Parent Company Only Financial Information

Interim Condensed Balance Sheets



	June 30 2019		December 31 2018
ASSETS
Cash on deposit at the Bank	$	2,009	$	2,499
Investments in subsidiaries	153,204		143,942
Premises and equipment	1,562		1,912
Other assets	51,973		51,674
TOTAL ASSETS	$	208,748	$	200,027
LIABILITIES AND SHAREHOLDERS’ EQUITY
Other liabilities	$	634	$	4,508
Shareholders' equity	208,114		195,519
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	208,748	$	200,027

Interim Condensed Statements of Income



	Three Months Ended June 30				Six Months Ended June 30
	2019		2018		2019		2018
Income
Dividends from subsidiaries	$	2,100	$	3,900	$	3,100	$	6,000
Interest income	2		—		4		—
Other income	232		855		213		1,530
Total income	2,334		4,755		3,317		7,530
Expenses
Compensation and benefits	—		1,175		—		2,159
Occupancy and equipment	14		126		29		249
Audit, consulting, and legal fees	115		208		245		432
Director fees	89		104		187		207
Other	328		172		618		308
Total expenses	546		1,785		1,079		3,355
Income before income tax benefit and equity in undistributed earnings of subsidiaries	1,788		2,970		2,238		4,175
Federal income tax benefit	64		192		179		380
Income before equity in undistributed earnings of subsidiaries	1,852		3,162		2,417		4,555
Undistributed earnings of subsidiaries	2,336		171		5,267		2,240
Net income	$	4,188	$	3,333	$	7,684	$	6,795

Interim Condensed Statements of Cash Flows



	Six Months Ended June 30
	2019			2018
Operating activities
Net income	$	7,684		$	6,795
Adjustments to reconcile net income to cash provided by operations
Undistributed earnings of subsidiaries	(5,267		)	(2,240		)
Undistributed earnings of equity securities without readily determinable fair values	(76		)	(64		)
Share-based payment awards under equity compensation plan	271			304
Depreciation	23			64
Changes in operating assets and liabilities which provided (used) cash
Other assets	5			1,084
Other liabilities	682			(837		)
Net cash provided by (used in) operating activities	3,322			5,106
Investing activities
Sales (purchases) of premises and equipment	—			(16		)
Net cash provided by (used in) investing activities	—			(16		)
Financing activities
Cash dividends paid on common stock	(4,093		)	(4,096		)
Proceeds from the issuance of common stock	2,436			3,272
Common stock repurchased	(1,339		)	(1,238		)
Common stock purchased for deferred compensation obligations	(816		)	(205		)
Net cash provided by (used in) financing activities	(3,812		)	(2,267		)
Increase (decrease) in cash and cash equivalents	(490		)	2,823
Cash and cash equivalents at beginning of period	2,499			185
Cash and cash equivalents at end of period	$	2,009		$	3,008

On January 1, 2019, there was a transaction to restructure the Bank and the parent holding company for the purpose of better-organizing the entities for present and future needs. The transaction is expected to produce future benefits for us in the form of reduced operational costs and better-managed risk. Assets and liabilities transferred from the parent company to the Bank relate primarily to capital assets, net deferred income tax asset, prepaid assets, employee benefits payable, accrued expenses, and a pension plan. Effective January 1, 2019, all employee compensation and benefit expenses will be recognized by the Bank, where expenses related to certain administrative functions were previously recognized by the parent holding company. Similarly, expenses related to most capital assets will be recognized by the Bank.