10-K/A

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

AMENDMENT NO. 1

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal ended December 31, 2016.

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _______________ to _______________.

Commission file number: 001-35034

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)

Registrant's telephone number, including area code: (989) 631-4280

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, par value $0.01 per share	The NASDAQ Stock Market LLC
(Title of each class to be registered)	(Name of each exchange on which each class is to be registered)

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐     NO ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. YES ☐  NO ☒

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES ☒     NO ☐

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate website, 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 ☒     NO ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒

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

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

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

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ☐     NO ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, computed by reference to the last sale price on June 30, 2016, as reported by the Nasdaq Stock Market, was approximately $44.5 million.

As of March 27, 2017, there were 2,106,153 issued and outstanding shares of the Registrant’s Common Stock.

DOCUMENTS INCORPORATED BY REFERENCE:

None.

TABLE OF CONTENTS

EXPLANATORY NOTE		1
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	2
ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	2
	CONSOLIDATED FINANCIAL STATEMENTS	F-1

Explanatory Note

Wolverine Bancorp, Inc. (the “Company”) is filing this Amendment No. 1 on Form 10-K/A to its Annual Report on Form 10-K for the year ended December 31, 2016, as filed with the Securities and Exchange Commission on March 31, 2017. The Company is re-filing Item 8 of Part II of the Form 10-K to include a revised audit report, which inadvertently included an incorrect date of issuance of March 30, 2017 in the previous filing. The Company is also revising the column heading on page F-50 to correct the date to 2016.

1

Table of Contents

PART II

ITEM 8.        Financial Statements and Supplementary Data

The Company’s Consolidated Financial Statements are presented in this Annual Report on Form 10-K beginning at page F-1.

 PART IV

ITEM 15.     Exhibits and Financial Statement Schedules

(a)(1) Financial Statements

The documents filed as a part of this Form 10-K are:

(A) Report of Independent Registered Public Accounting Firm;

(B) Consolidated Balance Sheets - December 31, 2016 and 2015;

(C) Consolidated Statements of Income for the years ended December 31, 2016 and 2015;

(D) Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2016 and 2015;

(E) Consolidated Statements of Cash Flows for the years ended December 31, 2016 and 2015; and

(F) Notes to Consolidated Financial Statements.

(a)(2) Financial Statement Schedules

All financial statement schedules have been omitted as the required information is inapplicable or has been included in the Notes to Consolidated Financial Statements.

(a)(3) Exhibits

3.1 Articles of Incorporation of Wolverine Bancorp, Inc.*

3.2 Bylaws of Wolverine Bancorp, Inc.*

4 Form of Common Stock Certificate of Wolverine Bancorp, Inc.*

10.1 Employment Agreement of David H. Dunn**

10.2 Employment Agreement of Rick A. Rosinski**

10.3 2002 Long Term Incentive Plan, as amended*

10.4 2006 Long Term Incentive Plan, as amended for Dunn*

10.5	2006 Long Term Incentive Plan, as amended for Rosinski*
10.6	2012 Equity Incentive Plan***

21 Subsidiaries****

23 Consent of Independent Auditor****

31.1 Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 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

_______	___________________
*	Incorporated by reference to the Registration Statement on Form S-1 (file no. 333-169432), initially filed September 16, 2010.
**	Incorporated by reference to the current Report on Form 8-K (file no. 001-35034) filed on July 8, 2011.
***	Incorporated by reference to the Proxy Statement filed on April 14, 2016.
****	Incorporated by reference to the Annual Report on Form 10-K (file no. 001-35034) filed on March 31, 2017.

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Table of Contents

Wolverine Bancorp, Inc.

Report of Independent Registered Public Accounting Firm and Consolidated Financial Statements

December 31, 2016 and 2015

3

Table of Contents

Wolverine Bancorp, Inc.

December 31, 2016 and 2015

Contents

Report of Independent Registered Public Accounting Firm	F-1
Consolidated Financial Statements
Balance Sheets	F-2
Statements of Income and Comprehensive Income	F-3
Statements of Changes in Stockholders’ Equity	F-4
Statements of Cash Flows	F-5
Notes to Financial Statements	F-6

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Report of Independent Registered Public Accounting Firm

Audit Committee, Board of Directors and Stockholders
Wolverine Bancorp, Inc.
Midland, Michigan

We have audited the accompanying consolidated balance sheets of Wolverine Bancorp, Inc. (Company) as of December 31, 2016 and 2015, and the related consolidated statements of income and comprehensive income, stockholders’ equity and cash flows for the years then ended. The Company's management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing auditing procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits also included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Wolverine Bancorp, Inc. as of December 31, 2016, and 2015, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ BKD, LLP

Indianapolis, Indiana

March 31, 2017

F-1

Table of Contents

Wolverine Bancorp, Inc.
Consolidated Balance Sheets
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

	December 31, 2016			December 31, 2015
Assets
Cash and due from banks	$	318		$	334
Interest-earning demand deposits		103,316			52,531
Cash and cash equivalents		103,634			52,865
Interest-earning time deposits		-			39,021
Investment securities held to maturity		499			500
Loans held for sale		238			581
Loans, net of allowance for loan losses of $9,326 and $10,061		320,606			314,613
Premises and equipment, net		1,127			1,285
Federal Home Loan Bank stock		2,700			2,700
Other real estate owned		86			130
Accrued interest receivable		846			967
Other assets		4,699			5,151
Total assets	$	434,435		$	417,813
Liabilities and Stockholders’ Equity
Liabilities
Deposits	$	280,548		$	281,701
Federal Home Loan Bank advances		60,000			47,000
Federal funds purchased		27,000			24,000
Interest payable and other liabilities		5,913			4,632
Total liabilities		373,461			357,333
Commitments and Contingencies
Stockholders’ Equity
Common Stock, $0.01 par value per share:
Authorized – 100,000,000 shares Issued and outstanding – 2,106,153 and 2,158,034 at December 31, 2016 and December 31, 2015		21			22
Unearned employee stock ownership plan (ESOP)		(1,215	)		(1,410	)
Additional paid-in capital		15,577			16,401
Retained earnings		46,591			45,467
Total stockholders’ equity		60,974			60,480
Total liabilities and stockholders’ equity	$	434,435		$	417,813

F-2

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Wolverine Bancorp, Inc.
Consolidated Statements of Income and Comprehensive Income
Years Ended December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

	2016			2015
Interest and Dividend Income
Loans	$	16,435		$	15,372
Investment securities and other		384			244
Total interest and dividend income		16,819			15,616
Interest Expense
Deposits		2,033			1,451
Borrowings		1,850			2,000
Total interest expense		3,883			3,451
Net Interest Income		12,936			12,165
Provision (Credit) for Loan Losses		(760	)		800
Net Interest Income After Provision for Loan Losses		13,696			11,365
Noninterest Income
Service charges and fees		260			297
Net gain on loan sales		469			660
Net gain (loss) on sale of real estate owned		32			(116	)
Other		296			382
Total noninterest income		1,057			1,223
Noninterest Expense
Salaries and employee benefits		4,953			4,541
Net occupancy and equipment expense		818			811
Information technology expense		240			236
Federal deposit insurance corporation premiums		214			217
Professional and services fees		584			398
Other real estate owned expense		25			50
Loan legal expense (recovery)		(74	)		322
Advertising expense		126			144
Michigan business tax		195			186
Other		915			953
Total noninterest expense		7,996			7,858
Income Before Income Tax		6,757			4,730
Provision for Income Taxes		2,404			1,544
Net Income and Comprehensive Income	$	4,353		$	3,186
Earnings Per Share:
Basic	$	2.20		$	1.57
Diluted	$	2.16		$	1.55

F-3

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Wolverine Bancorp, Inc.
Consolidated Statements of Changes in Stockholders’ Equity
Years Ended December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

	Common Stock			Additional Paid-in Capital			Unearned ESOP Shares			Retained Earnings			Total Stockholders' Equity
Balances at January 1, 2015	$	23		$	18,640		$	(1,564	)	$	44,439		$	61,538
Net Income		-			-			-			3,186			3,186
Purchase of 112,814 shares of common stock		(1	)		(2,795	)		-			-			(2,796	)
Share based compensation expense		-			319			-			-			319
ESOP shares earned		-			237			154			-			391
Dividends ($1.00 per share)		-			-			-			(2,158	)		(2,158	)
Balances at December 31, 2015		22			16,401			(1,410	)		45,467			60,480
Net Income		-			-			-			4,353			4,353
Purchase of 57,557 shares of common stock		(1	)		(1,517	)		-			-			(1,518	)
Exercised options		-			26			-			-			26
Share based compensation expense		-			334			-			-			334
ESOP shares earned		-			333			195			-			528
Dividends ($1.60 per share)		-			-			-			(3,229	)		(3,229	)
Balances at December 31, 2016	$	21		$	15,577		$	(1,215	)	$	46,591		$	60,974

F-4

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Wolverine Bancorp, Inc.

Consolidated Statements of Cash Flows
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

	2016			2015
Operating Activities
Net income	$	4,353		$	3,186
Items not requiring (providing) cash
Depreciation		223			232
Provision (credit) for loan losses		(760	)		800
(Gain) loss on other real estate owned		(32	)		116
Loans originated for sale		(17,309	)		(20,073	)
Deferred income taxes		348			(215	)
Proceeds from loans sold		18,121			20,722
Net gain on sale of loans		(469	)		(660	)
Share based compensation		334			319
Earned ESOP shares		528			391
Changes in
Interest receivable and other assets		225			249
Interest payable and other liabilities		210			429
Net cash provided by operating activities		5,772			5,496
Investing Activities
Net change in interest-earning time deposits		39,021			(39,021	)
Purchase of held to maturity securities		(499	)		(500	)
Proceeds from calls, maturities and pay-downs of held to maturity securities		500			-
Net change in loans		(5,425	)		(19,111	)
Proceeds from sale of real estate owned		268			272
Purchase of FHLB stock		-			(200	)
Purchase of premises and equipment		(65	)		(133	)
Net cash provided by (used in) investing activities		33,800			(58,693	)
Financing Activities
Net change in demand deposits, money market, checking and savings accounts		35,413			3,499
Net change in certificates of deposit		(36,566	)		54,673
Repayment of Federal Home Loan Bank advances		-			(13,000	)
Proceeds from Federal Home Loan Bank advances		13,000			10,000
Net change in Fed funds purchased		3,000			24,000
Proceeds from stock options exercised		26			-
Purchase of common stock		(1,518	)		(2,796	)
Dividends paid		(2,158	)		-
Net cash provided by financing activities		11,197			76,376
Change in Cash and Cash Equivalents		50,769			23,179
Cash and Cash Equivalents, Beginning of Period		52,865			29,686
Cash and Cash Equivalents, End of Period	$	103,634		$	52,865
Supplemental Disclosures of Cash Flows Information
Interest paid	$	3,937		$	3,375
Income taxes paid		1,981			1,847
Loans transferred to real estate owned		192			176
Dividends declared, not paid		2,305			2,158

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 1:    Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

Wolverine Bank (the “Bank”), a wholly owned subsidiary of Wolverine Bancorp, Inc. (the “Company”), is a federally chartered savings bank primarily engaged in providing a full range of banking and financial services to individual and business customers in the Great Lakes Bay Region and beyond. The Company is subject to competition from other financial institutions. The Company is subject to the regulation of the Federal Reserve Board and the Bank is subject to the regulation of the Officer of the Comptroller of the Currency, and both undergo periodic examinations.

The Bank’s additional wholly owned subsidiaries, Wolserv Corporation, a Michigan corporation which has a membership interest in a title company, and Wolverine Commercial Holdings LLC, a Michigan LLC owned by Wolverine Bank which holds certain real estate, are included in the consolidated financial statements.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of real estate acquired in connection with foreclosures or in satisfaction of loans and financial instruments.

Cash Equivalents

We consider all liquid investments with original maturities of three months or less to be cash equivalents.

Securities

Held-to-maturity securities, which include any security for which we have the positive intent and ability to hold until maturity, are carried at historical cost adjusted for amortization of premiums and accretion of discounts.

Amortization of premiums and accretion of discounts are recorded as interest income from securities. Realized gains and losses are recorded as net security gains (losses). Gains and losses on securities are determined on the specific-identification method.

Loans Held for Sale

Mortgage loans originated and intended for sale in the secondary market are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to noninterest income. Gains and losses on loan sales are recorded in noninterest income, and direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are reported at their outstanding principal balances adjusted for any charge-offs, the allowance for loan losses, any deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. Generally, loans are placed on nonaccrual status at ninety days past due and interest is considered a loss, unless the loan is well-secured. Accrued interest for loans placed on nonaccrual status is reversed against interest income.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical charge-off experience and expected loss given default derived from our internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.

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

Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, we do not separately identify individual consumer and residential loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Premises and Equipment

Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight-line and accelerated methods over the estimated useful lives of the assets ranging from 3 to 39 years.

Federal Home Loan Bank Stock

Federal Home Loan Bank stock is a required investment for institutions that are members of the Federal Home Loan Bank system. The required investment in the common stock is based on a predetermined formula, carried at cost, and evaluated for impairment.

Real Estate Owned

Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from foreclosed assets.

Earnings Per Common Share

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.

Income Taxes

We account for income taxes in accordance with income tax accounting guidance (ASC 740, Income Taxes). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. We determine deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized.

We recognize interest and penalties on income taxes as a component of income tax expense.

We file consolidated income tax returns with our subsidiaries.

Recently Issued Accounting Standards

FASB Accounting Standards Updates No. 2017-04, Intangibles – Goodwill and Other (Topic 350)

The FASB has issued Accounting Standards Update (ASU) No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The new guidance is intended to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test.

The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, the income tax effects of tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the qualitative impairment test is necessary. The amendments should be applied on a prospective basis. The nature of and reason for the change in accounting principle should be disclosed upon transition.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The amendments in this update should be adopted for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted on testing dates after January 1, 2017. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

FASB Accounting Standards Updates No. 2017-01, Business Combinations (Topic 805)

The FASB has issued Accounting Standards Update (ASU) No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The amendments in this update provide a more robust framework to use in determining when a set of assets and activities is a business. Because the current definition of a business is interpreted broadly and can be difficult to apply, stakeholders indicated that analyzing transactions is inefficient and costly and that the definition does not permit the use of reasonable judgment. The amendments provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable.

The amendments in this update become effective for annual periods and interim periods within those annual periods beginning after December 15, 2017. We are currently evaluating the impact of adopting the new guidance on the consolidated financial statements, but it is not expected to have a material impact.

FASB ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)

The FASB has issued Accounting Standards Update (ASU) No. 2016-15, Statement of Cash Flows (Topic 230). This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice of how certain cash receipts and cash payments are presented and classified in the statement of cash flow. In November 2016, the FASB issued ASU No. 2016-18, which gave clarification on how restricted cash was to be presented in the cash flow statement.

The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

FASB ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments

The FASB has issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The main objective of this amendment is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date.

The ASU requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.

Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.

The ASU requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. These disclosures include qualitative and quantitative requirements that provide additional information about the amounts recorded in the financial statements.

In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.

For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. All entities may adopt the amendments in this Update earlier as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company will be evaluating the impact of adopting this ASU and has not determined the anticipated impact on the consolidated financial statements.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

FASB ASU No. 2016-09, Compensation—Stock Compensation (Topic 718)

The FASB issued ASU No. 2016-09, Compensation–Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.

The ASU is intended to improve the accounting for employee shared-base payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including the income tax consequences, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. The amendments in this update became effective on January 1, 2017 and did not have a material impact on the consolidated financial statements.

For public business entities, the amendments are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. For all other entities, the amendments are effective for annual periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. Early adoption is permitted for any entity in any interim or annual period. The amendments in this update became effective on January 1, 2017 and did not have a material impact on the consolidated financial statements.

FASB ASU No. 2016-08, 2016-10, 2016-12, Revenue from Contracts with Customers (Topic 606)

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016, the FASB issued ASU 2016-08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in determining revenue recognition as principal versus agent. In April 2016, the FASB issued ASU 2016-10, “Identifying Performance Obligations and Licensing,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In May 2016, the FASB issued ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

For public business entities, the amendments are effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods with that reporting period, as deferred by ASU 2015-14. Early application is permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within the reporting period.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

All other entities should apply the guidance to annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. Early application is permitted for all other entities as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within annual reporting periods beginning one year after the annual reporting period in which the entity first applies the guidance in Update 2014-09. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No. 2016-07, Investments – Equity Method and Joint Ventures (Topic 323)

The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held.

The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required.

The amendments require that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method.

The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No. 2016-06, Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments

The FASB has issued Accounting Standards Update (ASU) No. 2016-05, Derivatives and Hedging (Topic 815): Effect of Derivative Contract Novations and Existing Hedge Accounting Relationships. The amendments apply to all reporting entities for which there is a change in the counterparty to a derivative instrument that has been designated as a hedging instrument.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The amendments clarify what steps are required when assessing whether the economic characteristics and risks of call (put) options are clearly and closely related to the economic characteristics and risks of their debt hosts, which is one of the criteria for bifurcating an embedded derivative. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks.

This standard will be effective for pubic business entities for fiscal year beginning after December 15, 2016 including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after December 15, 2017, and interim periods within fiscal years beginning after December 15, 2018. Early application is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No. 2016-02 – Leases (Topic 842)

The FASB has issued Accounting Standards Update (ASU) No. 2016-02, Leases. Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date:

●          A lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and

●          A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.

Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606,

Revenue from Contracts with Customers.

The new lease guidance simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees will no longer be provided with a source of off-balance sheet financing.

This standard will be effective for pubic business entities for fiscal year beginning after December 15, 2018 including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Early application is permitted for all public business entities and all nonpublic business entities upon issuance.

Lessees (for capital and operating leases) and lessors (for sales-type, direct financing and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach.

Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB Accounting Standards Updates No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities

The FASB has issued Accounting Standards Update (ASU) No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The new guidance is intended to improve the recognition and measurement of financial instruments. The ASU affects public and private companies, not-for-profit organizations, and employee benefit plans that hold financial assets or owe financial liabilities.

The new guidance makes targeted improvements to existing U.S. GAAP by:

● Requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income;

● Requiring public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes;

● Requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements;

● Eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for organizations that are not public business entities;

● Eliminating the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; and

● Requiring a reporting organization to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The new guidance is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new guidance permits early adoption of the own credit provision. In addition, the new guidance permits early adoption of the provision that exempts private companies and not-for-profit organizations from having to disclose fair value information about financial instruments measured at amortized cost. Adoption of the

ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

Note 2: Restriction on Cash and Due From Banks

We are required to maintain reserve funds in cash and/or on deposit with the Federal Reserve Bank. The reserve required at December 31, 2016 was $459.

At December 31, 2016, the Company’s cash accounts exceeded federally insured limits by approximately $391. Additionally, the Company had approximately $1,733 and $98,665 on deposit with the Federal Home Loan Bank of Indianapolis and Federal Reserve Bank of Chicago, as of December 31, 2016, which are not federally insured.

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:
December 31, 2016
Treasury bond	$	499	$	1	$	–	$	500
December 31, 2015
Treasury bond	$	500	$	–	$	–	$	500

The treasury bond held at December 31, 2016 matured on January 5^th, 2017.

There were no sales of securities during 2016 or 2015.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 4:     Loans and Allowance for Loan Losses

Categories of loans include:

	December 31, 2016		December 31, 2015
Real Estate
One-to four-family	$	35,389	$	39,719
Home equity		4,031		5,459
Commercial mortgage loans
Commercial real estate		195,924		183,934
Multifamily		54,827		58,804
Land		11,547		12,543
Construction		13,475		14,785
Commercial non-mortgage		20,047		14,826
Consumer		1,074		1,221
Total loans		336,314		331,291
Less
Net deferred loan costs, premiums and discounts		563		567
Undisbursed portion of loan		5,819		6,050
Allowance for loan losses		9,326		10,061
Net Loans	$	320,606	$	314,613

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 1-4 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 1-4 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.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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 multi-family

Commercial real estate and multi-family 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 multi-family 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.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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. Construction loans for one-to-four family residential properties are originated with a maximum loan to value ratio of 70% and 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 70% 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 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.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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; current market conditions; and change in regional employment conditions.

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

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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 December 31, 2016 and 2015:

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, 2016
Allowance for loan losses:
Balance, beginning of period	$	948		$	108		$	4,913		$	1,515		$	1,605		$	604		$	344	$	24		$	10,061
Provision charged to expense		(137	)		(59	)		555			(431	)		(544	)		(310	)		180		(14	)		(760	)
Losses charged off		(67	)		-			(85	)		-			-			-			-		(1	)		(153	)
Recoveries		54			-			39			-			81			-			-		4			178
Balance, end of period	$	798		$	49		$	5,422		$	1,084		$	1,142		$	294		$	524	$	13		$	9,326
Ending Balance: individually evaluated for impairment	$	-		$	-		$	235		$	-		$	550		$	-		$	-	$	-		$	785
Ending balance: collectively evaluated for impairment	$	798		$	49		$	5,187		$	1,084		$	592		$	294		$	524	$	13		$	8,541
Loans:
Ending Balance	$	35,389		$	4,031		$	195,924		$	54,827		$	11,547		$	13,475		$	20,047	$	1,074		$	336,314
Ending Balance: individually evaluated for impairment	$	1,500		$	-		$	8,103		$	6,311		$	1,061		$	-		$	-	$	-		$	16,975
Ending balance: collectively evaluated for impairment	$	33,889		$	4,031		$	187,821		$	48,516		$	10,486		$	13,475		$	20,047	$	1,074		$	319,339

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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, 2015
Allowance for loan losses:
Balance, beginning of period	$	881		$	100	$	3,573	$	1,391	$	1,205	$	539	$	269	$	18		$	7,976
Provision (credit) charged to expense		79			8		72		124		374		65		75		3			800
Losses charged off		(45	)		-		-		-		-		-		-		(1	)		(46	)
Recoveries		33			-		1,268		-		26		-		-		4			1,331
Balance, end of period	$	948		$	108	$	4,913	$	1,515	$	1,605	$	604	$	344	$	24		$	10,061
Ending Balance: individually evaluated for impairment	$	-		$	-	$	200	$	100	$	850	$	-	$	-	$	-		$	1,150
Ending balance: collectively evaluated for impairment	$	948		$	108	$	4,713	$	1,415	$	755	$	604	$	344	$	24		$	8,911
Loans:
Ending Balance	$	39,719		$	5,459	$	183,934	$	58,804	$	12,543	$	14,785	$	14,826	$	1,221		$	331,291
Ending Balance: individually evaluated for impairment	$	1,504		$	-	$	12,280	$	7,877	$	1,883	$	-	$	295	$	-		$	23,839
Ending balance: collectively evaluated for impairment	$	38,215		$	5,459	$	171,654	$	50,927	$	10,660	$	14,785	$	14,531	$	1,221		$	307,452

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.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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 December 31, 2016 and 2015:

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	33,787	$	36,941	$	4,031	$	5,459	$	173,375	$	150,122	$	48,241	$	46,230
Pass (Closely Monitored)		490		1,437		-		-		14,349		21,156		6,586		8,142
Special Mention		241		225		-		-		2,630		751		-		-
Substandard		871		1,116		-		-		5,570		11,905		-		4,432
Doubtful		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-
	$	35,389	$	39,719	$	4,031	$	5,459	$	195,924	$	183,934	$	54,827	$	58,804

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2016		2015		2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	9,631	$	9,462	$	13,475	$	14,785	$	16,500	$	9,626	$	1,074	$	1,221	$	300,114	$	273,846
Pass (Closely Monitored)		855		1,239		-		-		658		4,904		-		-		22,938		36,878
Special Mention		-		-		-		-		2,889		-		-		-		5,760		976
Substandard		1,061		1,842		-		-		-		296		-		-		7,502		19,591
Doubtful		-		-		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-		-		-
	$	11,547	$	12,543	$	13,475	$	14,785	$	20,047	$	14,826	$	1,074	$	1,221	$	336,314	$	331,291

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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 “pass grade” 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.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The following table is a summary of our past due and non-accrual loans as of December 31, 2016 and 2015:

As of December 31, 2016	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	$	165	$	94	$	137	$	396	$	34,993	$	35,389	$	-	$	137
Home Equity		-		-		-		-		4,031		4,031		-		-
Commercial Real Estate		-		648		100		748		195,176		195,924		-		4,872
Multifamily		-		-		-		-		54,827		54,827		-		-
Land		-		-		1,061		1,061		10,486		11,547		-		1,061
Construction		-		-		-		-		13,475		13,475		-		-
Commercial Non-Mortgage		-		-		-		-		20,047		20,047		-		-
Consumer		-		-		-		-		1,074		1,074		-		-
Total	$	165	$	742	$	1,298	$	2,205	$	334,109	$	336,314	$	-	$	6,070

As of December 31, 2015	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	$	151	$	152	$	-	$	303	$	39,416	$	39,719	$	-	$	99
Home Equity		-		-		-		-		5,459		5,459		-		-
Commercial Real Estate		6		1,011		-		1,017		182,917		183,934		-		5,188
Multifamily		1,291		-		-		1,291		57,513		58,804		-		-
Land		-		-		1,842		1,842		10,701		12,543		-		1,842
Construction		-		-		-		-		14,785		14,785		-		-
Commercial Non-Mortgage		-		-		-		-		14,826		14,826		-		-
Consumer		-		-		-		-		1,221		1,221		-		-
Total	$	1,448	$	1,163	$	1,842	$	4,453	$	326,838	$	331,291	$	-	$	7,129

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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 nonperforming 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.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The following table present impaired loans for the year ended December 31, 2016:

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		7,494		9,669		-		8,296		426
Multi Family		6,311		7,125		-		6,884		402
Land		-		-		-		24		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		609		695		235		385		41
Multi Family		-		-		-		-		-
Land		1,061		3,158		550		1,832		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		8,103		10,364		235		8,681		467
Multi Family		6,311		7,125		-		6,884		402
Land		1,061		3,158		550		1,856		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Total	$	16,975	$	22,267	$	785	$	18,733	$	1,062

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The following table present impaired loans for the year ended December 31, 2015:

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		9,912		11,820		-		10,508		289
Multi Family		6,586		7,400		-		6,685		359
Land		41		96		-		371		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		2,368		2,368		200		2,499		175
Multi Family		1,291		1,291		100		1,319		77
Land		1,842		3,640		850		2,115		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		12,280		14,188		200		13,007		464
Multi Family		7,877		8,691		100		8,004		436
Land		1,883		3,736		850		2,486		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Total	$	23,839	$	28,543	$	1,150	$	25,614	$	1,024

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

We have entered into transactions with certain executive officers, directors and their affiliates (related parties). In management’s opinion, such loans and other extensions of credit and deposits were made in the ordinary course of business and were made on substantially the same terms (including interest rates and collateral) as those prevailing at the time for comparable transactions with other persons. Further, in management’s opinion, these loans did not involve more than normal risk of collectability or present other unfavorable features.

Loans to related parties totaled $8,083 and $7,248 at December 31, 2016 and 2015, respectively. The increase was due to $3,148 in new loans and refinances and $2,313 in payoffs and repayments.

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

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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.

The following tables summarize the loans that have been restructured as TDRs during the twelve months ended December 31, 2016 and 2015:

	Twelve Months Ended
	December 31, 2016
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		2	$	826	$	826
Total		2	$	826	$	826

	Twelve Months Ended
	December 31, 2015
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		3	$	817	$	817
Total		3	$	817	$	817

The TDRs described above for the twelve months ended December 31, 2016 did not have a material impact on the allowance for loan losses or a material charge-off.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

A default on a TDR occurs when a TDR is 90 days or more past due, transferred to nonaccrual status, or transferred to other real estate owned. The Company did not have any TDR loans default during the past 12 months. The Company had no TDR loans that defaulted in 2016.

The following tables summarize the loans that have been restructured as TDRs based on the type of modification or concession granted to the borrower during the twelve months ending December 31, 2016 and 2015:

As of December 31, 2016	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		2		826		-		-		-		-		826
Total		2	$	826		-	$	-		-	$	-	$	826

As of December 31, 2015	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		-		-		-		-		3		817		817
Total		-	$	-		-	$	-		3	$	817	$	817

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

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. During the year ended December 31, 2016 and 2015, management predominantly utilized 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.

Note 5:     Premises and Equipment

Major classifications of premises and equipment, stated at cost, are as follows:

	2016			2015
Land	$	514		$	514
Buildings and improvements		3,156			3,146
Furniture, fixtures, and equipment		3,021			3,308
		6,691			6,968
Less accumulated depreciation		(5,564	)		(5,683	)
Net premises and equipment	$	1,127		$	1,285

Note 6:     Deposits

Deposits at year-end are summarized as follows:

	2016		2015
Savings accounts	$	13,923	$	13,626
Checking accounts		34,608		33,934
Money market accounts		104,798		70,356
Certificates of deposit		127,219		163,785
Total Deposits	$	280,548	$	281,701

Brokered certificates of deposit totaled $20,955 and $43,612 at December 31, 2016 and 2015.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

At December 31, 2016, scheduled maturities of certificates of deposit are as follows:

2017	75,405
2018	23,134
2019	17,749
2020	10,143
2021	676
Thereafter	112
Total	127,219

Time deposits of $250 or more were $33,402 and $39,061 at December 31, 2016 and 2015.

Note 7:     Federal Home Loan Bank Advances

Federal Home Loan Bank advances totaled $60,000 and $47,000 at December 31, 2016 and 2015. At December 31, 2016, the advances are at fixed rates and bear interest at rates ranging from 0.90% to 5.25% and are secured by loans under a blanket collateral agreement as well as specific deposits at the Federal Home Loan Bank totaling $148,999. Advances are subject to restrictions or penalties in the event of prepayment.

Aggregate annual maturities of our Federal Home Loan Bank advances at December 31, 2016, are:

2017	$	23,000,000
2018		5,000,000
2019		-
2020		10,000,000
2021		-
Thereafter		22,000,000
Total	$	60,000,000

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 8:     Income Taxes

The provision for income taxes includes these components:

	2016		2015
Taxes currently payable	$	2,056	$	1,759
Deferred income taxes		348		(215	)
Income tax expense	$	2,404	$	1,544

A reconciliation of income tax expense at the statutory rate to the Company’s actual income tax expense is shown below:

	2016			2015
Computed at the statutory rate (34%)	$	2,297		$	1,608
Increase (decrease) resulting from Tax exempt interest		(49	)		(49	)
Other		(156	)		(15	)
Actual tax expense	$	2,404		$	1,544

The tax effects of temporary differences related to deferred taxes shown on the consolidated balance sheets were:

	2016		2015
Deferred tax asset
Allowance for loan losses	$	2,725	$	2,984
Depreciation		142		134
Deferred loan fees		195		195
Deferred compensation		186		197
Real estate owned		3		27
Other		-		62
		3,251		3,599
Deferred tax liabilities
FHLB stock dividends		31		31
Net deferred tax asset	$	3,220	$	3,568

Retained earnings at December 31, 2016 include approximately $2,019 for which no deferred federal income tax liability has been recognized. This amount represents an allocation of income to bad debt deductions for tax purposes only. Reduction of amounts so allocated for purposes other than tax bad debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The deferred income tax liabilities on the preceding amounts that would have been recorded if they were expected to reverse into taxable income in the foreseeable future were approximately $686 at December 31, 2016.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

ASC Topic 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides b on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not identify any uncertain tax positions that it believes should be recognized in the consolidated financial statements.

Note 9:     Regulatory Matters

We are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on our financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, we must meet specific capital guidelines that involve quantitative measures of our assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. Our capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Basel III Capital Rules

In July 2013, the three federal bank regulatory agencies jointly published final rules (the Basel III Capital Rules) establishing a new comprehensive capital framework for U.S. banking organizations. The rules implement the Basel Committee’s December 2010 framework known as “Basel III” for strengthening international capital standards as well as certain provisions of the Dodd-Frank Act. These rules substantially revise the risk-based capital requirements applicable to bank holding companies and depository institutions, compared to the current U.S. risk-based capital rules. The Basel III Capital Rules define the components of capital and address other issues affecting the numerator in banking institutions’ regulatory capital ratios. These rules also address risk weights and other issues affecting the denominator in banking institutions’ regulatory capital ratios and replace the existing risk-weighting approach with a more risk-sensitive approach.

The Basel III Capital Rules were effective for the Bank on January 1, 2015 (subject to a four-year phase-in period). The Basel III Capital Rules, among other things, (i) introduce a new capital measure called “Common Equity Tier 1” (CET1), (ii) specify that Tier 1 capital consist of CET1 and “Additional Tier 1 Capital” instruments meeting specified requirements, (iii) define CET1 narrowly by requiring that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital and (iv) expand the scope of the deductions/adjustments as compared to existing regulations. Under the Basel III Capital Rules, the initial minimum capital ratios as of January 1, 2015, will be as follows:

4.5% CET1 to risk-weighted assets

6.0% Tier 1 capital to risk-weighted assets

8.0% Total capital to risk-weighted assets

4.0% Minimum leverage ratio

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Implementation of the deductions and other adjustments to CET1 began on January 1, 2015, and will phase in over a four-year period (beginning at 40% on January 1, 2015, and an additional 20% per year thereafter). Under the new rule, in order to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers, a banking organization must hold a capital conservation buffer composed of CET1 capital above its minimum risk-based capital requirements. The implementation of the capital conservation buffer began on January 1, 2016, at the 0.625% level and will phase in over a four-year period (increasing by that amount on each subsequent January 1 until it reaches 2.5% on January 1, 2019).

Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the table below). Management believes, as of December 31, 2016 and 2015, that we meet all capital adequacy requirements to which we are subject including the capital conservation buffer.

Our actual capital amounts and ratios are also presented in the table. 

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of December 31, 2016
Total risk-based capital (to risk-weighted assets)		63,829		22.02	%		23,188		8.0	%		28,985		10.0	%
Tier I capital (to risk-weighted assets)		60,131		20.75			17,391		6.0			23,188		8.0
Common equity tier 1 capital (to risk-weighted assets)		60,131		20.75			16,650		4.5			24,050		6.5
Tier I capital (to adjusted total assets)		60,131		16.25			14,800		4.0			18,500		5.0
As of December 31, 2015
Total risk-based capital (to risk-weighted assets)		61,810		20.7	%		23,848		8.0	%		29,810		10.0	%
Tier I capital (to risk-weighted assets)		57,990		19.45			17,886		6.0			23,848		8.0
Common equity tier 1 capital (to risk-weighted assets)		57,990		19.45			16,172		4.5			23,360		6.5
Tier I capital (to adjusted total assets)		57,990		16.14			14,375		4.0			17,969		5.0

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

DividendRestriction

The Bank is subject to certain restrictions on the amount of dividends that it may declare without prior regulatory approval. At December 31, 2016 the bank may not make a dividend declaration without prior regulatory approval.

Note 10:     Employee Benefits

We have a retirement savings 401(k) plan covering substantially all employees.  Employees may contribute up to 100% of their compensation with us matching 100% of the employee’s contribution on the first 3% of the employee’s compensation and 50% of the employee’s contributions that exceed 3% but does not exceed 5%.  Additionally, we can make discretionary contributions to our 401 (k) plan. Employer contributions charged to expense for the years ended 2016 and 2015 were $83 and $75 respectively.

Employee Stock Ownership Plan (ESOP)

As part of the conversion, we established an ESOP covering substantially all of our employees. The ESOP acquired 200,600 shares of WBKC common stock at $10.00 per share in the conversion with funds provided by a loan from the Company. Accordingly, $2,006 of common stock acquired by the ESOP reduced stockholders’ equity. Shares are released to participants proportionately as the loan is repaid. Compensation expense is recorded equal to the fair market value of the stock when contributions, which are determined annually by our Board of Directors, are made to the ESOP. Dividends on allocated shares are recorded as dividends and charged to retained earnings.  Dividends on unallocated shares are used to repay the loan.

ESOP expense for the years ended December 31, 2016 and 2015 was $555 and $391, respectively.

The ESOP shares as of December 31 were as follows:

	2016		2015
Allocated shares		73,220		55,665
Unearned shares		121,755		141,255
Total ESOP shares		194,975		196,920
Fair value of unearned shares at December 31	$	3,847	$	3,763

We are obligated at the option of each beneficiary to repurchase shares of the ESOP upon the beneficiary’s termination or after retirement. At December 31, 2016 and 2015, the fair value of the 73,220 and 55,665 allocated shares held by the ESOP was $2,314 and $1,483.

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Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 11:     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.

Impaired Loans (Collateral Dependent)

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 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 and subsequently as deemed necessary by management. Appraisals are reviewed for accuracy and consistency by management. Appraisers are selected from the list of approved appraisers maintained by management. The appraised values are reduced by discounts to consider lack of marketability and 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 management by comparison to historical results.

F-39

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The following table presents the fair value measurements of assets 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 December 31, 2016 and 2015:

			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)
December 31, 2016
Collateral-dependent Impaired loans	$	885	$	–	$	–	$	885

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 goodwill.

	Fair Value at December 31, 2016		Valuation Technique	Unobservable Inputs	Range
December 31, 2016
Collateral-dependent Impaired loans	$	885	Market comparable properties	Marketability discount		3%	-	13%	(6%)

There were no collateral-dependent impaired loans in the year ended December 31, 2015.

F-40

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Fair Value of Financial Instruments

The following table presents estimated fair values of the Company’s financial instruments and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2016.

			Fair Value Measurements Using
As of December 31, 2016	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	103,634	$	103,634	$	-	$	-
Held to maturity securities		499		-		500		-
Loans held for sale		238		-		239		-
Loans, net of allowance for loan losses		320,606		-		-		323,601
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		846		-		846		-
Financial liabilities
Deposits	$	280,548	$	153,290	$	-	$	128,655
Federal Home Loan Bank advances		60,000		-		59,187		-
Federal funds purchased		27,000		-		27,000		-
Interest payable		249		-		249		-

F-41

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

			Fair Value Measurements Using
As of December 31, 2015	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	52,865	$	52,865	$	-	$	-
Interest-earning time deposits		39,021		39,021		-		-
Held to maturity securities		500		-		500		-
Loans held for sale		581		-		583		-
Loans, net of allowance for loan losses		314,613		-		-		318,525
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		967		-		967		-
Financial liabilities
Deposits	$	281,701	$	117,916	$	-	$	165,657
Federal Home Loan Bank advances		47,000		-		46,390		-
Federal funds purchased		24,000		-		24,000		-
Interest payable		233		-		233		-

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, Federal Funds Purchased, 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 and Loans held for sale

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.

F-42

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015

(Amounts in Thousands, except per share data)

Deposits

Deposits include demand deposits, savings accounts, NOW 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 the Company 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 the Company’s 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 12:     Commitments and Contingent Liabilities

Some financial instruments, such as loan commitments, credit lines, letters of credit and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments may expire without being used. Off-balance-sheet risk to credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of the commitment.

At year-end, these financial instruments are summarized as follows:

	2016		2015
Commitments to extend credit	$	6,111	$	7,133
Unused portions of lines of credit		6,268		6,778
Standby letters of credit		787		990

Commitments to make loans generally expire within thirty to ninety days, while unused lines of credit expire at the maturity date of the individual loans.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 13:     Earnings Per Share (In thousands except per share amounts)

Years ended December 31	2016			2015
Net Income	$	4,353		$	3,186
Dividends and undistributed earnings allocated to participating securities		(47	)		(50	)
Income attributable to common shareholders		4,306			3,136
Weighted average shares outstanding (in thousands)		2,132			2,200
Less: average unearned ESOP and unvested restricted stock		(171	)		(203	)
Average Shares		1,961			1,997
Effect of dilutive based awards		32			25
Average common and common-equivalent shares for diluted EPS (in thousands)		1,993			2,022
Basic EPS	$	2.20		$	1.57
Diluted EPS	$	2.16		$	1.55

F-44

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 14:     Share Based Compensation

In May 2012, the Company’s stockholders approved the Wolverine Bancorp, Inc. 2012 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 are authorized but unissued shares. The maximum number of shares authorized under the Plan is 351,050. Total share-based compensation expense pursuant to the Plan for the years ended December 31, 2016 and 2015 was $334 and $319, 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, 2016		128,949		$	17.91		7	$	1,123
Granted		60,000			26.66		10		--
Exercised		(1,503	)		17.30		--		--
Forfeited		(3,888	)		19.58		--		--
Expired		(1,973	)		18.42		--		--
Options outstanding at December 31, 2016		181,585		$	20.76		7	$	1,956
Exercisable at December 31, 2016		92,748		$	17.44		6	$	1,305

F-45

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

The fair value of the Company’s stock options granted on September 9, 2016 was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		17.80	%
Risk-free interest rate		1.59	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.75
Grant date fair value	$	1.91

The fair value of the Company’s stock options granted on December 15, 2016 was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		18.10	%
Risk-free interest rate		2.51	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.03
Grant date fair value	$	2.58

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 has a Cash Dividend Policy whereby the Company expects to pay a cash dividend to shareholders on an annual basis. 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.

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Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

As of December 31, 2016, the Bank had $179 of unrecognized compensation expense related to stock options. The cost is expected to be recognized over a weighted-average period of 8.96 years. The total fair value of options vested in the year ended December 31, 2016 was $768. Stock option expense for the years ended December 31, 2016 and 2015 was $62 and $62, respectively.

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, 2016		36,534		$	19.16
Granted		7,500			28.61
Vested		(14,745	)		18.14
Forfeited		(2,717	)		19.02
Non-vested at December 31, 2016		26,572			22.38

As of December 31, 2016, the Company had $505 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 the years ended December 31, 2016 and 2015 were $272 and $257, respectively.

F-47

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Note 15:     Condensed Financial Information (Parent Company Only)

Presented below is condensed financial information as to financial position, results of operations and cash flows of the Company:

Condensed Balance Sheets

	December 31,		December 31,
Assets	2016		2015
Cash and cash equivalents	$	3,190	$	2,386
Investment in subsidiary		61,127		60,073
Other assets		205		199
Total assets	$	64,522	$	62,658
Liabilities - Other	$	3,548	$	2,178
Stockholders' Equity		60,974		60,480
Total liabilities and stockholders' equity	$	64,522	$	62,658

F-48

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Condensed Statements of Income and Comprehensive Income

	December 31,		December 31,
	2016		2015
Income - Dividends from subsidiary	$	4,500	$	4,500
Expense		344		260
Income Before Income Tax and Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,156		4,240
Income Tax Benefit		5		73
Income (Loss) Before Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,161		4,313
Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		192		(1,127	)
Net Income and Comprehensive Income	$	4,353	$	3,186

F-49

Table of Contents

Wolverine Bancorp, Inc.
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
(Amounts in Thousands, except per share data)

Condensed Statements of Cash Flows

	December 31,			December 31,
	2016			2015
Operating Activities
Net income	$	4,353		$	3,186
Items not requiring (providing) cash:
(Equity in undistributed income) distributions in excess of income of subsidiaries		(192	)		1,127
Change in other assets		(6	)		(74	)
Change in other liabilities		299			(47	)
Net cash provided by operating activities		4,454			4,192
Financing Activities
Purchase of common stock		(1,518	)		(2,796	)
Dividends paid		(2,158	)		-
Proceeds from stock options exercised		26			-
Net cash used in financing activities		(3,650	)		(2,796	)
Net Change in Cash and Cash Equivalents		804			1,396
Cash and Cash Equivalents, Beginning of Period		2,386			990
Cash and Cash Equivalents, End of Period	$	3,190		$	2,386

Supplemental Disclosures of Cash Flows Information
Dividends Declared, not paid	$	3,229	$	2,158

F-50

Table of Contents

Signatures

Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		Wolverine Bancorp, Inc.
Date: July 27, 2017	By:	/s/ David H. Dunn
		David H. Dunn President and Chief Executive Officer (Duly Authorized Representative)

EXHIBIT INDEX

3.1 Articles of Incorporation of Wolverine Bancorp, Inc.*

3.2 Bylaws of Wolverine Bancorp, Inc.*

4 Form of Common Stock Certificate of Wolverine Bancorp, Inc.*

10.1 Amended and Restated Employment Agreement of David H. Dunn**

10.2 Amended and Restated Employment Agreement of Rick A. Rosinski**

10.3 2002 Long Term Incentive Plan, as amended*

10.4 2006 Long Term Incentive Plan, as amended for Dunn*

10.5	2006 Long Term Incentive Plan, as amended for Rosinski*
10.6	2012 Equity Incentive Plan***

21 Subsidiaries****

23 Consent of Independent Auditor****

31.1 Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 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

* Incorporated by reference to the Registration Statement on Form S-1 (file no. 333-169432), initially filed with the SEC on September 16, 2010.

**	Incorporated by reference to the Current Report on Form 8-K filed with the SEC on July 8, 2011.
***	Incorporated by reference to the Proxy Statement filed on April 16, 2012.
****	Incorporated by reference to the Annual Report on Form 10-K (file no. 001-35034) filed on March 31, 2017.

EX-31.1

EXHIBITS 31.1 AND 31.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION

302 OF THE SARBANES-OXLEY ACT OF 2002

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 Amendment No. 1 to the annual report on Form 10-K/A 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 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 our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

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

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

July 27, 2017	/s/ David H. Dunn
Date	David H. Dunn
	President and Chief Executive Officer

EX-31.2

EXHIBITS 31.1 AND 31.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION

302 OF THE SARBANES-OXLEY ACT OF 2002

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 Amendment No. 1 to the annual report on Form 10-K/A 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 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 our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

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

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

July 27, 2017	/s/ Rick A. Rosinski
Date	Rick A. Rosinski
	Chief Operating Officer and Treasurer

EX-32.1

EXHIBIT 32

CERTIFICATE PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

David H. Dunn, President and Chief Executive Officer and Rick A. Rosinski, Chief Operating Officer and Treasurer of Wolverine Bancorp, Inc. (the “Company”) each certify in their capacity as officers of the Company that they have reviewed the Amendment No. 1 to the Annual Report of the Company on Form 10-K/A for the year ended December 31, 2016 and that to the best of their knowledge:

(1) the Report fully complies with the requirements of Sections 13(a) 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.

July 27, 2017	/s/ David H. Dunn
Date	David H. Dunn
	President and Chief Executive Officer
July 27, 2017	/s/ Rick A. Rosinski
Date	Rick A. Rosinski
	Chief Operating Officer and Treasurer

XML

Document And Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2016	Mar. 27, 2017	Jun. 30, 2016
Document Information [Line Items]
Entity Registrant Name	WOLVERINE BANCORP, INC.
Entity Central Index Key	0001500836
Trading Symbol	wbkc
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		2,106,153
Entity Public Float			$ 44.5
Document Type	10-K/A
Document Period End Date	Dec. 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY
Amendment Flag	true
Amendment Description	Wolverine Bancorp, Inc. (the "Company") is filing this Amendment No. 1 on Form 10-K/A to its Annual Report on Form 10-K for the year ended December 31, 2016, as filed with the Securities and Exchange Commission on March 31, 2017. The Company is re-filing Item 8 of Part II of the Form 10-K to include a revised audit report, which inadvertently included an incorrect date of issuance of March 30, 2017 in the previous filing. The Company is also revising the column heading on page F-50 to correct the date to 2016.

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Assets
Cash and due from banks	$ 318	$ 334
Interest-earning demand deposits	103,316	52,531
Cash and cash equivalents	103,634	52,865
Interest-earning time deposits		39,021
Investment securities held to maturity	499	500
Loans held for sale	238	581
Loans, net of allowance for loan losses of $9,326 and $10,061	320,606	314,613
Premises and equipment, net	1,127	1,285
Federal Home Loan Bank stock	2,700	2,700
Other real estate owned	86	130
Accrued interest receivable	846	967
Other assets	4,699	5,151
Total assets	434,435	417,813
Liabilities and Stockholders’ Equity
Deposits	280,548	281,701
Federal Home Loan Bank advances	60,000	47,000
Federal funds purchased	27,000	24,000
Interest payable and other liabilities	5,913	4,632
Total liabilities	373,461	357,333
Commitments and Contingencies
Common Stock, $0.01 par value per share: Authorized – 100,000,000 shares Issued and outstanding – 2,106,153 and 2,158,034 at December 31, 2016 and December 31, 2015	21	22
Unearned employee stock ownership plan (ESOP)	(1,215)	(1,410)
Additional paid-in capital	15,577	16,401
Retained earnings	46,591	45,467
Total stockholders’ equity	60,974	60,480
Total liabilities and stockholders’ equity	$ 434,435	$ 417,813

XML

Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Allowance for loan losses	$ 9,326	$ 10,061
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	2,106,153	2,158,034
Common stock, shares outstanding (in shares)	2,106,153	2,158,034

XML

Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Interest and Dividend Income
Loans	$ 16,435	$ 15,372
Investment securities and other	384	244
Total interest and dividend income	16,819	15,616
Interest Expense
Deposits	2,033	1,451
Borrowings	1,850	2,000
Total interest expense	3,883	3,451
Net Interest Income	12,936	12,165
Provision (credit) for loan losses	(760)	800
Net Interest Income After Provision for Loan Losses	13,696	11,365
Noninterest Income
Service charges and fees	260	297
Net gain on loan sales	469	660
Net gain (loss) on sale of real estate owned	32	(116)
Other	296	382
Total noninterest income	1,057	1,223
Noninterest Expense
Salaries and employee benefits	4,953	4,541
Net occupancy and equipment expense	818	811
Information technology expense	240	236
Federal deposit insurance corporation premiums	214	217
Professional and services fees	584	398
Other real estate owned expense	25	50
Loan legal expense (recovery)	(74)	322
Advertising expense	126	144
Michigan business tax	195	186
Other	915	953
Total noninterest expense	7,996	7,858
Income Before Income Tax	6,757	4,730
Provision for Income Taxes	2,404	1,544
Net Income and Comprehensive Income	$ 4,353	$ 3,186
Earnings Per Share:
Basic (in dollars per share)	$ 2.20	$ 1.57
Diluted (in dollars per share)	$ 2.16	$ 1.55

XML

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Unearned ESOP Shares [Member]	Retained Earnings [Member]	Total
Balances at Dec. 31, 2014	$ 23	$ 18,640	$ (1,564)	$ 44,439	$ 61,538
Net income				3,186	3,186
Purchase of common stock shares	(1)	(2,795)			(2,796)
Share based compensation expense		319			319
ESOP shares earned		237	154		391
Dividends				(2,158)	(2,158)
Balances at Dec. 31, 2015	22	16,401	(1,410)	45,467	60,480
Net income				4,353	4,353
Purchase of common stock shares	(1)	(1,517)			(1,518)
Exercised options		26			26
Share based compensation expense		334			334
ESOP shares earned		333	195		528
Dividends				(3,229)	(3,229)
Balances at Dec. 31, 2016	$ 21	$ 15,577	$ (1,215)	$ 46,591	$ 60,974

XML

Consolidated Statements of Changes in Stockholders' Equity (Parentheticals) - $ / shares	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Additional Paid-in Capital [Member]
Treasury stock, shares purchased (in shares)	57,557	112,814
Retained Earnings [Member]
Dividends, per share (in dollars per share)	$ 1.60	$ 1

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Operating Activities
Net income	$ 4,353	$ 3,186
Items not requiring (providing) cash
Depreciation	223	232
Provision (credit) for loan losses	(760)	800
(Gain) loss on other real estate owned	(32)	116
Loans originated for sale	(17,309)	(20,073)
Deferred income taxes	348	(215)
Proceeds from loans sold	18,121	20,722
Net gain on sale of loans	(469)	(660)
Share based compensation	334	319
Earned ESOP shares	528	391
Changes in
Interest receivable and other assets	225	249
Interest payable and other liabilities	210	429
Net cash provided by operating activities	5,772	5,496
Investing Activities
Net change in interest-earning time deposits	39,021	(39,021)
Purchase of held to maturity securities	(499)	(500)
Proceeds from calls, maturities and pay-downs of held to maturity securities	500
Net change in loans	(5,425)	(19,111)
Proceeds from sale of real estate owned	268	272
Purchase of FHLB stock		(200)
Purchase of premises and equipment	(65)	(133)
Net cash provided by (used in) investing activities	33,800	(58,693)
Financing Activities
Net change in demand deposits, money market, checking and savings accounts	35,413	3,499
Net change in certificates of deposit	(36,566)	54,673
Repayment of Federal Home Loan Bank advances		(13,000)
Proceeds from Federal Home Loan Bank advances	13,000	10,000
Net change in Fed funds purchased	3,000	24,000
Proceeds from stock options exercised	26
Purchase of common stock	(1,518)	(2,796)
Dividends paid	(2,158)
Net cash provided by financing activities	11,197	76,376
Change in Cash and Cash Equivalents	50,769	23,179
Cash and Cash Equivalents, Beginning of Period	52,865	29,686
Cash and Cash Equivalents, End of Period	103,634	52,865
Supplemental Disclosures of Cash Flows Information
Interest paid	3,937	3,375
Income taxes paid	1,981	1,847
Loans transferred to real estate owned	192	176
Dividends declared, not paid	$ 2,305	$ 2,158

XML

Note 1 - Nature of Operations and Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Nature of Operations and Accounting Policies Disclosure [Text Block]

Note

1:

    

Nature of Operations and Summary of Significant Accounting Policies

Nature of Operations

Wolverine Bank (the “Bank”), a wholly owned subsidiary of Wolverine Bancorp, Inc. (the “Company”), is a federally chartered savings bank primarily engaged in providing a full range of banking and financial services to individual and business customers in the Great Lakes Bay Region and beyond. The Company is subject to competition from other financial institutions. The Company is subject to the regulation of the Federal Reserve Board and the Bank is subject to the regulation of the Officer of the Comptroller of the Currency, and both undergo periodic examinations.

The Bank’s additional wholly owned subsidiaries, Wolserv Corporation, a Michigan corporation which has a membership interest in a title company, and Wolverine Commercial Holdings LLC, a Michigan LLC owned by Wolverine Bank which holds certain real estate, are included in the consolidated financial statements.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of real estate acquired in connection with foreclosures or in satisfaction of loans and financial instruments.

Cash Equivalents

We consider all liquid investments with original maturities of

three

months or less to be cash equivalents.

Securities

Held-to-maturity securities, which include any security for which we have the positive intent and ability to hold until maturity, are carried at historical cost adjusted for amortization of premiums and accretion of discounts.

Amortization of premiums and accretion of discounts are recorded as interest income from securities. Realized gains and losses are recorded as net security gains (losses). Gains and losses on securities are determined on the specific-identification method.

Loans Held for Sale

Mortgage loans originated and intended for sale in the

secondary

market are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to noninterest income. Gains and losses on loan sales are recorded in noninterest income, and direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan.

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are reported at their outstanding principal balances adjusted for any charge-offs, the allowance for loan losses, any deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. Generally, loans are placed on nonaccrual status at

ninety

days past due and interest is considered a loss, unless the loan is well-secured. Accrued interest for loans placed on nonaccrual status is reversed against interest income.

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that

may

affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical charge-off experience and expected loss given default derived from our internal risk rating process. Other adjustments

may

be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.

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

Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, we do not separately identify individual consumer and residential loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower.

Premises and Equipment

Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight-line and accelerated methods over the estimated useful lives of the assets ranging from

3

to

39

years.

Federal Home Loan Bank Stock

Federal Home Loan Bank stock is a required investment for institutions that are members of the Federal Home Loan Bank system. The required investment in the common stock is based on a predetermined formula, carried at cost, and evaluated for impairment.

Real Estate Owned

Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from foreclosed assets.

Earnings Per Common Share

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.

Income Taxes

We account for income taxes in accordance with income tax accounting guidance (ASC 

740,

Income Taxes

). The income tax accounting guidance results in

two

components of income tax 

expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. We determine deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur.

Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than

50

percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than

50

percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized.

We recognize interest and penalties on income taxes as a component of income tax expense.

We file consolidated income tax returns with our subsidiaries.

Recently Issued Accounting Standards

FASB Accounting Standards Updates No.

2017

-

04,

Intangibles – Goodwill and Other (Topic

350)

The FASB has issued Accounting Standards Update (ASU) No.

2017

-

04,

Intangibles – Goodwill and Other (Topic

350):

Simplifying the Test for Goodwill Impairment. The new guidance is intended to simplify the subsequent measurement of goodwill by eliminating Step

2

from the goodwill impairment test.

The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, the income tax effects of tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a

zero

or negative carrying amount to perform Step

2

of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the qualitative impairment test is necessary. The amendments should be applied on a prospective basis. The nature of and reason for the change in accounting principle should be disclosed upon transition.

The amendments in this update should be adopted for annual or any interim goodwill impairment tests in fiscal years beginning after

December

15,

2019.

Early adoption is permitted on testing dates after

January

1,

2017.

The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

FASB Accounting Standards Updates No.

2017

-

01,

Business Combinations (Topic

805)

The FASB has issued Accounting Standards Update (ASU) No.

2017

-

01,

Business Combinations (Topic

805):

Clarifying the Definition of a Business

. The amendments in this update provide a more robust framework to use in determining when a set of assets and activities is a business. Because the current definition of a business is interpreted broadly and can be difficult to apply, stakeholders indicated that analyzing transactions is inefficient and costly and that the definition does not permit the use of reasonable judgment. The amendments provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable.

The amendments in this update become effective for annual periods and interim periods within those annual periods beginning after

December

15,

2017.

We are currently evaluating the impact of adopting the new guidance on the consolidated financial statements, but it is not expected to have a material impact.

FASB ASU No.

2016

-

15,

Statement of Cash Flows (Topic

230):

Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

15,

Statement of Cash Flows (Topic

230).

This update addresses

eight

specific cash flow issues with the objective of reducing the existing diversity in practice of how certain cash receipts and cash payments are presented and classified in the statement of cash flow. In

November

2016,

the FASB issued ASU No.

2016

-

18,

which gave clarification on how restricted cash was to be presented in the cash flow statement.

The amendments are effective for public business entities for fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after

December

15,

2018,

and interim periods within fiscal years beginning after

December

15,

2019.

Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

13,

Financial Instruments—Credit Losses (Topic

326):

Measurement of Credit Losses on Financial Instruments

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

13,

Financial Instruments – Credit Losses (Topic

326):

Measurement of Credit Losses on Financial Instruments.

The main objective of this amendment is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date.

The ASU requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.

Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.

The ASU requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. These disclosures include qualitative and quantitative requirements that provide additional information about the amounts recorded in the financial statements.

In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.

For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this Update are effective for fiscal years beginning after

December

15,

2019,

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

December

15,

2020,

including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after

December

15,

2020,

and interim periods within fiscal years beginning after

December

15,

2021.

All entities

may

adopt the amendments in this Update earlier as of the fiscal years beginning after

December

15,

2018,

including interim periods within those fiscal years. The Company will be evaluating the impact of adopting this ASU and has not determined the anticipated impact on the consolidated financial statements.

FASB ASU No.

2016

-

09,

Compensation—Stock Compensation (Topic

718)

The FASB issued ASU No.

2016

-

09,

Compensation–Stock Compensation

(Topic

718):

Improvements to Employee Share-Based Payment Accounting

.

The ASU is intended to improve the accounting for employee shared-base payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including the income tax consequences, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. The amendments in this update became effective on

January

1,

2017

and did not have a material impact on the consolidated financial statements.

For public business entities, the amendments are effective for annual periods beginning after

December

15,

2016,

and interim periods within those annual periods. For all other entities, the amendments are effective for annual periods beginning after

December

15,

2017,

and interim periods within annual periods beginning after

December

15,

2018.

Early adoption is permitted for any entity in any interim or annual period. The amendments in this update became effective on

January

1,

2017

and did not have a material impact on the consolidated financial statements.

FASB ASU No.

2016

-

08,

2016

-

10,

2016

-

12,

Revenue from Contracts with Customers (Topic

606)

In

May

2014,

the FASB issued ASU

2014

-

09,

“

Revenue from Contracts with Customers

,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In

March

2016,

the FASB issued ASU

2016

-

08,

“

Principal versus Agent Considerations (Reporting Revenue Gross versus Net)

,” which clarifies the guidance in determining revenue recognition as principal versus agent. In

April

2016,

the FASB issued ASU

2016

-

10,

“

Identifying Performance Obligations and Licensing

,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In

May

2016,

the FASB issued ASU

2016

-

12,

“

Narrow-Scope Improvements and Practical Expedients

,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

For public business entities, the amendments are effective for annual reporting periods beginning after

December

15,

2017,

including interim reporting periods with that reporting period, as deferred by ASU

2015

-

14.

Early application is permitted as of annual reporting periods beginning after

December

15,

2016,

including interim reporting periods within the reporting period.

All other entities should apply the guidance to annual reporting periods beginning after

December

15,

2018,

and interim reporting periods within annual reporting periods beginning after

December

15,

2019.

Early application is permitted for all other entities as of annual reporting periods beginning after

December

15,

2016,

including interim reporting periods within annual reporting periods beginning

one

year after the annual reporting period in which the entity

first

applies the guidance in Update

2014

-

09.

Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

07,

Investments – Equity Method and Joint Ventures (Topic

323)

The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held.

The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required.

The amendments require that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method.

The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after

December

15,

2016.

The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

06,

Derivatives and Hedging (Topic

815):

Contingent Put and Call Options in Debt Instruments

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

05,

Derivatives and Hedging (Topic

815):

Effect of Derivative Contract Novations and Existing Hedge Accounting Relationships

. The amendments apply to all reporting entities for which there is a change in the counterparty to a derivative instrument that has been designated as a hedging instrument.

The amendments clarify what steps are required when assessing whether the economic characteristics and risks of call (put) options are clearly and closely related to the economic characteristics and risks of their debt hosts, which is

one

of the criteria for bifurcating an embedded derivative. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks.

This standard will be effective for pubic business entities for fiscal year beginning after

December

15,

2016

including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after

December

15,

2017,

and interim periods within fiscal years beginning after

December

15,

2018.

Early application is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

02

– Leases (Topic

842)

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

02,

Leases

. Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date:

●          A lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and

●          A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.

Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic

606,

Revenue from Contracts with Customers

.

The new lease guidance simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees will no longer be provided with a source of off-balance sheet financing.

This standard will be effective for pubic business entities for fiscal year beginning after

December

15,

2018

including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after

December

15,

2019

and interim periods within fiscal years beginning after

December

15,

2020.

Early application is permitted for all public business entities and all nonpublic business entities upon issuance.

Lessees (for capital and operating leases) and lessors (for sales-type, direct financing and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors

may

not apply a full retrospective transition approach.

Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB Accounting Standards Updates No.

2016

-

01,

Financial Instruments – Overall

(Subtopic

825

-

10):

Recognition and Measurement of Financial Assets and Financial Liabilities

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

01,

Financial Instruments – Overall (Subtopic

825

-

10):

Recognition and Measurement of Financial Assets and Financial Liabilities.

The new guidance is intended to improve the recognition and measurement of financial instruments. The ASU affects public and private companies, not-for-profit organizations, and employee benefit plans that hold financial assets or owe financial liabilities.

The new guidance makes targeted improvements to existing U.S. GAAP by:

● Requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income;

● Requiring public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes;

● Requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements;

● Eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for organizations that are not public business entities;

● Eliminating the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; and

● Requiring a reporting organization to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments.

The new guidance is effective for public companies for fiscal years beginning after

December

15,

2017,

including interim periods within those fiscal years. The new guidance permits early adoption of the own credit provision. In addition, the new guidance permits early adoption of the provision that exempts private companies and not-for-profit organizations from having to disclose fair value information about financial instruments measured at amortized cost. Adoption of the

ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

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Note 2 - Restriction on Cash and Due From Banks

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Summary of Cash and Due From Banks [Text Block]

Note 2: Restriction on Cash and Due From Banks

We are required to maintain reserve funds in cash and/or on deposit with the Federal Reserve Bank. The reserve required at

December

31,

2016

was

$459.

At

December

31,

2016,

the Company’s cash accounts exceeded federally insured limits by approximately

$391.

Additionally, the Company had approximately

$1,733

and

$98,665

on deposit with the Federal Home Loan Bank of Indianapolis and Federal Reserve Bank of Chicago, as of

December

31,

2016,

which are not federally insured.

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Note 3 - Securities

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

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

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:
December 31, 2016
Treasury bond	$	499	$	1	$	–	$	500
December 31, 2015
Treasury bond	$	500	$	–	$	–	$	500

The treasury bond held at

December

31,

2016

matured on

January

5

th

,

2017.

There were

no

sales of securities during

2016

or

2015.

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Note 4 - Loans and Allowance for Loan Losses

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

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

Note

4:

     

Loans and Allowance for Loan Losses

Categories of loans include:

	December 31, 2016		December 31, 2015
Real Estate
One-to four-family	$	35,389	$	39,719
Home equity		4,031		5,459
Commercial mortgage loans
Commercial real estate		195,924		183,934
Multifamily		54,827		58,804
Land		11,547		12,543
Construction		13,475		14,785
Commercial non-mortgage		20,047		14,826
Consumer		1,074		1,221
Total loans		336,314		331,291
Less
Net deferred loan costs, premiums and discounts		563		567
Undisbursed portion of loan		5,819		6,050
Allowance for loan losses		9,326		10,061
Net Loans	$	320,606	$	314,613

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

1

-

4

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

1

-

4

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 multi-family

Commercial real estate and multi-family 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 multi-family 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. Construction loans for

one

-to-

four

family residential properties are originated with a maximum loan to value ratio of

70%

and 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

70%

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 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; current market conditions; and change in regional employment conditions.

In instances where risk and loss exposure is clearly identified with a particular asset, a specific valuation allowance will be established or 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

December

31,

2016

and

2015:

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, 2016
Allowance for loan losses:
Balance, beginning of period	$	948		$	108		$	4,913		$	1,515		$	1,605		$	604		$	344	$	24		$	10,061
Provision charged to expense		(137	)		(59	)		555			(431	)		(544	)		(310	)		180		(14	)		(760	)
Losses charged off		(67	)		-			(85	)		-			-			-			-		(1	)		(153	)
Recoveries		54			-			39			-			81			-			-		4			178
Balance, end of period	$	798		$	49		$	5,422		$	1,084		$	1,142		$	294		$	524	$	13		$	9,326
Ending Balance: individually evaluated for impairment	$	-		$	-		$	235		$	-		$	550		$	-		$	-	$	-		$	785
Ending balance: collectively evaluated for impairment	$	798		$	49		$	5,187		$	1,084		$	592		$	294		$	524	$	13		$	8,541
Loans:
Ending Balance	$	35,389		$	4,031		$	195,924		$	54,827		$	11,547		$	13,475		$	20,047	$	1,074		$	336,314
Ending Balance: individually evaluated for impairment	$	1,500		$	-		$	8,103		$	6,311		$	1,061		$	-		$	-	$	-		$	16,975
Ending balance: collectively evaluated for impairment	$	33,889		$	4,031		$	187,821		$	48,516		$	10,486		$	13,475		$	20,047	$	1,074		$	319,339

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, 2015
Allowance for loan losses:
Balance, beginning of period	$	881		$	100	$	3,573	$	1,391	$	1,205	$	539	$	269	$	18		$	7,976
Provision (credit) charged to expense		79			8		72		124		374		65		75		3			800
Losses charged off		(45	)		-		-		-		-		-		-		(1	)		(46	)
Recoveries		33			-		1,268		-		26		-		-		4			1,331
Balance, end of period	$	948		$	108	$	4,913	$	1,515	$	1,605	$	604	$	344	$	24		$	10,061
Ending Balance: individually evaluated for impairment	$	-		$	-	$	200	$	100	$	850	$	-	$	-	$	-		$	1,150
Ending balance: collectively evaluated for impairment	$	948		$	108	$	4,713	$	1,415	$	755	$	604	$	344	$	24		$	8,911
Loans:
Ending Balance	$	39,719		$	5,459	$	183,934	$	58,804	$	12,543	$	14,785	$	14,826	$	1,221		$	331,291
Ending Balance: individually evaluated for impairment	$	1,504		$	-	$	12,280	$	7,877	$	1,883	$	-	$	295	$	-		$	23,839
Ending balance: collectively evaluated for impairment	$	38,215		$	5,459	$	171,654	$	50,927	$	10,660	$	14,785	$	14,531	$	1,221		$	307,452

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

December

31,

2016

and

2015:

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	33,788	$	36,941	$	4,031	$	5,459	$	173,375	$	150,122	$	48,241	$	46,230
Pass (Closely Monitored)		490		1,437		-		-		14,349		21,156		6,586		8,142
Special Mention		241		225		-		-		2,630		751		-		-
Substandard		871		1,116		-		-		5,570		11,905		-		4,432
Doubtful		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-
	$	35,389	$	39,719	$	4,031	$	5,459	$	195,924	$	183,934	$	54,827	$	58,804

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2016		2015		2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	9,631	$	9,462	$	13,475	$	14,785	$	16,499	$	9,626	$	1,074	$	1,221	$	300,114	$	273,846
Pass (Closely Monitored)		855		1,239		-		-		658		4,904		-		-		22,938		36,878
Special Mention		-		-		-		-		2,889		-		-		-		5,760		976
Substandard		1,061		1,842		-		-		-		296		-		-		7,502		19,591
Doubtful		-		-		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-		-		-
	$	11,547	$	12,543	$	13,475	$	14,785	$	20,047	$	14,826	$	1,074	$	1,221	$	336,314	$	331,291

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 “pass grade” 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

December

31,

2016

and

2015:

As of December 31, 2016	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	$	165	$	94	$	137	$	396	$	34,993	$	35,389	$	-	$	137
Home Equity		-		-		-		-		4,031		4,031		-		-
Commercial Real Estate		-		648		100		748		195,176		195,924		-		4,872
Multifamily		-		-		-		-		54,827		54,827		-		-
Land		-		-		1,061		1,061		10,486		11,547		-		1,061
Construction		-		-		-		-		13,475		13,475		-		-
Commercial Non-Mortgage		-		-		-		-		20,047		20,047		-		-
Consumer		-		-		-		-		1,074		1,074		-		-
Total	$	165	$	742	$	1,298	$	2,205	$	334,109	$	336,314	$	-	$	6,070

As of December 31, 2015	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	$	151	$	152	$	-	$	303	$	39,416	$	39,719	$	-	$	99
Home Equity		-		-		-		-		5,459		5,459		-		-
Commercial Real Estate		6		1,011		-		1,017		182,917		183,934		-		5,188
Multifamily		1,291		-		-		1,291		57,513		58,804		-		-
Land		-		-		1,842		1,842		10,701		12,543		-		1,842
Construction		-		-		-		-		14,785		14,785		-		-
Commercial Non-Mortgage		-		-		-		-		14,826		14,826		-		-
Consumer		-		-		-		-		1,221		1,221		-		-
Total	$	1,448	$	1,163	$	1,842	$	4,453	$	326,838	$	331,291	$	-	$	7,129

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 nonperforming 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 present impaired loans for the year ended

December

31,

2016:

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		7,494		9,669		-		8,296		426
Multi Family		6,311		7,125		-		6,884		402
Land		-		-		-		24		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		609		695		235		385		41
Multi Family		-		-		-		-		-
Land		1,061		3,158		550		1,832		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		8,103		10,364		235		8,681		467
Multi Family		6,311		7,125		-		6,884		402
Land		1,061		3,158		550		1,856		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Total	$	16,975	$	22,267	$	785	$	18,733	$	1,062

The following table present impaired loans for the year ended

December

31,

2015:

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		9,912		11,820		-		10,508		289
Multi Family		6,586		7,400		-		6,685		359
Land		41		96		-		371		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		2,368		2,368		200		2,499		175
Multi Family		1,291		1,291		100		1,319		77
Land		1,842		3,640		850		2,115		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		12,280		14,188		200		13,007		464
Multi Family		7,877		8,691		100		8,004		436
Land		1,883		3,736		850		2,486		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Total	$	23,839	$	28,543	$	1,150	$	25,614	$	1,024

We have entered into transactions with certain executive officers, directors and their affiliates (related parties). In management’s opinion, such loans and other extensions of credit and deposits were made in the ordinary course of business and were made on substantially the same terms (including interest rates and collateral) as those prevailing at the time for comparable transactions with other persons. Further, in management’s opinion, these loans did not involve more than normal risk of collectability or present other unfavorable features.

Loans to related parties totaled

$8,083

and

$7,248

at

December

31,

2016

and

2015,

respectively. The increase was due to

$3,148

in new loans and refinances and

$2,313

in payoffs and repayments.

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

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.

The following tables summarize the loans that have been restructured as TDRs during the

twelve

months ended

December

31,

2016

and

2015:

	Twelve Months Ended
	December 31, 2016
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		2	$	826	$	826
Total		2	$	826	$	826

	Twelve Months Ended
	December 31, 2015
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		3	$	817	$	817
Total		3	$	817	$	817

The TDRs described above for the

twelve

months ended

December

31,

2016

did not have a material impact on the allowance for loan losses or a material charge-off.

A default on a TDR occurs when a TDR is

90

days or more past due, transferred to nonaccrual status, or transferred to other real estate owned. The Company did

not

have any TDR loans default during the past

12

months. The Company had no TDR loans that defaulted in

2016.

The following tables summarize the loans that have been restructured as TDRs based on the type of modification or concession granted to the borrower during the

twelve

months ending

December

31,

2016

and

2015:

As of December 31, 2016	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		2		826		-		-		-		-		826
Total		2	$	826		-	$	-		-	$	-	$	826

As of December 31, 2015	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		-		-		-		-		3		817		817
Total		-	$	-		-	$	-		3	$	817	$	817

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. During the year ended

December

31,

2016

and

2015,

management predominantly utilized 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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Note 5 - Premises and Equipment

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

Note

5:

     

Premises and Equipment

Major classifications of premises and equipment, stated at cost, are as follows:

	2016			2015
Land	$	514		$	514
Buildings and improvements		3,156			3,146
Furniture, fixtures, and equipment		3,021			3,308
		6,691			6,968
Less accumulated depreciation		(5,564	)		(5,683	)
Net premises and equipment	$	1,127		$	1,285

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Note 6 - Deposits

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Deposit Liabilities Disclosures [Text Block]

Note

6:

     Deposits

Deposits at year-end are summarized as follows:

	2016		2015
Savings accounts	$	13,923	$	13,626
Checking accounts		34,608		33,934
Money market accounts		104,798		70,356
Certificates of deposit		127,219		163,785
Total Deposits	$	280,548	$	281,701

Brokered certificates of deposit totaled

$20,955

and

$43,612

at

December

31,

2016

and

2015.

At

December

31,

2016,

scheduled maturities of certificates of deposit are as follows:

2017	75,405
2018	23,134
2019	17,749
2020	10,143
2021	676
Thereafter	112
Total	127,219

Time deposits of

$250

or more were

$33,402

and

$39,061

at

December

31,

2016

and

2015.

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Note 7 - Federal Home Loan Bank Advances

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Federal Home Loan Bank Advances, Disclosure [Text Block]

Note

7:

     

Federal Home Loan Bank Advances

Federal Home Loan Bank advances totaled

$60,000

and

$47,000

at

December

31,

2016

and

2015.

At

December

31,

2016,

the advances are at fixed rates and bear interest at rates ranging from

0.90%

to

5.25%

and are secured by loans under a blanket collateral agreement as well as specific deposits at the Federal Home Loan Bank totaling

$148,999.

Advances are subject to restrictions or penalties in the event of prepayment.

Aggregate annual maturities of our Federal Home Loan Bank advances at

December

31,

2016,

are:

2017	$	23,000,000
2018		5,000,000
2019		-
2020		10,000,000
2021		-
Thereafter		22,000,000
Total	$	60,000,000

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Note 8 - Income Taxes

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Income Tax Disclosure [Text Block]

Note

8:

     

Income Taxes

The provision for income taxes includes these components:

	2016		2015
Taxes currently payable	$	2,056	$	1,759
Deferred income taxes		348		(215	)
Income tax expense	$	2,404	$	1,544

A reconciliation of income tax expense at the statutory rate to the Company’s actual income tax expense is shown below:

	2016			2015
Computed at the statutory rate (34%)	$	2,297		$	1,608
Increase (decrease) resulting from Tax exempt interest		(49	)		(49	)
Other		(156	)		(15	)
Actual tax expense	$	2,404		$	1,544

The tax effects of temporary differences related to deferred taxes shown on the consolidated balance sheets were:

	2016		2015
Deferred tax asset
Allowance for loan losses	$	2,725	$	2,984
Depreciation		142		134
Deferred loan fees		195		195
Deferred compensation		186		197
Real estate owned		3		27
Other		-		62
		3,251		3,599
Deferred tax liabilities
FHLB stock dividends		31		31
Net deferred tax asset	$	3,220	$	3,568

Retained earnings at

December

31,

2016

include approximately

$2,019

for which

no

deferred federal income tax liability has been recognized. This amount represents an allocation of income to bad debt deductions for tax purposes only. Reduction of amounts so allocated for purposes other than tax bad debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The deferred income tax liabilities on the preceding amounts that would have been recorded if they were expected to reverse into taxable income in the foreseeable future were approximately

$686

at

December

31,

2016.

ASC Topic

740

-

10

prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides b on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not identify any uncertain tax positions that it believes should be recognized in the consolidated financial statements.

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Note 9 - Regulatory Matters

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Regulatory Capital Requirements under Banking Regulations [Text Block]

Note

9:

     

Regulatory Matters

We are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on our financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, we must meet specific capital guidelines that involve quantitative measures of our assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. Our capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Basel III Capital Rules

In

July

2013,

the

three

federal bank regulatory agencies jointly published final rules (the Basel III

Capital Rules) establishing a new comprehensive capital framework for U.S. banking organizations. The rules implement the Basel Committee’s

December

2010

framework known as

“Basel III” for strengthening international capital standards as well as certain provisions of the

Dodd-Frank Act. These rules substantially revise the risk-based capital requirements applicable to bank holding companies and depository institutions, compared to the current U.S. risk-based

capital rules. The Basel III Capital Rules define the components of capital and address other issues affecting the numerator in banking institutions’ regulatory capital ratios. These rules also address risk weights and other issues affecting the denominator in banking institutions’ regulatory capital ratios and replace the existing risk-weighting approach with a more risk-sensitive approach.

The Basel III Capital Rules were effective for the Bank on

January

1,

2015

(subject to a

four

-year phase-in period). The Basel III Capital Rules, among other things, (i) introduce a new capital measure called “Common Equity Tier

1”

(CET1),

(ii) specify that Tier

1

capital consist of

CET1

and “Additional Tier

1

Capital” instruments meeting specified requirements, (iii) define

CET1

narrowly by requiring that most deductions/adjustments to regulatory capital measures be made to

CET1

and not to the other components of capital and (iv) expand the scope of the deductions/adjustments as compared to existing regulations. Under the Basel III Capital Rules, the initial minimum capital ratios as of

January

1,

2015,

will be as follows:

4.5%

CET1

to risk-weighted assets

6.0%

Tier

1

capital to risk-weighted assets

8.0%

Total capital to risk-weighted assets

4.0%

Minimum leverage ratio

Implementation of the deductions and other adjustments to

CET1

began on

January

1,

2015,

and will phase in over a

four

-year period (beginning at

40%

on

January

1,

2015,

and an additional

20%

per year thereafter). Under the new rule, in order to avoid limitations on capital distributions,

including dividend payments and certain discretionary bonus payments to executive officers, a

banking organization must hold a capital conservation buffer composed of

CET1

capital above its

minimum risk-based capital requirements. The implementation of the capital conservation buffer

began on

January

1,

2016,

at the

0.625%

level and will phase in over a

four

-year period (increasing by that amount on each subsequent

January

1

until it reaches

2.5%

on

January

1,

2019).

Quantitative measures established by regulation to ensure capital adequacy require us to maintain minimum amounts and ratios (set forth in the table below). Management believes, as of

December

31,

2016

and

2015,

that we meet all capital adequacy requirements to which we are subject including the capital conservation buffer.

Our actual capital amounts and ratios are also presented in the table. 

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of December 31, 2016
Total risk-based capital (to risk-weighted assets)		63,829		22.02	%		23,188		8.0	%		28,985		10.0	%
Tier I capital (to risk-weighted assets)		60,131		20.75			17,391		6.0			23,188		8.0
Common equity tier 1 capital (to risk-weighted assets)		60,131		20.75			16,650		4.5			24,050		6.5
Tier I capital (to adjusted total assets)		60,131		16.25			14,800		4.0			18,500		5.0
As of December 31, 2015
Total risk-based capital (to risk-weighted assets)		61,810		20.7	%		23,848		8.0	%		29,810		10.0	%
Tier I capital (to risk-weighted assets)		57,990		19.45			17,886		6.0			23,848		8.0
Common equity tier 1 capital (to risk-weighted assets)		57,990		19.45			16,172		4.5			23,360		6.5
Tier I capital (to adjusted total assets)		57,990		16.14			14,375		4.0			17,969		5.0

Dividend

Restriction

The Bank is subject to certain restrictions on the amount of dividends that it

may

declare without prior regulatory approval. At

December

31,

2016

the bank

may

not make a dividend declaration without prior regulatory approval.

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Note 10 - Employee Benefits

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Pension and Other Postretirement Benefits Disclosure [Text Block]

Note

10:

     

Employee Benefits

We have a retirement savings

401(k)

plan covering substantially all employees.  Employees

may

contribute up to

100%

of their compensation with us matching

100%

of the employee’s contribution on the

first

3%

of the employee’s compensation and

50%

of the employee’s contributions that exceed

3%

but does not exceed

5%.

  Additionally, we can make discretionary contributions to our

401

(k) plan. Employer contributions charged to expense for the years ended

2016

and

2015

were

$83

and

$75

respectively.

Employee Stock Ownership Plan (ESOP)

As part of the conversion, we established an ESOP covering substantially all of our employees. The ESOP acquired

200,600

shares of WBKC common stock at

$10.00

per share in the conversion with funds provided by a loan from the Company. Accordingly,

$2,006

of common stock acquired by the ESOP reduced stockholders’ equity. Shares are released to participants proportionately as the loan is repaid. Compensation expense is recorded equal to the fair market value of the stock when contributions, which are determined annually by our Board of Directors, are made to the ESOP. Dividends on allocated shares are recorded as dividends and charged to retained earnings.  Dividends on unallocated shares are used to repay the loan.

ESOP expense for the years ended

December

31,

2016

and

2015

was

$555

and

$391,

respectively.

The ESOP shares as of

December

31

were as follows:

	2016		2015
Allocated shares		73,220		55,665
Unearned shares		121,755		141,255
Total ESOP shares		194,975		196,920
Fair value of unearned shares at December 31	$	3,847	$	3,763

We are obligated at the option of each beneficiary to repurchase shares of the ESOP upon the beneficiary’s termination or after retirement. At

December

31,

2016

and

2015,

the fair value of the

73,220

and

55,665

allocated shares held by the ESOP was

$2,314

and

$1,483.

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Note 11 - Disclosures About Fair Value of Assets and Liabilities

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Fair Value Disclosures [Text Block]

Note

11:

     

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.

Impaired Loans (Collateral Dependent)

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 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 and subsequently as deemed necessary by management. Appraisals are reviewed for accuracy and consistency by management. Appraisers are selected from the list of approved appraisers maintained by management. The appraised values are reduced by discounts to consider lack of marketability and 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 management by comparison to historical results.

The following table presents the fair value measurements of assets 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

December

31,

2016

and

2015:

			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)
December 31, 2016
Collateral-dependent Impaired loans	$	885	$	–	$	–	$	885

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 goodwill.

	Fair Value at December 31, 2016		Valuation Technique	Unobservable Inputs	Range
December 31, 2016
Collateral-dependent Impaired loans	$	885	Market comparable properties	Marketability discount		3%	-	13%	(6%)

There were

no

collateral-dependent impaired loans in the year ended

December

31,

2015.

Fair Value of Financial Instruments

The following table presents estimated fair values of the Company’s financial instruments and the level within the fair value hierarchy in which the fair value measurements fall at

December

31,

2016.

			Fair Value Measurements Using
As of December 31, 2016	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	103,634	$	103,634	$	-	$	-
Held to maturity securities		499		-		500		-
Loans held for sale		238		-		239		-
Loans, net of allowance for loan losses		320,606		-		-		323,601
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		846		-		846		-
Financial liabilities
Deposits	$	280,548	$	153,290	$	-	$	128,655
Federal Home Loan Bank advances		60,000		-		59,187		-
Federal funds purchased		27,000		-		27,000		-
Interest payable		249		-		249		-

			Fair Value Measurements Using
As of December 31, 2015	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	52,865	$	52,865	$	-	$	-
Interest-earning time deposits		39,021		39,021		-		-
Held to maturity securities		500		-		500		-
Loans held for sale		581		-		583		-
Loans, net of allowance for loan losses		314,613		-		-		318,525
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		967		-		967		-
Financial liabilities
Deposits	$	281,701	$	117,916	$	-	$	165,657
Federal Home Loan Bank advances		47,000		-		46,390		-
Federal funds purchased		24,000		-		24,000		-
Interest payable		233		-		233		-

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, Federal Funds Purchased, 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 and Loans held for sale

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, NOW 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 the Company 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 the Company’s 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.

XML

Note 12 - Commitments and Contingent Liabilities

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

Note

12:

     

Commitments and Contingent Liabilities

Some financial instruments, such as loan commitments, credit lines, letters of credit and overdraft protection, are issued to meet customer financing needs. These are agreements to provide credit or to support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates. Commitments

may

expire without being used. Off-balance-sheet risk to credit loss exists up to the face amount of these instruments, although material losses are not anticipated. The same credit policies are used to make such commitments as are used for loans, including obtaining collateral at exercise of the commitment.

At year-end, these financial instruments are summarized as follows:

	2016		2015
Commitments to extend credit	$	6,111	$	7,133
Unused portions of lines of credit		6,268		6,778
Standby letters of credit		787		990

Commitments to make loans generally expire within

thirty

to

ninety

days, while unused lines of credit expire at the maturity date of the individual loans.

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Note 13 - Earnings Per Share

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Earnings Per Share [Text Block]

Note

13:

     

Earnings Per Share (In thousands except per share amounts)

Years ended December 31	2016			2015
Net Income	$	4,353		$	3,186
Dividends and undistributed earnings allocated to participating securities		(47	)		(50	)
Income attributable to common shareholders		4,306			3,136
Weighted average shares outstanding (in thousands)		2,132			2,200
Less: average unearned ESOP and unvested restricted stock		(171	)		(203	)
Average Shares		1,961			1,997
Effect of dilutive based awards		32			25
Average common and common-equivalent shares for diluted EPS (in thousands)		1,993			2,022
Basic EPS	$	2.20		$	1.57
Diluted EPS	$	2.16		$	1.55

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Note 14 - Share Based Compensation

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

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

Note

14:

     

Share Based Compensation

In

May

2012,

the Company’s stockholders approved the Wolverine Bancorp, Inc.

2012

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 are authorized but unissued shares. The maximum number of shares authorized under the Plan is

351,050.

Total share-based compensation expense pursuant to the Plan for the years ended

December

31,

2016

and

2015

was

$334

and

$319,

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, 2016		128,949		$	17.91		7	$	1,123
Granted		60,000			26.66		10		--
Exercised		(1,503	)		17.30		--		--
Forfeited		(3,888	)		19.58		--		--
Expired		(1,973	)		18.42		--		--
Options outstanding at December 31, 2016		181,585		$	20.76		7	$	1,956
Exercisable at December 31, 2016		92,748		$	17.44		6	$	1,305

The fair value of the Company’s stock options granted on

September

9,

2016

was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		17.80	%
Risk-free interest rate		1.59	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.75
Grant date fair value	$	1.91

The fair value of the Company’s stock options granted on

December

15,

2016

was determined using the Black-Scholes option pricing formula. The following assumptions were used in the formula:

Expected volatility		18.10	%
Risk-free interest rate		2.51	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.03
Grant date fair value	$	2.58

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 has a Cash Dividend Policy whereby the Company expects to pay a cash dividend to shareholders on an annual basis. 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.

As of

December

31,

2016,

the Bank had

$179

of unrecognized compensation expense related to stock options. The cost is expected to be recognized over a weighted-average period of

8.96

years. The total fair value of options vested in the year ended

December

31,

2016

was

$768.

Stock option expense for the years ended

December

31,

2016

and

2015

was

$62

and

$62,

respectively.

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, 2016		36,534		$	19.16
Granted		7,500			28.61
Vested		(14,745	)		18.14
Forfeited		(2,717	)		19.02
Non-vested at December 31, 2016		26,572			22.38

As of

December

31,

2016,

the Company had

$505

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 the years ended

December

31,

2016

and

2015

were

$272

and

$257,

respectively.

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Note 15 - Condensed Financial Information (Parent Company Only)

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Condensed Financial Information of Parent Company Only Disclosure [Text Block]

Note

15:

     

Condensed Financial Information (Parent Company Only)

Presented below is condensed financial information as to financial position, results of operations and cash flows of the Company:

Condensed Balance Sheets

	December 31,		December 31,
Assets	2016		2015
Cash and cash equivalents	$	3,190	$	2,386
Investment in subsidiary		61,127		60,073
Other assets		205		199
Total assets	$	64,522	$	62,658
Liabilities - Other	$	3,548	$	2,178
Stockholders' Equity		60,974		60,480
Total liabilities and stockholders' equity	$	64,522	$	62,658

Condensed Statements of Income and Comprehensive Income

	December 31,		December 31,
	2016		2015
Income - Dividends from subsidiary	$	4,500	$	4,500
Expense		344		260
Income Before Income Tax and Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,156		4,240
Income Tax Benefit		5		73
Income (Loss) Before Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,161		4,313
Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		192		(1,127	)
Net Income and Comprehensive Income	$	4,353	$	3,186

Condensed Statements of Cash Flows

	December 31,			December 31,
	2016			2015
Operating Activities
Net income	$	4,353		$	3,186
Items not requiring (providing) cash:
(Equity in undistributed income) distributions in excess of income of subsidiaries		(192	)		1,127
Change in other assets		(6	)		(74	)
Change in other liabilities		299			(47	)
Net cash provided by operating activities		4,454			4,192
Financing Activities
Purchase of common stock		(1,518	)		(2,796	)
Dividends paid		(2,158	)		-
Proceeds from stock options exercised		26			-
Net cash used in financing activities		(3,650	)		(2,796	)
Net Change in Cash and Cash Equivalents		804			1,396
Cash and Cash Equivalents, Beginning of Period		2,386			990
Cash and Cash Equivalents, End of Period	$	3,190		$	2,386

Supplemental Disclosures of Cash Flows Information
Dividends Declared, not paid	$	3,229	$	2,158

XML

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2016

Accounting Policies [Abstract]

Nature of Operations [Policy Text Block]

Nature of Operations

Wolverine Bank (the “Bank”), a wholly owned subsidiary of Wolverine Bancorp, Inc. (the “Company”), is a federally chartered savings bank primarily engaged in providing a full range of banking and financial services to individual and business customers in the Great Lakes Bay Region and beyond. The Company is subject to competition from other financial institutions. The Company is subject to the regulation of the Federal Reserve Board and the Bank is subject to the regulation of the Officer of the Comptroller of the Currency, and both undergo periodic examinations.

The Bank’s additional wholly owned subsidiaries, Wolserv Corporation, a Michigan corporation which has a membership interest in a title company, and Wolverine Commercial Holdings LLC, a Michigan LLC owned by Wolverine Bank which holds certain real estate, are included in the consolidated financial statements.

Basis of Accounting, Policy [Policy Text Block]

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of real estate acquired in connection with foreclosures or in satisfaction of loans and financial instruments.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash Equivalents

We consider all liquid investments with original maturities of

three

months or less to be cash equivalents.

Marketable Securities, Policy [Policy Text Block]

Securities

Held-to-maturity securities, which include any security for which we have the positive intent and ability to hold until maturity, are carried at historical cost adjusted for amortization of premiums and accretion of discounts.

Amortization of premiums and accretion of discounts are recorded as interest income from securities. Realized gains and losses are recorded as net security gains (losses). Gains and losses on securities are determined on the specific-identification method.

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

Loans Held for Sale

Mortgage loans originated and intended for sale in the

secondary

market are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to noninterest income. Gains and losses on loan sales are recorded in noninterest income, and direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan.

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

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoffs are reported at their outstanding principal balances adjusted for any charge-offs, the allowance for loan losses, any deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. Generally, loans are placed on nonaccrual status at

ninety

days past due and interest is considered a loss, unless the loan is well-secured. Accrued interest for loans placed on nonaccrual status is reversed against interest income.

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

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that

may

affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical charge-off experience and expected loss given default derived from our internal risk rating process. Other adjustments

may

be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.

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

Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, we do not separately identify individual consumer and residential loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower.

Property, Plant and Equipment, Policy [Policy Text Block]

Premises and Equipment

Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight-line and accelerated methods over the estimated useful lives of the assets ranging from

3

to

39

years.

Federal Home Loan Bank Stock [Policy Text Block]

Federal Home Loan Bank Stock

Federal Home Loan Bank stock is a required investment for institutions that are members of the Federal Home Loan Bank system. The required investment in the common stock is based on a predetermined formula, carried at cost, and evaluated for impairment.

Real Estate Owned [Policy Text Block]

Real Estate Owned

Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from foreclosed assets.

Earnings Per Share, Policy [Policy Text Block]

Earnings Per Common Share

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.

Income Tax, Policy [Policy Text Block]

Income Taxes

We account for income taxes in accordance with income tax accounting guidance (ASC 

740,

Income Taxes

). The income tax accounting guidance results in

two

components of income tax 

expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. We determine deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur.

Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than

50

percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than

50

percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized.

We recognize interest and penalties on income taxes as a component of income tax expense.

We file consolidated income tax returns with our subsidiaries.

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Issued Accounting Standards

FASB Accounting Standards Updates No.

2017

-

04,

Intangibles – Goodwill and Other (Topic

350)

The FASB has issued Accounting Standards Update (ASU) No.

2017

-

04,

Intangibles – Goodwill and Other (Topic

350):

Simplifying the Test for Goodwill Impairment. The new guidance is intended to simplify the subsequent measurement of goodwill by eliminating Step

2

from the goodwill impairment test.

The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, the income tax effects of tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a

zero

or negative carrying amount to perform Step

2

of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the qualitative impairment test is necessary. The amendments should be applied on a prospective basis. The nature of and reason for the change in accounting principle should be disclosed upon transition.

The amendments in this update should be adopted for annual or any interim goodwill impairment tests in fiscal years beginning after

December

15,

2019.

Early adoption is permitted on testing dates after

January

1,

2017.

The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

FASB Accounting Standards Updates No.

2017

-

01,

Business Combinations (Topic

805)

The FASB has issued Accounting Standards Update (ASU) No.

2017

-

01,

Business Combinations (Topic

805):

Clarifying the Definition of a Business

. The amendments in this update provide a more robust framework to use in determining when a set of assets and activities is a business. Because the current definition of a business is interpreted broadly and can be difficult to apply, stakeholders indicated that analyzing transactions is inefficient and costly and that the definition does not permit the use of reasonable judgment. The amendments provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable.

The amendments in this update become effective for annual periods and interim periods within those annual periods beginning after

December

15,

2017.

We are currently evaluating the impact of adopting the new guidance on the consolidated financial statements, but it is not expected to have a material impact.

FASB ASU No.

2016

-

15,

Statement of Cash Flows (Topic

230):

Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

15,

Statement of Cash Flows (Topic

230).

This update addresses

eight

specific cash flow issues with the objective of reducing the existing diversity in practice of how certain cash receipts and cash payments are presented and classified in the statement of cash flow. In

November

2016,

the FASB issued ASU No.

2016

-

18,

which gave clarification on how restricted cash was to be presented in the cash flow statement.

The amendments are effective for public business entities for fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after

December

15,

2018,

and interim periods within fiscal years beginning after

December

15,

2019.

Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

13,

Financial Instruments—Credit Losses (Topic

326):

Measurement of Credit Losses on Financial Instruments

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

13,

Financial Instruments – Credit Losses (Topic

326):

Measurement of Credit Losses on Financial Instruments.

The main objective of this amendment is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date.

The ASU requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.

Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.

The ASU requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. These disclosures include qualitative and quantitative requirements that provide additional information about the amounts recorded in the financial statements.

In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.

For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this Update are effective for fiscal years beginning after

December

15,

2019,

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

December

15,

2020,

including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after

December

15,

2020,

and interim periods within fiscal years beginning after

December

15,

2021.

All entities

may

adopt the amendments in this Update earlier as of the fiscal years beginning after

December

15,

2018,

including interim periods within those fiscal years. The Company will be evaluating the impact of adopting this ASU and has not determined the anticipated impact on the consolidated financial statements.

FASB ASU No.

2016

-

09,

Compensation—Stock Compensation (Topic

718)

The FASB issued ASU No.

2016

-

09,

Compensation–Stock Compensation

(Topic

718):

Improvements to Employee Share-Based Payment Accounting

.

The ASU is intended to improve the accounting for employee shared-base payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment award transactions are simplified, including the income tax consequences, the classification of awards as either equity or liabilities, and the classification on the statement of cash flows. The amendments in this update became effective on

January

1,

2017

and did not have a material impact on the consolidated financial statements.

For public business entities, the amendments are effective for annual periods beginning after

December

15,

2016,

and interim periods within those annual periods. For all other entities, the amendments are effective for annual periods beginning after

December

15,

2017,

and interim periods within annual periods beginning after

December

15,

2018.

Early adoption is permitted for any entity in any interim or annual period. The amendments in this update became effective on

January

1,

2017

and did not have a material impact on the consolidated financial statements.

FASB ASU No.

2016

-

08,

2016

-

10,

2016

-

12,

Revenue from Contracts with Customers (Topic

606)

In

May

2014,

the FASB issued ASU

2014

-

09,

“

Revenue from Contracts with Customers

,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In

March

2016,

the FASB issued ASU

2016

-

08,

“

Principal versus Agent Considerations (Reporting Revenue Gross versus Net)

,” which clarifies the guidance in determining revenue recognition as principal versus agent. In

April

2016,

the FASB issued ASU

2016

-

10,

“

Identifying Performance Obligations and Licensing

,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In

May

2016,

the FASB issued ASU

2016

-

12,

“

Narrow-Scope Improvements and Practical Expedients

,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications.

For public business entities, the amendments are effective for annual reporting periods beginning after

December

15,

2017,

including interim reporting periods with that reporting period, as deferred by ASU

2015

-

14.

Early application is permitted as of annual reporting periods beginning after

December

15,

2016,

including interim reporting periods within the reporting period.

All other entities should apply the guidance to annual reporting periods beginning after

December

15,

2018,

and interim reporting periods within annual reporting periods beginning after

December

15,

2019.

Early application is permitted for all other entities as of annual reporting periods beginning after

December

15,

2016,

including interim reporting periods within annual reporting periods beginning

one

year after the annual reporting period in which the entity

first

applies the guidance in Update

2014

-

09.

Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

07,

Investments – Equity Method and Joint Ventures (Topic

323)

The amendments eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held.

The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. Therefore, upon qualifying for the equity method of accounting, no retroactive adjustment of the investment is required.

The amendments require that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method.

The amendments are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after

December

15,

2016.

The amendments should be applied prospectively upon their effective date to increases in the level of ownership interest or degree of influence that result in the adoption of the equity method. Earlier application is permitted. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

06,

Derivatives and Hedging (Topic

815):

Contingent Put and Call Options in Debt Instruments

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

05,

Derivatives and Hedging (Topic

815):

Effect of Derivative Contract Novations and Existing Hedge Accounting Relationships

. The amendments apply to all reporting entities for which there is a change in the counterparty to a derivative instrument that has been designated as a hedging instrument.

The amendments clarify what steps are required when assessing whether the economic characteristics and risks of call (put) options are clearly and closely related to the economic characteristics and risks of their debt hosts, which is

one

of the criteria for bifurcating an embedded derivative. Consequently, when a call (put) option is contingently exercisable, an entity does not have to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks.

This standard will be effective for pubic business entities for fiscal year beginning after

December

15,

2016

including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after

December

15,

2017,

and interim periods within fiscal years beginning after

December

15,

2018.

Early application is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB ASU No.

2016

-

02

– Leases (Topic

842)

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

02,

Leases

. Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date:

●          A lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and

●          A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term.

Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic

606,

Revenue from Contracts with Customers

.

The new lease guidance simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees will no longer be provided with a source of off-balance sheet financing.

This standard will be effective for pubic business entities for fiscal year beginning after

December

15,

2018

including interim periods within those fiscal years. Nonpublic business entities should apply the amendments for fiscal years beginning after

December

15,

2019

and interim periods within fiscal years beginning after

December

15,

2020.

Early application is permitted for all public business entities and all nonpublic business entities upon issuance.

Lessees (for capital and operating leases) and lessors (for sales-type, direct financing and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors

may

not apply a full retrospective transition approach.

Adoption of the ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

FASB Accounting Standards Updates No.

2016

-

01,

Financial Instruments – Overall

(Subtopic

825

-

10):

Recognition and Measurement of Financial Assets and Financial Liabilities

The FASB has issued Accounting Standards Update (ASU) No.

2016

-

01,

Financial Instruments – Overall (Subtopic

825

-

10):

Recognition and Measurement of Financial Assets and Financial Liabilities.

The new guidance is intended to improve the recognition and measurement of financial instruments. The ASU affects public and private companies, not-for-profit organizations, and employee benefit plans that hold financial assets or owe financial liabilities.

The new guidance makes targeted improvements to existing U.S. GAAP by:

● Requiring equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income;

● Requiring public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes;

● Requiring separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements;

● Eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for organizations that are not public business entities;

● Eliminating the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; and

● Requiring a reporting organization to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk (also referred to as “own credit”) when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments.

The new guidance is effective for public companies for fiscal years beginning after

December

15,

2017,

including interim periods within those fiscal years. The new guidance permits early adoption of the own credit provision. In addition, the new guidance permits early adoption of the provision that exempts private companies and not-for-profit organizations from having to disclose fair value information about financial instruments measured at amortized cost. Adoption of the

ASU is not expected to have a significant effect on the Company’s consolidated financial statements.

XML

Note 3 - Securities (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Held-to-maturity Securities [Table Text Block]

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Approximate Fair Value
Held to Maturity Securities:
December 31, 2016
Treasury bond	$	499	$	1	$	–	$	500
December 31, 2015
Treasury bond	$	500	$	–	$	–	$	500

XML

Note 4 - Loans and Allowance for Loan Losses (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

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

	December 31, 2016		December 31, 2015
Real Estate
One-to four-family	$	35,389	$	39,719
Home equity		4,031		5,459
Commercial mortgage loans
Commercial real estate		195,924		183,934
Multifamily		54,827		58,804
Land		11,547		12,543
Construction		13,475		14,785
Commercial non-mortgage		20,047		14,826
Consumer		1,074		1,221
Total loans		336,314		331,291
Less
Net deferred loan costs, premiums and discounts		563		567
Undisbursed portion of loan		5,819		6,050
Allowance for loan losses		9,326		10,061
Net Loans	$	320,606	$	314,613

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

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, 2016
Allowance for loan losses:
Balance, beginning of period	$	948		$	108		$	4,913		$	1,515		$	1,605		$	604		$	344	$	24		$	10,061
Provision charged to expense		(137	)		(59	)		555			(431	)		(544	)		(310	)		180		(14	)		(760	)
Losses charged off		(67	)		-			(85	)		-			-			-			-		(1	)		(153	)
Recoveries		54			-			39			-			81			-			-		4			178
Balance, end of period	$	798		$	49		$	5,422		$	1,084		$	1,142		$	294		$	524	$	13		$	9,326
Ending Balance: individually evaluated for impairment	$	-		$	-		$	235		$	-		$	550		$	-		$	-	$	-		$	785
Ending balance: collectively evaluated for impairment	$	798		$	49		$	5,187		$	1,084		$	592		$	294		$	524	$	13		$	8,541
Loans:
Ending Balance	$	35,389		$	4,031		$	195,924		$	54,827		$	11,547		$	13,475		$	20,047	$	1,074		$	336,314
Ending Balance: individually evaluated for impairment	$	1,500		$	-		$	8,103		$	6,311		$	1,061		$	-		$	-	$	-		$	16,975
Ending balance: collectively evaluated for impairment	$	33,889		$	4,031		$	187,821		$	48,516		$	10,486		$	13,475		$	20,047	$	1,074		$	319,339

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, 2015
Allowance for loan losses:
Balance, beginning of period	$	881		$	100	$	3,573	$	1,391	$	1,205	$	539	$	269	$	18		$	7,976
Provision (credit) charged to expense		79			8		72		124		374		65		75		3			800
Losses charged off		(45	)		-		-		-		-		-		-		(1	)		(46	)
Recoveries		33			-		1,268		-		26		-		-		4			1,331
Balance, end of period	$	948		$	108	$	4,913	$	1,515	$	1,605	$	604	$	344	$	24		$	10,061
Ending Balance: individually evaluated for impairment	$	-		$	-	$	200	$	100	$	850	$	-	$	-	$	-		$	1,150
Ending balance: collectively evaluated for impairment	$	948		$	108	$	4,713	$	1,415	$	755	$	604	$	344	$	24		$	8,911
Loans:
Ending Balance	$	39,719		$	5,459	$	183,934	$	58,804	$	12,543	$	14,785	$	14,826	$	1,221		$	331,291
Ending Balance: individually evaluated for impairment	$	1,504		$	-	$	12,280	$	7,877	$	1,883	$	-	$	295	$	-		$	23,839
Ending balance: collectively evaluated for impairment	$	38,215		$	5,459	$	171,654	$	50,927	$	10,660	$	14,785	$	14,531	$	1,221		$	307,452

Financing Receivable Credit Quality Indicators [Table Text Block]

	1-4 Family				Home Equity				Commercial Real Estate				Multifamily
	2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	33,788	$	36,941	$	4,031	$	5,459	$	173,375	$	150,122	$	48,241	$	46,230
Pass (Closely Monitored)		490		1,437		-		-		14,349		21,156		6,586		8,142
Special Mention		241		225		-		-		2,630		751		-		-
Substandard		871		1,116		-		-		5,570		11,905		-		4,432
Doubtful		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-
	$	35,389	$	39,719	$	4,031	$	5,459	$	195,924	$	183,934	$	54,827	$	58,804

	Land				Construction				Commercial Non-Mortgage				Consumer				Total
	2016		2015		2016		2015		2016		2015		2016		2015		2016		2015
Pass	$	9,631	$	9,462	$	13,475	$	14,785	$	16,499	$	9,626	$	1,074	$	1,221	$	300,114	$	273,846
Pass (Closely Monitored)		855		1,239		-		-		658		4,904		-		-		22,938		36,878
Special Mention		-		-		-		-		2,889		-		-		-		5,760		976
Substandard		1,061		1,842		-		-		-		296		-		-		7,502		19,591
Doubtful		-		-		-		-		-		-		-		-		-		-
Loss		-		-		-		-		-		-		-		-		-		-
	$	11,547	$	12,543	$	13,475	$	14,785	$	20,047	$	14,826	$	1,074	$	1,221	$	336,314	$	331,291

Past Due Financing Receivables [Table Text Block]

As of December 31, 2016	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	$	165	$	94	$	137	$	396	$	34,993	$	35,389	$	-	$	137
Home Equity		-		-		-		-		4,031		4,031		-		-
Commercial Real Estate		-		648		100		748		195,176		195,924		-		4,872
Multifamily		-		-		-		-		54,827		54,827		-		-
Land		-		-		1,061		1,061		10,486		11,547		-		1,061
Construction		-		-		-		-		13,475		13,475		-		-
Commercial Non-Mortgage		-		-		-		-		20,047		20,047		-		-
Consumer		-		-		-		-		1,074		1,074		-		-
Total	$	165	$	742	$	1,298	$	2,205	$	334,109	$	336,314	$	-	$	6,070

As of December 31, 2015	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	$	151	$	152	$	-	$	303	$	39,416	$	39,719	$	-	$	99
Home Equity		-		-		-		-		5,459		5,459		-		-
Commercial Real Estate		6		1,011		-		1,017		182,917		183,934		-		5,188
Multifamily		1,291		-		-		1,291		57,513		58,804		-		-
Land		-		-		1,842		1,842		10,701		12,543		-		1,842
Construction		-		-		-		-		14,785		14,785		-		-
Commercial Non-Mortgage		-		-		-		-		14,826		14,826		-		-
Consumer		-		-		-		-		1,221		1,221		-		-
Total	$	1,448	$	1,163	$	1,842	$	4,453	$	326,838	$	331,291	$	-	$	7,129

Impaired Financing Receivables [Table Text Block]

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		7,494		9,669		-		8,296		426
Multi Family		6,311		7,125		-		6,884		402
Land		-		-		-		24		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		609		695		235		385		41
Multi Family		-		-		-		-		-
Land		1,061		3,158		550		1,832		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,500	$	1,620	$	-	$	1,311	$	70
Home Equity		-		-		-		-		-
Commercial real estate		8,103		10,364		235		8,681		467
Multi Family		6,311		7,125		-		6,884		402
Land		1,061		3,158		550		1,856		123
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Total	$	16,975	$	22,267	$	785	$	18,733	$	1,062

			Unpaid
	Recorded		Principal		Specific		YTD Average		YTD Interest
	Balance		Balance		Allowance		Balance		Income
Loans without a specific valuation allowance:
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		9,912		11,820		-		10,508		289
Multi Family		6,586		7,400		-		6,685		359
Land		41		96		-		371		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Loans with a specific valuation allowance:
1-4 Family	$	-	$	-	$	-	$	-	$	-
Home Equity		-		-		-		-		-
Commercial real estate		2,368		2,368		200		2,499		175
Multi Family		1,291		1,291		100		1,319		77
Land		1,842		3,640		850		2,115		-
Construction		-		-		-		-		-
Commercial Non-Mortgage		-		-		-		-		-
Consumer		-		-		-		-		-
Totals
1-4 Family	$	1,504	$	1,633	$	-	$	1,791	$	80
Home Equity		-		-		-		15		-
Commercial real estate		12,280		14,188		200		13,007		464
Multi Family		7,877		8,691		100		8,004		436
Land		1,883		3,736		850		2,486		22
Construction		-		-		-		-		-
Commercial Non-Mortgage		295		295		-		311		22
Consumer		-		-		-		-		-
Total	$	23,839	$	28,543	$	1,150	$	25,614	$	1,024

Schedule of Debtor Troubled Debt Restructuring, Current Period [Table Text Block]

	Twelve Months Ended
	December 31, 2016
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		2	$	826	$	826
Total		2	$	826	$	826

	Twelve Months Ended
	December 31, 2015
	Count		Balance prior to TDR		Balance after TDR
	(Amounts in Thousands, except per share data)
Commercial real estate		3	$	817	$	817
Total		3	$	817	$	817

Summary of Troubled Debt Restructuring Note, Debtor [Table Text Block]

As of December 31, 2016	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		2		826		-		-		-		-		826
Total		2	$	826		-	$	-		-	$	-	$	826

As of December 31, 2015	Payment Extension				Rate Reduction				Combination				Totals
	Number		Amount		Number		Amount		Number		Amount
Commercial Real Estate		-		-		-		-		3		817		817
Total		-	$	-		-	$	-		3	$	817	$	817

XML

Note 5 - Premises and Equipment (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Property, Plant and Equipment [Table Text Block]

	2016			2015
Land	$	514		$	514
Buildings and improvements		3,156			3,146
Furniture, fixtures, and equipment		3,021			3,308
		6,691			6,968
Less accumulated depreciation		(5,564	)		(5,683	)
Net premises and equipment	$	1,127		$	1,285

XML

Note 6 - Deposits (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Schedule of Deposits [Table Text Block]

	2016		2015
Savings accounts	$	13,923	$	13,626
Checking accounts		34,608		33,934
Money market accounts		104,798		70,356
Certificates of deposit		127,219		163,785
Total Deposits	$	280,548	$	281,701

Scheduled Maturities of Certificates of Deposits [Table Text Block]

2017	75,405
2018	23,134
2019	17,749
2020	10,143
2021	676
Thereafter	112
Total	127,219

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Note 7 - Federal Home Loan Bank Advances (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Schedule of Contractual Maturity Dates for Federal Home Loan Bank Advances [Table Text Block]

2017	$	23,000,000
2018		5,000,000
2019		-
2020		10,000,000
2021		-
Thereafter		22,000,000
Total	$	60,000,000

XML

Note 8 - Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	2016		2015
Taxes currently payable	$	2,056	$	1,759
Deferred income taxes		348		(215	)
Income tax expense	$	2,404	$	1,544

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	2016			2015
Computed at the statutory rate (34%)	$	2,297		$	1,608
Increase (decrease) resulting from Tax exempt interest		(49	)		(49	)
Other		(156	)		(15	)
Actual tax expense	$	2,404		$	1,544

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	2016		2015
Deferred tax asset
Allowance for loan losses	$	2,725	$	2,984
Depreciation		142		134
Deferred loan fees		195		195
Deferred compensation		186		197
Real estate owned		3		27
Other		-		62
		3,251		3,599
Deferred tax liabilities
FHLB stock dividends		31		31
Net deferred tax asset	$	3,220	$	3,568

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Note 9 - Regulatory Matters (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

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

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of December 31, 2016
Total risk-based capital (to risk-weighted assets)		63,829		22.02	%		23,188		8.0	%		28,985		10.0	%
Tier I capital (to risk-weighted assets)		60,131		20.75			17,391		6.0			23,188		8.0
Common equity tier 1 capital (to risk-weighted assets)		60,131		20.75			16,650		4.5			24,050		6.5
Tier I capital (to adjusted total assets)		60,131		16.25			14,800		4.0			18,500		5.0
As of December 31, 2015
Total risk-based capital (to risk-weighted assets)		61,810		20.7	%		23,848		8.0	%		29,810		10.0	%
Tier I capital (to risk-weighted assets)		57,990		19.45			17,886		6.0			23,848		8.0
Common equity tier 1 capital (to risk-weighted assets)		57,990		19.45			16,172		4.5			23,360		6.5
Tier I capital (to adjusted total assets)		57,990		16.14			14,375		4.0			17,969		5.0

XML

Note 10 - Employee Benefits (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Schedule of Employee Stock Ownership Plan, ESOP Share Allocation [Table Text Block]

	2016		2015
Allocated shares		73,220		55,665
Unearned shares		121,755		141,255
Total ESOP shares		194,975		196,920
Fair value of unearned shares at December 31	$	3,847	$	3,763

XML

Note 11 - Disclosures About Fair Value of Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Fair Value Measurements, Nonrecurring [Table Text Block]

			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)
December 31, 2016
Collateral-dependent Impaired loans	$	885	$	–	$	–	$	885

Fair Value Inputs, Assets, Quantitative Information [Table Text Block]

	Fair Value at December 31, 2016		Valuation Technique	Unobservable Inputs	Range
December 31, 2016
Collateral-dependent Impaired loans	$	885	Market comparable properties	Marketability discount		3%	-	13%	(6%)

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

			Fair Value Measurements Using
As of December 31, 2016	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	103,634	$	103,634	$	-	$	-
Held to maturity securities		499		-		500		-
Loans held for sale		238		-		239		-
Loans, net of allowance for loan losses		320,606		-		-		323,601
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		846		-		846		-
Financial liabilities
Deposits	$	280,548	$	153,290	$	-	$	128,655
Federal Home Loan Bank advances		60,000		-		59,187		-
Federal funds purchased		27,000		-		27,000		-
Interest payable		249		-		249		-

			Fair Value Measurements Using
As of December 31, 2015	Carrying Amount		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets
Cash and cash equivalents	$	52,865	$	52,865	$	-	$	-
Interest-earning time deposits		39,021		39,021		-		-
Held to maturity securities		500		-		500		-
Loans held for sale		581		-		583		-
Loans, net of allowance for loan losses		314,613		-		-		318,525
Federal Home Loan Bank stock		2,700		-		2,700		-
Interest receivable		967		-		967		-
Financial liabilities
Deposits	$	281,701	$	117,916	$	-	$	165,657
Federal Home Loan Bank advances		47,000		-		46,390		-
Federal funds purchased		24,000		-		24,000		-
Interest payable		233		-		233		-

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Note 12 - Commitments and Contingent Liabilities (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Schedule of Financial Instruments Owned and Pledged as Collateral [Table Text Block]

	2016		2015
Commitments to extend credit	$	6,111	$	7,133
Unused portions of lines of credit		6,268		6,778
Standby letters of credit		787		990

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Note 13 - Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

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

Years ended December 31	2016			2015
Net Income	$	4,353		$	3,186
Dividends and undistributed earnings allocated to participating securities		(47	)		(50	)
Income attributable to common shareholders		4,306			3,136
Weighted average shares outstanding (in thousands)		2,132			2,200
Less: average unearned ESOP and unvested restricted stock		(171	)		(203	)
Average Shares		1,961			1,997
Effect of dilutive based awards		32			25
Average common and common-equivalent shares for diluted EPS (in thousands)		1,993			2,022
Basic EPS	$	2.20		$	1.57
Diluted EPS	$	2.16		$	1.55

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Note 14 - Share Based Compensation (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

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

	Options			Weighted average exercise price		Remaining contractual life (years)		Aggregate intrinsic value
Options outstanding at January 1, 2016		128,949		$	17.91		7	$	1,123
Granted		60,000			26.66		10		--
Exercised		(1,503	)		17.30		--		--
Forfeited		(3,888	)		19.58		--		--
Expired		(1,973	)		18.42		--		--
Options outstanding at December 31, 2016		181,585		$	20.76		7	$	1,956
Exercisable at December 31, 2016		92,748		$	17.44		6	$	1,305

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

Expected volatility		17.80	%
Risk-free interest rate		1.59	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.75
Grant date fair value	$	1.91

Expected volatility		18.10	%
Risk-free interest rate		2.51	%
Expected dividend yield		5.00	%
Expected life (in years)		7.50
Exercise price for the stock options	$	26.03
Grant date fair value	$	2.58

Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]

	Service-Based Restricted stock awards			Weighted average grant date fair value
Non-vested at January 1, 2016		36,534		$	19.16
Granted		7,500			28.61
Vested		(14,745	)		18.14
Forfeited		(2,717	)		19.02
Non-vested at December 31, 2016		26,572			22.38

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Note 15 - Condensed Financial Information (Parent Company Only) (Tables)

12 Months Ended

Dec. 31, 2016

Notes Tables

Condensed Balance Sheet [Table Text Block]

	December 31,		December 31,
Assets	2016		2015
Cash and cash equivalents	$	3,190	$	2,386
Investment in subsidiary		61,127		60,073
Other assets		205		199
Total assets	$	64,522	$	62,658
Liabilities - Other	$	3,548	$	2,178
Stockholders' Equity		60,974		60,480
Total liabilities and stockholders' equity	$	64,522	$	62,658

Condensed Income Statement [Table Text Block]

	December 31,		December 31,
	2016		2015
Income - Dividends from subsidiary	$	4,500	$	4,500
Expense		344		260
Income Before Income Tax and Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,156		4,240
Income Tax Benefit		5		73
Income (Loss) Before Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		4,161		4,313
Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries		192		(1,127	)
Net Income and Comprehensive Income	$	4,353	$	3,186

Condensed Cash Flow Statement [Table Text Block]

	December 31,			December 31,
	2016			2015
Operating Activities
Net income	$	4,353		$	3,186
Items not requiring (providing) cash:
(Equity in undistributed income) distributions in excess of income of subsidiaries		(192	)		1,127
Change in other assets		(6	)		(74	)
Change in other liabilities		299			(47	)
Net cash provided by operating activities		4,454			4,192
Financing Activities
Purchase of common stock		(1,518	)		(2,796	)
Dividends paid		(2,158	)		-
Proceeds from stock options exercised		26			-
Net cash used in financing activities		(3,650	)		(2,796	)
Net Change in Cash and Cash Equivalents		804			1,396
Cash and Cash Equivalents, Beginning of Period		2,386			990
Cash and Cash Equivalents, End of Period	$	3,190		$	2,386

Supplemental Disclosures of Cash Flows Information
Dividends Declared, not paid	$	3,229	$	2,158

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Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Details Textual)	12 Months Ended
	Dec. 31, 2016
Minimum [Member]
Property, Plant and Equipment, Useful Life	3 years
Maximum [Member]
Property, Plant and Equipment, Useful Life	39 years

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Note 2 - Restriction on Cash and Due From Banks (Details Textual) $ in Thousands	Dec. 31, 2016 USD ($)
Cash, FDIC Insured Amount	$ 459
Cash, Uninsured Amount	391
Federal Home Loan Bank of Indianapolis [Member]
Cash Deposits in Affiliated Bank	1,733
Federal Home Loan Bank of Chicago [Member]
Cash Deposits in Affiliated Bank	$ 98,665

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Note 3 - Securities (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Proceeds from Sale of Held-to-maturity Securities	$ 0	$ 0

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Note 3 - Securities - Summary of Amortized Cost and Approximate Fair Values of Held to Maturity Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Held to maturity securities, gross unrealized gains	$ 1	$ 0
Held to maturity securities, fair value	500	500
Held to maturity securities, amortized cost	$ 499	$ 500

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Note 4 - Loans and Allowance for Loan Losses (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Percentage of Construction Loans for Commercial Real Estate of Loan to Completed Appraised Value, Ratio	70.00%
Charge Down to Net Realizable Value	120 days
Period for Discontinuation of Accrual of Interest on All Loan Classes	180 days
Loans and Leases Receivable, Related Parties	$ 8,083	$ 7,248
Loans and Leases Receivable, Related Parties, Additions	3,148
Loans and Leases Receivable, Related Parties, Proceeds	$ 2,313
Minimum Realizable Period for New Loan into Accrual Status Under Performance With New Loan Terms	180 days
Minimum Period for Realizable of Troubled Debt Restructuring Loans into Nonaccrual Status or Default Loans	90 days
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	$ 0
Minimum [Member]
Period for Discontinuation of Accrual of Interest on All Loan Classes	180 days

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Note 4 - Loans and Allowance for Loan Losses - Summary of Loans by Categories of Loans Class (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Total loans	$ 336,314	$ 331,291
Net deferred loan costs, premiums and discounts	563	567
Undisbursed portion of loan	5,819	6,050
Allowance for loan losses	9,326	10,061
Net Loans	320,606	314,613
Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	35,389	39,719
Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	4,031	5,459
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	195,924	183,934
Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	54,827	58,804
Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	11,547	12,543
Construction Portfolio Segment [Member]
Total loans	13,475	14,785
Commercial Portfolio Segment [Member]
Total loans	20,047	14,826
Consumer Portfolio Segment [Member]
Total loans	$ 1,074	$ 1,221

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Note 4 - Loans and Allowance for Loan Losses - Financing Receivables and Allowance for Credit Losses on Financing Receivables (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Allowance for loan losses: collectively evaluated for impairment	$ 8,541	$ 8,911
Loans	336,314	331,291
Loans: individually evaluated for impairment	16,975	23,839
Loans: collectively evaluated for impairment	319,339	307,452
Balance, beginning of period	10,061	7,976
Provision charged to expense	(760)	800
Losses charged off	(153)	(46)
Recoveries	178	1,331
Balance, end of period	9,326	10,061
Allowance for loan losses: individually evaluated for impairment	785	1,150
Residential Portfolio Segment [Member] | One- to Four-family [Member]
Allowance for loan losses: collectively evaluated for impairment	798	948
Loans	35,389	39,719
Loans: individually evaluated for impairment	1,500	1,504
Loans: collectively evaluated for impairment	33,889	38,215
Balance, beginning of period	948	881
Provision charged to expense	(137)	79
Losses charged off	(67)	(45)
Recoveries	54	33
Balance, end of period	798	948
Allowance for loan losses: individually evaluated for impairment	0	0
Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Allowance for loan losses: collectively evaluated for impairment	49	108
Loans	4,031	5,459
Loans: individually evaluated for impairment	0
Loans: collectively evaluated for impairment	4,031	5,459
Balance, beginning of period	108	100
Provision charged to expense	(59)	8
Losses charged off	0	0
Recoveries	0	0
Balance, end of period	49	108
Allowance for loan losses: individually evaluated for impairment	0	0
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Allowance for loan losses: collectively evaluated for impairment	5,187	4,713
Loans	195,924	183,934
Loans: individually evaluated for impairment	8,103	12,280
Loans: collectively evaluated for impairment	187,821	171,654
Balance, beginning of period	4,913	3,573
Provision charged to expense	555	72
Losses charged off	(85)	0
Recoveries	39	1,268
Balance, end of period	5,422	4,913
Allowance for loan losses: individually evaluated for impairment	235	200
Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Allowance for loan losses: collectively evaluated for impairment	1,084	1,415
Loans	54,827	58,804
Loans: individually evaluated for impairment	6,311	7,877
Loans: collectively evaluated for impairment	48,516	50,927
Balance, beginning of period	1,515	1,391
Provision charged to expense	(431)	124
Losses charged off	0	0
Recoveries	0	0
Balance, end of period	1,084	1,515
Allowance for loan losses: individually evaluated for impairment		100
Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Allowance for loan losses: collectively evaluated for impairment	592	755
Loans	11,547	12,543
Loans: individually evaluated for impairment	1,061	1,883
Loans: collectively evaluated for impairment	10,486	10,660
Balance, beginning of period	1,605	1,205
Provision charged to expense	(544)	374
Losses charged off	0	0
Recoveries	81	26
Balance, end of period	1,142	1,605
Allowance for loan losses: individually evaluated for impairment	550	850
Construction Portfolio Segment [Member]
Allowance for loan losses: collectively evaluated for impairment	294	604
Loans	13,475	14,785
Loans: individually evaluated for impairment	0	0
Loans: collectively evaluated for impairment	13,475	14,785
Balance, beginning of period	604	539
Provision charged to expense	(310)	65
Losses charged off	0
Recoveries	0	0
Balance, end of period	294	604
Allowance for loan losses: individually evaluated for impairment	0	0
Commercial Portfolio Segment [Member]
Allowance for loan losses: collectively evaluated for impairment	524	344
Loans	20,047	14,826
Loans: individually evaluated for impairment	0	295
Loans: collectively evaluated for impairment	20,047	14,531
Balance, beginning of period	344	269
Provision charged to expense	180	75
Losses charged off	0	0
Recoveries	0	0
Balance, end of period	524	344
Allowance for loan losses: individually evaluated for impairment	0	0
Consumer Portfolio Segment [Member]
Allowance for loan losses: collectively evaluated for impairment	13	24
Loans	1,074	1,221
Loans: individually evaluated for impairment	0	0
Loans: collectively evaluated for impairment	1,074	1,221
Balance, beginning of period	24	18
Provision charged to expense	(14)	3
Losses charged off	(1)	(1)
Recoveries	4	4
Balance, end of period	13	24
Allowance for loan losses: individually evaluated for impairment	$ 0	$ 0

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Note 4 - Loans and Allowance for Loan Losses - Credit Risk Profile of Our Loan Portfolio Based on Rating Category and Payment Activity (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Total loans	$ 336,314	$ 331,291
Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	35,389	39,719
Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	4,031	5,459
Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	11,547	12,543
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	195,924	183,934
Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	54,827	58,804
Construction Portfolio Segment [Member]
Total loans	13,475	14,785
Commercial Portfolio Segment [Member]
Total loans	20,047	14,826
Consumer Portfolio Segment [Member]
Total loans	1,074	1,221
Pass [Member]
Total loans	300,114	273,846
Pass [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	33,788	36,941
Pass [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	4,031	5,459
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	9,631	9,462
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	173,375	150,122
Pass [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	48,241	46,230
Pass [Member] | Construction Portfolio Segment [Member]
Total loans	13,475	14,785
Pass [Member] | Commercial Portfolio Segment [Member]
Total loans	16,499	9,626
Pass [Member] | Consumer Portfolio Segment [Member]
Total loans	1,074	1,221
Pass Closely Monitored [Member]
Total loans	22,938	36,878
Pass Closely Monitored [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	490	1,437
Pass Closely Monitored [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	0	0
Pass Closely Monitored [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	855	1,239
Pass Closely Monitored [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	14,349	21,156
Pass Closely Monitored [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	6,586	8,142
Pass Closely Monitored [Member] | Construction Portfolio Segment [Member]
Total loans	0	0
Pass Closely Monitored [Member] | Commercial Portfolio Segment [Member]
Total loans	658	4,904
Pass Closely Monitored [Member] | Consumer Portfolio Segment [Member]
Total loans	0	0
Special Mention [Member]
Total loans	5,760	976
Special Mention [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	241	225
Special Mention [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	0	0
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	0	0
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	2,630	751
Special Mention [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	0	0
Special Mention [Member] | Construction Portfolio Segment [Member]
Total loans	0	0
Special Mention [Member] | Commercial Portfolio Segment [Member]
Total loans	2,889	0
Special Mention [Member] | Consumer Portfolio Segment [Member]
Total loans	0	0
Substandard [Member]
Total loans	7,502	19,591
Substandard [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	871	1,116
Substandard [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	0	0
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	1,061	1,842
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	5,570	11,905
Substandard [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	0	4,432
Substandard [Member] | Construction Portfolio Segment [Member]
Total loans	0	0
Substandard [Member] | Commercial Portfolio Segment [Member]
Total loans	0	296
Substandard [Member] | Consumer Portfolio Segment [Member]
Total loans	0	0
Doubtful [Member]
Total loans	0	0
Doubtful [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	0	0
Doubtful [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	0	0
Doubtful [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	0	0
Doubtful [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	0	0
Doubtful [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	0	0
Doubtful [Member] | Construction Portfolio Segment [Member]
Total loans	0	0
Doubtful [Member] | Commercial Portfolio Segment [Member]
Total loans	0	0
Doubtful [Member] | Consumer Portfolio Segment [Member]
Total loans	0	0
Loss [Member]
Total loans	0	0
Loss [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total loans	0	0
Loss [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total loans	0	0
Loss [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total loans	0	0
Loss [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total loans	0	0
Loss [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total loans	0	0
Loss [Member] | Construction Portfolio Segment [Member]
Total loans	0	0
Loss [Member] | Commercial Portfolio Segment [Member]
Total loans	0	0
Loss [Member] | Consumer Portfolio Segment [Member]
Total loans	$ 0	$ 0

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Note 4 - Loans and Allowance for Loan Losses - Summary of Our Past Due and Non-accrual Loans (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Total Loans > 90 Days & Accruing	$ 0	$ 0
Total Nonaccrual	6,070	7,129
Financing Receivable, Past Due	2,205	4,453
Current	334,109	326,838
Total loans	336,314	331,291
Residential Portfolio Segment [Member] | One- to Four-family [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	137	99
Financing Receivable, Past Due	396	303
Current	34,993	39,416
Total loans	35,389	39,719
Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	0	0
Financing Receivable, Past Due	0	0
Current	4,031	5,459
Total loans	4,031	5,459
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	4,872	5,188
Financing Receivable, Past Due	748	1,017
Current	195,176	182,917
Total loans	195,924	183,934
Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	0	0
Financing Receivable, Past Due	0	1,291
Current	54,827	57,513
Total loans	54,827	58,804
Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	1,061	1,842
Financing Receivable, Past Due	1,061	1,842
Current	10,486	10,701
Total loans	11,547	12,543
Construction Portfolio Segment [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	0	0
Financing Receivable, Past Due	0	0
Current	13,475	14,785
Total loans	13,475	14,785
Commercial Portfolio Segment [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	0	0
Financing Receivable, Past Due	0	0
Current	20,047	14,826
Total loans	20,047	14,826
Consumer Portfolio Segment [Member]
Total Loans > 90 Days & Accruing	0	0
Total Nonaccrual	0	0
Financing Receivable, Past Due	0	0
Current	1,074	1,221
Total loans	1,074	1,221
Financing Receivables, 30 to 59 Days Past Due [Member]
Financing Receivable, Past Due	165	1,448
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Financing Receivable, Past Due	165	151
Financing Receivables, 30 to 59 Days Past Due [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Financing Receivable, Past Due	0	6
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Financing Receivable, Past Due	0	1,291
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 30 to 59 Days Past Due [Member] | Construction Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 30 to 59 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 30 to 59 Days Past Due [Member] | Consumer Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member]
Financing Receivable, Past Due	742	1,163
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Financing Receivable, Past Due	94	152
Financing Receivables, 60 to 89 Days Past Due [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Financing Receivable, Past Due	648	1,011
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member] | Construction Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, 60 to 89 Days Past Due [Member] | Consumer Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member]
Financing Receivable, Past Due	1,298	1,842
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Residential Portfolio Segment [Member] | One- to Four-family [Member]
Financing Receivable, Past Due	137	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Financing Receivable, Past Due	100	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Financing Receivable, Past Due	1,061	1,842
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Construction Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Commercial Portfolio Segment [Member]
Financing Receivable, Past Due	0	0
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | Consumer Portfolio Segment [Member]
Financing Receivable, Past Due	$ 0	$ 0

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Note 4 - Loans and Allowance for Loan Losses - Summary of Impaired Loans (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Average balance	$ 18,733	$ 25,614
Interest Income	1,062	1,024
Recorded balance	16,975	23,839
Unpaid principal balance	22,267	28,543
Specific allowance	785	1,150
Residential Portfolio Segment [Member] | One- to Four-family [Member]
Average balance	1,311	1,791
Interest Income	70	80
Recorded balance	1,500	1,504
Unpaid principal balance	1,620	1,633
Specific allowance	0	0
Average balance, with valuation allowance	0	0
Interest Income, with valuation allowance	0	0
Recorded balance, without valuation allowance	1,500	1,504
Unpaid principal balance, without valuation allowance	1,620	1,633
Average balance, without valuation allowance	1,311	1,791
Interest Income, without valuation allowance	70	80
Recorded balance, with valuation allowance	0	0
Unpaid principal balance, with valuation allowance	0	0
Residential Portfolio Segment [Member] | Home Equity Loan [Member]
Average balance	0	15
Interest Income	0	0
Recorded balance	0	0
Unpaid principal balance	0	0
Specific allowance	0	0
Average balance, with valuation allowance	0	0
Interest Income, with valuation allowance	0	0
Recorded balance, without valuation allowance	0	0
Unpaid principal balance, without valuation allowance	0	0
Average balance, without valuation allowance	0	15
Interest Income, without valuation allowance	0	0
Recorded balance, with valuation allowance	0	0
Unpaid principal balance, with valuation allowance	0	0
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Average balance	8,681	13,007
Interest Income	467	464
Recorded balance	8,103	12,280
Unpaid principal balance	10,364	14,188
Specific allowance	235	200
Average balance, with valuation allowance	385	2,499
Interest Income, with valuation allowance	41	175
Recorded balance, without valuation allowance	7,494	9,912
Unpaid principal balance, without valuation allowance	9,669	11,820
Average balance, without valuation allowance	8,296	10,508
Interest Income, without valuation allowance	426	289
Recorded balance, with valuation allowance	609	2,368
Unpaid principal balance, with valuation allowance	695	2,368
Commercial Real Estate Portfolio Segment [Member] | Multifamily Loan [Member]
Average balance	6,884	8,004
Interest Income	402	436
Recorded balance	6,311	7,877
Unpaid principal balance	7,125	8,691
Specific allowance	0	100
Average balance, with valuation allowance	0	1,319
Interest Income, with valuation allowance	0	77
Recorded balance, without valuation allowance	6,311	6,586
Unpaid principal balance, without valuation allowance	7,125	7,400
Average balance, without valuation allowance	6,884	6,685
Interest Income, without valuation allowance	402	359
Recorded balance, with valuation allowance	0	1,291
Unpaid principal balance, with valuation allowance	0	1,291
Commercial Real Estate Portfolio Segment [Member] | Land Loan [Member]
Average balance	1,856	2,486
Interest Income	123	22
Recorded balance	1,061	1,883
Unpaid principal balance	3,158	3,736
Specific allowance	550	850
Average balance, with valuation allowance	1,832	2,115
Interest Income, with valuation allowance	123	0
Recorded balance, without valuation allowance	0	41
Unpaid principal balance, without valuation allowance	0	96
Average balance, without valuation allowance	24	371
Interest Income, without valuation allowance	0	22
Recorded balance, with valuation allowance	1,061	1,842
Unpaid principal balance, with valuation allowance	3,158	3,640
Construction Portfolio Segment [Member]
Average balance	0
Interest Income	0	0
Recorded balance	0	0
Unpaid principal balance	0	0
Specific allowance	0	0
Average balance, with valuation allowance	0	0
Interest Income, with valuation allowance	0	0
Recorded balance, without valuation allowance	0	0
Unpaid principal balance, without valuation allowance	0	0
Average balance, without valuation allowance	0	0
Interest Income, without valuation allowance	0	0
Recorded balance, with valuation allowance	0	0
Unpaid principal balance, with valuation allowance	0	0
Commercial Portfolio Segment [Member]
Average balance	0	311
Interest Income	0	22
Recorded balance	0	295
Unpaid principal balance	0	295
Specific allowance	0	0
Average balance, with valuation allowance	0	0
Interest Income, with valuation allowance	0	0
Recorded balance, without valuation allowance	0	295
Unpaid principal balance, without valuation allowance	0	295
Average balance, without valuation allowance	0	311
Interest Income, without valuation allowance	0	22
Recorded balance, with valuation allowance	0	0
Unpaid principal balance, with valuation allowance	0	0
Consumer Portfolio Segment [Member]
Average balance	0	0
Interest Income	0	0
Recorded balance	0	0
Unpaid principal balance	0	0
Specific allowance	0	0
Average balance, with valuation allowance	0	0
Interest Income, with valuation allowance	0	0
Recorded balance, without valuation allowance	0	0
Unpaid principal balance, without valuation allowance	0	0
Average balance, without valuation allowance	0	0
Interest Income, without valuation allowance	0	0
Recorded balance, with valuation allowance	0	0
Unpaid principal balance, with valuation allowance	$ 0	$ 0

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Note 4 - Loans and Allowance for Loan Losses - Summary of Loans Restructured as TDRs (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Balance after TDR	$ 826	$ 817
Count	2	3
Balance prior to TDR	$ 826	$ 817
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Balance after TDR	$ 826	$ 817
Count	2	3
Balance prior to TDR	$ 826	$ 817

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Note 4 - Loans and Allowance for Loan Losses - Summary of Loans Restructured as TDRs Based on Type of Modification (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Number of contracts	2	3
Amount	$ 826	$ 817
Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Number of contracts	2	3
Amount	$ 826	$ 817
Payment Deferral [Member]
Number of contracts	2	0
Amount	$ 826	$ 0
Payment Deferral [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Number of contracts	2	0
Amount	$ 826	$ 0
Contractual Interest Rate Reduction [Member]
Number of contracts	0	0
Amount	$ 0	$ 0
Contractual Interest Rate Reduction [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Number of contracts	0	0
Amount	$ 0	$ 0
Combination [Member]
Number of contracts	0	3
Amount	$ 0	$ 817
Combination [Member] | Commercial Real Estate Portfolio Segment [Member] | Real Estate Loan [Member]
Number of contracts	0	3
Amount	$ 0	$ 817

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Note 5 - Premises and Equipment - Major Classifications of Premises and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Property, plant and equipment	$ 6,691	$ 6,968
Less accumulated depreciation	(5,564)	(5,683)
Net premises and equipment	1,127	1,285
Land [Member]
Property, plant and equipment	514	514
Building and Building Improvements [Member]
Property, plant and equipment	3,156	3,146
Furniture and Fixtures [Member]
Property, plant and equipment	$ 3,021	$ 3,308

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Note 6 - Deposits (Details Textual) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Interest-bearing Domestic Deposit, Brokered	$ 20,955	$ 43,612
Time Deposits, at or Above FDIC Insurance Limit	$ 33,402	$ 39,061

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Note 6 - Deposits - Deposits at Year End (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Savings accounts	$ 13,923	$ 13,626
Checking accounts	34,608	33,934
Money market accounts	104,798	70,356
Certificates of deposit	127,219	163,785
Total Deposits	$ 280,548	$ 281,701

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Note 6 - Deposits - Maturities of Certificates of Deposit (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
2017	$ 75,405
2018	23,134
2019	17,749
2020	10,143
2021	676
Thereafter	112
Total	$ 127,219	$ 163,785

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Note 7 - Federal Home Loan Bank Advances (Details Textual) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Advances from Federal Home Loan Banks	$ 60,000	$ 47,000
Deposits with Other Federal Home Loan Banks	$ 148,999
Minimum [Member]
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate	0.90%
Maximum [Member]
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate	5.25%

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Note 7 - Federal Home Loan Bank Advances - Aggregate Annual Maturities of Federal Home Loan Bank Advances (Details) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
2017	$ 23,000,000
2018	5,000,000
2019	0
2020	10,000,000
2021	0
Thereafter	22,000,000
Total	$ 60,000,000	$ 47,000,000

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Note 8 - Income Taxes (Details Textual) $ in Thousands	Dec. 31, 2016 USD ($)
Deferred Tax Liability Not Recognized, Amount of Unrecognized Deferred Tax Liability, Bad Debt Reserve for Tax Purposes of Qualified Lender	$ 2,019
Reversal of Deferred Tax Liability	686
Deferred Tax Liabilities, Net	$ 0

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Note 8 - Income Taxes - Components Included as Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Taxes currently payable	$ 2,056	$ 1,759
Deferred income taxes	348	(215)
Income tax expense	$ 2,404	$ 1,544

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Note 8 - Income Taxes - Reconciliation of Income Tax Expense at Statutory Rate to Company's Actual Income Tax Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Computed at the statutory rate (34%)	$ 2,297	$ 1,608
Increase (decrease) resulting from Tax exempt interest	(49)	(49)
Other	(156)	(15)
Income tax expense	$ 2,404	$ 1,544

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Note 8 - Income Taxes - Reconciliation of Income Tax Expense at Statutory Rate to Company's Actual Income Tax Expense (Details) (Parentheticals)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Statutory rate	34.00%	34.00%

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Note 8 - Income Taxes - Tax Effects of Temporary Differences Related to Deferred Taxes (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Deferred tax asset
Allowance for loan losses	$ 2,725	$ 2,984
Depreciation	142	134
Deferred loan fees	195	195
Deferred compensation	186	197
Real estate owned	3	27
Other	0	62
	3,251	3,599
Deferred tax liabilities
FHLB stock dividends	31	31
Net deferred tax asset	$ 3,220	$ 3,568

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Note 9 - Regulatory Matters (Details Textual)	Dec. 31, 2016	Jan. 01, 2016	Dec. 31, 2015	Jan. 01, 2015
Common Equity Tier 1 Capital Required for Capital Adequacy to Risk Weighted Assets	4.50%		4.50%	4.50%
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	6.00%		6.00%	6.00%
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%		8.00%	8.00%
Tier One Leverage Capital Required for Capital Adequacy to Average Assets				4.00%
Deductions and Adjustments To CET1 Initial Phase-in Percentage				40.00%
Deductions and Adjustments to CET1 Annual Phase-in Percent				20.00%
Capital Conservation Buffer Annual Phase-in		0.625%
Capital Conservation Buffer		2.50%

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Note 9 - Regulatory Matters - Quantitative Measures (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Jan. 01, 2015
Tier I capital (to adjusted total assets), to be well capitalized, ratio	5.00%	5.00%
Total risk-based capital, actual, amount	$ 63,829	$ 61,810
Total risk-based capital, actual, ratio	22.02%	20.70%
Total risk-based capital, for capital adequacy purposes, amount	$ 23,188	$ 23,848
Total risk-based capital, for capital adequacy purposes, ratio	8.00%	8.00%	8.00%
Total risk-based capital, to be well capitalized, amount	$ 28,985	$ 29,810
Total risk-based capital, to be well capitalized, ratio	10.00%	10.00%
Tier I capital, actual, amount	$ 60,131	$ 57,990
Tier I capital, actual, ratio	20.75%	19.45%
Tier I capital, for capital adequacy purposes, amount	$ 17,391	$ 17,886
Tier I capital, for capital adequacy purposes, ratio	6.00%	6.00%	6.00%
Tier I capital, to be well capitalized, amount	$ 23,188	$ 23,848
Tier I capital, to be well capitalized, ratio	8.00%	8.00%
Common equity tier 1 capital, actual, amount	$ 60,131	$ 57,990
Common equity tier 1 capital, actual, ratio	20.75%	19.45%
Common equity tier 1 capital, for capital adequacy purposes, amount	$ 16,650	$ 16,172
Common equity tier 1 capital, for capital adequacy purposes, ratio	4.50%	4.50%	4.50%
Common equity tier 1 capital, to be well capitalized, amount	$ 24,050	$ 23,360
Common equity tier 1 capital, to be well capitalized, ratio	6.50%	6.50%
Tier I capital (to adjusted total assets), actual, amount	$ 60,131	$ 57,990
Tier I capital (to adjusted total assets), actual, ratio	16.25%	16.14%
Tier I capital (to adjusted total assets), for capital adequacy purposes, amount	$ 14,800	$ 14,375
Tier I capital (to adjusted total assets), for capital adequacy purposes, ratio	4.00%	4.00%
Tier I capital (to adjusted total assets), to be well capitalized, amount	$ 18,500	$ 17,969

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Note 10 - Employee Benefits (Details Textual) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent	100.00%
Defined Contribution Plan, Employer Matching Contribution, Percent of Match	100.00%
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	3.00%
Defined Contribution Plan, Employer Matching Contribution, Percent of Match, Additional	50.00%
Defined Contribution Plan, Cost	$ 83	$ 75
Employee Stock Ownership Plan Shares Purchased by ESOP	200,600
Common Stock Purchased, Value Per Share	$ 10
Common Stock Shares Originally Acquired by ESOP	2,006
Employee Stock Ownership Plan (ESOP), Compensation Expense	$ 555	$ 391
Employee Stock Ownership Plan (ESOP), Number of Allocated Shares	73,220	55,665
Employee Stock Ownership Plan (ESOP), Deferred Shares, Fair Value	$ 2,314	$ 1,483
Minimum [Member]
Defined Contribution Plan, Employee Contribution, Additional Percentage	3.00%
Maximum [Member]
Defined Contribution Plan, Employee Contribution, Additional Percentage	5.00%

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Note 10 - Employee Benefits - Employee Stock Ownership Plan (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Allocated shares (in shares)	73,220	55,665
Unearned shares (in shares)	121,755	141,255
Total ESOP shares (in shares)	194,975	196,920
Fair value of unearned shares at December 31	$ 1,215	$ 1,410
Employee Stock Option [Member]
Fair value of unearned shares at December 31	$ 3,847	$ 3,763

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Note 11 - Disclosures About Fair Value of Assets and Liabilities (Details Textual) $ in Thousands	Dec. 31, 2015 USD ($)
Collateral-dependent Impaired Loans, Fair Value Disclosure	$ 0

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Note 11 - Disclosures About Fair Value of Assets and Liabilities - Summary of Fair Value Measurements of Assets and Liabilities on Nonrecurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Collateral-dependent Impaired loans		$ 0
Fair Value, Measurements, Nonrecurring [Member] | Estimate of Fair Value Measurement [Member]
Collateral-dependent Impaired loans	$ 885
Fair Value, Measurements, Nonrecurring [Member] | Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member]
Collateral-dependent Impaired loans	$ 885

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Note 11 - Disclosures About Fair Value of Assets and Liabilities - Summary of Quantitative Information About Unobservable Inputs (Details) - USD ($) $ in Thousands			12 Months Ended
	Dec. 15, 2016	Sep. 09, 2016	Dec. 31, 2016	Dec. 31, 2015
Collateral-dependent Impaired loans				$ 0
Expected volatility	18.10%	17.80%
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Market Approach Valuation Technique [Member]
Collateral-dependent Impaired loans			$ 885
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Market Approach Valuation Technique [Member] | Minimum [Member]
Expected volatility			3.00%
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Market Approach Valuation Technique [Member] | Maximum [Member]
Expected volatility			13.00%
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | Market Approach Valuation Technique [Member] | Weighted Average [Member]
Expected volatility			6.00%

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Note 11 - Disclosures About Fair Value of Assets and Liabilities - Summary of Estimated Fair Values of Company's Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Held to maturity securities	$ 500	$ 500
Federal funds purchased	27,000	24,000
Interest-earning time deposits		39,021
Reported Value Measurement [Member]
Held to maturity securities	499	500
Loans held for sale	238	581
Loans, net of allowance for loan losses	320,606	314,613
Federal Home Loan Bank stock	2,700	2,700
Interest receivable	846	967
Deposits	280,548	281,701
Federal Home Loan Bank advances	60,000	47,000
Federal funds purchased	27,000	24,000
Interest payable	249	233
Cash and cash equivalents	103,634	52,865
Interest-earning time deposits		39,021
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 1 [Member]
Held to maturity securities	0	0
Loans held for sale	0	0
Loans, net of allowance for loan losses	0	0
Federal Home Loan Bank stock	0	0
Interest receivable	0	0
Deposits	153,290	117,916
Federal Home Loan Bank advances	0	0
Federal funds purchased	0	0
Interest payable	0	0
Cash and cash equivalents	103,634	52,865
Interest-earning time deposits		39,021
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 2 [Member]
Held to maturity securities	500	500
Loans held for sale	239	583
Loans, net of allowance for loan losses	0	0
Federal Home Loan Bank stock	2,700	2,700
Interest receivable	846	967
Deposits	0	0
Federal Home Loan Bank advances	59,187	46,390
Federal funds purchased	27,000	24,000
Interest payable	249	233
Cash and cash equivalents	0	0
Interest-earning time deposits		0
Estimate of Fair Value Measurement [Member] | Fair Value, Inputs, Level 3 [Member]
Held to maturity securities	0	0
Loans held for sale	0	0
Loans, net of allowance for loan losses	323,601	318,525
Federal Home Loan Bank stock	0	0
Interest receivable	0	0
Deposits	128,655	165,657
Federal Home Loan Bank advances	0	0
Federal funds purchased	0	0
Interest payable	0	0
Cash and cash equivalents	$ 0	0
Interest-earning time deposits		$ 0

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Note 12 - Commitments and Contingent Liabilities (Details Textual)	12 Months Ended
	Dec. 31, 2016
Minimum [Member]
Commitments Expiration Period	30 days
Maximum [Member]
Commitments Expiration Period	90 days

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Note 12 - Commitments and Contingent Liabilities - Summary of Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Commitments to extend credit	$ 6,111	$ 7,133
Unused portions of lines of credit	6,268	6,778
Standby letters of credit	$ 787	$ 990

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Note 13 - Earnings Per Share - Earnings Per Share Table (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Net income	$ 4,353	$ 3,186
Dividends and undistributed earnings allocated to participating securities	(47)	(50)
Income attributable to common shareholders	$ 4,306	$ 3,136
Weighted average shares outstanding (in thousands) (in shares)	2,132	2,200
Less: average unearned ESOP and unvested restricted stock (in shares)	(171)	(203)
Average Shares (in shares)	1,961	1,997
Effect of dilutive based awards (in shares)	32	25
Average common and common-equivalent shares for diluted EPS (in thousands) (in shares)	1,993	2,022
Basic EPS (in dollars per share)	$ 2.20	$ 1.57
Diluted EPS (in dollars per share)	$ 2.16	$ 1.55

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Note 14 - Share Based Compensation (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	351,050
Allocated Share-based Compensation Expense	$ 334	$ 319
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	5 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options	$ 179
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	8 years 350 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value	$ 768
Stock or Unit Option Plan Expense	62	62
Restricted Stock or Unit Expense	272	$ 257
Restricted Stock [Member]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options	$ 505

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Note 14 - Share Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Options outstanding (in shares)	128,949
Options outstanding (in dollars per share)	$ 17.91
Options outstanding (in dollars per share)	$ 20.76	$ 17.91
Options outstanding (Year)	7 years	7 years
Options outstanding	$ 1,956	$ 1,123
Granted (in shares)	60,000
Granted (in dollars per share)	$ 26.66
Granted (Year)	10 years
Exercised (in shares)	(1,503)
Exercised (in dollars per share)	$ 17.30
Forfeited (in shares)	(3,888)
Forfeited (in dollars per share)	$ 19.58
Expired (in shares)	(1,973)
Expired (in dollars per share)	$ 18.42
Exercisable (in shares)	92,748
Exercisable (in dollars per share)	$ 17.44
Exercisable (Year)	6 years
Exercisable	$ 1,305
Options outstanding (in shares)	181,585	128,949

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Note 14 - Share Based Compensation - Assumptions Used in Black-scholes Option Pricing Formula (Details) - $ / shares	Dec. 15, 2016	Sep. 09, 2016
Risk-free interest rate	2.51%	1.59%
Expected dividend yield	5.00%	5.00%
Expected life (in years) (Year)	7 years 182 days	7 years 182 days
Exercise price for the stock options (in dollars per share)	$ 26.03	$ 26.75
Grant date fair value (in dollars per share)	$ 2.58	$ 1.91
Expected volatility	18.10%	17.80%

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Note 14 - Share Based Compensation - Summary of Restricted Stock Award Activity (Details) - Restricted Stock [Member]	12 Months Ended
	Dec. 31, 2016 $ / shares shares
Non-vested at January 1, 2016 (in shares) | shares	36,534
Non-vested at January 1, 2016 (in dollars per share) | $ / shares	$ 19.16
Granted (in shares) | shares	7,500
Granted (in dollars per share) | $ / shares	$ 28.61
Vested (in shares) | shares	(14,745)
Vested (in dollars per share) | $ / shares	$ 18.14
Forfeited (in shares) | shares	(2,717)
Forfeited (in dollars per share) | $ / shares	$ 19.02
Non-vested at December 31, 2016 (in dollars per share) | $ / shares	$ 22.38
Non-vested at December 31, 2016 (in shares) | shares	26,572

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Note 15 - Condensed Financial Information (Parent Company Only) - Condensed Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash and cash equivalents	$ 103,634	$ 52,865	$ 29,686
Other assets	4,699	5,151
Total assets	434,435	417,813
Stockholders' Equity	60,974	60,480	61,538
Total liabilities and stockholders' equity	434,435	417,813
Parent Company [Member]
Cash and cash equivalents	3,190	2,386	$ 990
Investment in subsidiary	61,127	60,073
Other assets	205	199
Total assets	64,522	62,658
Liabilities - Other	3,548	2,178
Stockholders' Equity	60,974	60,480
Total liabilities and stockholders' equity	$ 64,522	$ 62,658

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Note 15 - Condensed Financial Information (Parent Company Only) - Condensed Statements of Income and Comprehensive Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Income - Dividends from subsidiary	$ 16,819	$ 15,616
Expense	3,883	3,451
Income Before Income Tax and Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries	6,757	4,730
Income Tax Benefit	(2,404)	(1,544)
Net income	4,353	3,186
Parent Company [Member]
Income - Dividends from subsidiary	4,500	4,500
Expense	344	260
Income Before Income Tax and Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries	4,156	4,240
Income Tax Benefit	5	73
Income (Loss) Before Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries	4,161	4,313
Equity in Undistributed Income (Distribution in Excess of Income) of Subsidiaries	192	(1,127)
Net income	$ 4,353	$ 3,186

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Note 15 - Condensed Financial Information (Parent Company Only) - Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Operating Activities
Net income	$ 4,353	$ 3,186
Net cash provided by operating activities	5,772	5,496
Financing Activities
Purchase of common stock	(1,518)	(2,796)
Proceeds from stock options exercised	26
Net cash used in financing activities	11,197	76,376
Cash and Cash Equivalents, Beginning of Period	52,865	29,686
Cash and Cash Equivalents, End of Period	103,634	52,865
Supplemental Disclosures of Cash Flows Information
Dividends Declared, not paid	2,305	2,158
Parent Company [Member]
Operating Activities
Net income	4,353	3,186
(Equity in undistributed income) distributions in excess of income of subsidiaries	(192)	1,127
Change in other assets	(6)	(74)
Change in other liabilities	299	(47)
Net cash provided by operating activities	4,454	4,192
Financing Activities
Purchase of common stock	(1,518)	(2,796)
Dividends paid	(2,158)	0
Proceeds from stock options exercised	26	0
Net cash used in financing activities	(3,650)	(2,796)
Net Change in Cash and Cash Equivalents	804	1,396
Cash and Cash Equivalents, Beginning of Period	2,386	990
Cash and Cash Equivalents, End of Period	3,190	2,386
Supplemental Disclosures of Cash Flows Information
Dividends Declared, not paid	$ 3,229	$ 2,158