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Stockholders' Equity
 12 Months Ended
Dec. 31, 2014
Stockholders' Equity Note [Abstract]  
Stockholders' Equity
Note 14. Stockholders’ Equity
 
Restrictions on dividends:
 
Banking regulations limit the amount of dividends that may be paid without prior approval of the Bank’s regulatory agencies. Regulatory approval is required to pay dividends that exceed the Bank’s net profits for the current year plus its retained net profits for the preceding two years.
 
Retained earnings from which dividends may not be paid without prior approval totaled approximately $17,171,000, $15,293,000, and $14,312,000 at December 31, 2014, 2013, and 2012, respectively, based on the earnings restrictions and minimum capital ratio requirements noted below.
 
Employee stock purchase benefit plans:
 
The Company has a stock-based compensation plan, which is described below. There were no options issued during the years ended December 31, 2014, 2013 and 2012.
 
Employees who have completed one year of service are eligible to participate in the employee stock purchase plan. The number of shares of common stock granted under options will bear a uniform relationship to compensation. The plan allows employees to buy stock under options granted at 85% of the fair market value of the stock on the date of grant. Options are vested when granted and will expire no later than 27 months from the grant date or upon termination of employment. Activity under this plan is as follows:
 
At December 31, 2014, shares of common stock reserved for issuance under the plan totaled 48,011.
 
The Board of Directors may suspend or discontinue the plan at its discretion.
 
Dividend reinvestment and stock purchase plan:
 
The Company’s dividend reinvestment and stock purchase plan allows all participating stockholders the opportunity to receive additional shares of common stock in lieu of cash dividends at 95% of the fair market value on the dividend payment date.
 
During 2014, 2013, and 2012, shares of common stock purchased under the plan totaled 13,594, 10,392, and 19,069 respectively. At December 31, 2014, shares of common stock reserved for issuance under the plan totaled 197,524.
 
The Board of Directors may suspend or discontinue the plan at its discretion.
 
Stockholder purchase plan:
 
The Company’s stockholder purchase plan allows participating stockholders an option to purchase newly issued shares of common stock. The Board of Directors shall determine the number of shares that may be purchased pursuant to options. Options granted will expire no later than three months from the grant date. Each option will entitle the stockholder to purchase one share of common stock, and will be granted in proportion to stockholder share holdings. At the discretion of the Board of Directors, stockholders may be given the opportunity to purchase unsubscribed shares.
 
There was no activity under this plan for the years ended December 31, 2014, 2013, and 2012.
 
At December 31, 2014, shares of common stock reserved for issuance under the plan totaled 313,919.
 
The Board of Directors may suspend or discontinue the plan at its discretion.
 
Under all three plans, options granted, exercised, and expired, shares issued and reserved, and grant prices have been restated for the effects of any stock dividends or stock splits.
 
Regulatory capital requirements:
 
The Company and Bank are subject to various regulatory capital requirements administered by Federal and State banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. The Company and Bank must meet specific capital guidelines that involve quantitative measures of their respective assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting principles. The Company’s and Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.
 
Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios (as defined in the regulations) of total and Tier I capital to risk-weighted assets and of Tier I capital to average assets. Management believes, as of December 31, 2014, 2013, and 2012, that both the Company and Bank meet all capital adequacy requirements to which they are subject.
 
The Bank has been notified by its regulator that, as of its most recent regulatory examination, it is regarded as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized the Bank must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios. There have been no conditions or events since that notification that management believes have changed the Bank’s category.
 
A comparison of capital as of December 31, 2014, 2013, and 2012 with minimum requirements is approximately as follows:
 
To Be Well Capitalized
For Capital
Under Prompt Corrective
Actual
Adequacy Purposes
Action Provisions
Amount
Ratio
Amount
Ratio
Amount
Ratio
As of December 31, 2014
Total Capital
(to Risk Weighted Assets)
Company
 $ 36,959,000 14.3 % $ 20,645,810 8.0 % N/A
Bank
 36,655,000 14.3 % 20,477,654 8.0 % $ 25,597,067 10.0 %
Tier I Capital
(to Risk Weighted Assets)
Company
 $ 33,728,000 13.1 % $ 10,322,265 4.0 % N/A
Bank
 33,454,000 13.1 % 10,238,409 4.0 % 15,357,613 6.0 %
Tier I Capital
(to Average Assets)
Company
 $ 33,728,000 8.5 % $ 15,834,742 4.0 % N/A
Bank
 33,454,000 8.4 % 16,006,699 4.0 % 20,008,373 5.0 %
 
 
To Be Well Capitalized
For Capital
Under Prompt Corrective
Actual
Adequacy Purposes
Action Provisions
Amount
Ratio
Amount
Ratio
Amount
Ratio
As of December 31, 2013
Total Capital
(to Risk Weighted Assets)
Company
 $ 35,933,000 14.1 % $ 20,329,844 8.0 % N/A
Bank
 35,624,000 14.1 % 20,183,569 8.0 % $ 25,229,462 10.0 %
Tier I Capital
(to Risk Weighted Assets)
Company
 $ 32,761,000 12.9 % $ 10,166,330 4.0 % N/A
Bank
 32,470,000 12.9 % 10,091,686 4.0 % $ 15,137,529 6.0 %
Tier I Capital
(to Average Assets)
Company
 $ 32,761,000 8.7 % $ 15,079,862 4.0 % N/A
Bank
 32,470,000 8.6 % 15,119,907 4.0 % $ 18,899,884 5.0 %
As of December 31, 2012
Total Capital
(to Risk Weighted Assets)
Company
 $ 34,165,000 14.1 % $ 19,425,729 8.0 % N/A
Bank
 33,807,000 14.0 % 19,290,728 8.0 % $ 24,113,409 10.0 %
Tier I Capital
(to Risk Weighted Assets)
Company
 $ 31,124,000 12.8 % $ 9,711,076 4.0 % N/A
Bank
 30,787,000 12.8 % 9,643,540 4.0 % $ 14,465,309 6.0 %
Tier I Capital
(to Average Assets)
Company
 $ 31,124,000 8.3 % $ 15,072,155 4.0 % N/A
Bank
 30,787,000 8.1 % 15,297,888 4.0 % $ 19,122,360 5.0 %