Disclosure About Fair Value of Financial Instruments (Tables)

3 Months Ended

Jun. 30, 2012

Notes to Financial Statements

Estimated Fair Values of the Company's Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate the value:

Cash and Short-Term Investments

For cash, the carrying amount approximates fair value. For short-term investments, fair values are calculated based upon general investment market interest rates for similar maturity investments.

Investment Securities

For securities and marketable equity securities held-for-investment purposes, fair values are based on quoted market prices.

Loan Receivables

For certain homogeneous categories of loans, such as residential mortgages, credit card receivables and other consumer loans, fair value is estimated using the current U.S. treasury interest rate curve, a factor for cost of processing and a factor for historical credit risk to determine the discount rate.

Deposit Liabilities

The fair value of demand deposits, savings deposits and certain money market deposits are calculated based upon general investment market interest rates for investments with similar maturities. The value of fixed maturity certificates of deposit is estimated using the U.S. treasury interest rate curve currently offered for deposits of similar remaining maturities.

Commitments to Extend Credit

The fair value of commitments is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present credit-worthiness of the counterparties.

The estimated fair values of the Company’s financial instruments at June 30, 2012 and December 31, 2011, are as follows (amounts in thousands):

	June 30, 2012
	Carrying			Fair
	Amount			Value
	(In Thousands)
Financial Assets:
Cash and Short-Term Investments	$	3,139		$	3,139
Certificates of Deposit		5,710			5,710
Investment Securities		144			144
Loans		54,676			54,636
Less:  Allowance for Loan Losses		(1,800	)		NA
Less:  Deferred Loan Fees		(25	)		NA
	$	61,844		$	63,629
Financial Liabilities:
Deposits	$	73,821		$	73,853
Unrecognized Financial Instruments:
Commitments to Extend Credit	$	1,731		$	1,731
Credit Card Arrangements		12,228			12,228
	$	13,959		$	13,959

	December 31, 2011
	Carrying			Fair
	Amount			Value
	(In Thousands)
Financial Assets:
Cash and Short-Term Investments	$	3,506		$	3,506
Certificates of Deposit		5,458			5,458
Investment Securities		1,037			1,037
Loans		56,221			56,071
Less:  Allowance for Loan Losses		(1,800	)		NA
	$	64,422		$	66,072
Financial Liabilities:
Deposits	$	77,680		$	77,726
Unrecognized Financial Instruments:
Commitments to Extend Credit	$	2,079		$	2,079
Credit Card Arrangements		12,373			12,373
	$	14,452		$	14,452