COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2014

Commitments And Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 10. COMMITMENTS AND CONTINGENCIES

The Company is a party to financial instruments with off-balance-sheet risk entered into in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, which are not included in the accompanying financial statements.

Commitments to extend credit are agreements to lend money with fixed expiration dates or termination clauses. The Company applies the same credit standards used in the lending process when extending these commitments, and periodically reassesses the customer’s creditworthiness through ongoing credit reviews. Since some commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Collateral is obtained based on the Company’s assessment of the transaction. Essentially all letters of credit issued have expiration dates within one year. At September 30, 2014 and December 31, 2013, the Company’s commitments to extend credit totaled approximately $93.9 million and $67.1 million, respectively.

The Company is required to maintain average reserves at the Federal Reserve Bank. There were approximately $11.9 million and $4.6 million in required reserves at September 30, 2014 and December 31, 2013, respectively.