154	105,975
Commercial mortgage loans, Commercial real estate | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	130,383	107,825
Commercial mortgage loans, Commercial real estate | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	3,762	4,081
Commercial mortgage loans, Commercial real estate | Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	4,211	4,992
Commercial mortgage loans, Commercial real estate | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	8,835	9,256
Commercial mortgage loans, Multifamily
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	60,248	62,790	62,618
Commercial mortgage loans, Multifamily | Pass
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	46,678	48,808
Commercial mortgage loans, Multifamily | Pass (Closely Monitored)
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	8,850	9,170
Commercial mortgage loans, Multifamily | Substandard
Financing Receivable, Recorded Investment [Line Items]
Total Loans Receivable	$ 4,720	$ 4,812

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Condensed Consolidated Statement of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Operating Activities
Net income	$ 785	$ 961
Items not requiring (providing) cash
Depreciation	127	103
Provision for Loan Losses	495	675
Amortization of Federal Home Loan Bank advance prepayment penalty	6	34
Gain on other real estate owned	(3)	(100)
Loans originated for sale	(9,515)	(37,362)
Proceeds from loans sold	9,248	39,052
Net gain on sale of loans	(291)	(970)
Share based compensation	160	165
Changes in Interest receivable and other assets	(345)	312
Interest payable and other liabilities	1,211	1,420
Net cash provided by operating activities	1,878	4,290
Investing Activities
Proceeds from calls, maturities and pay-downs of held to maturity securities	66	69
Net change in loans	(28,312)	8,884
Proceeds from sale of real estate owned	525	636
Purchase of premises and equipment	(10)	(63)
Net cash provided (used) by investing activities	(27,731)	9,526
Financing Activities
Net change in demand deposits, money market, checking and savings accounts	12,818	(3,374)
Net change in certificates of deposit	35,434	3,319
Repayment of Federal Home Loan Bank advances	(10,000)
Proceeds from stock options exercised	28
Purchase of common stock	(442)	(661)
Net cash provided (used) by financing activities	37,838	(716)
Change in Cash and Cash Equivalents	11,985	13,100
Cash and Cash Equivalents, Beginning of Period	26,181	16,552
Cash and Cash Equivalents, End of Period	38,166	29,652
Supplemental Disclosures of Cash Flows Information
Interest paid	1,521	1,606
Income taxes paid	600	860
Loans transferred to real estate owned	$ 255	$ 81

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Securities

6 Months Ended

Jun. 30, 2014

Securities

Note 3: Securities

The amortized cost and approximate fair values of securities are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Approximate Fair Value
Held to Maturity Securities:
June 30, 2014
Municipal	$	57	$	—	$	—	$	57
December 31, 2013
Municipal	$	123	$	—	$	—	$	123

The amortized cost and fair value of securities at June 30, 2014, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2014
	Amortized Cost		Fair Value
Within one year	$	57	$	57
Totals	$	57	$	57

There were no sales of securities during the three or six months ended June 30, 2014 and 2013.

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Summary of Our Past Due and Non-Accrual Loans (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	$ 316	$ 933
60-89 Days Past Due	504	667
Greater than 90 Days	3,374	5,770
Total Past Due	4,194	7,370
Current	307,983	266,008
Total Loans Receivable	312,177	273,378	257,984
Total Loans>90 Days & Accruing		1,390
Total Nonaccrual	5,001	5,231
Real Estate, One-to four-family
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	86	217
Greater than 90 Days	138	254
Total Past Due	224	471
Current	50,173	49,255
Total Loans Receivable	50,397	49,726	52,937
Total Nonaccrual	138	254
Real Estate, Home equity
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	7,219	7,912
Total Loans Receivable	7,219	7,912	8,135
Commercial mortgage loans, Commercial real estate
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	181	716
60-89 Days Past Due	504	667
Greater than 90 Days	44	49
Total Past Due	729	1,432
Current	146,462	124,722
Total Loans Receivable	147,191	126,154	105,975
Total Nonaccrual	713	779
Commercial mortgage loans, Multifamily
Financing Receivable, Recorded Investment, Past Due [Line Items]
Greater than 90 Days		1,363
Total Past Due		1,363
Current	60,248	61,427
Total Loans Receivable	60,248	62,790	62,618
Total Loans>90 Days & Accruing		1,363
Commercial mortgage loans, Land
Financing Receivable, Recorded Investment, Past Due [Line Items]
30-59 Days Past Due	49
Greater than 90 Days	3,165	4,068
Total Past Due	3,214	4,068
Current	6,354	5,666
Total Loans Receivable	9,568	9,734	9,896
Total Loans>90 Days & Accruing		27
Total Nonaccrual	4,007	4,041
Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	23,609	8,669
Total Loans Receivable	23,609	8,669	13,677
Commercial Non-mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Greater than 90 Days	27	36
Total Past Due	27	36
Current	12,774	7,190
Total Loans Receivable	12,801	7,226	3,589
Total Nonaccrual	143	157
Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Current	1,144	1,167
Total Loans Receivable	$ 1,144	$ 1,167	$ 1,157

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Summary of Amortized Cost and Approximate Fair Values of Held to Maturity Securities (Detail) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Schedule of Held-to-maturity Securities [Line Items]
Held to Maturity Securities, Amortized cost	$ 57	$ 123
Held to Maturity Securities, Fair Value	57
Municipal Bonds
Schedule of Held-to-maturity Securities [Line Items]
Held to Maturity Securities, Amortized cost	57	123
Held to Maturity Securities, Gross Unrealized Gains
Held to Maturity Securities, Gross Unrealized Losses
Held to Maturity Securities, Fair Value	$ 57	$ 123