10-Q

1

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2017

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

COMMISSION FILE NUMBER 000-22062

UWHARRIE CAPITAL CORP

(Exact name of registrant as specified in its charter)

NORTH CAROLINA	56-1814206
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
132 NORTH FIRST STREET ALBEMARLE, NORTH CAROLINA	28001
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s Telephone number, including area code: (704) 983-6181

N/A

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

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) 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 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	☐ (Do not check if a smaller reporting company.)	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 Exchange Act).    ☐  Yes    ☒  No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: 6,979,244 shares of common stock outstanding as of November 6, 2017.

Table of Contents

		Page No.
Part I.	FINANCIAL INFORMATION
Item 1 -	Financial Statements (Unaudited)
	Consolidated Balance Sheets September 30, 2017 and December 31, 2016	3
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2017 and 2016	4
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2017 and 2016	5
	Consolidated Statements of Changes in Shareholders’ Equity for the Nine Months Ended September 30, 2017	6
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016	7
	Notes to Consolidated Financial Statements	8
Item 2 -	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3 -	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4 -	Controls and Procedures	33
Part II.	OTHER INFORMATION
Item 1 -	Legal Proceedings	34
Item 1A -	Risk Factors	34
Item 2 -	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3 -	Defaults Upon Senior Securities	34
Item 4 -	Mine Safety Disclosures	34
Item 5 -	Other Information	35
Item 6 -	Exhibits	36
	Signatures	37

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Uwharrie Capital Corp and Subsidiaries

Consolidated Balance Sheets

Part I. Financial Information

Item 1. Financial Statements.

	September 30, 2017 (Unaudited)			December 31, 2016*
	(dollars in thousands)
ASSETS
Cash and due from banks	$	6,826		$	9,422
Interest-earning deposits with banks		85,757			36,546
Securities available for sale, at fair value		97,717			105,899
Securities held to maturity, at amortized cost (fair value $11,575 and $11,934, respectively)		11,493			11,990
Loans held for sale		2,725			5,823
Loans:
Loans held for investment		349,919			341,829
Less allowance for loan losses		(2,448	)		(2,707	)
Net loans held for investment		347,471			339,122
Premises and equipment, net		14,302			14,173
Interest receivable		1,516			1,629
Restricted stock		1,068			1,052
Bank owned life insurance		8,514			6,897
Other real estate owned		2,681			4,176
Prepaid assets		1,000			826
Other assets		10,882			10,675
Total assets	$	591,952		$	548,230
LIABILITIES
Deposits:
Demand noninterest-bearing	$	118,459		$	103,138
Interest checking and money market accounts		295,330			272,968
Savings deposits		45,075			42,452
Time deposits, $250,000 and over		10,408			7,472
Other time deposits		57,981			59,689
Total deposits		527,253			485,719
Short-term borrowed funds		1,788			2,674
Junior subordinated debt		9,534			9,534
Interest payable		151			151
Other liabilities		8,066			6,627
Total liabilities		546,792			504,705
Off balance sheet items, commitments and contingencies (Note 9)
SHAREHOLDERS’ EQUITY
Common stock, $1.25 par value: 20,000,000 shares authorized; shares issued and    outstanding 6,978,263 and 7,050,315		8,723			8,813
Additional paid-in capital		12,258			12,540
Undivided profits		14,262			12,867
Accumulated other comprehensive loss		(726	)		(1,318	)
Total Uwharrie Capital Corp shareholders’ equity		34,517			32,902
Noncontrolling interest		10,643			10,623
Total shareholders’ equity		45,160			43,525
Total liabilities and shareholders’ equity	$	591,952		$	548,230

(*) Derived from audited consolidated financial statements

See accompanying notes

-3-

Uwharrie Capital Corp and Subsidiaries

Consolidated Statements of Income (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(in thousands, except share and per share data)
Interest Income
Loans, including fees	$	4,214		$	4,025		$	12,336		$	11,820
Investment securities
US Treasury		5			11			28			34
US Government agencies and corporations		369			313			1,122			939
State and political subdivisions		121			125			361			375
Interest-earning deposits with banks and federal funds sold		258			78			520			236
Total interest income		4,967			4,552			14,367			13,404
Interest Expense
Interest checking and money market accounts		113			82			295			229
Savings deposits		12			12			37			35
Time deposits, $250,000 and over		16			14			46			44
Other time deposits		51			59			143			255
Short-term borrowed funds		1			3			14			32
Long-term debt		138			139			410			412
Total interest expense		331			309			945			1,007
Net interest income		4,636			4,243			13,422			12,397
Provision for (recovery of) loan losses		(136	)		240			(309	)		70
Net interest income after provision for (recovery of) loan losses		4,772			4,003			13,731			12,327
Noninterest Income
Service charges on deposit accounts		299			309			874			904
Other service fees and commissions		1,003			1,055			3,206			3,330
Gain (loss) on sale of securities (includes reclassification of ($14,000), $2,000, ($14,000) and $544,000 from accumulated other comprehensive income)		(12	)		2			(12	)		544
Gain (loss) on fixed assets and other assets		3			(1	)		3			(3	)
Income from mortgage loan sales		790			1,111			2,539			2,769
Other income		215			117			567			389
Total noninterest income		2,298			2,593			7,177			7,933
Noninterest Expense
Salaries and employee benefits		3,647			3,626			10,987			10,792
Net occupancy expense		327			327			938			850
Equipment expense		151			159			451			488
Data processing costs		429			161			789			529
Office supplies and printing		27			34			89			117
Foreclosed real estate expense		48			29			312			204
Professional fees and services		223			171			570			541
Marketing and donations		251			224			737			651
Electronic banking expense		317			303			921			884
Software amortization and maintenance		198			174			569			508
FDIC insurance		76			86			167			257
Other noninterest expense		529			534			1,712			1,934
Total noninterest expense		6,223			5,828			18,242			17,755
Income before income taxes		847			768			2,666			2,505
Income taxes (includes reclassification of ($5,000), $1,000, ($5,000) and $210,000 from accumulated other comprehensive income)		259			228			829			745
Net income	$	588		$	540		$	1,837		$	1,760
Less: net income attributable to noncontrolling interest		(148	)		(149	)		(442	)		(444	)
Net income attributable to Uwharrie Capital Corp		440			391			1,395			1,316
Dividends – preferred stock		—			—			—			—
Net income (loss) available to common shareholders	$	440		$	391		$	1,395		$	1,316
Net income (loss) per common share
Basic	$	0.06		$	0.06		$	0.20		$	0.19
Diluted	$	0.06		$	0.06		$	0.20		$	0.19
Weighted average shares outstanding
Basic		6,979,137			7,095,112			7,008,240			7,111,733
Diluted		6,979,985			7,095,112			7,008,845			7,111,733

See accompanying notes

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Uwharrie Capital Corp and Subsidiaries

Consolidated Statements of Comprehensive Income (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(in thousands)
Net Income	$	588		$	540		$	1,837		$	1,760
Unrealized gain on available for sale securities		40			(268	)		884			1,165
Related tax effect		(14	)		90			(301	)		(422	)
Reclassification of (gain) losses recognized in net income		14			(2	)		14			(544	)
Related tax effect		(5	)		1			(5	)		210
Total other comprehensive income		35			(179	)		592			409
Comprehensive income		623			361			2,429			2,169
Less: Comprehensive income attributable to noncontrolling    interest		(148	)		(149	)		(442	)		(444	)
Comprehensive income attributable to Uwharrie Capital Corp	$	475		$	212		$	1,987		$	1,725

See accompanying notes

-5-

Uwharrie Capital Corp and Subsidiaries

Consolidated Statement of Changes in Shareholders’ Equity (Unaudited)

	Number of Common Shares Issued			Common Stock			Additional Paid-in Capital			Undivided Profits		Accumulated Other Comprehensive Income (Loss)			Non Controlling Interest			Total
	(dollars in thousands, except share data)
Balance, December 31, 2016		7,050,315		$	8,813		$	12,540		$	12,867	$	(1,318	)	$	10,623		$	43,525
Net income		—			—			—			1,395		—			442			1,837
Repurchase of common stock		(72,052	)		(90	)		(282	)		—		—			—			(372	)
Other comprehensive income		—			—			—			—		592			—			592
Record preferred stock dividend Series B    (noncontrolling interest)		—			—			—			—		—			(311	)		(311	)
Record preferred stock dividend Series C    (noncontrolling interest)		—			—			—			—		—			(111	)		(111	)
Balance, September 30, 2017		6,978,263		$	8,723		$	12,258		$	14,262	$	(726	)	$	10,643		$	45,160

See accompanying notes

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Uwharrie Capital Corp and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

	Nine Months Ended September 30,
	2017			2016
	(dollars in thousands)
Cash flows from operating activities
Net income	$	1,837		$	1,760
Adjustments to reconcile net income to net cash
Provided (used) by operating activities:
Depreciation and amortization		636			615
Provision/ (recovery) of loan losses		(309	)		70
(Gain) loss on sale of securities available for sale		12			(544	)
(Gain) loss on sale of OREO		31			(20	)
Net amortization of premium on investment securities AFS		665			745
Net amortization of premium on investment securities HTM		112			103
Net amortization of mortgage servicing rights		557			756
OREO write downs		92			15
Net change in:
Originations and purchases of mortgage loans for sale		(70,968	)		(82,825	)
Proceeds from sales of mortgage loans for sale		73,509			85,453
Accrued interest receivable		113			44
Prepaid assets		(174	)		(490	)
Cash surrender value of life insurance		(92	)		(98	)
Miscellaneous other assets		(493	)		(231	)
Accrued interest payable		—			(18	)
Miscellaneous other liabilities		1,439			1,202
Net cash provided by operating activities		6,967			6,537
Cash flows from investing activities
Proceeds from sales of investment securities available for sale		8,918			23,095
Proceeds from maturities, calls & paydowns of investment securities held to maturity		385			143
Proceeds from maturities, calls & paydowns of investment securities available for sale		5,823			5,668
Purchase of investment securities held to maturity		—			(1,027	)
Purchase of investment securities available for sale		(6,338	)		(39,597	)
Purchase of life insurance investment		(1,525	)		—
Net change in restricted stock		(16	)		(12	)
Net increase in loans		(8,401	)		(24,515	)
Proceeds from sales of premises, equipment, and other assets		—			150
Purchase of premises and equipment		(765	)		(324	)
Proceeds from sale of OREO		1,733			880
Net cash used by investing activities		(186	)		(35,539	)
Cash flows from financing activities
Net increase in deposit accounts		41,534			21,322
Net decrease in federal funds purchased and other short-term borrowings		(380	)		(3,972	)
Repayment of other borrowings		(506	)		(10	)
Common stock repurchases		(372	)		(260	)
Dividends paid on preferred stock		(442	)		(424	)
Net cash provided by financing activities		39,834			16,656
Increase (decrease) in cash and cash equivalents		46,615			(12,346	)
Cash and cash equivalents, beginning of period		45,968			68,933
Cash and cash equivalents, end of period	$	92,583		$	56,587
Supplemental Disclosures of Cash Flow Information
Interest paid	$	946		$	1,025
Income taxes paid		660			252
Supplemental Schedule of Non-Cash Activities
Net change in fair value securities available for sale, net of tax	$	592		$	410
Loans transferred to foreclosed real estate		361			315
Mortgage servicing rights capitalized		451			756

See accompanying notes

-7-

UWHARRIE CAPITAL CORP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Unaudited)

Note 1 – Basis of Presentation

The financial statements and accompanying notes are presented on a consolidated basis including Uwharrie Capital Corp (the “Company”) and its subsidiaries, Uwharrie Bank (the “Bank”), Uwharrie Investment Advisors, Inc. (“UIA”), and Uwharrie Mortgage, Inc. The Bank consolidates its subsidiaries, the Strategic Alliance Corporation, BOS Agency, Inc. and Gateway Mortgage, Inc., each of which is wholly owned by the Bank.

The information contained in the consolidated financial statements is unaudited. In the opinion of management, the consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and material adjustments necessary for a fair presentation of results of interim periods, all of which are of a normal recurring nature, have been made. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for an entire year. Management is not aware of economic events, outside influences or changes in concentrations of business that would require additional clarification or disclosure in the consolidated financial statements.

The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to consolidated financial statements filed as part of the Company’s 2016 Annual Report on Form 10-K. This Quarterly Report should be read in conjunction with such Annual Report.

Use of Estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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.

Note 2 – Comprehensive Income

The Company reports as comprehensive income all changes in shareholders’ equity during the year from sources other than shareholders. Other comprehensive income refers to all components (revenues, expenses, gains, and losses) of comprehensive income that are excluded from net income. The Company’s only component of other comprehensive income is unrealized gains and losses, net of income tax, on investment securities available for sale.

The following table presents the changes in accumulated other comprehensive income for the three and nine months ended September 30, 2017 and 2016:

	Unrealized holding gains on available-for-sale securities (net)
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Beginning Balance	$	(761	)	$	376		$	(1,318	)	$	(212	)
Other Comprehensive income (loss) before reclassifications,    net of ($14,000), $90,000, ($301,000) and ($422,000) tax    effect, respectively		26			(178	)		583			743
Amounts reclassified from accumulated other    comprehensive income, net of ($5,000), $1,000, ($5,000)    and $210,000 tax effect		9			(1	)		9			(334	)
Net current-period other comprehensive income (loss)		35			(179	)		592			409
Ending Balance	$	(726	)	$	197		$	(726	)	$	197

-8-

Note 3 – Noncontrolling Interest

In January 2013, the Company’s subsidiary banks issued a total of $7.9 million of Fixed Rate Noncumulative Perpetual Preferred Stock, Series B. The preferred stock qualified as Tier 1 capital at each bank and pays dividends at an annual rate of 5.30%. The preferred stock has no voting rights. This capital is presented as a noncontrolling interest in the consolidated balance sheets. Dividends declared on this preferred stock are presented as earnings allocated to the noncontrolling interest in the consolidated statements of income. Effective September 1, 2013, the Fixed Rate Noncumulative Perpetual Preferred Stock, Series B was rolled into one issue under Uwharrie Bank in connection with the consolidation and name change of the Company’s subsidiary banks.

During 2013, the Company’s subsidiary bank, Uwharrie Bank, raised $2.8 million of Fixed Rate Noncumulative Perpetual Preferred Stock, Series C. The preferred stock qualifies as Tier 1 capital at the bank and pays dividends at an annual rate of 5.30%. The preferred stock has no voting rights.

Note 4 – Per Share Data

Basic and diluted net income per common share is computed based on the weighted average number of shares outstanding during each period after retroactively adjusting for stock dividends. Diluted net income per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the net income of the Company. The Company had stock options outstanding covering 13,116 shares of common stock at both September 30, 2017 and December 31, 2016. All of these options were dilutive because the strike price was lower than the market price.

Basic and diluted net income per common share have been computed based upon net income available to common shareholders as presented in the accompanying consolidated statements of income divided by the weighted average number of common shares outstanding or assumed to be outstanding.

The computation of basic and diluted earnings per share is summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2017		2016		2017		2016
Weighted average number of common shares outstanding		6,979,137		7,095,112		7,008,240		7,111,733
Effect of dilutive stock options		848		—		605		—
Weighted average number of common shares and dilutive    potential common shares used in computing diluted net    income per common share		6,979,985		7,095,112		7,008,845		7,111,733

Note 5 – Investment Securities

Carrying amounts and fair values of securities available for sale and held to maturity are summarized below:

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	—	$	—	$	—	$	—
U.S. Government agencies		57,007		24		619		56,412
GSE - Mortgage-backed securities and CMO’s		22,352		36		271		22,117
State and political subdivisions		14,413		47		348		14,112
Corporate bonds		5,045		34		3		5,076
Total securities available for sale	$	98,817	$	141	$	1,241	$	97,717

-9-

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,351	$	9	$	—	$	1,360
State and political subdivisions		6,938		63		28		6,973
Corporate bonds		3,204		38		—		3,242
Total securities held to maturity	$	11,493	$	110	$	28	$	11,575

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	4,017	$	—	$	3	$	4,014
U.S. Government agencies		58,506		28		863		57,671
GSE - Mortgage-backed securities and CMO’s		26,195		39		586		25,648
State and political subdivisions		14,123		71		658		13,536
Corporate bonds		5,054		14		38		5,030
Total securities available for sale	$	107,895	$	152	$	2,148	$	105,899

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,754	$	—	$	17	$	1,737
State and political subdivisions		6,974		7		60		6,921
Corporate bonds		3,262		14		—		3,276
Total securities held to maturity	$	11,990	$	21	$	77	$	11,934

At September 30, 2017 and December 31, 2016, the Company owned Federal Reserve Bank (FRB) stock reported at cost of $509,000 and $507,000, and Federal Home Loan Bank (FHLB) stock of $559,000 and $545,000, respectively. The investments in FRB stock and FHLB stock are required investments related to the Company’s membership in, and borrowings with, these banks and classified as restricted stock on the consolidated balance sheet. These investments are carried at cost since there is no ready market and redemption has historically been made at par value. The Company estimated the fair value approximated cost and that these investments were not impaired at September 30, 2017.

Results from sales of securities available for sale for the three and nine-month periods ended September 30, 2017 and September 30, 2016 are as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2017			2016		2017			2016
	(dollars in thousands)
Gross proceeds from sales	$	8,918		$	—	$	8,918		$	20,225
Realized gains from sales	$	—		$	2	$	—		$	544
Realized losses from sales		12			—		12			—
Net realized gains	$	(12	)	$	2	$	(12	)	$	544

At September 30, 2017 and December 31, 2016, securities available for sale with a carrying amount of $80.7 million and $74.8 million, respectively, were pledged as collateral on public deposits and for other purposes as required or permitted by law.

The following tables show the gross unrealized losses and fair value of investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2017 and December 31, 2016. These unrealized losses on investment securities are a result of temporary fluctuations in market prices due to a rise in interest rates, which will adjust if rates decline, and in a volatile market and are in no way a reflection of the credit quality of the investments.

-10-

Management does not believe these fluctuations are a reflection of the quality of the investments. At September 30, 2017, the unrealized losses on available for sale securities less than twelve months related toeight government agency bonds, four government sponsored enterprise (GSE) mortgage backed securities, and one state and political bond. The Company had twelve government agency bonds, nine GSE mortgage backed securities, and one corporate bond that had been in a loss position for more than twelve months. At September 30, 2017, the unrealized losses on held to maturity securities related totwo state and political bonds.  At December 31, 2016, the unrealized losses on available for sale securities less than twelve months related to one U.S. Treasury, seventeen government agency bonds, ten GSE mortgage backed securities, one corporate bond and seven state and political subdivision bonds. The Company had six government agency bonds, four GSE mortgage backed securities and one corporate bond that had been in a loss position for more than twelve months. At December 31, 2016, the unrealized losses on held to maturity securities related to one government agency securityand eightstate and political subdivision bonds.

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Gov’t agencies		29,110		235		21,377		384		50,487		619
GSE-Mortgage-backed securities and CMO’s		6,148		40		11,456		231		17,604		271
State and political		1,162		25		10,224		323		11,386		348
Corporate bonds		—		—		806		3		806		3
Total securities available for sale	$	36,420	$	300	$	43,863	$	941	$	80,283	$	1,241

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
State and political		2,033		28		—		—		2,033		28
Total securities held to maturity	$	2,033	$	28	$	—	$	—	$	2,033	$	28

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Treasury	$	4,014	$	3	$	—	$	—	$	4,014	$	3
U.S. Gov’t agencies		48,192		807		4,164		56		52,356		863
GSE-Mortgage-backed securities and CMO’s		16,250		395		5,251		191		21,501		586
State and political		9,994		658		—		—		9,994		658
Corporate bonds		1,999		27		800		11		2,799		38
Total securities available for sale	$	80,449	$	1,890	$	10,215	$	258	$	90,664	$	2,148

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
U.S. Gov’t agencies	$	1,895	$	17	$	—	$	—	$	1,895	$	17
State and political		6,056		60		—		—		6,056		60
Total securities held to maturity	$	7,951	$	77	$	—	$	—	$	7,951	$	77

Declines in the fair value of the investment portfolio are believed by management to be temporary in nature. When evaluating an investment for other-than-temporary impairment, management considers, among other things, the length of time and the extent to which the fair value has been in a loss position, the financial condition of the issuer and the intent and the ability of the Company to hold the investment until the loss position is recovered.

Any unrealized losses were largely due to increases in market interest rates over the yields available at the time of purchase. The fair value is expected to recover as the bonds approach their maturity date or market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of quality but that the losses are temporary in nature. At

-11-

September 30, 2017, the Company does not intend to sell and is not likely to be required to sell the available for sale securities that were in a loss position prior to full recovery.

The aggregate amortized cost and fair value of the available for sale securities portfolio at September 30, 2017 by remaining contractual maturity are as follows:

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Securities available for sale
U.S. Government agencies
Due after one but within five years		36,569		36,238		1.40	%
Due after five but within ten years		15,022		14,799		1.90	%
Due after ten years		5,416		5,375		1.77	%
		57,007		56,412		1.57	%
Mortgage-backed securities
Due after one but within five years		2,662		2,645		2.02	%
Due after five but within ten years		5,875		5,866		2.15	%
Due after ten years		13,815		13,606		1.93	%
		22,352		22,117		2.00	%
State and political subdivisions
Due after one but within five years		1,955		2,000		4.90	%
Due after five but within ten years		2,703		2,657		3.12	%
Due after ten years		9,755		9,455		2.45	%
		14,413		14,112		2.91	%
Corporate Bonds
Due after one but within five years		2,829		2,826		2.15	%
Due after five but within ten years		2,216		2,250		1.50	%
		5,045		5,076		1.86	%
Total Securities available for sale
Due after one but within five years		44,015		43,709		1.64	%
Due after five but within ten years		25,816		25,572		2.05	%
Due after ten years		28,986		28,436		2.07	%
	$	98,817	$	97,717		1.88	%

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Held to maturity
U. S. Government agencies
Due after five but within ten years	$	1,351	$	1,360		2.49	%
		1,351		1,360		2.49	%
State and political subdivisions
Due after one but within five years		3,700		3,710		2.28	%
Due after five but within ten years		3,238		3,263		3.03	%
		6,938		6,973		2.63	%
Corporate Bonds
Due after one but within five years		3,204		3,242		2.76	%
		3,204		3,242		2.76	%
Total Securities held for maturity
Due after one but within five years		6,904		6,952		2.51	%
Due after five but within ten years		4,589		4,623		2.87	%
	$	11,493	$	11,575		2.65	%

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Note 6 – Loans Held for Investment

The composition of net loans held for investment by class as of September 30, 2017 and December 31, 2016 are as follows:

	September 30, 2017			December 31, 2016
	(dollars in thousands)
Commercial
Commercial	$	56,469		$	55,752
Real estate - commercial		116,178			109,752
Other real estate construction loans		32,511			26,718
Noncommercial
Real estate 1-4 family construction		4,360			5,625
Real estate - residential		77,447			81,700
Home equity		49,840			50,815
Consumer loans		10,431			9,711
Other loans		2,703			1,687
		349,939			341,760
Less:
Allowance for loan losses		(2,448	)		(2,707	)
Deferred loan (fees) costs, net		(20	)		69
Loans held for investment, net	$	347,471		$	339,122

Note 7 – Allowance for Loan Losses

The following table shows the change in the allowance for loan losses by loan segment for the three and nine months ended September 30, 2017 and 2016, respectively:

Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,323		$	1,346		$	1,404		$	1,310
Provision (recovery) charged to operations		(34	)		271			(169	)		342
Charge-offs		(6	)		(69	)		(22	)		(131	)
Recoveries		18			12			88			39
Net (charge-offs) / Recoveries		12			(57	)		66			(92	)
Balance at end of period	$	1,301		$	1,560		$	1,301		$	1,560

Non-Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,228		$	1,360		$	1,303		$	1,574
Provision (recovery) charged to operations		(102	)		(31	)		(140	)		(272	)
Charge-offs		(7	)		(118	)		(91	)		(198	)
Recoveries		28			78			75			185
Net (charge-offs) / Recoveries		21			(40	)		(16	)		(13	)
Balance at end of period	$	1,147		$	1,289		$	1,147		$	1,289

-13-

Total	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	2,551		$	2,706		$	2,707		$	2,884
Provision (recovery) charged to operations		(136	)		240			(309	)		70
Charge-offs		(13	)		(187	)		(113	)		(329	)
Recoveries		46			90			163			224
Net (charge-offs) / Recoveries		33			(97	)		50			(105	)
Balance at end of period	$	2,448		$	2,849		$	2,448		$	2,849

The following table shows period-end loans and reserve balances by loan segment both individually and collectively evaluated for impairment at September 30, 2017 and December 31, 2016:

September 30, 2017
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	13	$	1,856	$	1,288	$	203,302	$	1,301	$	205,158
Non-Commercial		154		3,534		993		141,227		1,147		144,761
Total	$	167	$	5,390	$	2,281	$	344,529	$	2,448	$	349,919

December 31, 2016
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	16	$	1,993	$	1,388	$	190,229	$	1,404	$	192,222
Non-Commercial		123		4,096		1,180		145,511		1,303		149,607
Total	$	139	$	6,089	$	2,568	$	335,740	$	2,707	$	341,829

Past due loan information is used by management when assessing the adequacy of the allowance for loan losses. The following table summarizes the past due information of the loan portfolio by class:

September 30, 2017
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	34	$	—	$	34	$	56,435	$	56,469	$	—
Real estate - commercial		114		457		571		116,064		116,178		—
Other real estate construction		—		53		53		32,511		32,511		—
Real estate 1-4 family construction		—		—		—		4,360		4,360		—
Real estate - residential		1,356		190		1,546		76,071		77,427		—
Home equity		171		58		229		49,669		49,840		—
Consumer loans		12		2		14		10,417		10,431		2
Other loans		—		—		—		2,703		2,703		—
Total	$	1,687	$	760	$	2,447	$	348,230	$	349,919	$	2

-14-

December 31, 2016
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due and Non - Accrual		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	—	$	—	$	—	$	55,752	$	55,752	$	—
Real estate - commercial		—		392		392		109,360		109,752		—
Other real estate construction		106		190		296		26,422		26,718		—
Real estate construction		—		—		—		5,625		5,625		—
Real estate - residential		510		846		1,356		80,413		81,769		—
Home equity		66		22		88		50,727		50,815		—
Consumer loan		36		—		36		9,675		9,711		—
Other loans		—		—		—		1,687		1,687		—
Total	$	718	$	1,450	$	2,168	$	339,661	$	341,829	$	—

Once a loan becomes 90 days past due, the loan is automatically transferred to a nonaccrual status. The exception to this policy is credit card loans that remain in accruing status 90 days or more until they are paid current or charged off. Also, mortgage loans that were originated for sale but were not sold and are being held in the loan portfolio remain in an accruing status until they are foreclosed.

The Company had $1.1 million in foreclosed residential real estate and noresidential real estate in the process of foreclosure at September 30, 2017.

The composition of nonaccrual loans by class as of September 30, 2017 and December 31, 2016 is as follows:

	September 30, 2017		December 31, 2016
	(dollars in thousands)
Real estate - commercial		457		392
Other real estate construction		53		190
Real estate – residential		190		846
Home equity		58		22
Consumer loans		2		—
	$	760	$	1,450

Management uses a risk-grading program to facilitate the evaluation of probable inherent loan losses and to measure the adequacy of the allowance for loan losses. In this program, risk grades are initially assigned by the loan officers and reviewed and monitored by the lenders and credit administration. The program has eight risk grades summarized in five categories as follows:

Pass: Loans that are pass grade credits include loans that are fundamentally sound with risk factors that are reasonable and acceptable. They generally conform to policy with only minor exceptions and any major exceptions are clearly mitigated by other economic factors.

Watch: Loans that are watch credits include loans on management’s watch list where a risk concern may be anticipated in the near future.

Substandard: Loans that are considered substandard are loans that are inadequately protected by current sound net worth, paying capacity of the obligor or the value of the collateral pledged. All nonaccrual loans are graded as substandard.

Doubtful: Loans that are considered to be doubtful have all weaknesses inherent in loans classified substandard, plus the added characteristic that the weaknesses make the collection or liquidation in full on the basis of current existing facts, conditions and values highly questionable and improbable.

-15-

Loss: Loans that are considered to be a loss are considered to be uncollectible and of such little value that their continuance as bankable assets is not warranted.

The tables below summarize risk grades of the loan portfolio by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	55,202	$	1,252	$	15	$	—	$	56,469
Real estate - commercial		110,810		3,091		2,277		—		116,178
Other real estate construction		30,382		1,736		393		—		32,511
Real estate 1 - 4 family construction		4,360		—		—		—		4,360
Real estate - residential		69,364		6,839		1,224		—		77,427
Home equity		48,981		800		59		—		49,840
Consumer loans		10,361		69		1		—		10,431
Other loans		2,703		—		—		—		2,703
Total	$	332,163	$	13,787	$	3,969	$	—	$	349,919

December 31, 2016
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	54,906	$	827	$	19	$	—	$	55,752
Real estate - commercial		105,366		1,937		2,449		—		109,752
Other real estate construction		24,312		1,876		530		—		26,718
Real estate 1 - 4 family construction		5,625		—		—		—		5,625
Real estate - residential		71,105		8,551		2,113		—		81,769
Home equity		49,818		973		24		—		50,815
Consumer loans		9,545		163		3		—		9,711
Other loans		1,687		—		—		—		1,687
Total	$	322,364	$	14,327	$	5,138	$	—	$	341,829

Loans that are in nonaccrual status or 90 days past due and still accruing are considered to be nonperforming. At September 30, 2017 there was one loan 90 days past due and still accruing and no loans at December 31, 2016.The following tables show the breakdown between performing and nonperforming loans by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	56,469	$	—	$	56,469
Real estate - commercial		115,721		457		116,178
Other real estate construction		32,458		53		32,511
Real estate 1 – 4 family construction		4,360		—		4,360
Real estate – residential		77,238		190		77,427
Home equity		49,781		58		49,840
Consumer loans		10,429		2		10,431
Other loans		2,703		—		2,703
Total	$	349,159	$	760	$	349,919

-16-

December 31, 2016
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	55,752	$	—	$	55,752
Real estate - commercial		109,360		392		109,752
Other real estate construction		26,528		190		26,718
Real estate 1 – 4 family construction		5,625		—		5,625
Real estate – residential		80,923		846		81,769
Home equity		50,793		22		50,815
Consumer loans		9,711		—		9,711
Other loans		1,687		—		1,687
Total	$	340,379	$	1,450	$	341,829

Loans are considered impaired when, based on current information and events, it is probable the Company will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement. If a loan is deemed impaired, a specific calculation is performed and a specific reserve is allocated, if necessary. The tables below summarize the loans deemed impaired and the amount of specific reserves allocated by class at September 30, 2017 and December 31, 2016.

September 30, 2017
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	11	$	11	$	—	$	—
Real estate - commercial		1,692		1,412		280		9
Other real estate construction		691		53		100		4
Real estate 1 - 4 family construction		1		—		1		—
Real estate - residential		3,413		1,417		1,996		122
Home equity		71		28		42		32
Consumer loans		49		50		—		—
Other loans		—		—		—		—
Total	$	5,928	$	2,971	$	2,419	$	167

December 31, 2016
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	29	$	13	$	16	$	2
Real estate - commercial		1,671		1,552		119		9
Other real estate construction		831		190		103		5
Real estate 1 - 4 family construction		6		—		6		—
Real estate - residential		3,994		2,072		1,922		123
Home equity		35		35		—		—
Consumer loans		61		61		—		—
Other loans		—		—		—		—
Total	$	6,627	$	3,923	$	2,166	$	139

-17-

	Three Months ended September 30, 2017				Three Months ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	11		1	$	31		—
Real estate - commercial		1,661		17		620		9
Other real estate construction		154		1		297		1
Real estate 1- 4 family construction		2		—		9		1
Real estate - residential		3,560		39		4,542		65
Home equity		112		—		46		—
Consumer loans		51		—		71		2
Other loans		—		—		—		—
Total	$	5,551	$	58	$	5,616	$	78

	Nine Months Ended September 30, 2017				Nine Months Ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	20	$	1	$	48	$	1
Real estate - commercial		1,664		46		624		28
Other real estate construction		223		4		299		4
Real estate 1- 4 family construction		4		—		11		1
Real estate - residential		3,777		124		4,522		176
Home equity		74		1		47		1
Consumer loans		55		3		74		5
Other loans		—		—		—		—
Total	$	5,817	$	179	$	5,625	$	216

Note 8 – Troubled Debt Restructures

A modification of a loan constitutes a troubled debt restructuring (“TDR”) when a borrower is experiencing financial difficulty and the modification involves providing a concession to the existing loan contract. The Company offers various types of concessions when modifying loans to troubled borrowers, however, forgiveness of principal is rarely granted. Concessions offered are term extensions, capitalizing accrued interest, reducing interest rates to below current market rates or a combination of any of these. Combinations from time to time may include allowing a customer to be placed on interest-only payments. The presentations below in the “other” category are TDRs with a combination of concessions. At the time of a TDR, additional collateral or a guarantor may be requested.

Loans modified as TDRs are typically already on nonaccrual status and in some cases, partial charge-offs may have already been taken against the outstanding loan balance. The Company classifies TDR loans as impaired loans and evaluates the need for an allowance for loan loss on a loan-by-loan basis. An allowance is based on either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the estimated fair value of the underlying collateral less any selling costs, if the loan is deemed to be collateral dependent.

At September 30, 2017, the Company had $4.7 million in TDRs outstanding, none of which were on a non-accruing basis.

-18-

For the three and nine months ended September 30, 2017 and 2016, the following table presents a breakdown of the types of concessions made by loan class:

	For the Three Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		1		186		186
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		2	$	195	$	193

	For the Three Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		2		226		214
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		2	$	226	$	214

	For the Nine Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		1	$	12	$	11
Real estate - commercial		1		166		163
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		5		661		630
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		8	$	848	$	811

-19-

	For the Nine Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		4		555		482
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		4	$	555	$	482

During the twelve months ended September 30, 2017 and September 30, 2016, there was one TDR for which there was a payment default.

A default on a TDR is defined as being past due 90 days or being out of compliance with the modification agreement. As previously mentioned, the Company considers TDRs to be impaired loans and has $123,000 in the allowance for loan losses as of September 30, 2017, as a direct result of these TDRs. At September 30, 2016, there was $106,000 in the allowance for loan losses related to TDRs.

The following table presents the successes and failures of the types of loan modifications within the previous twelve months as of September 30, 2017 and 2016:

	Paid In Full				Paying as restructured				Converted to nonaccrual				Foreclosure/ Default
	Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments
	(dollars in thousands)
September 30, 2017
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		5		562		8		811		—		—		1		15
Total		5	$	562		8	$	811		—	$	—		1	$	15
September 30, 2016
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		6		433		8		501		—		—		4		59
Total		6	$	433		8	$	501		—	$	—		4	$	59

The Company has not committed to fund any additional disbursements for TDRs.

Note 9 – Commitments and Contingencies

The Company’s subsidiary bank is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, lines of credit and standby letters of credit. These instruments involve elements of credit risk in excess of amounts recognized in the accompanying financial statements.

The Bank’s risk of loss with unfunded loans and lines of credit or standby letters of credit is represented by the contractual amount of these instruments. The Bank uses the same credit policies in making commitments under such instruments as it does for on-

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balance sheet instruments. The amount of collateral obtained, if any, is based on management’s credit evaluation of the borrower. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Credit card commitments are unsecured.

At September 30, 2017, outstanding financial instruments whose contract amounts represented credit risk were approximately:

	(dollars in thousands)
Commitments to extend credit	$	106,808
Credit card commitments		10,419
Standby letters of credit		1,349
Total commitments	$	118,576

In 2016, the Bank entered into a five-year operating lease for commercial property. The term expires on September 30, 2021. The annual cost of the lease is $151,875 with a 2.625% annual adjustor.

During the second quarter of 2017, the Bank entered into a lease that following completion of construction will be ten years and three months.  Construction is expected to be complete no later than first quarter of 2018.

Note 10 – Fair Value Disclosures

Accounting Standards Codification (ASC) 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements, but clarifies and standardizes some divergent practices that have emerged since prior guidance was issued. ASC 820 creates a three-level hierarchy under which individual fair value estimates are to be ranked based on the relative reliability of the inputs used in the valuation.

ASC 820 defines fair value as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, the Company considers the principal or most advantageous market in which those assets or liabilities are sold and considers assumptions that market participants would use when pricing those assets or liabilities. Fair values determined using Level 1 inputs rely on active and observable markets to price identical assets or liabilities. In situations where identical assets and liabilities are not traded in active markets, fair values may be determined based on Level 2 inputs, which exist when observable data exists for similar assets and liabilities. Fair values for assets and liabilities for which identical or similar assets and liabilities are not actively traded in observable markets are based on Level 3 inputs, which are considered to be unobservable.

Among the Company’s assets and liabilities, investment securities available for sale are reported at their fair values on a recurring basis. Certain other assets are adjusted to their fair value on a nonrecurring basis, including other real estate owned, impaired loans, loans held for sale, which are carried at the lower of cost or market; loan servicing rights, where fair value is determined using similar assets with similar characteristics, when available, or based upon discounted cash flows using market-based assumptions; and goodwill, which is periodically tested for impairment. Deposits, short-term borrowings and long-term obligations are not reported at fair value.

Prices for US Treasury securities are readily available in the active markets in which those securities are traded, and the resulting fair values are shown in the “Level 1 input” column. Prices for government agency securities, mortgage-backed securities and for state, county and municipal securities are obtained for similar securities, and the resulting fair values are shown in the “Level 2 input” column. Prices for all other non-marketable investments are determined based on various assumptions that are not observable. The fair values for these investment securities are shown in the “Level 3 input” column. Non-marketable investment securities, which are carried at their purchase price, include those that may only be redeemed by the issuer. The changes in securities between Level 1 and Level 2 were related to the purchase and sale of several securities and not the transfer of securities.

The Company does not record loans at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment by using one of several methods including collateral value, fair value of similar debt or discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the present value of the expected repayments or fair value of collateral exceed the recorded investments in such loans. The Company typically bases the fair value of the collateral on appraised values which the Company considers Level 3 valuations.

Foreclosed assets are adjusted to fair value upon transfer of the loans to other real estate owned. Real estate acquired in settlement of loans is recorded initially at the estimated fair value of the property less estimated selling costs at the date of foreclosure. The initial

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recorded value may be subsequently reduced by additional allowances, which are charged to earnings if the estimated fair value of the property less estimated selling costs declines below the initial recorded value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. The Company typically bases the fair value of the collateral on appraised values which the Company considers Level 3 valuations.

Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate, based on secondary market prices. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. These loans are recorded in Level 2.

The following table provides fair value information for assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Government Agencies		56,412		—		56,412		—
GSE - Mortgage-backed securities and CMO’s		22,117		—		22,117		—
State and political subdivisions		14,112		—		14,112		—
Corporate bonds		5,076		—		5,076		—
Total assets at fair value	$	97,717	$	—	$	97,717	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Treasury	$	4,014	$	4,014	$	—	$	—
US Gov’t		57,671		—		57,671		—
Mortgage-backed securities and CMO’s		25,648		—		25,648		—
State and political subdivisions		13,536		—		13,536		—
Corporate bonds		5,030		—		5,030		—
Total assets at fair value	$	105,899	$	4,014	$	101,885	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis in accordance with U.S. GAAP. These include assets that are measured at the lower of cost or market that were recognized at fair value less cost to sell at the end of the period. Assets measured at fair value on a nonrecurring basis are included in the table below as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,304	$	—	$	—	$	2,304
Other real estate owned		1,827		—		—		1,827
Total assets at fair value	$	4,131	$	—	$	—	$	4,131
Total liabilities at fair value	$	—	$	—	$	—	$	—

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	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,217	$	—	$	—	$	2,217
Other real estate owned		3,130		—		—		3,130
Total assets at fair value	$	5,347	$	—	$	—	$	5,347
Total liabilities at fair value	$	—	$	—	$	—	$	—

Quantitative Information about Level 3 Fair Value Measurements

September 30, 2017
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount Rate	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

December 31, 2016
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount rates	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

At September 30, 2017, impaired loans were being evaluated with discounted expected cash flows and discounted appraisals were being used on collateral dependent loans.

Note 11 – Fair Values of Financial Instruments and Interest Rate Risk

ASC 825, “Disclosures about Fair Value of Financial Instruments,” requires disclosure of the fair value of financial assets and financial liabilities, including those that are not measured and reported at fair value on a recurring basis or non-recurring basis.

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The fair value estimates presented at September 30, 2017 and December 31, 2016 are based on relevant market information and information about the financial instruments. Fair value estimates are intended to represent the price an asset could be sold at or the price at which a liability could be settled. However, given there is no active market or observable market transactions for many of the Company’s financial instruments, the Company has made estimates of many of these fair values which are subjective in nature, involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimated values. The estimated fair values disclosed in the following table do not represent market values of all assets and liabilities of the Company and should not be interpreted to represent the underlying value of the Company. The following table reflects a comparison of carrying amounts and the estimated fair value of the financial instruments as of September 30, 2017 and December 31, 2016:

September 30, 2017
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	92,583		92,583	$	90,093	$	2,490	$	—
Securities available for sale		97,717		97,717		—		97,717		—
Securities held to maturity		11,493		11,575		—		11,575		—
Loans held for investment, net		349,919		354,125		—		—		354,125
Loans held for sale		2,725		2,725		—		2,725		—
Restricted stock		1,068		1,068		1,068		—		—
Accrued interest receivable		1,516		1,516		—		—		1,516
FINANCIAL LIABILITIES
Deposits	$	527,253	$	500,388	$	—	$	500,388	$	—
Short-term borrowings		1,788		1,788		—		1,788		—
Junior subordinated debt		9,534		9,651		—		—		9,651
Accrued interest payable		151		151		—		—		151

December 31, 2016
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	45,968	$	45,995	$	43,478	$	2,517	$	—
Securities available for sale		105,899		105,899		4,014		101,885		—
Securities held to maturity		11,990		11,934		—		11,934		—
Loans held for investment, net		339,122		337,348		—		—		337,348
Loans held for sale		5,823		5,685		—		5,685		—
Restricted stock		1,052		1,052		1,052		—		—
Accrued interest receivable		1,629		1,629		—		—		1,629
FINANCIAL LIABILITIES
Deposits		485,719		447,784		—		447,784		—
Short-term borrowings		2,674		2,674		—		2,674		—
Junior subordinated debt		9,534		9,673		—		—		9,673
Accrued interest payable		151		151		—		—		151

The following methods and assumptions were used by the Company in estimating the fair value of financial instruments:

• Cash and cash equivalents – The carrying amount of cash and cash equivalents approximate their fair values due to the short period of time until their expected realization and are recorded in Level 1 with the exception of time deposits due from banks that are in Level 2.

• Securities available for sale – Securities available for sale are carried at fair value based on quoted and observable market prices and are recorded in Levels 1 and 2. Also see discussion in Note 5.

• Securities held to maturity – Securities held to maturity are carried at amortized cost and are recorded in Level 2.

• Loans – The fair value of loans is estimated based on discounted expected cash flows using the current interest rates at which similar loans would be made and carried in Level 3. Loans held for sale, which represent current mortgage production forward sales not yet delivered, are valued based on secondary market prices. The fair value of loans does not

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consider the lack of liquidity and uncertainty in the market that would affect the valuation. Loans held for sale are recorded in Level 2.

• Restricted stock – It is not practicable to determine fair value of restricted stock which is comprised of Federal Home Loan Bank and Federal Reserve Bank stock due to restrictions placed on its transferability and it is presented at its carrying value and is recorded in Level 1 due to the redemption provisions of the Federal Home Loan Bank and the Federal Reserve Bank.

• Accrued interest receivable and payable – Both accrued interest receivable and payable are recorded in Level 3, as there are not active markets for these.

• Deposits – The fair value of deposits is estimated based on discounted cash flow analyses using offered market rates and is recorded in Level 2. The fair value of deposits does not consider any customer related intangibles.

• Borrowings – The fair value disclosed for short-term borrowings, which are composed of overnight borrowings and debt due within one year approximate the carrying value for such debt and is recorded in Level 2. The estimated fair value for long-term borrowings are estimated based on discounted cash flow analyses using offered market rates. Total borrowings are carried in Level 2. Junior subordinated debt is fair valued based on discounted cash flow analyses and is recorded in Level 3.

At September 30, 2017, the Company’s subsidiary bank had outstanding standby letters of credit and commitments to extend credit. These off-balance sheet financial instruments are generally exercisable at the market rate prevailing at the date the underlying transaction will be completed; therefore, the fair value is the fee the Bank is expected to receive. This amount is deemed immaterial by management. See Note 9.

Note 12 – Recent Accounting Pronouncements

In January 2016, the FASB issued ASU 2016-01, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” The amendments in this ASU address certain aspects of recognition, measurement, presentation and disclosure. The amendments in this ASU (i) require equity investments to be measured at fair value with changes in fair value recognized in net income; (ii) simplify the impairment assessment of equity investments without readily determinable fair value; (iii) require public business entities to use exit prices, rather than entry prices, when measuring fair value of financial instruments for disclosure purposes; (iv) require separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements; (v) eliminate the requirement to disclose the method(s) and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost on the balance sheet; (vi) require separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; and (vii) state that a valuation allowance on deferred tax assets related to available-for-sale securities should be evaluated in combination with other deferred tax assets. The amendments in this ASU are effective for public business entities for fiscal periods beginning after December 15, 2017, including interim periods within those fiscal years. The ASU only permits early adoption of the instrument-specific credit risk provision. The Company currently does not invest in equity securities, therefore the impact from the adoption of this standard is not expected to be material to the financial position or results of operations of the Company, but new disclosures on fair value will be implemented.

In February 2016, the FASB issued ASU 2016-02, “Leases, Topic 842”. This ASU increases the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The key difference between existing standards and this ASU is the requirement for lessees to recognize on their balance sheet all lease contracts with lease terms greater than 12 months, including operating leases. Both a right-of-use asset, representing the right to use the leased asset, and a lease liability, representing the contractual obligation, are required to be recognized on the balance sheet of the lessee at lease commencement. Further, this ASU requires lessees to classify leases as either operating or finance leases, which are substantially similar to the current operating and capital leases classifications. The distinction between these two classifications under the new standard does not relate to balance sheet treatment, but relates to treatment in the statements of income and cash flows. Lessor guidance remains largely unchanged with the exception of how a lessor determines the appropriate lease classification for each lease to better align the lessor guidance with revised lessee classification guidance. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the impact of the new standard, which we anticipate we will adopt during the first quarter of 2019. We currently have one property that we operate under a lease, which would affect both the Consolidated Statements of Income and the Consolidated Balance Sheets.

In March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versusAgent considerations (Reporting Revenue Gross versus Net)”. ASU 2016-08 updates the new revenue standard by clarifying the principal

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versus agent implementation guidance, but does not change the core principle of the new standard. The updates to the principal versus agent guidance:  (i) require an entity to determine whether it is a principal or an agent for each distinct good or service (or a distinct bundle of goods or services) to be provided to the customer; (ii) illustrate how an entity that is a principal might apply the control principle to goods, services, or rights to services, when another party is involved in providing goods or services to a customer and (iii) Clarify that the purpose of certain specific control indicators is to support or assist in the assessment of whether an entity controls a good or service before it is transferred to the customer, provide more specific guidance on how the indicators should be considered, and clarify that their relevance will vary depending on the facts and circumstances.  For public business entities, the effective date and transition requirements for these amendments are the same as the effective date and transition requirements of ASU 2014-09 which is effective for interim and annual periods beginning after December 15, 2017. The amendments can be applied retrospectively to each prior reporting period or retrospectively with the cumulative effect of initially applying this new guidance recognized at the date of initial application.  Our revenue is comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and non-interest income.  ASU 2016-08 and 2014-09 could require us to change how we recognize certain revenue streams within non-interest income, however, we do not expect these changes to have a significant impact on our financial statements.  We continue to evaluate the impact of ASU 2016-08 and 2014-09 on our Company and expect to adopt the standard in the first quarter of 2018 with a cumulative effect adjustment to opening retained earnings, if such adjustment is deemed to be significant.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 requires an entity to utilize a new impairment model known as the current expected credit loss (“CECL”) model to estimate its lifetime “expected credit loss” and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. The CECL model is expected to result in earlier recognition of credit losses. ASU 2016-13 also requires new disclosures for financial assets measured at amortized cost, loans and available-for-sale debt securities. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. Entities will apply the standard’s provisions as a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. We are currently exploring vendor-based options for outsourcing our current model as well as extending our current model to comply with CECL. We continue to assess the potential financial impact to the Company’s financial position.

From time to time, the FASB issues exposure drafts of proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts.

Reclassification

Certain amounts in the 2016 financial statements have been reclassified to conform to the 2017 presentation. These reclassifications do not have an impact on net income or shareholders’ equity.

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

This Quarterly Report on Form 10-Q may contain certain forward-looking statements consisting of estimates with respect to the financial condition, results of operations and business of the Company that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation or regulation; and other economic, competitive, governmental, regulatory, and technological factors affecting the Company’s operations, pricing, products and services. Any use of “we” or “our” in the following discussion refers to the Company on a consolidated basis.

Comparison of Financial Condition at September 30, 2017 and December 31, 2016.

During the nine months ended September 30, 2017, the Company’s total assets increased $43.7 million, from $548.2 million to $591.9 million.

Cash and cash equivalents increased $46.6 million during the nine months ended September 30, 2017. Cash and due from banks decreased $2.6 million, while interest-earning deposits with banks increased $49.2 million. The increase is directly related to the increase in noninterest-bearing deposits.

Investment securities consist of securities available for sale and securities held to maturity. Investment securities decreased $8.7 million to $109.2 million for the nine-month period ended September 30, 2017. At September 30, 2017, the Company had net unrealized losses on securities available for sale of $1.1 million.

Loans held for investment increased from $341.8 million to $349.9 million, an increase of $8.1 million or 2.37%. The Company experienced growth in the commercial, other real estate commercial and construction, and other loan segments during the first nine months of 2017. The other real estate construction segment has the largest increase in the portfolio of 21.7% or $5.8 million. The largest decline is in the residential real estate segment of $4.3 million or 5.2%. Loans held for sale decreased 53.2%, or $3.1 million as many of the loans produced near year-end were not sold on the secondary market until first quarter 2017. The allowance for loan losses was $2.4 million at September 30, 2017, which represented 0.69% of the total loan portfolio compared to $2.7 million or 0.79% at December 31, 2016.

Other changes in consolidated assets are primarily related to bank owned life insurance and other real estate owned. Bank owned life insurance increased $1.6 million due to an additional $1.5 million investment for an executive officer. Other real estate owned decreased $1.5 million. During the nine months ended September 30, 2017, the Company sold thirteen pieces of property totaling $1.8 million. The Company recorded net valuation write-down adjustments of $92,000.

Customer deposits, our primary funding source, experienced a $41.5 million increase during the nine-month period ended September 30, 2017, increasing from $485.7 million to $527.2 million or 8.55%. Demand noninterest bearing checking increased $15.3 million, interest checking and money market accounts increased $22.3 million, savings deposits increased $2.6 million and time deposits greater than $250,000 increased $2.9 million. This increase was offset by declines in other time deposits of $1.7 million.

Total short-term borrowings decreased $886,000 for the first nine months of 2017 due to a payoff of an outstanding line of credit.

Other liabilities increased from $6.6 million at December 31, 2016 to $8.1 million at September 30, 2017, an increase of $1.4 million related to an increase in supplemental executive retirement plans (SERPs) valuation and annual funding, of which there is a corresponding increase in Rabbi Trust assets.  Additionally, reserve balances increased due to timing of payables which is to recognize expenses to be paid within the calendar year.  

At September 30, 2017, total shareholders’ equity was $45.2 million, an increase of $1.6 million from December 31, 2016. Net income for the nine-month period ended September 30, 2017 was $1.8 million. Unrealized gains and losses on investment securities, net of tax, increased by $592,000. The Company also repurchased 72,052 shares of common stock for a total value of $372,000. The Company paid $422,000 in dividends attributed to noncontrolling interest.

Comparison of Results of Operations for the Three Months Ended September 30, 2017 and 2016.

Net Income and Net Income Available to Common Shareholders

Uwharrie Capital Corp reported net income of $588,000 for the three months ended September 30, 2017, as compared to $540,000 for the three months ended September 30, 2016, a increase of $48,000. Net income available to common shareholders was $440,000 or $0.06 per common share at September 30, 2017, compared to $391,000 or $0.06 per common share at September 30, 2016. Net income available to common shareholders is net income less dividends on the aforementioned noncontrolling interest.

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Net Interest Income

As with most financial institutions, the primary component of earnings for our subsidiary bank is net interest income. Net interest income is the difference between interest income, principally from loan and investment securities portfolios, and interest expense, principally on customer deposits and wholesale borrowings. Changes in net interest income result from changes in volume, spread and margin. For this purpose, volume refers to the average dollar level of interest-earning assets and interest-bearing liabilities, spread refers to the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities, and margin refers to net interest income divided by average interest-earning assets. Margin is influenced by the level and relative mix of interest-earning assets and interest-bearing liabilities, as well as by levels of noninterest-bearing liabilities and capital.

Net interest income for the three months ended September 30, 2017 was $4.6 million compared to $4.2 million for the three months ended September 30, 2016, an increase of $393,000. During the third quarter of 2017, the average yield on our interest–earning assets decreased three basis points to 3.72%, while the average rate we paid for our interest-bearing liabilities remained flat at 0.32%. The aforementioned changes resulted in a decrease of two basis points interest rate spread to 3.40% for the third quarter of 2017 compared to 3.42% in 2016. Our net interest margin decreased one basis point to 3.47% in the third quarter of 2017 from 3.48% in the comparable period in 2016. A portion of the Company’s loan portfolio has interest rate floors and caps in place on the loans. This feature has allowed the Company to maintain a stronger interest margin, while there has been a decline in rates; however, this feature could hurt the margin in a rising rate environment.

The following table presents average balance sheets and a net interest income analysis for the three months ended September 30, 2017 and 2016:

Average Balance Sheet and Net Interest Income Analysis

For the Three Months Ended September 30,

(dollars in thousands)
	Average Balance				Income/Expenses				Rate/Yield
	2017		2016		2017		2016		2017			2016
Interest-earning assets:
Taxable securities	$	95,670	$	87,217	$	386	$	324		1.60	%		1.48	%
Nontaxable securities (1)		16,260		19,440		109		125		4.29	%		4.20	%
Short-term investments		76,098		48,799		258		78		1.35	%		0.64	%
Taxable loans		342,246		327,457		4,146		3,929		4.81	%		4.77	%
Non-taxable loans (1)		10,800		15,296		68		96		4.01	%		4.18	%
Total interest-earning assets		541,074		498,209		4,967		4,552		3.72	%		3.75	%
Interest-bearing liabilities:
Interest-bearing deposits		399,205		370,622		192		167		0.19	%		0.18	%
Short-term borrowed funds		1,556		2,183		1		3		0.25	%		0.55	%
Long-term debt		9,534		9,538		138		139		5.74	%		5.80	%
Total interest bearing liabilities		410,295		382,343		331		309		0.32	%		0.32	%
Net interest spread	$	130,779	$	115,866	$	4,636	$	4,243		3.40	%		3.42	%
Net interest margin (1) (% of earning assets)										3.47	%		3.48	%

(1) Yields related to securities and loans exempt from income taxes are stated on a fully tax-equivalent basis, assuming a 34.00% tax rate.

Provision and Allowance for Loan Losses

The provision for loan losses was a recovery of $136,000 for the three months ending September 30, 2017 compared to an expense of $240,000 for the same period in 2016. There were net loan recoveries of $22,000 for the three months ended September 30, 2017, as compared with net loan charge offs of $97,000 during the same period of 2016. Refer to the Asset Quality discussion on page 32 for further information.

Noninterest Income

The Company generates most of its revenue from net interest income; however, diversification of our revenue base is of major importance in our long-term success. Total noninterest income decreased $295,000 for the three-month period ending September 30,

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2017 as compared to the same period in 2016. The primary factor contributing to the overall decrease was a decrease in service fees and commissions from our investment division of $52,000, and a decrease of mortgage loan sales of $321,000 to $2.5 million for the quarter ended September 30, 2017 from $2.8 million for the same period in 2016.

Noninterest Expense

Noninterest expense for the quarter ended September 30, 2017 was $6.2 million compared to $5.8 million for the same period of 2016. The largest component of noninterest expense comes from $250,000 for deconversion costs of our core accounting software. Salaries and employee benefits increased $21,000 for the quarter ending September 30, 2017.  Net occupancy expense remained flat at September 30, 2017. Foreclosed real estate expense has increased $17,000 from $29,000 at September 30, 2016 to $48,000 at September 30, 2017 due to write downs for updated appraisals and contract prices to sell the property.  FDIC insurance has decreased $10,000 from September 30, 2016 to September 30, 2017 due to the decline in troubled assets, as well as the altered deposit insurance calculation that took effect in the first quarter of 2017. The table below reflects the composition of other noninterest expense.  Total loan cost increased $16,000 for the three-month period ended September 30, 2017 compared to the three-month period ended September 30, 2016 due to reduced loan collection, cost of loans in process of foreclosure, and reduced bank paid closing cost expenses.

Other noninterest expense

	Three Months Ended September 30,
	2017		2016
	(dollars in thousands)
Postage	$	45	$	48
Telephone and data lines		43		41
Loan costs (recoveries)		81		65
Shareholder relations expense		47		33
Dues and subscriptions		55		49
Other		258		298
Total	$	529	$	534

Income Tax Expense

The Company had income tax expense of $259,000 for the three months ended September 30, 2017 at an effective tax rate of 30.58% compared to income tax expense of $228,000 with an effective tax rate of 29.69% in the comparable 2016 period. Income taxes computed at the statutory rate are affected primarily by the eligible amount of interest earned on state and municipal securities, tax-free municipal loans and income earned on bank owned life insurance. The effective tax rate increased as we had less interest income from tax-free bonds and loans. 

Comparison of Results of Operations for the Nine Months Ended September 30, 2017 and 2016.

Net Income and Net Income Available to Common Shareholders

Uwharrie Capital Corp reported an increase of $77,000 in net income for the nine months ended September 30, 2017, as compared to the nine months ended September 30, 2016. Net income available to common shareholders was $1.4 million or $0.20 per common share for the nine months ended September 30, 2017, compared to $1.3 million or $0.19 per common share for the nine months ended September 30, 2016. Net income available to common shareholders is net income less dividends on the aforementioned noncontrolling interest.

Net Interest Income

Net interest income for the nine months ended September 30, 2017 was $13.4 million compared to $12.4 million for nine months ending September 30, 2016. During the nine months ending September 30, 2017, the volume of interest-earning assets increased $40 million as the volume of interest-bearing liabilities increased $24 million. The average yield on our interest–earning assets declined seven basis points to 3.73%, while the average rate we paid for our interest-bearing liabilities decreased four basis points to 0.32%. The Company’s assets that are interest rate sensitive adjust at the time the Federal Reserve adjusts interest rates, while interest-bearing time deposits adjust at the time of maturity. The aforementioned changes resulted in a decrease of two basis points in our interest rate spread to 3.42% for the first nine months of 2017, compared to 3.44% for the first nine months of 2016. Our net interest margin was 3.49% and 3.52% for the comparable nine-month periods in 2017 and 2016, respectively. A portion of the Company’s loan portfolio has interest rate floors and caps in place on the loans. This feature has allowed the Company to maintain a stronger interest margin, while there has been a decline in rates; however, this feature could hurt the margin in a rising rate environment.

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The following table presents average balance sheets and a net interest income analysis for the six months ended September 30, 2017 and 2016:

Average Balance Sheet and Net Interest Income Analysis

For the Nine Months Ended September 30,

(dollars in thousands)
	Average Balance				Income/Expenses				Rate/Yield
	2017		2016		2017		2016		2017			2016
Interest-earning assets:
Taxable securities	$	97,694	$	85,149	$	1,185	$	973		1.62	%		1.53	%
Nontaxable securities (1)		16,936		19,291		326		375		4.15	%		4.20	%
Short-term investments		62,181		49,458		520		235		1.12	%		0.63	%
Taxable loans		338,794		316,102		12,135		11,506		4.79	%		4.86	%
Non-taxable loans (1)		10,657		16,405		201		315		4.06	%		4.21	%
Total interest-earning assets		526,262		486,405		14,367		13,404		3.73	%		3.80	%
Interest-bearing liabilities:
Interest-bearing deposits		388,948		363,839		521		563		0.18	%		0.21	%
Short-term borrowed funds		2,267		3,582		14		32		0.83	%		1.19	%
Long-term debt		9,534		9,543		410		412		5.75	%		5.77	%
Total interest bearing liabilities		400,749		376,964		945		1,007		0.32	%		0.36	%
Net interest spread	$	125,513	$	109,441	$	13,422	$	12,397		3.42	%		3.44	%
Net interest margin (1) (% of earning assets)										3.49	%		3.52	%

(1) Yields related to securities and loans exempt from income taxes are stated on a fully tax-equivalent basis, assuming a 34.00% tax rate.

Provision and Allowance for Loan Losses

The Company recovered $309,000 for the nine months ending September 30, 2017 compared to $70,000 provision for the same period in 2016. There were net loan recoveries of $49,000 for the nine months ended September 30, 2017 as compared with net loan charge-offs of $8,000 during the same period of 2016. Refer to the Asset Quality discussion on page 32 for further information.

Noninterest Income

The Company generates most of its revenue from net interest income; however, like all financial institutions, diversification of our earnings base is of major importance in our long-term success. Total noninterest income decreased $756,000 for the nine-month period ending September 30, 2017 as compared to the same period in 2016. Income from mortgage loan sales was $2.5 million for the nine months ended September 30, 2017 compared to $2.8 million for the same period in 2016. Service charges on deposit accounts produced revenue of $874,000 for the nine months ended September 30, 2017, a decrease of $30,000 compared to the same period in 2016. Other service fees and commissions experienced a 1.6% decrease for the comparable nine-month period. This decrease was directly related to brokerage commissions and mortgage loan sales decreasing. September 30, 2017 losses realized on the sale of securities were $14,000 for the first nine months in 2017 compared to gains of $544,000 for the same period in 2016.  

Noninterest Expense

Noninterest expense for the nine months ended September 30, 2017 was $18.2 million compared to $17.8 million for the same period of 2016; an increase of $487,000. Salaries and employee benefits, the largest component of noninterest expense, increased $195,000 for the nine months ending September 30, 2017. Professional fees and services increased $52,000 during the nine months ending September 30, 2017 as compared to the same period in 2016. Data processing fees increased $250,000 for deconversion costs of our core accounting software.  FDIC deposit insurance premiums also declined $90,000 for the comparable periods. Foreclosed real estate expense increased $108,000 for the nine months ending September 30, 2017 compared to the same period in 2016. The driver of this increase was due to write downs to contracts of sale. Other noninterest expense decreased $222,000 for the comparable nine-month periods. The table below reflects the composition of other noninterest expense.  Total loan cost declined $157,000 for the nine-month period September 30, 2017 compared to September 30, 2016 due to reduced loan collection, cost of loans in process of foreclosure, and reduced bank paid closing cost expenses.

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Other noninterest expense

	Nine Months Ended September 30,
	2017		2016
	(in thousands)
Postage	$	142	$	145
Telephone and data lines		124		125
Loan costs		249		406
Shareholder relations expense		110		100
Dues and subscriptions		163		146
Other		924		1,012
Total	$	1,712	$	1,934

Income Tax Expense

The Company had income tax expense of $829,000 for the nine months ended September 30, 2017 resulting in an effective tax rate of 31.10%, compared to income tax expense of $745,000 and an effective rate of 29.74% in the 2016 period.Income taxes computed at the statutory rate are affected primarily by the eligible amount of interest earned on state and municipal securities, tax-free municipal loans and income earned on bank owned life insurance. The effective tax rate increased as we had less interest income from tax-free bonds and loans. 

Asset Quality

The Company’s allowance for loan losses is established through charges to earnings in the form of a provision for loan losses. The allowance is increased by provisions charged to operations and decreased by recoveries of amounts previously charged off and is reduced by recovery of provisions and loans charged off. Management continuously evaluates the adequacy of the allowance for loan losses. In evaluating the adequacy of the allowance, management considers the following: the growth, composition and industry diversification of the portfolio; historical loan loss experience; current delinquency levels; adverse situations that may affect a borrower’s ability to repay; estimated value of any underlying collateral; prevailing economic conditions and other relevant factors. The Company’s credit administration function, through a review process, periodically validates the accuracy of the initial risk grade assessment. In addition, as a given loan’s credit quality improves or deteriorates, the credit administration department has the responsibility to change the borrower’s risk grade accordingly. For loans determined to be impaired, the allowance is based on either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the estimated fair value of the underlying collateral less the selling costs. This evaluation is inherently subjective, as it requires material estimates, including the amounts and timing of future cash flows expected to be received on impaired loans, which may be susceptible to significant change. In addition, regulatory agencies, as an integral part of their examination process, periodically review the allowance for loan losses and may require additions for estimated losses based upon judgments different from those of management.

Management uses a risk-grading program designed to evaluate the credit risk in the loan portfolio. In this program, risk grades are initially assigned by loan officers then reviewed and monitored by credit administration. This process includes the maintenance of an internally classified loan list that is designed to help management assess the overall quality of the loan portfolio and the adequacy of the allowance for loan losses. In establishing the appropriate classification for specific assets, management considers, among other factors, the estimated value of the underlying collateral, the borrower’s ability to repay, the borrower’s payment history and the current delinquent status. Because of this process, certain loans are deemed to be impaired and evaluated as an impaired loan.

The allowance for loan losses represents management’s best estimate of an appropriate amount to provide for probable credit risk inherent in the loan portfolio in the normal course of business. While management believes that it uses the best information available to establish the allowance for loan losses, future adjustments to the allowance may be necessary and results of operations could be adversely affected if circumstances differ from the assumptions used in making the determinations. Furthermore, while management believes it has established the allowance for loan losses in conformity with generally accepted accounting principles, there can be no assurance that banking regulators, in reviewing the Company’s portfolio, will not require an adjustment to the allowance for loan losses. In addition, because future events affecting borrowers and collateral cannot be predicted with certainty, there can be no assurance that the existing allowance for loan losses is adequate or that increases will not be necessary, should the quality of any loans deteriorate because of the factors discussed herein. Any material increase in the allowance for loan losses may adversely affect the Company’s financial condition and results of operations.

At September 30, 2017, the levels of our impaired loans, which includes all loans in nonaccrual status, TDRs and other loans deemed by management to be impaired, were $5.4 million compared to $6.1 million at December 31, 2016, a net decrease of $699,000. Total nonaccrual loans, which are a component of impaired loans, decreased from $1.5 million at December 31, 2016 to $758,000 at

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September 30, 2017. During the first nine months of 2017, four relationships totaling $140,000 were added to impaired loans. The addition was offset by twelve impaired relationships totaling $849,000 being charged off, paid out, and net pay downs of $182,000.

The allowance, expressed as a percentage of gross loans held for investment, decreased ten basis points from 0.79% at December 31, 2016 to 0.69% at September 30, 2017. The collectively evaluated reserve allowance as a percentage of collectively evaluated loans decreased from 0.78% at December 31, 2016 to 0.69% at September 30, 2017. Intuitively, growth in the loan portfolio would indicate an increase in the reserve; however, the overall quality of performing loans in the loan portfolio improved. Additionally, charge-offs have declined $217,000 during the first three quarters compared to the same period of 2016. Recoveries have also decreased $62,000 resulting in an improvement in net charge-offs of $155,000.  The improved charge off position contributed to the decrease in the reserve for loan loss. New loan production has credit metrics that we believe indicate a lower probability of default, thus lowering the expected loss associated with those credits compared to the overall loan portfolio. The combined (current book and new production) loan portfolio is less risky; therefore, as current loans contractually pay down and new production is booked – growing the overall portfolio – the allowance as a percentage of loans, declines, similar to the expected loss of the overall blended portfolio. The individually evaluated allowance as a percentage of individually evaluated loans increased from 2.28% at December 31, 2016 to 3.11% at September 30, 2017 due to an increase of individually evaluated loans that are not sufficiently collateralized, therefore requiring additional allowance. The portion of the Company’s allowance for loan loss model related to general reserves captures the mean loss of individual loans and the rare event of severe loss that can occur within the loan portfolio. Specifically, the Company calculates probable losses on loans by computing a probability of loss and expected loss scenario by FDIC call report codes. Together, these expected components as well as a level of more extreme unexpected losses form the basis of the allowance model. The loans that are impaired and included in the specific reserve are excluded from these calculations.

The Company assesses the probability of losses inherent in the loan portfolio using probability of default data, acquired from a third-party vendor representing a one-year loss horizon for each obligor. The Company updates the data inputs into the model; specifically, the loss given default and the probability of defaults obtained from the vendor annually during the second quarter. The Company updates the credit scores which is one of the components used within the allowance model semi-annually, during the first and third quarters. The probability of default associated with each credit score is the major driver in the overall decrease in the allowance for loan losses, thus reducing the balance of the allowance.

Nonperforming loans, which consist of nonaccrual loans and loans past due 90 days and still accruing, to total loans decreased from 0.42% at December 31, 2016, to 0.22% at September 30, 2017.

Management believes the current level of the allowance for loan losses is appropriate in light of the risk inherent in the loan portfolio.

Other real estate owned decreased $1.7 million during the nine month period ended September 30, 2017. The Company sold fifteen pieces of foreclosed property totaling $1.8 million realizing a loss of $31,000. The Company had seven write-downs of $142,000 which was offset by improved valuations and sales activity of $50,000.  There were two loans foreclosed on during the third quarter with a book value of $113,000.

Troubled debt restructured loans at September 30, 2017 totaled $4.7 million compared to $4.5 million at December 31, 2016 and are included in impaired loans. At September 30, 2017, there were no troubled debt restructured loans in nonaccrual status.

The following table shows the comparison of nonperforming assets at September 30, 2017 to December 31, 2016:

Nonperforming Assets

(dollars in thousands)

	September 30, 2017			December 31, 2016
Nonperforming assets:
Loans past due 90 days or more	$	2		$	—
Nonaccrual loans		758			1,450
Other real estate owned		2,681			4,176
Total nonperforming assets	$	3,441		$	5,626
Allowance for loans losses	$	2,448		$	2,707
Nonperforming loans to total loans		0.22	%		0.42	%
Allowance for loan losses to total loans		0.69	%		0.79	%
Nonperforming assets to total assets		0.58	%		1.03	%
Allowance for loan losses to nonperforming loans		322.96	%		186.69	%

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Liquidity and Capital Resources

The objective of the Company’s liquidity management policy is to ensure the availability of sufficient cash flows to meet all financial commitments and to capitalize on any opportunities for expansion. Liquidity management addresses the ability to meet deposit withdrawals on demand or at contractual maturity, to repay borrowings as they mature and to fund new loans and investments as opportunities arise.

The Company’s primary sources of internally generated funds are principal and interest payments on loans, cash flows generated from operations and cash flow generated by investments. Growth in deposits is typically the primary source of funds for loan growth. The Company and its subsidiary bank have multiple funding sources, in addition to deposits, that can be used to increase liquidity and provide additional financial flexibility. These sources are the subsidiary bank’s established federal funds lines with correspondent banks aggregating $28 million at September 30, 2017, with available credit of $28.0 million; established borrowing relationships with the Federal Home Loan Bank, with available credit of $40.5 million; access to borrowings from the Federal Reserve Bank discount window, with available credit of $30.7 million and the issuance of commercial paper. The Company has also secured long-term debt from other sources. Total debt from these sources aggregated $9.5 million at both September 30, 2017, and December 31, 2016.

Banks and bank holding companies, as regulated institutions, must meet required levels of capital. The Federal Reserve, the primary federal regulator of the Company and its subsidiary bank, has adopted minimum capital regulations or guidelines that categorize components and the level of risk associated with various types of assets.

The Company continues to maintain capital ratios that support its asset growth. Bank regulatory agencies approved regulatory capital guidelines (“Basel III”) aimed at strengthening existing capital requirements for banking organizations. Under the final rules, minimum requirements increase for both the quantity and quality of capital held by the Company. The rules include a common equity Tier 1 capital to risk-weighted assets minimum ratio of 4.50%, an increase in the minimum ratio of Tier 1 capital to risk-weighted assets of 6.00%, require a minimum ratio of total capital to risk-weighted assets of 8.00%, and require a minimum Tier 1 leverage ratio of 5.00%. A  capital conservation buffer, comprised of common equity Tier 1 capital, was also established above the regulatory minimum capital requirements. This capital conservation buffer will be phased in beginning January 1, 2016 at 0.625% of risk-weighted assets and increase each subsequent year by an additional 0.625% until reaching its final level of 2.50% on January 1, 2019. Strict eligibility criteria for regulatory capital instruments were also implemented under the final rules. The final rules also revise the definition and calculation of Tier 1 capital, total capital, and risk-weighted assets.

The phase-in period for the final rules became effective for the Company and its subsidiary bank on January 1, 2015, with full compliance of all the final rules’ requirements phased in over a multi-year schedule, to be fully phased-in by January 1, 2019. As of September 30, 2017, the Company and its subsidiary bank continue to exceed minimum capital standards and remain well-capitalized under the new rules.

As previously discussed, the Company’s subsidiary bank has a net total of $10.6 million in outstanding Fixed Rate Noncumulative Perpetual Preferred Stock. The preferred stock qualifies as Tier 1 capital at the Bank and pays dividends at an annual rate of 5.30%. The net total of $10.6 million is presented as noncontrolling interest at the Company level and qualifies as Tier 1 capital at the Company. At September 30, 2017, the Company had $9.5 million in subordinated debt outstanding that qualifies as Tier 2 capital. The Company has made all interest and dividend payments in a timely manner.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

The Company’s primary market risk is interest rate risk. Interest rate risk is the result of differing maturities or repricing intervals of interest-earning assets and interest-bearing liabilities and the fact that rates on these financial instruments do not change uniformly. These conditions may impact the earnings generated by the Company’s interest earning assets or the cost of its interest-bearing liabilities, thus directly impacting the Company’s overall earnings. The Company’s management actively monitors and manages interest rate risk. One way this is accomplished is through the development of and adherence to the Company’s asset/liability policy. This policy sets forth management’s strategy for matching the risk characteristics of the Company’s interest-earning assets and liabilities so as to mitigate the effect of changes in the rate environment. In management’s opinion, the Company’s market risk profile has not changed significantly since December 31, 2016.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

At the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s principal executive officer and principal financial officer, of

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the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Securities Exchange Act (“Exchange Act”) Rule 13a-15.

Based upon that evaluation, the principal executive officer and principal financial officer concluded that in their opinion, the Company’s disclosure controls and procedures were effective (1) to provide reasonable assurance that information required to be disclosed by the Company in the reports filed or submitted by it under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) to provide reasonable assurance that information required to be disclosed by the Company in such reports is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate to allow for timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

Management of the Company has evaluated, with the participation of the Company’s principal executive officer and principal financial officer, changes in the Company’s internal controls over financial reporting (as defined in Rule 13a -15(f) and 15d – 15(f) of the Exchange Act) during the third quarter of 2017. In connection with such evaluation, the Company has determined that there were no changes in the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. The Company reviews its disclosure controls and procedures, which may include its internal control over financial reporting, on an ongoing basis, and may from time to time make changes aimed at enhancing their effectiveness and to ensuring that the Company’s systems evolve with its business.

Part II. OTHER INFORMATION

Item 1. Legal Proceedings

Neither the Company nor its subsidiaries, nor any of their properties are subject to any material legal proceedings. From time to time, the Company’s subsidiary bank is engaged in ordinary routine litigation incidental to its business.

Item 1A. Risk Factors

Disclosure under this item is not required for smaller reporting companies.

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

The following table sets forth information with respect to shares of common stock repurchased by the Company during the three months ended September 30, 2017.

	(a) Total Number of Shares Purchased		(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Program (1)		(d) Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans
July 1, 2017 Through July 31, 2017		—	$	—		—	$	—
August 1, 2017 Through August 31, 2017		—	$	—		—	$	—
September 1, 2017 Through September 30, 2017		981	$	5.25		—	$	—
Total		981	$	5.25		—	$	—

(1) Trades of the Company’s common stock occur on the OTC Pink market from time to time. The Company also has in place a Stock Repurchase Plan that provides liquidity to its shareholders in the event a willing buyer is not available to purchase shares that are offered for sale. The Company is under no obligation to purchase shares offered; however, it will accommodate such offers as its Stock Repurchase Plan allows.

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

Not applicable

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Item 5. Other Information

None.

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Item 6. Exhibits

The following exhibits are being filed herewith:

Exhibit Number	Description of Exhibit
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	Interactive data files providing financial information from the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2017, in XBRL (eXtensible Business Reporting Language)

-36-

Signatures

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

		UWHARRIE CAPITAL CORP
		(Registrant)
Date:	November 7, 2017	By:	/s/ Roger L. Dick
		Roger L. Dick
		President and Chief Executive Officer
Date:	November 7, 2017	By:	/s/ R. David Beaver, III
		R. David Beaver, III
		Principal Financial Officer

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EX-31.1

Exhibit 31.1

UWHARRIE CAPITAL CORP

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

Pursuant to Rule 13a -14(a)

I, Roger L. Dick, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarterly period ended September 30, 2017 of Uwharrie Capital Corp (the “registrant”);

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

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

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

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

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

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

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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.

Date:	November 7, 2017	/s/ Roger L. Dick
		Roger L. Dick
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

UWHARRIE CAPITAL CORP

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

Pursuant to Rule 13a -14(a)

I, R. David Beaver, III, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarterly period ended September 30, 2017 of Uwharrie Capital Corp the (“registrant”);

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

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

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

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

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

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

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter 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.

Date:	November 7, 2017	/s/ R. David Beaver, III
		R. David Beaver, III
		Principal Financial Officer

EX-32

Exhibit 32

Certification pursuant to 18 U.S.C. 1350 as adopted pursuant

to Section 906 of the Sarbanes-Oxley Act of 2002

The undersigned each hereby certifies that, to his knowledge, (i) the Form 10-Q filed by Uwharrie Capital Corp (the “Issuer”) for the quarter ended September 30, 2017, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in that report fairly presents, in all material respects, the financial condition and results of operations of the Issuer on the dates and for the periods presented therein.

Date:	November 7, 2017	/s/ Roger L. Dick
		Roger L. Dick
		President and Chief Executive Officer
Date:	November 7, 2017	/s/ R. David Beaver, III
		R. David Beaver, III
		Principal Financial Officer

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Nov. 06, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q3
Trading Symbol	UWHR
Entity Registrant Name	UWHARRIE CAPITAL CORP
Entity Central Index Key	0000898171
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		6,979,244

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Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
ASSETS
Cash and due from banks	$ 6,826	$ 9,422
Interest-earning deposits with banks	85,757	36,546
Securities available for sale, at fair value	97,717	105,899
Securities held to maturity, at amortized cost (fair value $11,575 and $11,934, respectively)	11,493	11,990
Loans held for sale	2,725	5,823
Loans:
Loans held for investment	349,919	341,829
Less allowance for loan losses	(2,448)	(2,707)
Net loans held for investment	347,471	339,122
Premises and equipment, net	14,302	14,173
Interest receivable	1,516	1,629
Restricted stock	1,068	1,052
Bank owned life insurance	8,514	6,897
Other real estate owned	2,681	4,176
Prepaid assets	1,000	826
Other assets	10,882	10,675
Total assets	591,952	548,230
Deposits:
Demand noninterest-bearing	118,459	103,138
Interest checking and money market accounts	295,330	272,968
Savings deposits	45,075	42,452
Time deposits, $250,000 and over	10,408	7,472
Other time deposits	57,981	59,689
Total deposits	527,253	485,719
Short-term borrowed funds	1,788	2,674
Junior subordinated debt	9,534	9,534
Interest payable	151	151
Other liabilities	8,066	6,627
Total liabilities	546,792	504,705
Off balance sheet items, commitments and contingencies (Note 9)
SHAREHOLDERS’ EQUITY
Common stock, $1.25 par value: 20,000,000 shares authorized; shares issued and outstanding 6,978,263 and 7,050,315	8,723	8,813
Additional paid-in capital	12,258	12,540
Undivided profits	14,262	12,867
Accumulated other comprehensive loss	(726)	(1,318)
Total Uwharrie Capital Corp shareholders’ equity	34,517	32,902
Noncontrolling interest	10,643	10,623
Total shareholders’ equity	45,160	43,525
Total liabilities and shareholders’ equity	$ 591,952	$ 548,230

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Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Statement Of Financial Position [Abstract]
Securities held for sale, at amortized cost, fair value	$ 11,575	$ 11,934
Common stock, par value	$ 1.25	$ 1.25
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	6,978,263	7,050,315
Common stock, shares outstanding	6,978,263	7,050,315

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Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Interest Income
Loans, including fees	$ 4,214	$ 4,025	$ 12,336	$ 11,820
Investment securities
US Treasury	5	11	28	34
US Government agencies and corporations	369	313	1,122	939
State and political subdivisions	121	125	361	375
Interest-earning deposits with banks and federal funds sold	258	78	520	236
Total interest income	4,967	4,552	14,367	13,404
Interest Expense
Interest checking and money market accounts	113	82	295	229
Savings deposits	12	12	37	35
Time deposits, $250,000 and over	16	14	46	44
Other time deposits	51	59	143	255
Short-term borrowed funds	1	3	14	32
Long-term debt	138	139	410	412
Total interest expense	331	309	945	1,007
Net interest income	4,636	4,243	13,422	12,397
Provision for (recovery of) loan losses	(136)	240	(309)	70
Net interest income after provision for (recovery of) loan losses	4,772	4,003	13,731	12,327
Noninterest Income
Service charges on deposit accounts	299	309	874	904
Other service fees and commissions	1,003	1,055	3,206	3,330
Gain (loss) on sale of securities (includes reclassification of ($14,000), $2,000, ($14,000) and $544,000 from accumulated other comprehensive income)	(12)	2	(12)	544
Gain (loss) on fixed assets and other assets	3	(1)	3	(3)
Income from mortgage loan sales	790	1,111	2,539	2,769
Other income	215	117	567	389
Total noninterest income	2,298	2,593	7,177	7,933
Noninterest Expense
Salaries and employee benefits	3,647	3,626	10,987	10,792
Net occupancy expense	327	327	938	850
Equipment expense	151	159	451	488
Data processing costs	429	161	789	529
Office supplies and printing	27	34	89	117
Foreclosed real estate expense	48	29	312	204
Professional fees and services	223	171	570	541
Marketing and donations	251	224	737	651
Electronic banking expense	317	303	921	884
Software amortization and maintenance	198	174	569	508
FDIC insurance	76	86	167	257
Other noninterest expense	529	534	1,712	1,934
Total noninterest expense	6,223	5,828	18,242	17,755
Income before income taxes	847	768	2,666	2,505
Income taxes (includes reclassification of ($5,000), $1,000, ($5,000) and $210,000 from accumulated other comprehensive income)	259	228	829	745
Net income	588	540	1,837	1,760
Less: net income attributable to noncontrolling interest	(148)	(149)	(442)	(444)
Net income attributable to Uwharrie Capital Corp	440	391	1,395	1,316
Dividends – preferred stock	0	0	0	0
Net income (loss) available to common shareholders	$ 440	$ 391	$ 1,395	$ 1,316
Net income (loss) per common share
Basic	$ 0.06	$ 0.06	$ 0.20	$ 0.19
Diluted	$ 0.06	$ 0.06	$ 0.20	$ 0.19
Weighted average shares outstanding
Basic	6,979,137	7,095,112	7,008,240	7,111,733
Diluted	6,979,985	7,095,112	7,008,845	7,111,733

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Consolidated Statements of Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Income Statement [Abstract]
Reclassification from accumulated other comprehensive income	$ (14)	$ 2	$ (14)	$ 544
Tax effect on amount reclassified from accumulated other comprehensive income	$ (5)	$ 1	$ (5)	$ 210

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Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Statement Of Income And Comprehensive Income [Abstract]
Net Income	$ 588	$ 540	$ 1,837	$ 1,760
Unrealized gain on available for sale securities	40	(268)	884	1,165
Related tax effect	(14)	90	(301)	(422)
Reclassification of (gain) losses recognized in net income	14	(2)	14	(544)
Related tax effect	(5)	1	(5)	210
Total other comprehensive income	35	(179)	592	409
Comprehensive income	623	361	2,429	2,169
Less: Comprehensive income attributable to noncontrolling interest	(148)	(149)	(442)	(444)
Comprehensive income attributable to Uwharrie Capital Corp	$ 475	$ 212	$ 1,987	$ 1,725

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Consolidated Statement of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Number of Common Shares Issued [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Undivided Profits [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Noncontrolling Interest [Member]
Net Income	$ 1,760
Other comprehensive income	409
Net Income	540
Other comprehensive income	(179)
Beginning balance at Dec. 31, 2016	43,525		$ 8,813	$ 12,540	$ 12,867	$ (1,318)	$ 10,623
Beginning balance, shares at Dec. 31, 2016		7,050,315
Net Income	1,837				1,395		442
Repurchase of common stock	(372)		(90)	(282)
Repurchase of common stock, shares		(72,052)
Other comprehensive income	592					592
Record preferred stock dividend Series B (noncontrolling interest)	(311)						(311)
Record preferred stock dividend Series C (noncontrolling interest)	(111)						(111)
Ending balance at Sep. 30, 2017	45,160		8,723	12,258	14,262	(726)	10,643
Ending balance, shares at Sep. 30, 2017		6,978,263
Net Income	588
Other comprehensive income	35
Ending balance at Sep. 30, 2017	$ 45,160		$ 8,723	$ 12,258	$ 14,262	$ (726)	$ 10,643
Ending balance, shares at Sep. 30, 2017		6,978,263

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Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Cash flows from operating activities
Net Income	$ 1,837	$ 1,760
Adjustments to reconcile net income to net cash Provided (used) by operating activities:
Depreciation and amortization	636	615
Provision/ (recovery) of loan losses	(309)	70
(Gain) loss on sale of securities available for sale	12	(544)
(Gain) loss on sale of OREO	31	(20)
Net amortization of premium on investment securities AFS	665	745
Net amortization of premium on investment securities HTM	112	103
Net amortization of mortgage servicing rights	557	756
OREO write downs	92	15
Net change in:
Originations and purchases of mortgage loans for sale	(70,968)	(82,825)
Proceeds from sales of mortgage loans for sale	73,509	85,453
Accrued interest receivable	113	44
Prepaid assets	(174)	(490)
Cash surrender value of life insurance	(92)	(98)
Miscellaneous other assets	(493)	(231)
Accrued interest payable		(18)
Miscellaneous other liabilities	1,439	1,202
Net cash provided by operating activities	6,967	6,537
Cash flows from investing activities
Proceeds from sales of investment securities available for sale	8,918	23,095
Proceeds from maturities, calls & paydowns of investment securities held to maturity	385	143
Proceeds from maturities, calls & paydowns of investment securities available for sale	5,823	5,668
Purchase of investment securities held to maturity		(1,027)
Purchase of investment securities available for sale	(6,338)	(39,597)
Purchase of life insurance investment	(1,525)
Net change in restricted stock	(16)	(12)
Net increase in loans	(8,401)	(24,515)
Proceeds from sales of premises, equipment, and other assets		150
Purchase of premises and equipment	(765)	(324)
Proceeds from sale of OREO	1,733	880
Net cash used by investing activities	(186)	(35,539)
Cash flows from financing activities
Net increase in deposit accounts	41,534	21,322
Net decrease in federal funds purchased and other short-term borrowings	(380)	(3,972)
Repayment of other borrowings	(506)	(10)
Common stock repurchases	(372)	(260)
Dividends paid on preferred stock	(442)	(424)
Net cash provided by financing activities	39,834	16,656
Increase (decrease) in cash and cash equivalents	46,615	(12,346)
Cash and cash equivalents, beginning of period	45,968	68,933
Cash and cash equivalents, end of period	92,583	56,587
Supplemental Disclosures of Cash Flow Information
Interest paid	946	1,025
Income taxes paid	660	252
Supplemental Schedule of Non-Cash Activities
Net change in fair value securities available for sale, net of tax	592	410
Loans transferred to foreclosed real estate	361	315
Mortgage servicing rights capitalized	$ 451	$ 756

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Basis of Presentation

9 Months Ended

Sep. 30, 2017

Organization Consolidation And Presentation Of Financial Statements Abstract

Basis of Presentation

Note 1 – Basis of Presentation

The financial statements and accompanying notes are presented on a consolidated basis including Uwharrie Capital Corp (the “Company”) and its subsidiaries, Uwharrie Bank (the “Bank”), Uwharrie Investment Advisors, Inc. (“UIA”), and Uwharrie Mortgage, Inc. The Bank consolidates its subsidiaries, the Strategic Alliance Corporation, BOS Agency, Inc. and Gateway Mortgage, Inc., each of which is wholly owned by the Bank.

The information contained in the consolidated financial statements is unaudited. In the opinion of management, the consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and material adjustments necessary for a fair presentation of results of interim periods, all of which are of a normal recurring nature, have been made. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for an entire year. Management is not aware of economic events, outside influences or changes in concentrations of business that would require additional clarification or disclosure in the consolidated financial statements.

The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to consolidated financial statements filed as part of the Company’s 2016 Annual Report on Form 10-K. This Quarterly Report should be read in conjunction with such Annual Report.

Use of Estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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.

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Comprehensive Income

9 Months Ended

Sep. 30, 2017

Equity [Abstract]

Comprehensive Income

Note 2 – Comprehensive Income

The Company reports as comprehensive income all changes in shareholders’ equity during the year from sources other than shareholders. Other comprehensive income refers to all components (revenues, expenses, gains, and losses) of comprehensive income that are excluded from net income. The Company’s only component of other comprehensive income is unrealized gains and losses, net of income tax, on investment securities available for sale.

The following table presents the changes in accumulated other comprehensive income for the three and nine months ended September 30, 2017 and 2016:

	Unrealized holding gains on available-for-sale securities (net)
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Beginning Balance	$	(761	)	$	376		$	(1,318	)	$	(212	)
Other Comprehensive income (loss) before reclassifications,    net of ($14,000), $90,000, ($301,000) and ($422,000) tax    effect, respectively		26			(178	)		583			743
Amounts reclassified from accumulated other    comprehensive income, net of ($5,000), $1,000, ($5,000)    and $210,000 tax effect		9			(1	)		9			(334	)
Net current-period other comprehensive income (loss)		35			(179	)		592			409
Ending Balance	$	(726	)	$	197		$	(726	)	$	197

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Noncontrolling Interest

9 Months Ended

Sep. 30, 2017

Noncontrolling Interest [Abstract]

Noncontrolling Interest

Note 3 – Noncontrolling Interest

In January 2013, the Company’s subsidiary banks issued a total of $7.9 million of Fixed Rate Noncumulative Perpetual Preferred Stock, Series B. The preferred stock qualified as Tier 1 capital at each bank and pays dividends at an annual rate of 5.30%. The preferred stock has no voting rights. This capital is presented as a noncontrolling interest in the consolidated balance sheets. Dividends declared on this preferred stock are presented as earnings allocated to the noncontrolling interest in the consolidated statements of income. Effective September 1, 2013, the Fixed Rate Noncumulative Perpetual Preferred Stock, Series B was rolled into one issue under Uwharrie Bank in connection with the consolidation and name change of the Company’s subsidiary banks.

During 2013, the Company’s subsidiary bank, Uwharrie Bank, raised $2.8 million of Fixed Rate Noncumulative Perpetual Preferred Stock, Series C. The preferred stock qualifies as Tier 1 capital at the bank and pays dividends at an annual rate of 5.30%. The preferred stock has no voting rights.

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Per Share Data

9 Months Ended

Sep. 30, 2017

Earnings Per Share [Abstract]

Per Share Data

Note 4 – Per Share Data

Basic and diluted net income per common share is computed based on the weighted average number of shares outstanding during each period after retroactively adjusting for stock dividends. Diluted net income per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the net income of the Company. The Company had stock options outstanding covering 13,116 shares of common stock at both September 30, 2017 and December 31, 2016. All of these options were dilutive because the strike price was lower than the market price.

Basic and diluted net income per common share have been computed based upon net income available to common shareholders as presented in the accompanying consolidated statements of income divided by the weighted average number of common shares outstanding or assumed to be outstanding.

The computation of basic and diluted earnings per share is summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2017		2016		2017		2016
Weighted average number of common shares outstanding		6,979,137		7,095,112		7,008,240		7,111,733
Effect of dilutive stock options		848		—		605		—
Weighted average number of common shares and dilutive    potential common shares used in computing diluted net    income per common share		6,979,985		7,095,112		7,008,845		7,111,733

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Investment Securities

9 Months Ended

Sep. 30, 2017

Investments Debt And Equity Securities [Abstract]

Investment Securities

Note 5 – Investment Securities

Carrying amounts and fair values of securities available for sale and held to maturity are summarized below:

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	—	$	—	$	—	$	—
U.S. Government agencies		57,007		24		619		56,412
GSE - Mortgage-backed securities and CMO’s		22,352		36		271		22,117
State and political subdivisions		14,413		47		348		14,112
Corporate bonds		5,045		34		3		5,076
Total securities available for sale	$	98,817	$	141	$	1,241	$	97,717

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,351	$	9	$	—	$	1,360
State and political subdivisions		6,938		63		28		6,973
Corporate bonds		3,204		38		—		3,242
Total securities held to maturity	$	11,493	$	110	$	28	$	11,575

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	4,017	$	—	$	3	$	4,014
U.S. Government agencies		58,506		28		863		57,671
GSE - Mortgage-backed securities and CMO’s		26,195		39		586		25,648
State and political subdivisions		14,123		71		658		13,536
Corporate bonds		5,054		14		38		5,030
Total securities available for sale	$	107,895	$	152	$	2,148	$	105,899

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,754	$	—	$	17	$	1,737
State and political subdivisions		6,974		7		60		6,921
Corporate bonds		3,262		14		—		3,276
Total securities held to maturity	$	11,990	$	21	$	77	$	11,934

At September 30, 2017 and December 31, 2016, the Company owned Federal Reserve Bank (FRB) stock reported at cost of $509,000 and $507,000, and Federal Home Loan Bank (FHLB) stock of $559,000 and $545,000, respectively. The investments in FRB stock and FHLB stock are required investments related to the Company’s membership in, and borrowings with, these banks and classified as restricted stock on the consolidated balance sheet. These investments are carried at cost since there is no ready market and redemption has historically been made at par value. The Company estimated the fair value approximated cost and that these investments were not impaired at September 30, 2017.

Results from sales of securities available for sale for the three and nine-month periods ended September 30, 2017 and September 30, 2016 are as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2017			2016		2017			2016
	(dollars in thousands)
Gross proceeds from sales	$	8,918		$	—	$	8,918		$	20,225
Realized gains from sales	$	—		$	2	$	—		$	544
Realized losses from sales		12			—		12			—
Net realized gains	$	(12	)	$	2	$	(12	)	$	544

At September 30, 2017 and December 31, 2016, securities available for sale with a carrying amount of $80.7 million and $74.8 million, respectively, were pledged as collateral on public deposits and for other purposes as required or permitted by law.

The following tables show the gross unrealized losses and fair value of investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2017 and December 31, 2016. These unrealized losses on investment securities are a result of temporary fluctuations in market prices due to a rise in interest rates, which will adjust if rates decline, and in a volatile market and are in no way a reflection of the credit quality of the investments. Management does not believe these fluctuations are a reflection of the quality of the investments. At September 30, 2017, the unrealized losses on available for sale securities less than twelve months related toeight government agency bonds, four government sponsored enterprise (GSE) mortgage backed securities, and one state and political bond. The Company had twelve government agency bonds, nine GSE mortgage backed securities, and one corporate bond that had been in a loss position for more than twelve months. At September 30, 2017, the unrealized losses on held to maturity securities related to two state and political bonds.  At December 31, 2016, the unrealized losses on available for sale securities less than twelve months related to one U.S. Treasury, seventeen government agency bonds, ten GSE mortgage backed securities, one corporate bond and seven state and political subdivision bonds. The Company had six government agency bonds, four GSE mortgage backed securities and one corporate bond that had been in a loss position for more than twelve months. At December 31, 2016, the unrealized losses on held to maturity securities related to one government agency securityand eight state and political subdivision bonds.

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Gov’t agencies		29,110		235		21,377		384		50,487		619
GSE-Mortgage-backed securities and CMO’s		6,148		40		11,456		231		17,604		271
State and political		1,162		25		10,224		323		11,386		348
Corporate bonds		—		—		806		3		806		3
Total securities available for sale	$	36,420	$	300	$	43,863	$	941	$	80,283	$	1,241

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
State and political		2,033		28		—		—		2,033		28
Total securities held to maturity	$	2,033	$	28	$	—	$	—	$	2,033	$	28

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Treasury	$	4,014	$	3	$	—	$	—	$	4,014	$	3
U.S. Gov’t agencies		48,192		807		4,164		56		52,356		863
GSE-Mortgage-backed securities and CMO’s		16,250		395		5,251		191		21,501		586
State and political		9,994		658		—		—		9,994		658
Corporate bonds		1,999		27		800		11		2,799		38
Total securities available for sale	$	80,449	$	1,890	$	10,215	$	258	$	90,664	$	2,148

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
U.S. Gov’t agencies	$	1,895	$	17	$	—	$	—	$	1,895	$	17
State and political		6,056		60		—		—		6,056		60
Total securities held to maturity	$	7,951	$	77	$	—	$	—	$	7,951	$	77

Declines in the fair value of the investment portfolio are believed by management to be temporary in nature. When evaluating an investment for other-than-temporary impairment, management considers, among other things, the length of time and the extent to which the fair value has been in a loss position, the financial condition of the issuer and the intent and the ability of the Company to hold the investment until the loss position is recovered.

Any unrealized losses were largely due to increases in market interest rates over the yields available at the time of purchase. The fair value is expected to recover as the bonds approach their maturity date or market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of quality but that the losses are temporary in nature. At September 30, 2017, the Company does not intend to sell and is not likely to be required to sell the available for sale securities that were in a loss position prior to full recovery.

The aggregate amortized cost and fair value of the available for sale securities portfolio at September 30, 2017 by remaining contractual maturity are as follows:

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Securities available for sale
U.S. Government agencies
Due after one but within five years		36,569		36,238		1.40	%
Due after five but within ten years		15,022		14,799		1.90	%
Due after ten years		5,416		5,375		1.77	%
		57,007		56,412		1.57	%
Mortgage-backed securities
Due after one but within five years		2,662		2,645		2.02	%
Due after five but within ten years		5,875		5,866		2.15	%
Due after ten years		13,815		13,606		1.93	%
		22,352		22,117		2.00	%
State and political subdivisions
Due after one but within five years		1,955		2,000		4.90	%
Due after five but within ten years		2,703		2,657		3.12	%
Due after ten years		9,755		9,455		2.45	%
		14,413		14,112		2.91	%
Corporate Bonds
Due after one but within five years		2,829		2,826		2.15	%
Due after five but within ten years		2,216		2,250		1.50	%
		5,045		5,076		1.86	%
Total Securities available for sale
Due after one but within five years		44,015		43,709		1.64	%
Due after five but within ten years		25,816		25,572		2.05	%
Due after ten years		28,986		28,436		2.07	%
	$	98,817	$	97,717		1.88	%

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Held to maturity
U. S. Government agencies
Due after five but within ten years	$	1,351	$	1,360		2.49	%
		1,351		1,360		2.49	%
State and political subdivisions
Due after one but within five years		3,700		3,710		2.28	%
Due after five but within ten years		3,238		3,263		3.03	%
		6,938		6,973		2.63	%
Corporate Bonds
Due after one but within five years		3,204		3,242		2.76	%
		3,204		3,242		2.76	%
Total Securities held for maturity
Due after one but within five years		6,904		6,952		2.51	%
Due after five but within ten years		4,589		4,623		2.87	%
	$	11,493	$	11,575		2.65	%

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Loans Held for Investment

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Loans Held for Investment

Note 6 – Loans Held for Investment

The composition of net loans held for investment by class as of September 30, 2017 and December 31, 2016 are as follows:

	September 30, 2017			December 31, 2016
	(dollars in thousands)
Commercial
Commercial	$	56,469		$	55,752
Real estate - commercial		116,178			109,752
Other real estate construction loans		32,511			26,718
Noncommercial
Real estate 1-4 family construction		4,360			5,625
Real estate - residential		77,447			81,700
Home equity		49,840			50,815
Consumer loans		10,431			9,711
Other loans		2,703			1,687
		349,939			341,760
Less:
Allowance for loan losses		(2,448	)		(2,707	)
Deferred loan (fees) costs, net		(20	)		69
Loans held for investment, net	$	347,471		$	339,122

XML

Allowance for Loan Losses

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Allowance for Loan Losses

Note 7 – Allowance for Loan Losses

The following table shows the change in the allowance for loan losses by loan segment for the three and nine months ended September 30, 2017 and 2016, respectively:

Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,323		$	1,346		$	1,404		$	1,310
Provision (recovery) charged to operations		(34	)		271			(169	)		342
Charge-offs		(6	)		(69	)		(22	)		(131	)
Recoveries		18			12			88			39
Net (charge-offs) / Recoveries		12			(57	)		66			(92	)
Balance at end of period	$	1,301		$	1,560		$	1,301		$	1,560

Non-Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,228		$	1,360		$	1,303		$	1,574
Provision (recovery) charged to operations		(102	)		(31	)		(140	)		(272	)
Charge-offs		(7	)		(118	)		(91	)		(198	)
Recoveries		28			78			75			185
Net (charge-offs) / Recoveries		21			(40	)		(16	)		(13	)
Balance at end of period	$	1,147		$	1,289		$	1,147		$	1,289

Total	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	2,551		$	2,706		$	2,707		$	2,884
Provision (recovery) charged to operations		(136	)		240			(309	)		70
Charge-offs		(13	)		(187	)		(113	)		(329	)
Recoveries		46			90			163			224
Net (charge-offs) / Recoveries		33			(97	)		50			(105	)
Balance at end of period	$	2,448		$	2,849		$	2,448		$	2,849

The following table shows period-end loans and reserve balances by loan segment both individually and collectively evaluated for impairment at September 30, 2017 and December 31, 2016:

September 30, 2017
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	13	$	1,856	$	1,288	$	203,302	$	1,301	$	205,158
Non-Commercial		154		3,534		993		141,227		1,147		144,761
Total	$	167	$	5,390	$	2,281	$	344,529	$	2,448	$	349,919

December 31, 2016
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	16	$	1,993	$	1,388	$	190,229	$	1,404	$	192,222
Non-Commercial		123		4,096		1,180		145,511		1,303		149,607
Total	$	139	$	6,089	$	2,568	$	335,740	$	2,707	$	341,829

Past due loan information is used by management when assessing the adequacy of the allowance for loan losses. The following table summarizes the past due information of the loan portfolio by class:

September 30, 2017
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	34	$	—	$	34	$	56,435	$	56,469	$	—
Real estate - commercial		114		457		571		116,064		116,178		—
Other real estate construction		—		53		53		32,511		32,511		—
Real estate 1-4 family construction		—		—		—		4,360		4,360		—
Real estate - residential		1,356		190		1,546		76,071		77,427		—
Home equity		171		58		229		49,669		49,840		—
Consumer loans		12		2		14		10,417		10,431		2
Other loans		—		—		—		2,703		2,703		—
Total	$	1,687	$	760	$	2,447	$	348,230	$	349,919	$	2

December 31, 2016
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due and Non - Accrual		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	—	$	—	$	—	$	55,752	$	55,752	$	—
Real estate - commercial		—		392		392		109,360		109,752		—
Other real estate construction		106		190		296		26,422		26,718		—
Real estate construction		—		—		—		5,625		5,625		—
Real estate - residential		510		846		1,356		80,413		81,769		—
Home equity		66		22		88		50,727		50,815		—
Consumer loan		36		—		36		9,675		9,711		—
Other loans		—		—		—		1,687		1,687		—
Total	$	718	$	1,450	$	2,168	$	339,661	$	341,829	$	—

Once a loan becomes 90 days past due, the loan is automatically transferred to a nonaccrual status. The exception to this policy is credit card loans that remain in accruing status 90 days or more until they are paid current or charged off. Also, mortgage loans that were originated for sale but were not sold and are being held in the loan portfolio remain in an accruing status until they are foreclosed.

The Company had $1.1 million in foreclosed residential real estate and noresidential real estate in the process of foreclosure at September 30, 2017.

The composition of nonaccrual loans by class as of September 30, 2017 and December 31, 2016 is as follows:

	September 30, 2017		December 31, 2016
	(dollars in thousands)
Real estate - commercial		457		392
Other real estate construction		53		190
Real estate – residential		190		846
Home equity		58		22
Consumer loans		2		—
	$	760	$	1,450

Management uses a risk-grading program to facilitate the evaluation of probable inherent loan losses and to measure the adequacy of the allowance for loan losses. In this program, risk grades are initially assigned by the loan officers and reviewed and monitored by the lenders and credit administration. The program has eight risk grades summarized in five categories as follows:

Pass: Loans that are pass grade credits include loans that are fundamentally sound with risk factors that are reasonable and acceptable. They generally conform to policy with only minor exceptions and any major exceptions are clearly mitigated by other economic factors.

Watch: Loans that are watch credits include loans on management’s watch list where a risk concern may be anticipated in the near future.

Substandard: Loans that are considered substandard are loans that are inadequately protected by current sound net worth, paying capacity of the obligor or the value of the collateral pledged. All nonaccrual loans are graded as substandard.

Doubtful: Loans that are considered to be doubtful have all weaknesses inherent in loans classified substandard, plus the added characteristic that the weaknesses make the collection or liquidation in full on the basis of current existing facts, conditions and values highly questionable and improbable.

Loss: Loans that are considered to be a loss are considered to be uncollectible and of such little value that their continuance as bankable assets is not warranted.

The tables below summarize risk grades of the loan portfolio by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	55,202	$	1,252	$	15	$	—	$	56,469
Real estate - commercial		110,810		3,091		2,277		—		116,178
Other real estate construction		30,382		1,736		393		—		32,511
Real estate 1 - 4 family construction		4,360		—		—		—		4,360
Real estate - residential		69,364		6,839		1,224		—		77,427
Home equity		48,981		800		59		—		49,840
Consumer loans		10,361		69		1		—		10,431
Other loans		2,703		—		—		—		2,703
Total	$	332,163	$	13,787	$	3,969	$	—	$	349,919

December 31, 2016
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	54,906	$	827	$	19	$	—	$	55,752
Real estate - commercial		105,366		1,937		2,449		—		109,752
Other real estate construction		24,312		1,876		530		—		26,718
Real estate 1 - 4 family construction		5,625		—		—		—		5,625
Real estate - residential		71,105		8,551		2,113		—		81,769
Home equity		49,818		973		24		—		50,815
Consumer loans		9,545		163		3		—		9,711
Other loans		1,687		—		—		—		1,687
Total	$	322,364	$	14,327	$	5,138	$	—	$	341,829

Loans that are in nonaccrual status or 90 days past due and still accruing are considered to be nonperforming. At September 30, 2017 there was one loan 90 days past due and still accruing and no loans at December 31, 2016.The following tables show the breakdown between performing and nonperforming loans by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	56,469	$	—	$	56,469
Real estate - commercial		115,721		457		116,178
Other real estate construction		32,458		53		32,511
Real estate 1 – 4 family construction		4,360		—		4,360
Real estate – residential		77,238		190		77,427
Home equity		49,781		58		49,840
Consumer loans		10,429		2		10,431
Other loans		2,703		—		2,703
Total	$	349,159	$	760	$	349,919

December 31, 2016
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	55,752	$	—	$	55,752
Real estate - commercial		109,360		392		109,752
Other real estate construction		26,528		190		26,718
Real estate 1 – 4 family construction		5,625		—		5,625
Real estate – residential		80,923		846		81,769
Home equity		50,793		22		50,815
Consumer loans		9,711		—		9,711
Other loans		1,687		—		1,687
Total	$	340,379	$	1,450	$	341,829

Loans are considered impaired when, based on current information and events, it is probable the Company will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement. If a loan is deemed impaired, a specific calculation is performed and a specific reserve is allocated, if necessary. The tables below summarize the loans deemed impaired and the amount of specific reserves allocated by class at September 30, 2017 and December 31, 2016.

September 30, 2017
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	11	$	11	$	—	$	—
Real estate - commercial		1,692		1,412		280		9
Other real estate construction		691		53		100		4
Real estate 1 - 4 family construction		1		—		1		—
Real estate - residential		3,413		1,417		1,996		122
Home equity		71		28		42		32
Consumer loans		49		50		—		—
Other loans		—		—		—		—
Total	$	5,928	$	2,971	$	2,419	$	167

December 31, 2016
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	29	$	13	$	16	$	2
Real estate - commercial		1,671		1,552		119		9
Other real estate construction		831		190		103		5
Real estate 1 - 4 family construction		6		—		6		—
Real estate - residential		3,994		2,072		1,922		123
Home equity		35		35		—		—
Consumer loans		61		61		—		—
Other loans		—		—		—		—
Total	$	6,627	$	3,923	$	2,166	$	139

	Three Months ended September 30, 2017				Three Months ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	11		1	$	31		—
Real estate - commercial		1,661		17		620		9
Other real estate construction		154		1		297		1
Real estate 1- 4 family construction		2		—		9		1
Real estate - residential		3,560		39		4,542		65
Home equity		112		—		46		—
Consumer loans		51		—		71		2
Other loans		—		—		—		—
Total	$	5,551	$	58	$	5,616	$	78

	Nine Months Ended September 30, 2017				Nine Months Ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	20	$	1	$	48	$	1
Real estate - commercial		1,664		46		624		28
Other real estate construction		223		4		299		4
Real estate 1- 4 family construction		4		—		11		1
Real estate - residential		3,777		124		4,522		176
Home equity		74		1		47		1
Consumer loans		55		3		74		5
Other loans		—		—		—		—
Total	$	5,817	$	179	$	5,625	$	216

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Troubled Debt Restructures

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Troubled Debt Restructures

Note 8 – Troubled Debt Restructures

A modification of a loan constitutes a troubled debt restructuring (“TDR”) when a borrower is experiencing financial difficulty and the modification involves providing a concession to the existing loan contract. The Company offers various types of concessions when modifying loans to troubled borrowers, however, forgiveness of principal is rarely granted. Concessions offered are term extensions, capitalizing accrued interest, reducing interest rates to below current market rates or a combination of any of these. Combinations from time to time may include allowing a customer to be placed on interest-only payments. The presentations below in the “other” category are TDRs with a combination of concessions. At the time of a TDR, additional collateral or a guarantor may be requested.

Loans modified as TDRs are typically already on nonaccrual status and in some cases, partial charge-offs may have already been taken against the outstanding loan balance. The Company classifies TDR loans as impaired loans and evaluates the need for an allowance for loan loss on a loan-by-loan basis. An allowance is based on either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price or the estimated fair value of the underlying collateral less any selling costs, if the loan is deemed to be collateral dependent.

At September 30, 2017, the Company had $4.7 million in TDRs outstanding, none of which were on a non-accruing basis.

For the three and nine months ended September 30, 2017 and 2016, the following table presents a breakdown of the types of concessions made by loan class:

	For the Three Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		1		186		186
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		2	$	195	$	193

	For the Three Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		2		226		214
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		2	$	226	$	214

	For the Nine Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		1	$	12	$	11
Real estate - commercial		1		166		163
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		5		661		630
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		8	$	848	$	811

	For the Nine Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		4		555		482
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		4	$	555	$	482

During the twelve months ended September 30, 2017 and September 30, 2016, there was one TDR for which there was a payment default.

A default on a TDR is defined as being past due 90 days or being out of compliance with the modification agreement. As previously mentioned, the Company considers TDRs to be impaired loans and has $123,000 in the allowance for loan losses as of September 30, 2017, as a direct result of these TDRs. At September 30, 2016, there was $106,000 in the allowance for loan losses related to TDRs.

The following table presents the successes and failures of the types of loan modifications within the previous twelve months as of September 30, 2017 and 2016:

	Paid In Full				Paying as restructured				Converted to nonaccrual				Foreclosure/ Default
	Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments
	(dollars in thousands)
September 30, 2017
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		5		562		8		811		—		—		1		15
Total		5	$	562		8	$	811		—	$	—		1	$	15
September 30, 2016
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		6		433		8		501		—		—		4		59
Total		6	$	433		8	$	501		—	$	—		4	$	59

The Company has not committed to fund any additional disbursements for TDRs.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2017

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 9 – Commitments and Contingencies

The Company’s subsidiary bank is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, lines of credit and standby letters of credit. These instruments involve elements of credit risk in excess of amounts recognized in the accompanying financial statements.

The Bank’s risk of loss with unfunded loans and lines of credit or standby letters of credit is represented by the contractual amount of these instruments. The Bank uses the same credit policies in making commitments under such instruments as it does for on-balance sheet instruments. The amount of collateral obtained, if any, is based on management’s credit evaluation of the borrower. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Credit card commitments are unsecured.

At September 30, 2017, outstanding financial instruments whose contract amounts represented credit risk were approximately:

	(dollars in thousands)
Commitments to extend credit	$	106,808
Credit card commitments		10,419
Standby letters of credit		1,349
Total commitments	$	118,576

In 2016, the Bank entered into a five-year operating lease for commercial property. The term expires on September 30, 2021. The annual cost of the lease is $151,875 with a 2.625% annual adjustor.

During the second quarter of 2017, the Bank entered into a lease that following completion of construction will be ten years and three months.  Construction is expected to be complete no later than first quarter of 2018.

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Fair Value Disclosures

9 Months Ended

Sep. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value Disclosures

Note 10 – Fair Value Disclosures

Accounting Standards Codification (ASC) 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements, but clarifies and standardizes some divergent practices that have emerged since prior guidance was issued. ASC 820 creates a three-level hierarchy under which individual fair value estimates are to be ranked based on the relative reliability of the inputs used in the valuation.

ASC 820 defines fair value as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, the Company considers the principal or most advantageous market in which those assets or liabilities are sold and considers assumptions that market participants would use when pricing those assets or liabilities. Fair values determined using Level 1 inputs rely on active and observable markets to price identical assets or liabilities. In situations where identical assets and liabilities are not traded in active markets, fair values may be determined based on Level 2 inputs, which exist when observable data exists for similar assets and liabilities. Fair values for assets and liabilities for which identical or similar assets and liabilities are not actively traded in observable markets are based on Level 3 inputs, which are considered to be unobservable.

Among the Company’s assets and liabilities, investment securities available for sale are reported at their fair values on a recurring basis. Certain other assets are adjusted to their fair value on a nonrecurring basis, including other real estate owned, impaired loans, loans held for sale, which are carried at the lower of cost or market; loan servicing rights, where fair value is determined using similar assets with similar characteristics, when available, or based upon discounted cash flows using market-based assumptions; and goodwill, which is periodically tested for impairment. Deposits, short-term borrowings and long-term obligations are not reported at fair value.

Prices for US Treasury securities are readily available in the active markets in which those securities are traded, and the resulting fair values are shown in the “Level 1 input” column. Prices for government agency securities, mortgage-backed securities and for state, county and municipal securities are obtained for similar securities, and the resulting fair values are shown in the “Level 2 input” column. Prices for all other non-marketable investments are determined based on various assumptions that are not observable. The fair values for these investment securities are shown in the “Level 3 input” column. Non-marketable investment securities, which are carried at their purchase price, include those that may only be redeemed by the issuer. The changes in securities between Level 1 and Level 2 were related to the purchase and sale of several securities and not the transfer of securities.

The Company does not record loans at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment by using one of several methods including collateral value, fair value of similar debt or discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the present value of the expected repayments or fair value of collateral exceed the recorded investments in such loans. The Company typically bases the fair value of the collateral on appraised values which the Company considers Level 3 valuations.

Foreclosed assets are adjusted to fair value upon transfer of the loans to other real estate owned. Real estate acquired in settlement of loans is recorded initially at the estimated fair value of the property less estimated selling costs at the date of foreclosure. The initial recorded value may be subsequently reduced by additional allowances, which are charged to earnings if the estimated fair value of the property less estimated selling costs declines below the initial recorded value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. The Company typically bases the fair value of the collateral on appraised values which the Company considers Level 3 valuations.

Loans originated and intended for sale in the secondary market are carried at the lower of cost or estimated fair value in the aggregate, based on secondary market prices. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income. These loans are recorded in Level 2.

The following table provides fair value information for assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Government Agencies		56,412		—		56,412		—
GSE - Mortgage-backed securities and CMO’s		22,117		—		22,117		—
State and political subdivisions		14,112		—		14,112		—
Corporate bonds		5,076		—		5,076		—
Total assets at fair value	$	97,717	$	—	$	97,717	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Treasury	$	4,014	$	4,014	$	—	$	—
US Gov’t		57,671		—		57,671		—
Mortgage-backed securities and CMO’s		25,648		—		25,648		—
State and political subdivisions		13,536		—		13,536		—
Corporate bonds		5,030		—		5,030		—
Total assets at fair value	$	105,899	$	4,014	$	101,885	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis in accordance with U.S. GAAP. These include assets that are measured at the lower of cost or market that were recognized at fair value less cost to sell at the end of the period. Assets measured at fair value on a nonrecurring basis are included in the table below as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,304	$	—	$	—	$	2,304
Other real estate owned		1,827		—		—		1,827
Total assets at fair value	$	4,131	$	—	$	—	$	4,131
Total liabilities at fair value	$	—	$	—	$	—	$	—

	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,217	$	—	$	—	$	2,217
Other real estate owned		3,130		—		—		3,130
Total assets at fair value	$	5,347	$	—	$	—	$	5,347
Total liabilities at fair value	$	—	$	—	$	—	$	—

Quantitative Information about Level 3 Fair Value Measurements

September 30, 2017
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount Rate	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

December 31, 2016
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount rates	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

At September 30, 2017, impaired loans were being evaluated with discounted expected cash flows and discounted appraisals were being used on collateral dependent loans.

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Fair Values of Financial Instruments and Interest Rate Risk

9 Months Ended

Sep. 30, 2017

Investments All Other Investments [Abstract]

Fair Values of Financial Instruments and Interest Rate Risk

Note 11 – Fair Values of Financial Instruments and Interest Rate Risk

ASC 825, “Disclosures about Fair Value of Financial Instruments,” requires disclosure of the fair value of financial assets and financial liabilities, including those that are not measured and reported at fair value on a recurring basis or non-recurring basis.

The fair value estimates presented at September 30, 2017 and December 31, 2016 are based on relevant market information and information about the financial instruments. Fair value estimates are intended to represent the price an asset could be sold at or the price at which a liability could be settled. However, given there is no active market or observable market transactions for many of the Company’s financial instruments, the Company has made estimates of many of these fair values which are subjective in nature, involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimated values. The estimated fair values disclosed in the following table do not represent market values of all assets and liabilities of the Company and should not be interpreted to represent the underlying value of the Company. The following table reflects a comparison of carrying amounts and the estimated fair value of the financial instruments as of September 30, 2017 and December 31, 2016:

September 30, 2017
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	92,583		92,583	$	90,093	$	2,490	$	—
Securities available for sale		97,717		97,717		—		97,717		—
Securities held to maturity		11,493		11,575		—		11,575		—
Loans held for investment, net		349,919		354,125		—		—		354,125
Loans held for sale		2,725		2,725		—		2,725		—
Restricted stock		1,068		1,068		1,068		—		—
Accrued interest receivable		1,516		1,516		—		—		1,516
FINANCIAL LIABILITIES
Deposits	$	527,253	$	500,388	$	—	$	500,388	$	—
Short-term borrowings		1,788		1,788		—		1,788		—
Junior subordinated debt		9,534		9,651		—		—		9,651
Accrued interest payable		151		151		—		—		151

December 31, 2016
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	45,968	$	45,995	$	43,478	$	2,517	$	—
Securities available for sale		105,899		105,899		4,014		101,885		—
Securities held to maturity		11,990		11,934		—		11,934		—
Loans held for investment, net		339,122		337,348		—		—		337,348
Loans held for sale		5,823		5,685		—		5,685		—
Restricted stock		1,052		1,052		1,052		—		—
Accrued interest receivable		1,629		1,629		—		—		1,629
FINANCIAL LIABILITIES
Deposits		485,719		447,784		—		447,784		—
Short-term borrowings		2,674		2,674		—		2,674		—
Junior subordinated debt		9,534		9,673		—		—		9,673
Accrued interest payable		151		151		—		—		151

The following methods and assumptions were used by the Company in estimating the fair value of financial instruments:

• Cash and cash equivalents – The carrying amount of cash and cash equivalents approximate their fair values due to the short period of time until their expected realization and are recorded in Level 1 with the exception of time deposits due from banks that are in Level 2.

• Securities available for sale – Securities available for sale are carried at fair value based on quoted and observable market prices and are recorded in Levels 1 and 2. Also see discussion in Note 5.

• Securities held to maturity – Securities held to maturity are carried at amortized cost and are recorded in Level 2.

• Loans – The fair value of loans is estimated based on discounted expected cash flows using the current interest rates at which similar loans would be made and carried in Level 3. Loans held for sale, which represent current mortgage production forward sales not yet delivered, are valued based on secondary market prices. The fair value of loans does not consider the lack of liquidity and uncertainty in the market that would affect the valuation. Loans held for sale are recorded in Level 2.

• Restricted stock – It is not practicable to determine fair value of restricted stock which is comprised of Federal Home Loan Bank and Federal Reserve Bank stock due to restrictions placed on its transferability and it is presented at its carrying value and is recorded in Level 1 due to the redemption provisions of the Federal Home Loan Bank and the Federal Reserve Bank.

• Accrued interest receivable and payable – Both accrued interest receivable and payable are recorded in Level 3, as there are not active markets for these.

• Deposits – The fair value of deposits is estimated based on discounted cash flow analyses using offered market rates and is recorded in Level 2. The fair value of deposits does not consider any customer related intangibles.

• Borrowings – The fair value disclosed for short-term borrowings, which are composed of overnight borrowings and debt due within one year approximate the carrying value for such debt and is recorded in Level 2. The estimated fair value for long-term borrowings are estimated based on discounted cash flow analyses using offered market rates. Total borrowings are carried in Level 2. Junior subordinated debt is fair valued based on discounted cash flow analyses and is recorded in Level 3.

At September 30, 2017, the Company’s subsidiary bank had outstanding standby letters of credit and commitments to extend credit. These off-balance sheet financial instruments are generally exercisable at the market rate prevailing at the date the underlying transaction will be completed; therefore, the fair value is the fee the Bank is expected to receive. This amount is deemed immaterial by management. See Note 9.

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Recent Accounting Pronouncements

9 Months Ended

Sep. 30, 2017

Accounting Changes And Error Corrections [Abstract]

Recent Accounting Pronouncements

Note 12 – Recent Accounting Pronouncements

In January 2016, the FASB issued ASU 2016-01, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” The amendments in this ASU address certain aspects of recognition, measurement, presentation and disclosure. The amendments in this ASU (i) require equity investments to be measured at fair value with changes in fair value recognized in net income; (ii) simplify the impairment assessment of equity investments without readily determinable fair value; (iii) require public business entities to use exit prices, rather than entry prices, when measuring fair value of financial instruments for disclosure purposes; (iv) require separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements; (v) eliminate the requirement to disclose the method(s) and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost on the balance sheet; (vi) require separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the organization has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; and (vii) state that a valuation allowance on deferred tax assets related to available-for-sale securities should be evaluated in combination with other deferred tax assets. The amendments in this ASU are effective for public business entities for fiscal periods beginning after December 15, 2017, including interim periods within those fiscal years. The ASU only permits early adoption of the instrument-specific credit risk provision. The Company currently does not invest in equity securities, therefore the impact from the adoption of this standard is not expected to be material to the financial position or results of operations of the Company, but new disclosures on fair value will be implemented.

In February 2016, the FASB issued ASU 2016-02, “Leases, Topic 842”. This ASU increases the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The key difference between existing standards and this ASU is the requirement for lessees to recognize on their balance sheet all lease contracts with lease terms greater than 12 months, including operating leases. Both a right-of-use asset, representing the right to use the leased asset, and a lease liability, representing the contractual obligation, are required to be recognized on the balance sheet of the lessee at lease commencement. Further, this ASU requires lessees to classify leases as either operating or finance leases, which are substantially similar to the current operating and capital leases classifications. The distinction between these two classifications under the new standard does not relate to balance sheet treatment, but relates to treatment in the statements of income and cash flows. Lessor guidance remains largely unchanged with the exception of how a lessor determines the appropriate lease classification for each lease to better align the lessor guidance with revised lessee classification guidance. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the impact of the new standard, which we anticipate we will adopt during the first quarter of 2019. We currently have one property that we operate under a lease, which would affect both the Consolidated Statements of Income and the Consolidated Balance Sheets.

In March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versusAgent considerations (Reporting Revenue Gross versus Net)”. ASU 2016-08 updates the new revenue standard by clarifying the principal versus agent implementation guidance, but does not change the core principle of the new standard. The updates to the principal versus agent guidance:  (i) require an entity to determine whether it is a principal or an agent for each distinct good or service (or a distinct bundle of goods or services) to be provided to the customer; (ii) illustrate how an entity that is a principal might apply the control principle to goods, services, or rights to services, when another party is involved in providing goods or services to a customer and (iii) Clarify that the purpose of certain specific control indicators is to support or assist in the assessment of whether an entity controls a good or service before it is transferred to the customer, provide more specific guidance on how the indicators should be considered, and clarify that their relevance will vary depending on the facts and circumstances.  For public business entities, the effective date and transition requirements for these amendments are the same as the effective date and transition requirements of ASU 2014-09 which is effective for interim and annual periods beginning after December 15, 2017. The amendments can be applied retrospectively to each prior reporting period or retrospectively with the cumulative effect of initially applying this new guidance recognized at the date of initial application.  Our revenue is comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09, and non-interest income.  ASU 2016-08 and 2014-09 could require us to change how we recognize certain revenue streams within non-interest income, however, we do not expect these changes to have a significant impact on our financial statements.  We continue to evaluate the impact of ASU 2016-08 and 2014-09 on our Company and expect to adopt the standard in the first quarter of 2018 with a cumulative effect adjustment to opening retained earnings, if such adjustment is deemed to be significant.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. ASU 2016-13 requires an entity to utilize a new impairment model known as the current expected credit loss (“CECL”) model to estimate its lifetime “expected credit loss” and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. The CECL model is expected to result in earlier recognition of credit losses. ASU 2016-13 also requires new disclosures for financial assets measured at amortized cost, loans and available-for-sale debt securities. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. Entities will apply the standard’s provisions as a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. We are currently exploring vendor-based options for outsourcing our current model as well as extending our current model to comply with CECL. We continue to assess the potential financial impact to the Company’s financial position.

From time to time, the FASB issues exposure drafts of proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts.

Reclassification

Certain amounts in the 2016 financial statements have been reclassified to conform to the 2017 presentation. These reclassifications do not have an impact on net income or shareholders’ equity.

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Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2017

Organization Consolidation And Presentation Of Financial Statements Abstract

Basis of Presentation

The financial statements and accompanying notes are presented on a consolidated basis including Uwharrie Capital Corp (the “Company”) and its subsidiaries, Uwharrie Bank (the “Bank”), Uwharrie Investment Advisors, Inc. (“UIA”), and Uwharrie Mortgage, Inc. The Bank consolidates its subsidiaries, the Strategic Alliance Corporation, BOS Agency, Inc. and Gateway Mortgage, Inc., each of which is wholly owned by the Bank.

The information contained in the consolidated financial statements is unaudited. In the opinion of management, the consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and material adjustments necessary for a fair presentation of results of interim periods, all of which are of a normal recurring nature, have been made. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for an entire year. Management is not aware of economic events, outside influences or changes in concentrations of business that would require additional clarification or disclosure in the consolidated financial statements.

The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to consolidated financial statements filed as part of the Company’s 2016 Annual Report on Form 10-K. This Quarterly Report should be read in conjunction with such Annual Report.

Use of Estimates

Use of Estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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.

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Comprehensive Income (Tables)

9 Months Ended

Sep. 30, 2017

Equity [Abstract]

Accumulated Other Comprehensive Income

The following table presents the changes in accumulated other comprehensive income for the three and nine months ended September 30, 2017 and 2016:

	Unrealized holding gains on available-for-sale securities (net)
	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Beginning Balance	$	(761	)	$	376		$	(1,318	)	$	(212	)
Other Comprehensive income (loss) before reclassifications,    net of ($14,000), $90,000, ($301,000) and ($422,000) tax    effect, respectively		26			(178	)		583			743
Amounts reclassified from accumulated other    comprehensive income, net of ($5,000), $1,000, ($5,000)    and $210,000 tax effect		9			(1	)		9			(334	)
Net current-period other comprehensive income (loss)		35			(179	)		592			409
Ending Balance	$	(726	)	$	197		$	(726	)	$	197

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Per Share Data (Tables)

9 Months Ended

Sep. 30, 2017

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The computation of basic and diluted earnings per share is summarized below:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2017		2016		2017		2016
Weighted average number of common shares outstanding		6,979,137		7,095,112		7,008,240		7,111,733
Effect of dilutive stock options		848		—		605		—
Weighted average number of common shares and dilutive    potential common shares used in computing diluted net    income per common share		6,979,985		7,095,112		7,008,845		7,111,733

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Investment Securities (Tables)

9 Months Ended

Sep. 30, 2017

Investments Debt And Equity Securities [Abstract]

Carrying Amounts and Fair Values of Securities Available for Sale and Held to Maturity

Carrying amounts and fair values of securities available for sale and held to maturity are summarized below:

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	—	$	—	$	—	$	—
U.S. Government agencies		57,007		24		619		56,412
GSE - Mortgage-backed securities and CMO’s		22,352		36		271		22,117
State and political subdivisions		14,413		47		348		14,112
Corporate bonds		5,045		34		3		5,076
Total securities available for sale	$	98,817	$	141	$	1,241	$	97,717

September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,351	$	9	$	—	$	1,360
State and political subdivisions		6,938		63		28		6,973
Corporate bonds		3,204		38		—		3,242
Total securities held to maturity	$	11,493	$	110	$	28	$	11,575

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities available for sale
U.S. Treasury	$	4,017	$	—	$	3	$	4,014
U.S. Government agencies		58,506		28		863		57,671
GSE - Mortgage-backed securities and CMO’s		26,195		39		586		25,648
State and political subdivisions		14,123		71		658		13,536
Corporate bonds		5,054		14		38		5,030
Total securities available for sale	$	107,895	$	152	$	2,148	$	105,899

December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(dollars in thousands)
Securities held to maturity
U.S. Government agencies	$	1,754	$	—	$	17	$	1,737
State and political subdivisions		6,974		7		60		6,921
Corporate bonds		3,262		14		—		3,276
Total securities held to maturity	$	11,990	$	21	$	77	$	11,934

Sales of Securities Available for Sale

Results from sales of securities available for sale for the three and nine-month periods ended September 30, 2017 and September 30, 2016 are as follows:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2017			2016		2017			2016
	(dollars in thousands)
Gross proceeds from sales	$	8,918		$	—	$	8,918		$	20,225
Realized gains from sales	$	—		$	2	$	—		$	544
Realized losses from sales		12			—		12			—
Net realized gains	$	(12	)	$	2	$	(12	)	$	544

Gross Unrealized Losses and Fair Value of Investments

At December 31, 2016, the unrealized losses on held to maturity securities related to one government agency securityand eight state and political subdivision bonds.

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Gov’t agencies		29,110		235		21,377		384		50,487		619
GSE-Mortgage-backed securities and CMO’s		6,148		40		11,456		231		17,604		271
State and political		1,162		25		10,224		323		11,386		348
Corporate bonds		—		—		806		3		806		3
Total securities available for sale	$	36,420	$	300	$	43,863	$	941	$	80,283	$	1,241

	Less than 12 Months				12 Months or More				Total
September 30, 2017	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
State and political		2,033		28		—		—		2,033		28
Total securities held to maturity	$	2,033	$	28	$	—	$	—	$	2,033	$	28

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Securities available for sale temporary impairment
U.S. Treasury	$	4,014	$	3	$	—	$	—	$	4,014	$	3
U.S. Gov’t agencies		48,192		807		4,164		56		52,356		863
GSE-Mortgage-backed securities and CMO’s		16,250		395		5,251		191		21,501		586
State and political		9,994		658		—		—		9,994		658
Corporate bonds		1,999		27		800		11		2,799		38
Total securities available for sale	$	80,449	$	1,890	$	10,215	$	258	$	90,664	$	2,148

	Less than 12 Months				12 Months or More				Total
December 31, 2016	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(dollars in thousands)
Held to maturity temporary impairment
U.S. Gov’t agencies	$	1,895	$	17	$	—	$	—	$	1,895	$	17
State and political		6,056		60		—		—		6,056		60
Total securities held to maturity	$	7,951	$	77	$	—	$	—	$	7,951	$	77

Amortized Cost and Fair Value of Available for Sale Securities Portfolio

The aggregate amortized cost and fair value of the available for sale securities portfolio at September 30, 2017 by remaining contractual maturity are as follows:

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Securities available for sale
U.S. Government agencies
Due after one but within five years		36,569		36,238		1.40	%
Due after five but within ten years		15,022		14,799		1.90	%
Due after ten years		5,416		5,375		1.77	%
		57,007		56,412		1.57	%
Mortgage-backed securities
Due after one but within five years		2,662		2,645		2.02	%
Due after five but within ten years		5,875		5,866		2.15	%
Due after ten years		13,815		13,606		1.93	%
		22,352		22,117		2.00	%
State and political subdivisions
Due after one but within five years		1,955		2,000		4.90	%
Due after five but within ten years		2,703		2,657		3.12	%
Due after ten years		9,755		9,455		2.45	%
		14,413		14,112		2.91	%
Corporate Bonds
Due after one but within five years		2,829		2,826		2.15	%
Due after five but within ten years		2,216		2,250		1.50	%
		5,045		5,076		1.86	%
Total Securities available for sale
Due after one but within five years		44,015		43,709		1.64	%
Due after five but within ten years		25,816		25,572		2.05	%
Due after ten years		28,986		28,436		2.07	%
	$	98,817	$	97,717		1.88	%

Amortized Cost and Fair Value of Held to Maturity Securities Portfolio

	September 30, 2017
	Amortized Cost		Estimated Fair Value		Book Yield
	(dollars in thousands)
Held to maturity
U. S. Government agencies
Due after five but within ten years	$	1,351	$	1,360		2.49	%
		1,351		1,360		2.49	%
State and political subdivisions
Due after one but within five years		3,700		3,710		2.28	%
Due after five but within ten years		3,238		3,263		3.03	%
		6,938		6,973		2.63	%
Corporate Bonds
Due after one but within five years		3,204		3,242		2.76	%
		3,204		3,242		2.76	%
Total Securities held for maturity
Due after one but within five years		6,904		6,952		2.51	%
Due after five but within ten years		4,589		4,623		2.87	%
	$	11,493	$	11,575		2.65	%

XML

Loans Held for Investment (Tables)

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Composition of Net Loans Held for Investment by Class

The composition of net loans held for investment by class as of September 30, 2017 and December 31, 2016 are as follows:

	September 30, 2017			December 31, 2016
	(dollars in thousands)
Commercial
Commercial	$	56,469		$	55,752
Real estate - commercial		116,178			109,752
Other real estate construction loans		32,511			26,718
Noncommercial
Real estate 1-4 family construction		4,360			5,625
Real estate - residential		77,447			81,700
Home equity		49,840			50,815
Consumer loans		10,431			9,711
Other loans		2,703			1,687
		349,939			341,760
Less:
Allowance for loan losses		(2,448	)		(2,707	)
Deferred loan (fees) costs, net		(20	)		69
Loans held for investment, net	$	347,471		$	339,122

XML

Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Changes in Allowance for Loan Losses

The following table shows the change in the allowance for loan losses by loan segment for the three and nine months ended September 30, 2017 and 2016, respectively:

Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,323		$	1,346		$	1,404		$	1,310
Provision (recovery) charged to operations		(34	)		271			(169	)		342
Charge-offs		(6	)		(69	)		(22	)		(131	)
Recoveries		18			12			88			39
Net (charge-offs) / Recoveries		12			(57	)		66			(92	)
Balance at end of period	$	1,301		$	1,560		$	1,301		$	1,560

Non-Commercial	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	1,228		$	1,360		$	1,303		$	1,574
Provision (recovery) charged to operations		(102	)		(31	)		(140	)		(272	)
Charge-offs		(7	)		(118	)		(91	)		(198	)
Recoveries		28			78			75			185
Net (charge-offs) / Recoveries		21			(40	)		(16	)		(13	)
Balance at end of period	$	1,147		$	1,289		$	1,147		$	1,289

Total	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
	(dollars in thousands)
Balance, beginning of period	$	2,551		$	2,706		$	2,707		$	2,884
Provision (recovery) charged to operations		(136	)		240			(309	)		70
Charge-offs		(13	)		(187	)		(113	)		(329	)
Recoveries		46			90			163			224
Net (charge-offs) / Recoveries		33			(97	)		50			(105	)
Balance at end of period	$	2,448		$	2,849		$	2,448		$	2,849

Schedule of Loans and Reserve Balances by Loan Segment Both Individually and Collectively Evaluated for Impairment

The following table shows period-end loans and reserve balances by loan segment both individually and collectively evaluated for impairment at September 30, 2017 and December 31, 2016:

September 30, 2017
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	13	$	1,856	$	1,288	$	203,302	$	1,301	$	205,158
Non-Commercial		154		3,534		993		141,227		1,147		144,761
Total	$	167	$	5,390	$	2,281	$	344,529	$	2,448	$	349,919

December 31, 2016
	Individually Evaluated				Collectively Evaluated				Total
	Reserve		Loans		Reserve		Loans		Reserve		Loans
	(dollars in thousands)
Commercial	$	16	$	1,993	$	1,388	$	190,229	$	1,404	$	192,222
Non-Commercial		123		4,096		1,180		145,511		1,303		149,607
Total	$	139	$	6,089	$	2,568	$	335,740	$	2,707	$	341,829

Past Due Information of Loan Portfolio by Class

Past due loan information is used by management when assessing the adequacy of the allowance for loan losses. The following table summarizes the past due information of the loan portfolio by class:

September 30, 2017
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	34	$	—	$	34	$	56,435	$	56,469	$	—
Real estate - commercial		114		457		571		116,064		116,178		—
Other real estate construction		—		53		53		32,511		32,511		—
Real estate 1-4 family construction		—		—		—		4,360		4,360		—
Real estate - residential		1,356		190		1,546		76,071		77,427		—
Home equity		171		58		229		49,669		49,840		—
Consumer loans		12		2		14		10,417		10,431		2
Other loans		—		—		—		2,703		2,703		—
Total	$	1,687	$	760	$	2,447	$	348,230	$	349,919	$	2

December 31, 2016
	Loans 30-89 Days Past Due		Loans 90 Days or More Past due and Non - Accrual		Total Past Due Loans		Current Loans		Total Loans		Accruing Loans 90 or More Days Past Due
	(dollars in thousands)
Commercial	$	—	$	—	$	—	$	55,752	$	55,752	$	—
Real estate - commercial		—		392		392		109,360		109,752		—
Other real estate construction		106		190		296		26,422		26,718		—
Real estate construction		—		—		—		5,625		5,625		—
Real estate - residential		510		846		1,356		80,413		81,769		—
Home equity		66		22		88		50,727		50,815		—
Consumer loan		36		—		36		9,675		9,711		—
Other loans		—		—		—		1,687		1,687		—
Total	$	718	$	1,450	$	2,168	$	339,661	$	341,829	$	—

Composition of Nonaccrual Loans by Class

The composition of nonaccrual loans by class as of September 30, 2017 and December 31, 2016 is as follows:

	September 30, 2017		December 31, 2016
	(dollars in thousands)
Real estate - commercial		457		392
Other real estate construction		53		190
Real estate – residential		190		846
Home equity		58		22
Consumer loans		2		—
	$	760	$	1,450

Summary of Risk Grades of Portfolio by Class

The tables below summarize risk grades of the loan portfolio by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	55,202	$	1,252	$	15	$	—	$	56,469
Real estate - commercial		110,810		3,091		2,277		—		116,178
Other real estate construction		30,382		1,736		393		—		32,511
Real estate 1 - 4 family construction		4,360		—		—		—		4,360
Real estate - residential		69,364		6,839		1,224		—		77,427
Home equity		48,981		800		59		—		49,840
Consumer loans		10,361		69		1		—		10,431
Other loans		2,703		—		—		—		2,703
Total	$	332,163	$	13,787	$	3,969	$	—	$	349,919

December 31, 2016
	Pass		Watch		Sub- standard		Doubtful		Total
	(dollars in thousands)
Commercial	$	54,906	$	827	$	19	$	—	$	55,752
Real estate - commercial		105,366		1,937		2,449		—		109,752
Other real estate construction		24,312		1,876		530		—		26,718
Real estate 1 - 4 family construction		5,625		—		—		—		5,625
Real estate - residential		71,105		8,551		2,113		—		81,769
Home equity		49,818		973		24		—		50,815
Consumer loans		9,545		163		3		—		9,711
Other loans		1,687		—		—		—		1,687
Total	$	322,364	$	14,327	$	5,138	$	—	$	341,829

Summary of Performing and Nonperforming Loans by Class

The following tables show the breakdown between performing and nonperforming loans by class at September 30, 2017 and December 31, 2016:

September 30, 2017
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	56,469	$	—	$	56,469
Real estate - commercial		115,721		457		116,178
Other real estate construction		32,458		53		32,511
Real estate 1 – 4 family construction		4,360		—		4,360
Real estate – residential		77,238		190		77,427
Home equity		49,781		58		49,840
Consumer loans		10,429		2		10,431
Other loans		2,703		—		2,703
Total	$	349,159	$	760	$	349,919

December 31, 2016
	Performing		Non- Performing		Total
	(dollars in thousands)
Commercial	$	55,752	$	—	$	55,752
Real estate - commercial		109,360		392		109,752
Other real estate construction		26,528		190		26,718
Real estate 1 – 4 family construction		5,625		—		5,625
Real estate – residential		80,923		846		81,769
Home equity		50,793		22		50,815
Consumer loans		9,711		—		9,711
Other loans		1,687		—		1,687
Total	$	340,379	$	1,450	$	341,829

Summary of Loans Deemed Impaired and Specific Reserves Allocated by Class

The tables below summarize the loans deemed impaired and the amount of specific reserves allocated by class at September 30, 2017 and December 31, 2016.

September 30, 2017
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	11	$	11	$	—	$	—
Real estate - commercial		1,692		1,412		280		9
Other real estate construction		691		53		100		4
Real estate 1 - 4 family construction		1		—		1		—
Real estate - residential		3,413		1,417		1,996		122
Home equity		71		28		42		32
Consumer loans		49		50		—		—
Other loans		—		—		—		—
Total	$	5,928	$	2,971	$	2,419	$	167

December 31, 2016
	Unpaid Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Related Allowance
	(dollars in thousands)
Commercial	$	29	$	13	$	16	$	2
Real estate - commercial		1,671		1,552		119		9
Other real estate construction		831		190		103		5
Real estate 1 - 4 family construction		6		—		6		—
Real estate - residential		3,994		2,072		1,922		123
Home equity		35		35		—		—
Consumer loans		61		61		—		—
Other loans		—		—		—		—
Total	$	6,627	$	3,923	$	2,166	$	139

	Three Months ended September 30, 2017				Three Months ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	11		1	$	31		—
Real estate - commercial		1,661		17		620		9
Other real estate construction		154		1		297		1
Real estate 1- 4 family construction		2		—		9		1
Real estate - residential		3,560		39		4,542		65
Home equity		112		—		46		—
Consumer loans		51		—		71		2
Other loans		—		—		—		—
Total	$	5,551	$	58	$	5,616	$	78

	Nine Months Ended September 30, 2017				Nine Months Ended September 30, 2016
	Average Recorded Investment		Interest Income		Average Recorded Investment		Interest Income
	(dollars in thousands)
Commercial	$	20	$	1	$	48	$	1
Real estate - commercial		1,664		46		624		28
Other real estate construction		223		4		299		4
Real estate 1- 4 family construction		4		—		11		1
Real estate - residential		3,777		124		4,522		176
Home equity		74		1		47		1
Consumer loans		55		3		74		5
Other loans		—		—		—		—
Total	$	5,817	$	179	$	5,625	$	216

XML

Troubled Debt Restructures (Tables)

9 Months Ended

Sep. 30, 2017

Receivables [Abstract]

Breakdown of Types of Concessions Made by Loan Class

For the three and nine months ended September 30, 2017 and 2016, the following table presents a breakdown of the types of concessions made by loan class:

	For the Three Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		1		186		186
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		2	$	195	$	193

	For the Three Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		2		226		214
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		2	$	226	$	214

	For the Nine Months Ended September 30, 2017
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		1	$	12	$	11
Real estate - commercial		1		166		163
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		5		661		630
Home equity		—		—		—
Consumer loans		1		9		7
Other loans		—		—		—
Total		8	$	848	$	811

	For the Nine Months Ended September 30, 2016
	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
	(dollars in thousands)
Other:
Commercial		—	$	—	$	—
Real estate - commercial		—		—		—
Other real estate construction		—		—		—
Real estate 1 – 4 family construction		—		—		—
Real estate – residential		4		555		482
Home equity		—		—		—
Consumer loans		—		—		—
Other loans		—		—		—
Total		4	$	555	$	482

Schedule of Successes and Failures of Types of Debt Restructuring

The following table presents the successes and failures of the types of loan modifications within the previous twelve months as of September 30, 2017 and 2016:

	Paid In Full				Paying as restructured				Converted to nonaccrual				Foreclosure/ Default
	Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments		Number of Loans		Recorded Investments
	(dollars in thousands)
September 30, 2017
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		5		562		8		811		—		—		1		15
Total		5	$	562		8	$	811		—	$	—		1	$	15
September 30, 2016
Below market
Interest rate		—	$	—		—	$	—		—	$	—		—	$	—
Extended payment Terms		—		—		—		—		—		—		—		—
Forgiveness of Principal/Other		6		433		8		501		—		—		4		59
Total		6	$	433		8	$	501		—	$	—		4	$	59

XML

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2017

Commitments And Contingencies Disclosure [Abstract]

Outstanding Financial Instruments Whose Contract Amounts Represented Credit Risk

At September 30, 2017, outstanding financial instruments whose contract amounts represented credit risk were approximately:

	(dollars in thousands)
Commitments to extend credit	$	106,808
Credit card commitments		10,419
Standby letters of credit		1,349
Total commitments	$	118,576

XML

Fair Value Disclosures (Tables)

9 Months Ended

Sep. 30, 2017

Fair Value Disclosures [Abstract]

Fair Value Information for Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table provides fair value information for assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Government Agencies		56,412		—		56,412		—
GSE - Mortgage-backed securities and CMO’s		22,117		—		22,117		—
State and political subdivisions		14,112		—		14,112		—
Corporate bonds		5,076		—		5,076		—
Total assets at fair value	$	97,717	$	—	$	97,717	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Securities available for sale:
US Treasury	$	4,014	$	4,014	$	—	$	—
US Gov’t		57,671		—		57,671		—
Mortgage-backed securities and CMO’s		25,648		—		25,648		—
State and political subdivisions		13,536		—		13,536		—
Corporate bonds		5,030		—		5,030		—
Total assets at fair value	$	105,899	$	4,014	$	101,885	$	—
Total liabilities at fair value	$	—	$	—	$	—	$	—

Assets Measured at Fair Value on Nonrecurring Basis

Assets measured at fair value on a nonrecurring basis are included in the table below as of September 30, 2017 and December 31, 2016:

	September 30, 2017
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,304	$	—	$	—	$	2,304
Other real estate owned		1,827		—		—		1,827
Total assets at fair value	$	4,131	$	—	$	—	$	4,131
Total liabilities at fair value	$	—	$	—	$	—	$	—

	December 31, 2016
	(dollars in thousands)
	Total		Level 1		Level 2		Level 3
Impaired loans	$	2,217	$	—	$	—	$	2,217
Other real estate owned		3,130		—		—		3,130
Total assets at fair value	$	5,347	$	—	$	—	$	5,347
Total liabilities at fair value	$	—	$	—	$	—	$	—

Quantitative Information about Level 3 Fair Value Measurements

Quantitative Information about Level 3 Fair Value Measurements

September 30, 2017
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount Rate	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

December 31, 2016
	Valuation Technique	Unobservable Input	General Range
Nonrecurring measurements:
Impaired loans	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 25%
	Discounted cash flows	Discount rates	4%-8.75%
OREO	Discounted appraisals	Collateral discounts and    Estimated costs to sell	0 – 10%

XML

Fair Values of Financial Instruments and Interest Rate Risk (Tables)

9 Months Ended

Sep. 30, 2017

Investments All Other Investments [Abstract]

Comparison of Carrying Amounts and Estimated Fair Value of Financial Instruments

The following table reflects a comparison of carrying amounts and the estimated fair value of the financial instruments as of September 30, 2017 and December 31, 2016:

September 30, 2017
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	92,583		92,583	$	90,093	$	2,490	$	—
Securities available for sale		97,717		97,717		—		97,717		—
Securities held to maturity		11,493		11,575		—		11,575		—
Loans held for investment, net		349,919		354,125		—		—		354,125
Loans held for sale		2,725		2,725		—		2,725		—
Restricted stock		1,068		1,068		1,068		—		—
Accrued interest receivable		1,516		1,516		—		—		1,516
FINANCIAL LIABILITIES
Deposits	$	527,253	$	500,388	$	—	$	500,388	$	—
Short-term borrowings		1,788		1,788		—		1,788		—
Junior subordinated debt		9,534		9,651		—		—		9,651
Accrued interest payable		151		151		—		—		151

December 31, 2016
	Carrying Value		Estimated Fair Value		Level 1		Level 2		Level 3
	(dollars in thousands)
FINANCIAL ASSETS
Cash and cash equivalents	$	45,968	$	45,995	$	43,478	$	2,517	$	—
Securities available for sale		105,899		105,899		4,014		101,885		—
Securities held to maturity		11,990		11,934		—		11,934		—
Loans held for investment, net		339,122		337,348		—		—		337,348
Loans held for sale		5,823		5,685		—		5,685		—
Restricted stock		1,052		1,052		1,052		—		—
Accrued interest receivable		1,629		1,629		—		—		1,629
FINANCIAL LIABILITIES
Deposits		485,719		447,784		—		447,784		—
Short-term borrowings		2,674		2,674		—		2,674		—
Junior subordinated debt		9,534		9,673		—		—		9,673
Accrued interest payable		151		151		—		—		151

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Comprehensive Income - Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning balance			$ 43,525
Total other comprehensive income	$ 35	$ (179)	592	$ 409
Ending balance	45,160		45,160
Unrealized Holding Gains on Available-for-Sale Securities (Net) [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Beginning balance	(761)	376	(1,318)	(212)
Other Comprehensive income (loss) before reclassifications, net of ($14,000), $90,000, ($301,000) and ($422,000) tax effect, respectively	26	(178)	583	743
Amounts reclassified from accumulated other comprehensive income, net of ($5,000), $1,000, ($5,000) and $210,000 tax effect	9	(1)	9	(334)
Total other comprehensive income	35	(179)	592	409
Ending balance	$ (726)	$ 197	$ (726)	$ 197

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Comprehensive Income - Accumulated Other Comprehensive Income (Parenthetical) (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Accumulated Other Comprehensive Income Loss [Line Items]
Tax effect on amount reclassified from accumulated other comprehensive income	$ (5)	$ 1	$ (5)	$ 210
Unrealized Holding Gains on Available-for-Sale Securities (Net) [Member]
Accumulated Other Comprehensive Income Loss [Line Items]
Tax effect on Other Comprehensive income (loss) before reclassifications	(14)	90	(301)	(422)
Tax effect on amount reclassified from accumulated other comprehensive income	$ (5)	$ 1	$ (5)	$ 210

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Noncontrolling Interest - Additional Information (Detail) - USD ($) $ in Millions	1 Months Ended	9 Months Ended	12 Months Ended
	Jan. 31, 2013	Sep. 30, 2017	Dec. 31, 2013
Preferred Stock Series B [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Preferred stock issued	$ 7.9
Dividends rate	5.30%
Voting rights		The preferred stock has no voting rights
Preferred Stock Series C [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Preferred stock issued			$ 2.8
Dividends rate			5.30%
Voting rights		The preferred stock has no voting rights

XML

Per Share Data - Additional Information (Detail) - shares	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Earnings Per Share [Abstract]
Stock options outstanding	13,116	13,116

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Per Share Data - Computation of Basic and Diluted Earnings Per Share (Detail) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Earnings Per Share [Abstract]
Weighted average number of common shares outstanding	6,979,137	7,095,112	7,008,240	7,111,733
Effect of dilutive stock options	848	0	605	0
Weighted average number of common shares and dilutive potential common shares used in computing diluted net income per common share	6,979,985	7,095,112	7,008,845	7,111,733

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Investment Securities - Carrying Amounts and Fair Values of Securities Available for Sale and Held to Maturity (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost	$ 98,817	$ 107,895
Available-for-sale Securities, Gross Unrealized Gains	141	152
Available-for-sale Securities, Gross Unrealized Losses	1,241	2,148
Available-for-sale Securities, Fair Value	97,717	105,899
Held-to-maturity Securities, Amortized Cost	11,493	11,990
Held-to-maturity Securities, Gross Unrealized Gains	110	21
Held-to-maturity Securities, Gross Unrealized Losses	28	77
Held-to-maturity Securities, Fair Value	11,575	11,934
U.S. Treasury [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost		4,017
Available-for-sale Securities, Gross Unrealized Losses		3
Available-for-sale Securities, Fair Value		4,014
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost	57,007	58,506
Available-for-sale Securities, Gross Unrealized Gains	24	28
Available-for-sale Securities, Gross Unrealized Losses	619	863
Available-for-sale Securities, Fair Value	56,412	57,671
Held-to-maturity Securities, Amortized Cost	1,351	1,754
Held-to-maturity Securities, Gross Unrealized Gains	9
Held-to-maturity Securities, Gross Unrealized Losses		17
Held-to-maturity Securities, Fair Value	1,360	1,737
GSE - Mortgage-backed Securities and CMO's [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost	22,352	26,195
Available-for-sale Securities, Gross Unrealized Gains	36	39
Available-for-sale Securities, Gross Unrealized Losses	271	586
Available-for-sale Securities, Fair Value	22,117	25,648
State and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost	14,413	14,123
Available-for-sale Securities, Gross Unrealized Gains	47	71
Available-for-sale Securities, Gross Unrealized Losses	348	658
Available-for-sale Securities, Fair Value	14,112	13,536
Held-to-maturity Securities, Amortized Cost	6,938	6,974
Held-to-maturity Securities, Gross Unrealized Gains	63	7
Held-to-maturity Securities, Gross Unrealized Losses	28	60
Held-to-maturity Securities, Fair Value	6,973	6,921
Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Amortized Cost	5,045	5,054
Available-for-sale Securities, Gross Unrealized Gains	34	14
Available-for-sale Securities, Gross Unrealized Losses	3	38
Available-for-sale Securities, Fair Value	5,076	5,030
Held-to-maturity Securities, Amortized Cost	3,204	3,262
Held-to-maturity Securities, Gross Unrealized Gains	38	14
Held-to-maturity Securities, Fair Value	$ 3,242	$ 3,276

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Investment Securities - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2017 USD ($) Security	Dec. 31, 2016 USD ($) Security
Schedule of Available-for-sale Securities [Line Items]
Federal Reserve Bank (FRB) stock owned by Company | $	$ 509,000	$ 507,000
Federal Home Loan Bank (FHLB) stock | $	559,000	545,000
Securities available for sale pledged as collateral on public deposits | $	$ 80,700,000	$ 74,800,000
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses more than twelve months	12	6
Number of available for sale securities related to unrealized losses less than twelve months	8	17
Number of securities related to unrealized losses		1
GSE - Mortgage-backed Securities and CMO's [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses more than twelve months	9	4
Number of available for sale securities related to unrealized losses less than twelve months	4	10
Available for sale securities | $	$ 0
U.S. Treasury [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses less than twelve months		1
States And Political [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses less than twelve months	1
Number of securities related to unrealized losses	2
State and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses less than twelve months		7
Number of securities related to unrealized losses		8
Corporate Bond [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of available for sale securities related to unrealized losses more than twelve months	1	1
Number of available for sale securities related to unrealized losses less than twelve months		1

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Investment Securities - Sales of Securities Available for Sale (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Investments Debt And Equity Securities [Abstract]
Gross proceeds from sales	$ 8,918		$ 8,918	$ 20,225
Realized gains from sales		$ 2		544
Realized losses from sales	12		12
Net realized gains	$ (12)	$ 2	$ (12)	$ 544

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Investment Securities - Gross Unrealized Losses and Fair Value of Investments (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	$ 36,420	$ 80,449
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	300	1,890
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Fair Value	43,863	10,215
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	941	258
Available-for-sale Securities, Gross unrealized losses, Fair Value	80,283	90,664
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses	1,241	2,148
Held-to-maturity Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	2,033	7,951
Held-to-maturity-Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	28	77
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Fair Value	0	0
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	0	0
Held-to-maturity Securities, Gross unrealized losses, Fair Value	2,033	7,951
Held-to-maturity Securities, Gross unrealized losses, Unrealized Losses	28	77
Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value		1,999
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses		27
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Fair Value	806	800
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	3	11
Available-for-sale Securities, Gross unrealized losses, Fair Value	806	2,799
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses	3	38
U.S. Treasury [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value		4,014
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses		3
Available-for-sale Securities, Gross unrealized losses, Fair Value		4,014
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses		3
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	29,110	48,192
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	235	807
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Fair Value	21,377	4,164
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	384	56
Available-for-sale Securities, Gross unrealized losses, Fair Value	50,487	52,356
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses	619	863
Held-to-maturity Securities, Gross unrealized losses, Less than Twelve Months, Fair Value		1,895
Held-to-maturity-Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses		17
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Fair Value		0
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses		0
Held-to-maturity Securities, Gross unrealized losses, Fair Value		1,895
Held-to-maturity Securities, Gross unrealized losses, Unrealized Losses		17
GSE - Mortgage-backed Securities and CMO's [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	6,148	16,250
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	40	395
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Fair Value	11,456	5,251
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	231	191
Available-for-sale Securities, Gross unrealized losses, Fair Value	17,604	21,501
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses	271	586
State and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	1,162	9,994
Available-for-sale Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	25	658
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Fair Value	10,224
Available-for-sale Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	323
Available-for-sale Securities, Gross unrealized losses, Fair Value	11,386	9,994
Available-for-sale Securities, Gross unrealized losses, Unrealized Losses	348	658
Held-to-maturity Securities, Gross unrealized losses, Less than Twelve Months, Fair Value	2,033	6,056
Held-to-maturity-Securities, Gross unrealized losses, Less than Twelve Months, Unrealized Losses	28	60
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Fair Value	0	0
Held-to-maturity Securities, Gross unrealized losses, Twelve Months or More, Unrealized Losses	0	0
Held-to-maturity Securities, Gross unrealized losses, Fair Value	2,033	6,056
Held-to-maturity Securities, Gross unrealized losses, Unrealized Losses	$ 28	$ 60

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Investment Securities - Amortized Cost and Fair Value of Available for Sale Securities Portfolio (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 44,015
Due after five but within ten years, Amortized Cost	25,816
Due after ten years, Amortized Cost	28,986
Available-for-sale Securities, Amortized Cost	98,817	$ 107,895
Due after one but within five years, Estimated Fair Value	43,709
Due after five but within ten years, Estimated Fair Value	25,572
Due after ten years, Estimated Fair Value	28,436
Fair Value	$ 97,717	105,899
Due after one but within five years, Book Yield	1.64%
Due after five but within ten years, Book Yield	2.05%
Due after ten years, Book Yield	2.07%
Total securities available for sale, Book Yield	1.88%
Corporate Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 2,829
Due after five but within ten years, Amortized Cost	2,216
Available-for-sale Securities, Amortized Cost	5,045	5,054
Due after one but within five years, Estimated Fair Value	2,826
Due after five but within ten years, Estimated Fair Value	2,250
Fair Value	$ 5,076	5,030
Due after one but within five years, Book Yield	2.15%
Due after five but within ten years, Book Yield	1.50%
Total securities available for sale, Book Yield	1.86%
U.S. Government Agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 36,569
Due after five but within ten years, Amortized Cost	15,022
Due after ten years, Amortized Cost	5,416
Available-for-sale Securities, Amortized Cost	57,007	58,506
Due after one but within five years, Estimated Fair Value	36,238
Due after five but within ten years, Estimated Fair Value	14,799
Due after ten years, Estimated Fair Value	5,375
Fair Value	$ 56,412	57,671
Due after one but within five years, Book Yield	1.40%
Due after five but within ten years, Book Yield	1.90%
Due after ten years, Book Yield	1.77%
Total securities available for sale, Book Yield	1.57%
Mortgage-backed Securities and CMO's [Member]
Schedule of Available-for-sale Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 2,662
Due after five but within ten years, Amortized Cost	5,875
Due after ten years, Amortized Cost	13,815
Available-for-sale Securities, Amortized Cost	22,352	26,195
Due after one but within five years, Estimated Fair Value	2,645
Due after five but within ten years, Estimated Fair Value	5,866
Due after ten years, Estimated Fair Value	13,606
Fair Value	$ 22,117	25,648
Due after one but within five years, Book Yield	2.02%
Due after five but within ten years, Book Yield	2.15%
Due after ten years, Book Yield	1.93%
Total securities available for sale, Book Yield	2.00%
State and Political Subdivisions [Member]
Schedule of Available-for-sale Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 1,955
Due after five but within ten years, Amortized Cost	2,703
Due after ten years, Amortized Cost	9,755
Available-for-sale Securities, Amortized Cost	14,413	14,123
Due after one but within five years, Estimated Fair Value	2,000
Due after five but within ten years, Estimated Fair Value	2,657
Due after ten years, Estimated Fair Value	9,455
Fair Value	$ 14,112	$ 13,536
Due after one but within five years, Book Yield	4.90%
Due after five but within ten years, Book Yield	3.12%
Due after ten years, Book Yield	2.45%
Total securities available for sale, Book Yield	2.91%

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Investment Securities - Amortized Cost and Fair Value of Held to Maturity Securities Portfolio (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Schedule of Held-to-maturity Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 6,904
Due after five but within ten years, Amortized Cost	4,589
Total Securities held for maturity, Amortized Cost	11,493
Due after one but within five years, Estimated Fair Value	6,952
Due after five but within ten years, Estimated Fair Value	4,623
Total Securities held for maturity, Estimated Fair Value	$ 11,575	$ 11,934
Due after one but within five years	2.51%
Due after five but within ten years	2.87%
Total Securities held for maturity, Estimated Fair Value	2.65%
U.S. Government Agencies [Member]
Schedule of Held-to-maturity Securities [Line Items]
Due after five but within ten years, Amortized Cost	$ 1,351
Total Securities held for maturity, Amortized Cost	1,351
Due after five but within ten years, Estimated Fair Value	1,360
Total Securities held for maturity, Estimated Fair Value	$ 1,360	1,737
Due after five but within ten years	2.49%
Total Securities held for maturity, Estimated Fair Value	2.49%
State and Political Subdivisions [Member]
Schedule of Held-to-maturity Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 3,700
Due after five but within ten years, Amortized Cost	3,238
Total Securities held for maturity, Amortized Cost	6,938
Due after one but within five years, Estimated Fair Value	3,710
Due after five but within ten years, Estimated Fair Value	3,263
Total Securities held for maturity, Estimated Fair Value	$ 6,973	6,921
Due after five but within ten years	2.28%
Due after ten years, Book Yield	3.03%
Total Securities held for maturity, Estimated Fair Value	2.63%
Corporate Bonds [Member]
Schedule of Held-to-maturity Securities [Line Items]
Due after one but within five years, Amortized Cost	$ 3,204
Total Securities held for maturity, Amortized Cost	3,204
Due after one but within five years, Estimated Fair Value	3,242
Total Securities held for maturity, Estimated Fair Value	$ 3,242	$ 3,276
Due after one but within five years	2.76%
Total Securities held for maturity, Estimated Fair Value	2.76%

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Loans Held for Investment - Composition of Net Loans Held for Investment by Class (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	$ 349,939		$ 341,760
Less:
Allowance for loan losses	(2,448)	$ (2,551)	(2,707)	$ (2,849)	$ (2,706)	$ (2,884)
Deferred loan (fees) costs, net	(20)		69
Net loans held for investment	347,471		339,122
Commercial [Member]
Less:
Allowance for loan losses	(1,301)	(1,323)	(1,404)	(1,560)	(1,346)	(1,310)
Commercial [Member] | Commercial Loan [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	56,469		55,752
Commercial [Member] | Real Estate - Commercial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	116,178		109,752
Commercial [Member] | Other Real Estate Construction [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	32,511		26,718
Non-Commercial [Member]
Less:
Allowance for loan losses	(1,147)	$ (1,228)	(1,303)	$ (1,289)	$ (1,360)	$ (1,574)
Non-Commercial [Member] | Consumer Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	10,431		9,711
Non-Commercial [Member] | Real Estate 1 - 4 Family Construction [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	4,360		5,625
Non-Commercial [Member] | Real Estate - Residential [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	77,447		81,700
Non-Commercial [Member] | Home Equity [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	49,840		50,815
Non-Commercial [Member] | Other Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans, Total	$ 2,703		$ 1,687

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Allowance for Loan Losses - Changes in Allowance for Loan Losses (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Financing Receivable Allowance For Credit Losses [Line Items]
Balance, beginning of period	$ 2,551	$ 2,706	$ 2,707	$ 2,884
Provision (recovery) charged to operations	(136)	240	(309)	70
Charge-offs	(13)	(187)	(113)	(329)
Recoveries	46	90	163	224
Net (charge-offs) / Recoveries	33	(97)	50	(105)
Balance at end of period	2,448	2,849	2,448	2,849
Commercial [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Balance, beginning of period	1,323	1,346	1,404	1,310
Provision (recovery) charged to operations	(34)	271	(169)	342
Charge-offs	(6)	(69)	(22)	(131)
Recoveries	18	12	88	39
Net (charge-offs) / Recoveries	12	(57)	66	(92)
Balance at end of period	1,301	1,560	1,301	1,560
Non-Commercial [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Balance, beginning of period	1,228	1,360	1,303	1,574
Provision (recovery) charged to operations	(102)	(31)	(140)	(272)
Charge-offs	(7)	(118)	(91)	(198)
Recoveries	28	78	75	185
Net (charge-offs) / Recoveries	21	(40)	(16)	(13)
Balance at end of period	$ 1,147	$ 1,289	$ 1,147	$ 1,289

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Allowance for Loan Losses - Schedule of Loans and Reserve Balances by Loan Segment Both Individually and Collectively Evaluated for Impairment (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Dec. 31, 2015
Financing Receivable Allowance For Credit Losses [Line Items]
Individually Evaluated, Reserve	$ 167		$ 139
Individually Evaluated, Loans	5,390		6,089
Collectively Evaluated, Reserve	2,281		2,568
Collectively Evaluated, Loans	344,529		335,740
Total Reserve	2,448	$ 2,551	2,707	$ 2,849	$ 2,706	$ 2,884
Total Loans	349,919		341,829
Commercial [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Individually Evaluated, Reserve	13		16
Individually Evaluated, Loans	1,856		1,993
Collectively Evaluated, Reserve	1,288		1,388
Collectively Evaluated, Loans	203,302		190,229
Total Reserve	1,301	1,323	1,404	1,560	1,346	1,310
Total Loans	205,158		192,222
Non-Commercial [Member]
Financing Receivable Allowance For Credit Losses [Line Items]
Individually Evaluated, Reserve	154		123
Individually Evaluated, Loans	3,534		4,096
Collectively Evaluated, Reserve	993		1,180
Collectively Evaluated, Loans	141,227		145,511
Total Reserve	1,147	$ 1,228	1,303	$ 1,289	$ 1,360	$ 1,574
Total Loans	$ 144,761		$ 149,607

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Allowance for Loan Losses - Past Due Information of Loan Portfolio by Class (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Financing Receivable Impaired [Line Items]
Total Past Due Loans	$ 2,447	$ 2,168
Current Loans	348,230	339,661
Total Loans	349,919	341,829
Accruing Loans 90 or More Days Past Due	2	0
Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	1,687	718
Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	760	1,450
Real Estate - Commercial [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	571	392
Current Loans	116,064	109,360
Total Loans	116,178	109,752
Accruing Loans 90 or More Days Past Due	0	0
Real Estate - Commercial [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	114
Real Estate - Commercial [Member] | Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	457	392
Other Real Estate Construction [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	53	296
Current Loans	32,511	26,422
Total Loans	32,511	26,718
Accruing Loans 90 or More Days Past Due	0	0
Other Real Estate Construction [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans		106
Other Real Estate Construction [Member] | Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	53	190
Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Impaired [Line Items]
Current Loans	4,360
Total Loans	4,360	5,625
Accruing Loans 90 or More Days Past Due	0
Real Estate - Residential [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	1,546	1,356
Current Loans	76,071	80,413
Total Loans	77,427	81,769
Accruing Loans 90 or More Days Past Due	0	0
Real Estate - Residential [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	1,356	510
Real Estate - Residential [Member] | Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	190	846
Home Equity [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	229	88
Current Loans	49,669	50,727
Total Loans	49,840	50,815
Accruing Loans 90 or More Days Past Due	0	0
Home Equity [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	171	66
Home Equity [Member] | Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	58	22
Other Loans [Member]
Financing Receivable Impaired [Line Items]
Current Loans	2,703	1,687
Total Loans	2,703	1,687
Accruing Loans 90 or More Days Past Due	0	0
Real Estate Construction [Member]
Financing Receivable Impaired [Line Items]
Current Loans		5,625
Total Loans		5,625
Accruing Loans 90 or More Days Past Due		0
Commercial Loan [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	34
Current Loans	56,435	55,752
Total Loans	56,469	55,752
Accruing Loans 90 or More Days Past Due	0	0
Commercial Loan [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	34
Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	14	36
Current Loans	10,417	9,675
Total Loans	10,431	9,711
Accruing Loans 90 or More Days Past Due	2	0
Consumer Loans [Member] | Loans 30-89 Days Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	12	$ 36
Consumer Loans [Member] | Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Total Past Due Loans	$ 2

XML

Allowance for Loan Losses - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2017 USD ($) Loan	Dec. 31, 2016 Loan
Allowance For Loan Losses [Line Items]
Financing receivable recorded investment number of days past due	90 days
Real Estate - Residential [Member]
Allowance For Loan Losses [Line Items]
Foreclosed residential real estate, loan amount	$ 1,100,000
Residential real estate in process of foreclosure, loan amount	$ 0
Number of nonperforming loans | Loan	1	0

XML

Allowance for Loan Losses - Composition of Nonaccrual Loans by Class (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	$ 2,447	$ 2,168
Real Estate - Commercial [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	571	392
Other Real Estate Construction [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	53	296
Real Estate - Residential [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	1,546	1,356
Home Equity [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	229	88
Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	14	36
Loans 90 Days or More Past Due [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	760	1,450
Loans 90 Days or More Past Due [Member] | Real Estate - Commercial [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	457	392
Loans 90 Days or More Past Due [Member] | Other Real Estate Construction [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	53	190
Loans 90 Days or More Past Due [Member] | Real Estate - Residential [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	190	846
Loans 90 Days or More Past Due [Member] | Home Equity [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	58	$ 22
Loans 90 Days or More Past Due [Member] | Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
Increase in non-performing loans	$ 2

XML

Allowance for Loan Losses - Summary of Risk Grades of Portfolio by Class (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Financing Receivable Recorded Investment [Line Items]
Loans	$ 349,919	$ 341,829
Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	116,178	109,752
Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	32,511	26,718
Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	4,360	5,625
Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	77,427	81,769
Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	49,840	50,815
Other Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	2,703	1,687
Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	56,469	55,752
Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	10,431	9,711
Pass [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	332,163	322,364
Pass [Member] | Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	110,810	105,366
Pass [Member] | Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	30,382	24,312
Pass [Member] | Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	4,360	5,625
Pass [Member] | Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	69,364	71,105
Pass [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	48,981	49,818
Pass [Member] | Other Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	2,703	1,687
Pass [Member] | Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	55,202	54,906
Pass [Member] | Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	10,361	9,545
Watch [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	13,787	14,327
Watch [Member] | Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	3,091	1,937
Watch [Member] | Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	1,736	1,876
Watch [Member] | Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	6,839	8,551
Watch [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	800	973
Watch [Member] | Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	1,252	827
Watch [Member] | Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	69	163
Sub-standard [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	3,969	5,138
Sub-standard [Member] | Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	2,277	2,449
Sub-standard [Member] | Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	393	530
Sub-standard [Member] | Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	1,224	2,113
Sub-standard [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	59	24
Sub-standard [Member] | Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	15	19
Sub-standard [Member] | Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	$ 1	$ 3

XML

Allowance for Loan Losses - Summary of Performing and Nonperforming Loans by Class (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Financing Receivable Recorded Investment [Line Items]
Loans	$ 349,919	$ 341,829
Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	116,178	109,752
Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	32,511	26,718
Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	4,360	5,625
Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	77,427	81,769
Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	49,840	50,815
Other Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	2,703	1,687
Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	56,469	55,752
Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	10,431	9,711
Performing [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	349,159	340,379
Performing [Member] | Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	115,721	109,360
Performing [Member] | Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	32,458	26,528
Performing [Member] | Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	4,360	5,625
Performing [Member] | Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	77,238	80,923
Performing [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	49,781	50,793
Performing [Member] | Other Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	2,703	1,687
Performing [Member] | Commercial Loan [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	56,469	55,752
Performing [Member] | Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	10,429	9,711
Non-Performing [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	760	1,450
Non-Performing [Member] | Real Estate - Commercial [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	457	392
Non-Performing [Member] | Other Real Estate Construction [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	53	190
Non-Performing [Member] | Real Estate - Residential [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	190	846
Non-Performing [Member] | Home Equity [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	58	$ 22
Non-Performing [Member] | Consumer Loans [Member]
Financing Receivable Recorded Investment [Line Items]
Loans	$ 2

XML

Allowance for Loan Losses - Summary of Loans Deemed Impaired and Specific Reserves Allocated by Class (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	$ 5,928		$ 5,928		$ 6,627
Recorded Investment With No Allowance	2,971		2,971		3,923
Recorded Investment With Allowance	2,419		2,419		2,166
Related Allowance	167		167		139
Average Recorded Investment	5,551	$ 5,616	5,817	$ 5,625
Interest Income	58	78	179	216
Real Estate - Commercial [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	1,692		1,692		1,671
Recorded Investment With No Allowance	1,412		1,412		1,552
Recorded Investment With Allowance	280		280		119
Related Allowance	9		9		9
Average Recorded Investment	1,661	620	1,664	624
Interest Income	17	9	46	28
Other Real Estate Construction [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	691		691		831
Recorded Investment With No Allowance	53		53		190
Recorded Investment With Allowance	100		100		103
Related Allowance	4		4		5
Average Recorded Investment	154	297	223	299
Interest Income	1	1	4	4
Real Estate 1 - 4 Family Construction [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	1		1		6
Recorded Investment With Allowance	1		1		6
Average Recorded Investment	2	9	4	11
Interest Income		1		1
Real Estate - Residential [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	3,413		3,413		3,994
Recorded Investment With No Allowance	1,417		1,417		2,072
Recorded Investment With Allowance	1,996		1,996		1,922
Related Allowance	122		122		123
Average Recorded Investment	3,560	4,542	3,777	4,522
Interest Income	39	65	124	176
Home Equity [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	71		71		35
Recorded Investment With No Allowance	28		28		35
Recorded Investment With Allowance	42		42
Related Allowance	32		32
Average Recorded Investment	112	46	74	47
Interest Income			1	1
Commercial Loan [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	11		11		29
Recorded Investment With No Allowance	11		11		13
Recorded Investment With Allowance					16
Related Allowance					2
Average Recorded Investment	11	31	20	48
Interest Income	1		1	1
Consumer Loans [Member]
Financing Receivable Impaired [Line Items]
Unpaid Principal Balance	49		49		61
Recorded Investment With No Allowance	50		50		$ 61
Average Recorded Investment	$ 51	71	55	74
Interest Income		$ 2	$ 3	$ 5

XML

Troubled Debt Restructures - Additional Information (Detail)	9 Months Ended		12 Months Ended
	Sep. 30, 2017 USD ($) Contract	Sep. 30, 2016 USD ($)	Sep. 30, 2017 USD ($) Contract	Sep. 30, 2016 Contract
Receivables [Abstract]
Troubled debt restructuring outstanding | $	$ 4,700,000		$ 4,700,000
Number of contracts on non-accruing basis | Contract	0
Number of TDR's payment default | Contract			1	1
TDR is defined as being past due	90 days
Allowance for loan loss on TDR | $	$ 123,000	$ 106,000

XML

Troubled Debt Restructures - Breakdown of Types of Concessions Made by Loan Class (Detail) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017 USD ($) Contract	Sep. 30, 2016 USD ($) Contract	Sep. 30, 2017 USD ($) Contract	Sep. 30, 2016 USD ($) Contract
Financing Receivable, Modifications [Line Items]
Number of Contracts | Contract	2	2	8	4
Pre-Modification Outstanding Recorded Investment	$ 195	$ 226	$ 848	$ 555
Post-Modification Outstanding Recorded Investment	$ 193	$ 214	$ 811	$ 482
Other Payment Terms [Member] | Commercial Loan [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts | Contract			1
Pre-Modification Outstanding Recorded Investment			$ 12
Post-Modification Outstanding Recorded Investment			$ 11
Other Payment Terms [Member] | Consumer Loans [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts | Contract	1		1
Pre-Modification Outstanding Recorded Investment	$ 9		$ 9
Post-Modification Outstanding Recorded Investment	$ 7		$ 7
Other Payment Terms [Member] | Real Estate - Commercial [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts | Contract			1
Pre-Modification Outstanding Recorded Investment			$ 166
Post-Modification Outstanding Recorded Investment			$ 163
Other Payment Terms [Member] | Real Estate - Residential [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts | Contract	1	2	5	4
Pre-Modification Outstanding Recorded Investment	$ 186	$ 226	$ 661	$ 555
Post-Modification Outstanding Recorded Investment	$ 186	$ 214	$ 630	$ 482

XML

Troubled Debt Restructures - Schedule of Successes and Failures of Types of Loan Debt Restructuring (Detail) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017 USD ($) Contract	Sep. 30, 2016 USD ($) Contract	Sep. 30, 2017 USD ($) Loan Contract	Sep. 30, 2016 USD ($) Loan Contract
Financing Receivable, Modifications [Line Items]
Number of Loans | Contract	2	2	8	4
Recorded Investments	$ 4,700		$ 4,700
Paid In Full [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			5	6
Recorded Investments	562	$ 433	$ 562	$ 433
Paying as Restructured [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			8	8
Recorded Investments	811	501	$ 811	$ 501
Foreclosure/ Default [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			1	4
Recorded Investments	15	59	$ 15	$ 59
Forgiveness of Principal Other [Member] | Paid In Full [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			5	6
Recorded Investments	562	433	$ 562	$ 433
Forgiveness of Principal Other [Member] | Paying as Restructured [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			8	8
Recorded Investments	811	501	$ 811	$ 501
Forgiveness of Principal Other [Member] | Foreclosure/ Default [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans | Loan			1	4
Recorded Investments	$ 15	$ 59	$ 15	$ 59

XML

Commitments and Contingencies - Outstanding Financial Instruments Whose Contract Amounts Represented Credit Risk (Detail) $ in Thousands	Sep. 30, 2017 USD ($)
Loss Contingencies [Line Items]
Total commitments	$ 118,576
Commitments to Extend Credit [Member]
Loss Contingencies [Line Items]
Total commitments	106,808
Credit Card Commitments [Member]
Loss Contingencies [Line Items]
Total commitments	10,419
Standby Letters of Credit [Member]
Loss Contingencies [Line Items]
Total commitments	$ 1,349

XML

Commitments and Contingencies - Additional Information (Detail) - Uwharrie Bank [Member] - Commercial Property [Member] - USD ($)	3 Months Ended	9 Months Ended	12 Months Ended
	Jun. 30, 2017	Sep. 30, 2017	Dec. 31, 2016
Loss Contingencies [Line Items]
Operating lease, term of contract	10 years 3 months		5 years
Lease expiration date			Sep. 30, 2021
Annual cost of lease			$ 151,875
Lease annual adjustor percentage			2.625%
Estimated construction completion period, description		Construction is expected to be complete no later than first quarter of 2018.

XML

Fair Value Disclosures - Fair Value Information for Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	$ 97,717	$ 105,899
Corporate Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	5,076	5,030
Fair Value on a Recurring Basis [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	97,717	105,899
Total liabilities at fair value	0	0
Fair Value on a Recurring Basis [Member] | U.S. Treasury [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value		4,014
Fair Value on a Recurring Basis [Member] | U.S. Government Agencies [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	56,412	57,671
Fair Value on a Recurring Basis [Member] | GSE - Mortgage-backed Securities and CMO's [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	22,117	25,648
Fair Value on a Recurring Basis [Member] | State and Political Subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	14,112	13,536
Fair Value on a Recurring Basis [Member] | Corporate Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	5,076	5,030
Fair Value on a Recurring Basis [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value		4,014
Total liabilities at fair value	0	0
Fair Value on a Recurring Basis [Member] | Level 1 [Member] | U.S. Treasury [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value		4,014
Fair Value on a Recurring Basis [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	97,717	101,885
Total liabilities at fair value	0	0
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | U.S. Government Agencies [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	56,412	57,671
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | GSE - Mortgage-backed Securities and CMO's [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	22,117	25,648
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | State and Political Subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	14,112	13,536
Fair Value on a Recurring Basis [Member] | Level 2 [Member] | Corporate Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	5,076	5,030
Fair Value on a Recurring Basis [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities at fair value	$ 0	$ 0

XML

Fair Value Disclosures - Assets Measured at Fair Value on Nonrecurring Basis (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 97,717	$ 105,899
Fair Value on a Nonrecurring Basis [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	2,304	2,217
Other real estate owned	1,827	3,130
Fair Value	4,131	5,347
Total liabilities at fair value	0	0
Fair Value on a Nonrecurring Basis [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities at fair value	0	0
Fair Value on a Nonrecurring Basis [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities at fair value	0	0
Fair Value on a Nonrecurring Basis [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired loans	2,304	2,217
Other real estate owned	1,827	3,130
Fair Value	4,131	5,347
Total liabilities at fair value	$ 0	$ 0

XML

Fair Value Disclosures - Quantitative Information about Level 3 Fair Value Measurements (Detail)	9 Months Ended	12 Months Ended
	Sep. 30, 2017	Dec. 31, 2016
Discounted Cash Flows [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Valuation Technique	Discounted cash flows
Discounted Cash Flows [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	4.00%	4.00%
Discounted Cash Flows [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	8.75%	8.75%
Impaired Loans [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Valuation Technique	Discounted appraisals
Impaired Loans [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	0.00%	0.00%
Impaired Loans [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	25.00%	25.00%
OREO [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Valuation Technique	Discounted appraisals
OREO [Member] | Minimum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	0.00%	0.00%
OREO [Member] | Maximum [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Fair value inputs discount rate and estimated costs to sell	10.00%	10.00%

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Fair Values of Financial Instruments and Interest Rate Risk - Comparison of Carrying Amounts and Estimated Fair Value of Financial Instruments (Detail) - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
FINANCIAL ASSETS
Securities held to maturity	$ 11,575	$ 11,934
Loans held for investment, net	347,471	339,122
Accrued interest receivable	1,516	1,629
FINANCIAL LIABILITIES
Junior subordinated debt	9,534	9,534
Accrued interest payable	151	151
Carrying Value [Member]
FINANCIAL ASSETS
Cash and cash equivalents	92,583	45,968
Securities available for sale	97,717	105,899
Securities held to maturity	11,493	11,990
Loans held for investment, net	349,919	339,122
Loans held for sale	2,725	5,823
Restricted stock	1,068	1,052
Accrued interest receivable	1,516	1,629
FINANCIAL LIABILITIES
Deposits	527,253	485,719
Short-term borrowings	1,788	2,674
Junior subordinated debt	9,534	9,534
Accrued interest payable	151	151
Estimated Fair Value [Member]
FINANCIAL ASSETS
Cash and cash equivalents	92,583	45,995
Securities available for sale	97,717	105,899
Securities held to maturity	11,575	11,934
Loans held for investment, net	354,125	337,348
Loans held for sale	2,725	5,685
Restricted stock	1,068	1,052
Accrued interest receivable	1,516	1,629
FINANCIAL LIABILITIES
Deposits	500,388	447,784
Short-term borrowings	1,788	2,674
Junior subordinated debt	9,651	9,673
Accrued interest payable	151	151
Level 1 [Member]
FINANCIAL ASSETS
Cash and cash equivalents	90,093	43,478
Securities available for sale		4,014
Restricted stock	1,068	1,052
Level 2 [Member]
FINANCIAL ASSETS
Cash and cash equivalents	2,490	2,517
Securities available for sale	97,717	101,885
Securities held to maturity	11,575	11,934
Loans held for sale	2,725	5,685
FINANCIAL LIABILITIES
Deposits	500,388	447,784
Short-term borrowings	1,788	2,674
Level 3 [Member]
FINANCIAL ASSETS
Loans held for investment, net	354,125	337,348
Accrued interest receivable	1,516	1,629
FINANCIAL LIABILITIES
Junior subordinated debt	9,651	9,673
Accrued interest payable	$ 151	$ 151

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Fair Values of Financial Instruments and Interest Rate Risk - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2017
Fair Value Assets And Liabilities Measured On Recurring Basis [Abstract]
Short term borrowings due period	1 year

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Recent Accounting Pronouncements - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2017 Property
Accounting Changes And Error Corrections [Abstract]
Number of property	1