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Acquisition Activity
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9 Months Ended | |
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Sep. 30, 2014
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| Business Combinations [Abstract] | ||
| Business Combination Disclosure [Text Block] |
Note 3 Acquisition Activity
On April 1, 2014, the Bank acquired First Federal Savings and Loan Association of Hammond ("First Federal"), a federal mutual savings association headquartered in Hammond, Indiana. First Federal operated two banking locations in Hammond and Highland, Indiana. The Bank acquired First Federal by merging First Federal with and into the Bank immediately following First Federal's voluntary supervisory conversion to stock form. The Bank was not required to issue or pay any shares, cash, or other consideration in the merger. The First Federal acquisition added assets with a fair value of $37.9 million, including securities with a fair value of $3.8 million, loans receivable with a fair value of $29.1 million, premises and equipment with a fair value of $967 thousand, and foreclosed real estate of $690 thousand. The First Federal acquisition also added liabilities with a fair value of $39.6 million, including core deposits with a fair value of $7.2 million and certificates of deposit with a fair value of $29.8 million. As a result of the differences in the fair value of assets and liabilities, goodwill of $1.6 million and intangible assets of $93 thousand were also added. As part of the fair value of loans receivable, a net fair value discount was established for residential real estate, including home equity lines of credit, of $1.1 million that is being accreted over 55 months on a straight line basis. Approximately $202 thousand of accretion was taken into income during the quarter ended September 30, 2014. Approximately $269 thousand of accretion was taken into income for the nine months ended September 30, 2014. It is estimated that $54 thousand of accretion will occur during the remainder of 2014, $204 thousand of accretion will occur annually through to 2017, and accretion of $170 thousand will occur during 2018. As part of the fair value of certificates of deposit, a fair value premium was established of $276 thousand that is being amortized over 17 months on a straight line basis. Approximately $50 thousand of amortization was taken as expense during the quarter ended September 30, 2014. Approximately $100 thousand of amortization was taken as expense during the nine months ended September 30, 2014. It is estimated that $50 thousand of amortization will occur during the remainder of 2014 and $126 thousand of amortization will occur during 2015. |