MB Bancorp Inc - FORM 10-K/A

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EX-32.1 - EXHIBIT 32.1 - MB Bancorp Inc	tv490126_ex32-1.htm
EX-31.2 - EXHIBIT 31.2 - MB Bancorp Inc	tv490126_ex31-2.htm
EX-31.1 - EXHIBIT 31.1 - MB Bancorp Inc	tv490126_ex31-1.htm
EX-23.2 - EXHIBIT 23.2 - MB Bancorp Inc	tv490126_ex23-2.htm
EX-23.1 - EXHIBIT 23.1 - MB Bancorp Inc	tv490126_ex23-1.htm

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K/A
(Amendment No. 1)

(Mark One)

☒

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

For the fiscal year ended December 31, 2017

☐

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: 000-55341

MB BANCORP, INC.

(Exact Name of Registrant as Specified in Its Charter)

	Maryland			47-1696350
	(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
	1920 Rock Spring Road, Forest Hill, Maryland			21050
	(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (410) 420-9600
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.01 per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒ No

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 Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

Indicate by check mark whether the registrant is a large accelerated, an accelerated filer, a non-accelerated filer, a 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. (Check one):

	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 ☒

The aggregate market value of the common stock held by non-affiliates as of June 30, 2017 was $28,086,566. As of March 13, 2018, the registrant had 1,940,200 shares of its common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the proxy statement for the registrant’s 2018 annual meeting of stockholders (Part III).

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Form 10-K/A

Explanatory Note

This Amendment No. 1 (this “Amendment”) amends the Annual Report on Form 10-K of MB Bancorp, Inc. for the year ended December 31, 2017, filed with the Securities Exchange Commission on March 13, 2018 (the “Original Form 10-K”). The sole purpose of this Amendment is to file the Dixon Hughes Goodman LLP “Report of Independent Registered Public Accounting Firm” which was inadvertently omitted from our Original Form 10-K. No other changes have been made to the Original Form 10-K as previously filed.

In addition, as required by Rule 12b-15 under the Securities Act of 1934, as amended, new certifications by our principal executive officer and principal financial officer are filed as exhibits to this Amendment under Item 15 of Part IV hereof.

This Amendment speaks as of the filing date of our Original Form 10-K and has not been updated to reflect events occurring subsequent to the original filing date.

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PART II

Item 8. Financial Statements and Supplementary Data

Index to Consolidated Financial Statements
of MB Bancorp, Inc. and Subsidiary

	Reports of Independent Registered Public Accounting Firms					F-1
	Consolidated Balance Sheets as of December 31, 2017 and 2016					F-3
	Consolidated Statements of Operations for the Years Ended December 31, 2017 and 2016					F-4
	Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2017 and 2016					F-5
	Consolidated Statements of Equity for the Years Ended December 31, 2017 and 2016					F-6
	Consolidated Statements of Cash Flows for the Years Ended December 31, 2017 and 2016					F-7
	Notes to Consolidated Financial Statements					F-8

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
MB Bancorp, Inc. and Subsidiaries
Forest Hill, Maryland

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of MB Bancorp, Inc. and Subsidiaries (the “Company”) as of December 31, 2017, and the related consolidated statements of operations, comprehensive loss, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017, and the results of its operations and its cash flows for year then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

We have served as the Company’s auditor since 2017.
Salisbury, Maryland
March 5, 2018

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Report of Independent Registered Public Accounting Firm

The Board of Directors
MB Bancorp, Inc.
Forest Hill, Maryland

We have audited the accompanying consolidated balance sheet of MB Bancorp, Inc. and Subsidiaries (the “Company”) as of December 31, 2016, and the related consolidated statements of operations, comprehensive loss, changes in shareholders’ equity, and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2016, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ Dixon Hughes Goodman LLP

Baltimore, Maryland
March 30, 2017

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MB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

ASSETS	As of December 31, 2017			As of December 31, 2016
(Dollars in thousands)	As of December 31, 2017			As of December 31, 2016
Cash and due from banks		$	6,603		$	5,399
Interest bearing deposits in other banks			1,362			3,868
Total cash and cash equivalents			7,965			9,267
Other interest-bearing deposits in other banks			1,245			7,222
Investment securities available-for-sale – at fair value			16,605			3,698
Investment securities held to maturity – amortized cost			17,410			18,818
Loans, net of unearned fees			95,053			87,248
Less allowance for loan losses			(1,288)			(1,218)
Loans, net			93,765			86,030
Real estate ground rents			822			829
Less allowance for credit losses			(141)			(141)
Ground rents, net			681			688
Federal Home Loan Bank stock, at cost			754			418
Property and equipment – net			3,664			3,677
Deferred income taxes			—			—
Bank-owned life insurance			4,574			931
Accrued interest receivable and other assets			668			562
TOTAL ASSETS		$	147,331		$	131,311
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Deposits		$	103,308		$	93,015
Federal Home Loan Bank advances			13,000			7,000
Deferred compensation liability			159			170
Accounts payable and other liabilities			504			802
Total liabilities			116,971			100,987
STOCKHOLDERS’ EQUITY:
Common stock .01 par value; authorized 19,000,000 shares; issued 1,940,200 and 1,902,900 shares at December 31, 2017 and December 31, 2016, respectively			19			19
Additional paid-in capital			18,135			18,132
Retained earnings – substantially restricted			13,780			13,770
Accumulated other comprehensive loss			(229)			(139)
Unearned ESOP shares			(1,345)			(1,458)
Total stockholders’ equity			30,360			30,324
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	147,331		$	131,311

See accompanying notes to consolidated financial statements.

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MB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Years Ended December 31,
(Dollars in thousands, except per share amount)	2017			2016
INTEREST INCOME:
Interest and fees on loans		$	3,423		$	3,735
Interest on federal funds sold and other investments			78			135
Interest and dividends on investment securities			882			672
Total interest income			4,383			4,542
INTEREST EXPENSE:
Interest on deposits			816			769
Interest on short-term borrowings			69			1
Interest on long term borrowings			51			435
Total interest expense			936			1,205
NET INTEREST INCOME			3,447			3,337
(REVERSAL) PROVISION FOR LOAN LOSSES			—			(258)
NET INTEREST INCOME AFTER (REVERSAL) PROVISION FOR LOAN LOSSES			3,447			3,595
NON-INTEREST INCOME:
Service charges on deposit accounts			15			10
Fees and charges on loans			39			35
Increase in cash surrender value of life insurance			163			35
Gain on investment securities			57			—
Loss on early extinguishment of debt			—			(140)
Ground rent fees			41			43
Other income			44			56
Total non-interest income			359			39
NON-INTEREST EXPENSE:
Salaries and employee benefits			2,115			2,811
Occupancy expenses			433			398
Furniture and equipment expenses			41			42
Legal and professional expenses			320			414
Data processing and other outside services			322			292
FDIC insurance premiums			20			76
Advertising and marketing related expenses			9			30
Provision for loss on other real estate owned			—			—
Other expenses			473			551
Total non-interest expenses			3,733			4,614
INCOME (LOSS) BEFORE INCOME TAXES			73			(980)
INCOME TAX EXPENSE			—			771
NET INCOME (LOSS)		$	73		$	(1,751)
Basic earnings per share		$	0.04		$	(0.96)
Diluted earnings per share		$	0.04		$	(0.96)

See accompanying notes to consolidated financial statements.

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MB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	For the Years Ended
(Dollars in thousands)	December 31, 2017			December 31, 2016
NET INCOME (Loss)		$	73		$	(1,751)
OTHER COMPREHENSIVE INCOME (LOSS) ON AVAILABLE-FOR-SALE INVESTMENT SECURITIES:
Unrealized gains (losses) during the period			(90)			(128)
Reclassification of gain included in period			(57)			—
Unrealized gains (losses) during the period			(147)			(128)
Income taxes on unrealized gains (losses) during the period			—			—
			(147)			(128)
COMPREHENSIVE Income (loss)		$	(74)		$	(1,879)

See accompanying notes to consolidated financial statements.

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MB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016

(Dollars in thousands)	Common Stock			Additional Paid In Capital			Retained Earnings			Unearned ESOP Shares			Accumulated Other Comprehensive Income (Loss)			Total Stockholders’ Equity
BALANCES AT JANUARY 1, 2016		$	21		$	20,158		$	16,284		$	(1,571)		$	(11)		$	34,881
Net loss			—			—			(1,751)			—			—			(1,751)
Net unrealized loss on available-for sale securities, net of tax of $0			—			—			—			—			(128)			(128)
Stock-based compensation			—			26			—			113			—			139
Repurchase of shares			(2)			(2,052)			(763)			—			—			(2,817)
BALANCES AT DECEMBER 31, 2016		$	19		$	18,132		$	13,770		$	(1,458)		$	(139)		$	30,324
BALANCES AT JANUARY 1, 2017		$	19		$	18,132		$	13,770		$	(1,458)		$	(139)		$	30,324
Net income			—			—			73			—			—			73
Net unrealized loss on available-for sale securities, net of tax of $0			—			—			—			—			(90)			(90)
Stock-based compensation			—			124			—			113			—			237
Repurchase of shares			—			(121)			(63)			—			—			(184)
BALANCES AT DECEMBER 31, 2017		$	19		$	18,135		$	13,780		$	(1,345)		$	(229)		$	30,360

See accompanying notes to consolidated financial statements.

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MB BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Years Ended
(Dollars in thousands)	December 31, 2017			December 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)		$	73		$	(1,751)
Adjustment to reconcile net income to net cash used in operating activities:
Depreciation expense			132			133
Increase in cash surrender value of life insurance			(143)			(35)
Net amortization/accretion of premiums and discounts			69			(40)
Provision for loan losses			—			(258)
Reversal for ground rent losses			—			(8)
Deferred income tax benefits, net			—			786
Non-cash compensation under stock-based benefit plan			237			139
Increase in accrued interest and other assets			(106)			(19)
Gain on sale of investment securities			(57)			—
Loss on early extinguishment of debt			—			140
Decrease in deferred compensation liability			(11)			(76)
(Decrease) increase in accounts payable and other liabilities			(298)			432
Net cash used in operating activities			(104)			(557)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net decrease (increase) in other interest bearing deposits in other banks			5,977			11,088
Purchase of available-for-sale investments			(15,971)			(2,499)
Proceeds from calls/repayments of available-for-sale investments			1,599			7,185
Proceeds from sale of available for sale securities			1,359			—
Purchase of held-to-maturity investments			(1,732)			(31,596)
Proceeds from maturity/repayments of held-to-maturity investments			3,144			21,938
(Increase) decrease in loans, net			(7,735)			7,353
Proceeds from sale of ground rents			7			15
Purchase of bank-owned life insurance			(3,500)			—
Purchase of property, plant and equipment			(119)			(17)
Redemption of Federal Home Loan Bank stock			(336)			270
Net cash provided by (used in) investing activities			(17,307)			13,737
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits		$	10,293		$	323
Federal Home Loan Bank advances			52,000			7,000
Federal Home Loan Bank repayments			(46,000)			(12,140)
Repurchase of common stock			(184)			(2,817)
Net cash used in financing activities			16,109			(7,634)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			(1,302)			5,546
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR			9,267			3,721
CASH AND CASH EQUIVALENTS AT END OF YEAR		$	7,965		$	9,267
Supplemental cash flow information:
Interest paid		$	922			1,267
Income taxes paid		$	—		$	—
Noncash:
Transfer of other real estate owned to loans		$	—		$	—

See accompanying notes to consolidated financial statements.

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MB BANCORP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

In 2002, Bohemian American Federal Savings and Loan Association, Inc., incorporated in 1899 in the State of Maryland, merged with Madison & Bradford Federal Savings & Loan Association, incorporated in 1904 in the State of Maryland, to form Madison Bohemian Savings Bank. On September 1, 2009 Madison Bohemian Savings Bank changed its name to Madison Bank of Maryland (the “Bank”). The Bank’s principal business is providing mortgage and consumer loans in Baltimore and Harford County. The Bank also provides construction and lot loans. Significant accounting policies followed by the Bank are presented below.

On August 26, 2014, the Bank’s Board of Directors approved a plan (the “Plan”) to convert from a federally-chartered mutual savings bank to a federally-chartered stock savings bank form of organization, which was subsequently approved by the Bank’s members. The Plan included the formation of MB Bancorp, Inc. (the “Company”) to own all of the outstanding capital stock of the Bank. On December 29, 2014, the Bank completed its mutual-to-stock conversion. On that date, the Bank became the wholly owned subsidiary of the Company and the Company sold 2,116,000 shares of its common stock for gross offering proceeds of $21,160,000.

The cost of conversion and issuing and selling the capital stock was deducted from the proceeds of the offering. At the time of conversion, the Bank established a liquidation account in an amount equal to its retained earnings as reflected in the latest balance sheet used in the final conversion prospectus. The liquidation account will be maintained for the benefit of eligible account holders who continue to maintain their deposit accounts in the Bank after conversion. The liquidation account will be reduced annually to the extent that eligible depositors have reduced their qualifying deposits. In the event of a complete liquidation of the Bank, eligible depositors who continue to maintain accounts in accordance with Office of the Comptroller of the Currency (“OCC”) regulations will be entitled to receive a distribution from the liquidation account before any liquidation may be made with respect to the Company’s common stock. The conversion will be accounted for as change in corporate form with the historic base of the Bank’s assets, liabilities and equity unchanged as a result. The Bank may not declare or pay a cash dividend if the effect thereof would cause its net worth to be reduced below either the amount required for the liquidation account discussed below or the regulatory capital requirements imposed by the OCC.

Principles of Consolidation

The consolidated financial statements include the accounts of MB Bancorp, Inc. (“The Company”) and its wholly owned subsidiaries, Madison Bank of Maryland (“The Bank”), 1920 Rock Spring Road, LLC formed in 1998 to own and hold real estate and Mutual, LLC formed in 2011 to hold other real estate owned. All significant intercompany accounts and transactions have been eliminated. The accounting and reporting policies of the Company conform to U.S. generally accepted accounting principles and to general practices in the banking industry.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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.

Cash and Cash Equivalents

The Company has included cash and due from banks, interest-bearing deposits in other banks with original maturities of 90 days or less, and federal funds sold and other overnight investments as cash and cash equivalents for the purpose of reporting cash flows.

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Credit Risk

The Company has unsecured deposits with several other financial institutions in excess of amounts insured by the Federal Deposit Insurance Corporation (“FDIC”).

Investments Securities

As securities are purchased, management determines if the securities should be classified as held to maturity or available for sale. Securities which management has the intent and ability to hold to maturity are recorded at amortized cost. Securities which may be sold before maturity are classified as available for sale and carried at fair value with unrealized gains and losses included in accumulated other comprehensive income, a separate component of equity, on an after-tax basis. Realized gains and losses, using the specific identification method, are included as a separate component of noninterest income. Premiums and discounts on investment securities are amortized/accreted to the earlier of call or maturity. Investments in Federal Home Bank stock are excluded from securities classified as available for sale and are carried at cost.

Declines in the fair value of individual available for sale or held to maturity securities below their cost that are other than temporary, result in write-downs of the individual securities to their fair value. Factors affecting the determination of whether another-than-temporary impairment has occurred include, among others, a downgrading of the security by the rating agency or a significant deterioration in the financial condition of the issuer.

Management systematically evaluates investment securities for other-than-temporary declines in fair value on a quarterly basis. This analysis requires management to consider various factors, which include (1) duration and magnitude of the decline in value, (2) the financial condition of the issuer or issuers and (3) the structure of the security.

An impairment loss is recognized in earnings only when (1) the Bank intends to sell the debt security; (2) it is more likely than not that the Bank will be required to sell the security before recovery of its amortized cost basis; or (3) the Company does not expect to recover the entire amortized cost basis of the security. In situations where the Bank intends to sell or when it is more likely than not that the Company will be required to sell the security, the entire impairment loss must be recognized in earnings. In all other situations, only the portion of the impairment loss representing the credit loss must be recognized in earnings, with the remaining portion being recognized in stockholders’ equity as a component of other comprehensive income, net of deferred taxes.

Loans

Loans are stated at the principal amount outstanding net of any deferred fees and costs. Interest income on loans is accrued at the contractual rate on the principal amount outstanding. It is the Company’s policy to discontinue the accrual of interest when circumstances indicate that collection is doubtful. Direct loan origination fees, net of direct loan origination costs, are amortized or accreted over the contractual life of the loan using the interest method.

Loans are considered impaired when, based on current information; it is probable that the Company will not collect all principal and interest payments according to contractual terms. Generally, loans are considered impaired once principal and interest payments are past due and they are placed on non-accrual. Management also considers the financial condition of the borrower, cash flows of the loan and the value of the related collateral. Impaired loans do not include large groups of smaller balance homogeneous credits such as residential real estate and consumer installment loans, which are evaluated collectively for impairment. Loans specifically reviewed for impairment are not considered impaired during periods of “minimal delay” in payment (usually ninety days or less) provided eventual collection of all amounts due is expected. Impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate, except that as a practical expedient, the Company may measure impairment based on a loan’s observable market price or the fair value of the collateral, if the loan is collateral dependent. The Company recognizes interest income on impaired loans on a cash basis if the borrower demonstrates the ability to meet the contractual obligation and collateral is sufficient. If there is doubt regarding the borrower’s ability to make payments or the collateral is not sufficient, payments received are accounted for as a reduction in principal.

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A loan is considered to be a troubled debt restructured loan (“TDR”) when the Company grants a concession to the borrower that the Company would not otherwise consider to a borrower of comparable risk and placed on non-accrual status. Such concessions include the reduction of interest rates, forgiveness of all or a portion of principal or interest, extension of loan term or other modifications at interest rates
that are less than the current market rate for new obligations with similar risk. If a loan is in nonaccrual status at the time we restructure it and classify the restructure as a troubled debt restructuring, it is our policy to maintain the loan as nonaccrual until we receive six consecutive monthly payments under the restructured terms. TDR loans that are in compliance with their modified terms and that yield a market rate may be removed from the TDR status after a period of one year.

Allowance for Loan Losses

The allowance for loan losses is established through a provision for loan losses charged to expense or reversal for loan losses which is credited to expense. Loans are charged against the allowance for loan losses when management believes that the collectability of the principal is unlikely. The Company maintains an allowance for loan losses at an amount estimated to equal all loan losses incurred in our loan portfolio that are both probable and reasonable to estimate at a balance sheet date. The evaluations take into consideration such factors as changes in the nature and volume of the loan portfolio, overall portfolio quality, review of specific problem loans, and current economic conditions and trends that may affect the borrowers’ ability to pay.

The allowance for loan losses represents an estimation done pursuant to either Accounting Standards Codification (“ASC”) Topic 450 “Contingencies” or Topic 310 “Receivables.” The Company uses a loan grading system where loans are graded based on management’s evaluation of the risk associated with each loan. A factor, based on the loan grading is applied to the loan allowance to provide for losses. In addition, management judgmentally establishes an additional nonspecific reserve. The nonspecific portion of the allowance reflects management’s estimate of probable inherent but undetected losses within the portfolio due to uncertainties in economic conditions, delays in obtaining information, including unfavorable information about a borrower’s financial condition, the difficulty in identifying triggering events that correlates perfectly to subsequent loss rates, and risk factors that have not yet manifested themselves in loss allocation factors. The adequacy of the allowance is determined through careful and continuous evaluation of the loan portfolio, which involves the consideration of a number of factors to establish a prudent level. Determination of the allowance is inherently subjective and requires significant estimates, including estimated losses on pools of homogeneous loans based on historical loss experience and consideration of current economic trends, which may be susceptible to significant change.

While management believes it has established the allowance for loan losses in accordance with generally accepted accounting principles and has taken into account the views of its regulators and the current economic environment, there can be no assurance that in the future the Bank’s regulators or the economic environment will not require further increases in the allowance.

Real Estate Ground Rents

Ground rents are a form of real estate ownership where the land is owned by one entity, but the improved property located on the land is owned by the homeowner. The Company’s ground rents are supported by deeds that have been registered with Maryland State Department of Assessments and Taxation. Under Maryland law, homeowners are required to pay the ground rent owner an annual fee that is stated in the original ground rent deed. The fee is typically 6% of the original value of the land as stipulated in the deed and is paid biannually. In addition, Maryland law stipulates that ground rent owners are required to sell or redeem the ground rent to the homeowner when requested. The redemption price on the ground rent is the lesser of the annual ground rent fee divided by a statutory redemption rate, which ranges from 6% to 12%, or the contractual sales price. Maryland also limits the collection of ground rent fees to amounts due for three years or less.

Ground rents are recorded at the lower of cost or fair value. Fair value is estimated based on the contractual value of the unconsummated redemption or sales agreements. Ground rent fees are recognized upon receipt and included in non-interest income. At December 31, 2017 and 2016, the Company’s investment includes individual ground rents ranging from $600 to $3,000, totaling $822,000 and $829,000

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respectively. An allowance for losses is established when the collectability of ground rent payments becomes uncertain, typically when the ground rent payment becomes three years delinquent. At December 31, 2017 and 2016, the Company had $141,000 and $141,000 respectively, of ground rents that were three years or more delinquent and were reserved at 100%.

Premises and Equipment

Premises and equipment are stated at cost less accumulated depreciation and amortization computed using the straight-line method. Premises and equipment are depreciated over the useful lives of the assets. Useful lives range from five to ten years for furniture, fixtures, and equipment; three to five years for software, hardware, and data handling equipment. Maintenance and repairs are charged to expense as incurred, while improvements, which extend the useful life, are capitalized and depreciated over the estimated remaining life of the asset.

Long-lived depreciable assets are evaluated periodically for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. Impairment exists when the expected undiscounted future cash flows of a long-lived asset are less than its carrying value. In that event, the Company recognizes a loss for the difference between the carrying amount and the estimated fair value of the asset based on a quoted market price, if applicable, or a discounted cash flow analysis.

Bank-Owned Life Insurance

The Bank purchased single-premium life insurance policies on certain former officers and directors of the Bank. The net cash surrender value of those policies is classified in other assets. Appreciation in the value of the insurance policies is classified in non-interest income.

Other Real Estate Owned

Real estate acquired in satisfaction of a debt is carried at fair value net of estimated selling costs. Costs incurred in maintaining foreclosed real estate and write-downs to reflect declines in the fair value of the properties after acquisition are included in noninterest expenses.

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales, when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (1) the assets have been isolated from the Bank, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Earnings Per Share

Basic per share amounts are based on the weighted average shares of common stock outstanding. Unearned ESOP shares are not included in outstanding shares. Diluted earnings per share assume the conversion, exercise or issuance of all potential common stock instruments such as options, warrants and convertible securities, unless the effect is to reduce a loss or increase earnings per share.

Advertising Costs

Advertising costs are generally expensed as incurred.

Income Taxes

The Bank uses the liability method of accounting for income taxes. Under the liability method, deferred-tax assets and liabilities are determined based on differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities (i.e., temporary differences) and are measured at the enacted rates that will be in effect when these differences reverse. Deferred income taxes are

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recognized when it is deemed more likely than not that the benefits of such deferred income taxes will be realized. The Bank recognizes interest and/or penalties related to income tax matters in income tax expense. Tax years subsequent to December 31, 2014 remain subject to examination by Federal and State of Maryland jurisdictions.

ASC Topic 740, “Income Taxes,” provides clarification on accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Bank has not identified any income tax uncertainties.

Recognition of Deferred Tax Valuation Allowance

During 2014, management established a valuation allowance for the net operating loss component of the Bank’s deferred tax assets as the Bank had remained in a cumulative loss position for three consecutive years and consequently management reevaluated the need for a valuation allowance of the deferred tax asset balance. Management’s evaluation included: management’s ability to fully implement our strategic plan and the ability to generate sufficient taxable income to fully realize the Bank’s net operating loss carryforwards. Management concluded that it is more likely than not the Bank will be unable to generate sufficient taxable income in the foreseeable future to fully utilize the cumulative net operating loss carryforward and, therefore, established a valuation allowance to offset the net operating loss carryforward related deferred tax asset. As of December 31, 2017, management concluded that it is more likely than not the Bank will be unable to generate sufficient taxable income in the foreseeable future to fully utilize the deferred tax assets and placed a full valuation allowance on all net deferred tax assets.

Stock-Based Compensation

The Company has stock-based incentive arrangements to attract and retain key personnel in order to promote the success of the business. In May 2016, the 2016 Equity Incentive Plan (the “2016 plan”) was approved by shareholders, which authorizes the issuance of restricted stock and stock options to the Board of Directors and key employees.

Compensation cost for all stock-based awards is measured at fair value on date of grant and recognized over the vesting period on a straight-line basis. Such value is recognized as expense over the service period, net of estimated forfeitures. The estimation of stock awards that ultimately vest requires judgment, and to the extent actual results or updated estimates differ from our current estimates, such amounts will be recorded as a cumulative adjustment in the period estimates are revised. The Company considers many factors when estimating expected forfeitures, including types of awards, employee class and historical experience.

Supplemental Executive Retirement Plans (“SERP”)

The Bank has SERP’s with various former officers and directors of the Bank. The liabilities under the majority of the agreements are capped at the cash values of insurance policies that have been purchased to fund the policies. The liability for a director who has already attained retirement age has been calculated on the present value of payments under the plan. There is also life insurance to protect the Bank under this director’s plan.

Financial Statement Presentation

Certain amounts in the prior years’ financial statements have been reclassified to conform to the correct year’s presentation.

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INVESTMENT SECURITIES

The carrying amount and estimated fair market value of investment securities classified as available-for-sale are summarized as follows:

	December 31, 2017
(Dollars in thousands)	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Estimated Fair Value
Investments available-for-sale:
U.S. Government securities		$	1,000		$	—		$	(55)		$	945
Municipal Securities			499			—			(2)			497
Mortgage-backed securities			15,334			—			(171)			15,163
Total investments available-for-sale		$	16,833		$	—		$	(228)		$	16,605

	December 31, 2016
(Dollars in thousands)	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Estimated Fair Value
Investments available-for-sale:
U.S. Government securities		$	1,000		$	—		$	(67)		$	933
Mortgage-backed securities		$	2,837			10			(82)			2,765
Total investments available-for-sale		$	3,837		$	10		$	(149)		$	3,698

The carrying amount and estimated fair market value of investment securities classified as held-to-maturity are summarized as follows:

	December 31, 2017
(Dollars in thousands)	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Estimated Fair Value
Investments held-to-maturity:
U.S. Government securities		$	12,500		$	—		$	(424)		$	12,076
Mortgage backed securities			4,910			106			(84)			4,932
Total investments held-to-maturity		$	17,410		$	106		$	(508)		$	17,008

	December 31, 2016
(Dollars in thousands)	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Estimated Fair Value
Investments held-to-maturity:
U.S. Government securities		$	12,500		$	—		$	(612)		$	11,888
Mortgage backed securities			6,318			183			(118)			6,383
Total investments held-to-maturity		$	18,818		$	183		$	(730)		$	18,271

Below are schedules of both available-for-sale and held-to-maturity securities with unrealized losses as of December 31, 2017 and 2016 and the length of time the individual security has been in a continuous unrealized loss position. Unrealized losses are the result of interest rate levels differing from those existing at the time of purchase of the securities and as to mortgage-backed securities, estimated prepayment speeds. At December 31, 2017 and 2016, these unrealized losses are considered temporary as they reflect changes in fair values and are subject to change daily as interest rates fluctuate and the Bank has the ability and intent to hold the securities until the earlier of maturity or recovery.

The Bank realized gains of $57,000 on sale of investment securities for the year ended December 31, 2017. There were no sales of investment securities for the year ended December 31, 2016. Proceeds from sales of available for sale securities totaled $1.4 million for the year ended December 31, 2017 with realized

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gains of $23,000. During the year ended December 31, 2017, the Bank also sold held-to-maturity securities which has a substantial (greater than 85%) portion of the principal paid prior to the sale of the security thus not tainting the remaining held-to-maturity portfolio. Proceeds from sales of held-to-maturity securities totaled $701,000 for the year ended December 31, 2017 with realized gains of $34,000.

	December 31, 2017
	Less than 12 Months						12 Months or More						Total
(Dollars in thousands)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Mortgage-backed securities		$	13,443		$	(117)		$	4,499		$	(138)		$	17,942		$	(255)
Municipal Securities			497			(2)									497			(2)
U.S. Government securities			987			(13)			12,034			(466)			13,021			(479)
Total temporarily impaired securities		$	14,927		$	(132)		$	16,533		$	(604)		$	31,460		$	(736)

	December 31, 2016
	Less than 12 Months						12 Months or More						Total
(Dollars in thousands)	Fair Value			Unrealized Losses			Fair Value			Unrealized Losses			Fair Value			Unrealized Losses
Mortgage-backed securities		$	5,369		$	(200)		$	—		$	—		$	5,369		$	(200)
Government securities			12,821			(679)			—			—			12,821			(679)
Total temporarily impaired securities		$	18,190		$	(879)		$	—		$	—		$	18,190		$	(879)

The scheduled maturities of debt securities at December 31, 2017 were as follows:

	Amortized Cost			Fair Value
	(in thousands)			(in thousands)
Due over one year through five years		$	1,000		$	987
Due over five years through ten years			4,000			3,875
Due after ten years			8,999			8,656
Mortgage-backed securities			20,244			20,095
Total		$	34,243		$	33,613

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LOANS RECEIVABLE

Loans receivable consist of the following:

(Dollars in thousands)	December 31, 2017			December 31, 2016
Secured by real estate:
Residential:
One-to four-family		$	74,266		$	71,266
Multi-family			1,243			2,038
Total			75,509			73,304
Non-residential			13,183			7,021
Construction and land loans			3,240			5,104
Home equity line of credit (“HELOC”)			3,471			3,473
Consumer and other loans:
Loans to depositors, secured by savings, &C&I			424			18
			95,827			88,920
Add:
Net discount on purchased loans			1			10
Unamortized net deferred costs			41			16
Less:
Undisbursed portion of construction loans			(741)			(1,650)
Unearned net loan origination fees			(75)			(48)
Less allowance for loan losses			(1,288)			(1,218)
Loans receivable, net		$	93,765		$	86,030

The risks associated with lending activities differ among the various loan types and are subject to the impact of changes in interest rates, market conditions of collateral securing the loans, and general economic conditions. All of these factors may adversely impact the borrower’s ability to repay its loans and impact the associated collateral.

Residential real estate includes mortgage loans with the underlying one- to four-family or multi-family residential property (primarily owner-occupied) securing the debt. The Bank’s attempt to minimize risk exposure is minimized in these types of loans through the evaluation of the credit worthiness of the borrower, including debt-to-income ratios and underwriting standards which limit the loans-to-value ratio at origination to generally no more than 80% unless the borrower obtains private mortgage insurance.

Residential real estate also includes home equity loans and lines of credit. These present a slightly higher risk to the Bank than one-to four-family first lien mortgages as they can be first or second liens on the underlying property. These loans are generally limited with respect to loan-to-value ratios and the credit worthiness of the borrower is considered including debt-to-income ratios.

Non-residential real estate includes various types of loans which have differing levels of credit risk associated with them. Owner-occupied commercial real estate loans are generally dependent upon the successful operation of the borrower’s business, with cash flows generated from the business being the primary source of loan repayment. If the business suffers a downturn in sales or profitability, the borrower’s ability to repay the loan could be in jeopardy. The Bank, attempts to minimize this credit risk through its underwriting standards which include the credit worthiness of the borrower, a limitation on loan amounts to the value of the property securing the loan, and an evaluation of debt service coverage ratios. Non-owner occupied commercial real estate loans present a different credit risk to the Bank than owner-occupied commercial real estate, as the repayment of the loan is dependent upon the borrower’s ability to generate a sufficient level of occupancy to produce rental income that exceeds debt service requirement and operating expenses. Lower occupancy or lease rates may result in a reduction in cash flows, which hinder the ability of

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the borrower to meet debt service requirements, and may result in lower collateral values. The Bank generally follows the same underwriting standards for these loans as with owner occupied commercial real estate, but recognizes the greater risk inherent in these credit relationships in its loan pricing.

Construction and land loans consist of one- to four-family residential construction and land development loans. The risk of loss on these loans is largely dependent on the Bank’s ability to assess the property’s value at the completion of the project. During the construction phase, a number of factors could potentially negatively impact the collateral value, including cost overruns, delays in completing the project, competition and real estate market conditions which may change based on the supply of similar properties in the area. In the event the collateral value at the completion of the project is not sufficient to cover the outstanding loan balance, the Bank must rely upon other repayment sources, including the borrowers and/or guarantors of the project or other collateral securing the loan. The Bank attempts to mitigate credit risk through strict underwriting standards including evaluation of the credit worthiness of the borrowers and their success in other projects, adequate loan-to-value ratios and continual monitoring of the project during its construction phase.

Consumer loans consist primarily of loans secured by the borrower’s deposit balance at the Bank. As these loans are typically 100% secured by savings and certificate of deposits, the risk of credit loss is not deemed significant.

The Bank maintains an allowance for loan losses at an amount estimated to equal all loan losses incurred in our loan portfolio that are both probable and reasonable to estimate at a balance sheet date. Our determination as to the classification of our assets is subject to review by the OCC and the FDIC. We regularly review our asset portfolio to determine whether any assets require classification in accordance with applicable regulatory guidelines.

The Bank provides for loan losses based upon the consistent application of our documented allowance for loan loss methodology. All loan losses are charged to the allowance for loan losses and all recoveries are credited to it. Additions to the allowance for loan losses are provided by charges to income and reductions in the allowance result in credits to income based on various factors which, in our judgment, deserve current recognition is estimating probable losses. We regularly review the loan portfolio and make provisions or reversals for loan losses in order to maintain the allowance for loan losses in accordance with Generally Accepted Accounting Principles (“GAAP”). The allowance for loan losses consists of two components:

•

Specific allowances are only established for non-collateral dependent troubled-debt restructured loans and are established at the modification date of the troubled loan. The specific valuation allowance is computed as the excess of the loan’s expected cash flow based on the remaining original loan terms and the expected cash flow of the corresponding modified loan discounted at the original loan rate. As long as the borrower performs under the terms of the modification agreement, on a monthly basis we recalculate the specific valuation using the discounted cash-flow method described above. If the borrower fails to perform under the modification agreement, we will treat the loan as a collateral dependent and measure the loss by using the fair value of the collateral less disposition costs.

Losses on non-modified loans are charged-off in the month the loss is measured. Non-modified loans are measured for loss at the point the loan becomes 90 to 120 days delinquent or at maturity if an extension is requested. We obtain a third party appraisal to determine the fair value of the collateral. We measure these loans for loss by using the fair value of collateral less disposition costs method and if any loss is determined it is charged off directly. Subsequently, these loans are re-evaluated at least quarterly by obtaining an updated third party appraisal or other valuations such as from the Freddie Mac Automated Valuation Model to determine if there should be any further loss recognition.

•

General allowances are established for loan losses on a portfolio basis for loans that do not meet the definition of impaired loans. The portfolio is grouped into similar risk characteristics, primarily loan type and regulatory classification. We apply an estimated loss rate to each loan group. The loss rates applied are based upon our loss experience adjusted, as appropriate, for the qualitative factors discussed below.

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Management’s periodic evaluation of the adequacy of the allowance is based on the Bank’s historical loan loss experience, known and inherent losses in the portfolio, adverse situations that may affect the borrower’s ability to repay, and the estimated value of any underlying collateral. The historical loss experience is further adjusted for qualitative factors which include: changes in composition of the loan portfolio, current economic conditions, trends of past due and classified loans, quality of loan review system and Board oversight, existence and effect of concentrations and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant change, including the amounts and timing of future cash flows expected to be received on impaired loans.

A loan is considered past due or delinquent when a contractual payment is not paid on the day it is due. Loans are generally placed on non-accrual status when they become 120 days delinquent. We may choose to consider loans from 90 to 119 days delinquent to be non-accrual, and generally do so except where a borrower has a history of periodically bringing a loan current after being 90 days or more delinquent. If the loan is less than 90 days delinquent, but information is brought to our attention that indicates the collection of interest is doubtful, the loan will immediately be considered non-accrual. A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan by loan basis. If the loan is deemed collateral dependent, the impairment is measured on the net realizable value of the collateral. If loan repayment is not deemed collateral dependent, impairment is measured on the net present value of the expected discounted future cash flows.

The Bank charges off loans after the loan, or a portion of the loan is deemed to be a loss and the loss amount has been determined. The loss amount is charged to the established allowance for loan losses. Each loss is evaluated on its specific facts regarding the appropriate timing to recognize the loss.

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Allowance for loan losses and recorded investment in loans for the year ended December 31, 2017 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Unallocated			Total
Allowance for loan losses:
Beginning balance		$	973		$	158		$	87		$	—		$	1,218
Charge-offs			(85)			(81)			—			—			(166)
Recoveries			105			—			131			—			236
Provisions (Reversal)			50			81			(131)			—			—
Ending balance		$	1,043		$	158		$	87		$	—		$	1,288
Allowance for loan losses: Ending balance: individually evaluated for impairment		$	30		$	—		$	—		$	—		$	30
Ending balance: collectively evaluated for impairment		$	1,013		$	158		$	87		$	—		$	1,258
Loans:
Ending balance: individually evaluated for impairment		$	2,179		$	1,154		$	1,094		$	—		$	4,427
Ending balance: collectively evaluated for impairment		$	77,225		$	12,029		$	2,146		$	—		$	91,400

Allowance for loan losses and recorded investment in loans for the year ended December 31, 2016 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Unallocated			Total
Allowance for loan losses:
Beginning balance		$	960		$	194		$	157		$	250		$	1,561
Charge-offs			(4)			—			(81)			—			(85)
Recoveries			—			—			—			—			—
Provisions (Reversal)			17			(36)			11			(250)			(258)
Ending balance		$	973		$	158		$	87		$	—		$	1,218
Allowance for loan losses: Ending balance: individually evaluated for impairment		$	38		$	—		$	—		$	—		$	38
Ending balance: collectively evaluated for impairment		$	935		$	158		$	87		$	—		$	1,180
Loans:
Ending balance: individually evaluated for impairment		$	3,772		$	1,451		$	2,346		$	—		$	7,569
Ending balance: collectively evaluated for impairment		$	73,023		$	5,570		$	2,758		$	—		$	81,351

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Credit risk profile by internally assigned classification as of December 31, 2017 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
Non-classified		$	74,808		$	11,181		$	1,910		$	87,899
Special mention			2,060			—			236			2,296
Substandard			2,536			2,002			1,094			5,632
Doubtful			—			—			—			—
Loss			—			—			—			—
Total		$	79,404		$	13,183		$	3,240		$	95,827

Credit risk profile by internally assigned classification as of December 31, 2016 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
Non-classified		$	71,147		$	5,653		$	2,791		$	79,591
Special mention			3,005			159			87			3,251
Substandard			2,643			1,209			2,226			6,078
Doubtful			—			—			—			—
Loss			—			—			—			—
Total		$	76,795		$	7,021		$	5,104		$	88,920

•

Special Mention — A Special Mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special Mention assets are not considered adversely classified in accordance with regulatory guidelines and do not expose an institution to sufficient risk to warrant adverse classification.

•

Substandard — Substandard loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected.

•

Doubtful — Loans classified Doubtful have all the weaknesses inherent in those classified Substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions and values, highly questionable and improbable.

•

Loss — Loans classified Loss are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be affected in the future.

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Impaired loans as of and for the year ended December 31, 2017 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
With no related allowance recorded:
Recorded investment		$	1,823		$	1,154		$	1,094		$	4,071
Unpaid principal balance			2,421			2,026			2,137			6,584
Average recorded investment, for the twelve months ended December 31, 2017			2,511			1,468			1,310			5,289
Interest income recognized			179			92			41			312
Interest income foregone			8			4			53			65
With an allowance recorded:
Recorded investment			356			—			—			356
Unpaid principal balance			357			—			—			357
Related allowance			30			—			—			30
Average recorded investment, for the twelve months ended December 31, 2017			354			—			—			354
Interest income recognized			57			—			—			57
Interest income foregone			—			—			—			—
Total
Recorded investment			2,179			1,154			1,094			4,427
Unpaid principal balance			2,778			2,026			2,137			6,941
Related allowance			30			—			—			30
Average recorded investment, for the twelve months ended December 31, 2017			2,865			1,468			1,310			5,643
Interest income recognized			236			92			41			369
Interest income foregone			8			4			53			65

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Impaired loans as of and for the year ended December 31, 2016 is as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
With no related allowance recorded:
Recorded investment		$	2,633		$	1,451		$	2,346		$	6,430
Unpaid principal balance			2,971			1,665			3,512			8,148
Average recorded investment, for the twelve months ended December 31, 2016			2,522			1,353			2,309			6,184
Interest income recognized			166			45			122			333
Interest income foregone			11			18			7			36
With an allowance recorded:
Recorded investment			1,139			—			—			1,139
Unpaid principal balance			1,140			—			—			1,140
Related allowance			38			—			—			38
Average recorded investment, for the twelve months ended December 31, 2016			1,151			—			—			1,151
Interest income recognized			792			—			—			792
Interest income foregone			50			—			—			50
Total
Recorded investment			3,772			1,451			2,346			7,569
Unpaid principal balance			4,111			1,665			3,512			9,288
Related allowance			38			—			—			38
Average recorded investment, for the twelve months ended December 31, 2016			3,673			1,353			2,309			7,335
Interest income recognized			958			45			122			1,125
Interest income foregone			61			18			7			86

An aged analysis of past due loans as of December 31, 2017 are as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, C&I, and Consumer			Non-residential Real Estate			Construction and Land			Total
Current		$	78,710		$	13,183		$	2,609		$	94,502
30 – 59 days past due			115			—			—			115
60 – 89 days past due			—			—			—			—
Greater than 90 day past due and still accruing			341			—			—			341
Greater than 90 days past due			238			—			631			869
Total past due			694			—			631			1,325
Total		$	79,404		$	13,183		$	3,240		$	95,827

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An aged analysis of past due loans as of December 31, 2016 are as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
Current		$	74,773		$	6,912		$	3,312		$	84,997
30 – 59 days past due			908			—			1,792			2,700
60 – 89 days past due			433			—			—			433
Greater than 90 day past due and still accruing			—			—			—			—
Greater than 90 days past due			681			109			—			790
Total past due			2,022			109			1,792			3,923
Total		$	76,795		$	7,021		$	5,104		$	88,920

Non-performing loans as of December 31, 2017 are as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
Non-accruing troubled debt restructured loans		$	427		$	—		$	649		$	1,076
Other non-accrual loans			430			74			—			504
Total non-accrual loans			857			74			649			1,580
Accruing troubled debt restructured loans			1,059			1,153			—			2,212
Total		$	1,916		$	1,227		$	649		$	3,792

Non-performing loans as of December 31, 2016 are as follows:

(Dollars in thousands)	Residential Real Estate, HELOC, and Consumer			Non-residential Real Estate			Construction and Land			Total
Non-accruing troubled debt restructured loans		$	565		$	1,020		$	33		$	1,618
Other non-accrual loans			541			—			—			541
Total non-accrual loans			1,106			1,020			33			2,159
Accruing troubled debt restructured loans			1,172			348			1,760			3,280
Total		$	2,278		$	1,368		$	1,793		$	5,439

Troubled debt restructurings (“TDRs”) are modifications of loans to assist borrowers who are unable to meet the original terms of their loans, in an effort to minimize the potential loss on the loan. Modifications of the loan terms includes but is not necessarily limited to: reduction of interest rates, forgiveness of all or a portion of principal or interest, extension of loan term or other modifications at interest rates that are less than the current market rate for new obligations with similar risk. If a loan is in non-accrual status at the time we restructure it and classify the restructure as a troubled debt restructuring, it is our policy to maintain the loan as nonaccrual until we receive six consecutive payments under the restructured terms. TDR loans that are in compliance with their modified terms and have made at least six consecutive payments under the restructured terms are included in accruing TDR loans.

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The following includes loans modified as troubled debt restructurings during the year ended December 31, 2017.

(Dollars in thousands)	Number of Contracts		Pre-modification Outstanding Recorded Investment			Post-modification Outstanding Recorded Investment
Residential real estate and consumer		1		$	156		$	156
Non-residential real estate		—			—			—
Construction and land		—			—			—
Total		1		$	156		$	156

The following includes loans modified as troubled debt restructurings during the year ended December 31, 2016.

(Dollars in thousands)	Number of Contracts		Pre-modification Outstanding Recorded Investment			Post-modification Outstanding Recorded Investment
Residential real estate and consumer		2		$	347		$	347
Non-residential real estate		—			—			—
Construction and land		—			—			—
Total		2		$	347		$	347

During the years ended December 31, 2017 and 2016, no loans classified as troubled debt restructurings subsequently defaulted.

Loans serviced by the Bank for the benefit of others totaled $401,000 and $422,000 at December 31, 2017 and 2016, respectively.

Consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure totaled $5,000 and $0 as of December 31, 2017 and 2016.

PROPERTY AND EQUIPMENT

Property and equipment is summarized by major classification as follows at:

(Dollars in thousands)	December 31, 2017			December 31, 2016
Land		$	1,018		$	1,018
Buildings			4,398			4,346
Furniture, fixtures and equipment			1,021			983
			6,437			6,347
Less accumulated depreciation and amortization			2,773			2,670
Total property and equipment		$	3,664		$	3,677

Depreciation expense for the years ended December 31, 2017 and 2016 was $132,000 and $133,000, respectively.

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The Bank is obligated under long-term operating leases for one of its branches. Rental expense under these agreements was approximately $90,000 and $92,000 for the years ended December 31, 2017 and 2016, respectively. At December 31, 2017, the minimum rental commitments under the non-cancelable operating leases are as follows:

Year Ending December 31:
2018		82,366
2019		84,837
2020		87,383
2021		90,004
2022		61,346
	$	405,936

OTHER REAL ESTATE OWNED

The balance in other real estate owned at December 31, 2017 and 2016 was $0.

The activity in residential other real estate owned is as follows:

(Dollars in thousands)

December 31,
2017

December 31,
2016

Beginning balance

—

Additions

—

Transfers from Loans

—

Transfers to Loans

—

Sales

—

Provisions

—

Ending balance

—

DEPOSITS

Deposits are summarized as follows:

(Dollars in thousands)	December 31, 2017			December 31, 2016
Non-interest-bearing deposits		$	1,542		$	1,415
NOW and Money market			21,481			21,241
Savings			14,718			13,811
Certificates of deposit			65,567			56,548
Total deposits		$	103,308		$	93,015

The aggregate amount of time deposits in denominations of $250,000 or more as of December 31, 2017 and 2016 was $3,165,000 and $2,724,000, respectively. Deposit amounts in excess of $250,000 generally are not insured by the Federal Deposit Insurance Corporation.

At December 31, 2017, the schedule maturities of certificates of deposit are as follows:

(Dollars in thousands)
2018	$	35,440
2019		11,309
2020		7,331
2021		7,527
2022		3,960
Total	$	65,567

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Executive officers’ and directors’ deposits were $330,000 and $237,000 at December 31, 2017 and 2016, respectively.

INCOME TAXES

The sources of deferred tax assets and liabilities and the tax effect of each are as follows:

(Dollars in thousands)	December 31, 2017			December 31, 2016
Deferred tax assets:
Deferred loan fees and costs, net		$	9		$	12
Allowance for credit losses			355			481
Deferred compensation			44			67
Severance payments			60			170
Restricted stock awards			14			2
Allowance for ground rents			39			56
Allowance for delinquent mortgage interest			101			141
Contribution carryforward			2			2
Net operating loss carryforward			1,354			1,831
Unrealized loss on available-for-sale securities			—			—
Total deferred tax assets			1,978			2,762
Valuation allowance			(1,883)			(2,608)
Deferred tax assets after valuation allowance			95			154
Deferred tax liabilities:
Depreciation			95			130
ESOP			—			24
Total deferred tax liabilities			95			154
Net deferred tax assets		$	—		$	—

Management evaluates deferred tax assets annually.

The provision for income taxes is comprised of the following:

	Year Ended December 31
(Dollars in thousands)	2017			2016
Tax expense (benefit):
Current federal and state		$	—		$	(15)
Deferred tax			—			786
Total		$	—		$	771

A reconciliation of the provision for income taxes at the statutory federal tax rates to the Bank’s actual provision for income taxes is as follows:

	12 Months Ended December 31, 2017		12 Months Ended December 31, 2016
Computed at federal statutory rates		34.0%		(34.0)%
State income taxes, net of federal tax benefit		0.0		0.0
Bank-owned life insurance income		(76.0)		(1.2)
Nondeductibles		13.1		0.9
Valuation allowance		2.4		111.7
Other		26.6		1.3
Total		0.0%		78.7%

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On December 22, 2017 the Tax Cuts and Jobs Act was signed into law which, among other items, reduced the corporate tax rate from a graduated set of rates with a maximum of 35% to a flat 21% beginning with taxable years starting after December 31, 2017. As required under ASC Topic 740, the Bank re-measured its deferred income tax assets and liabilities for temporary differences from the current corporate tax rate to the new corporate tax rate of 21% as of December 31, 2017. Since we have a full valuation allowance on our deferred income tax assets, there was no cumulative adjustment recognized in income tax expense from continuing operations as a discrete item in the period that included the enactment date, December 31, 2017. Beginning in 2018 the Company’s federal statutory tax rate will be 21%.

The amount of loss carryforwards available for any one year may be limited if the Bank is subject to the alternative minimum tax.

At December 31, 2017, the Bank had approximately $4,700,000 in federal and state net operating loss carryforwards. These net operating loss carryforwards begin to expire in 2033. Realization depends on generating sufficient taxable income before the expiration of the loss carryforward period. The amount of the loss carryforward available for any one year may be limited if the Bank is subject to the alternative minimum tax.

Valuation allowance for deferred taxes for the years ended December 31, 2017 and 2016 is as follows:

(Dollars in thousands)	Valuation Allowance
Balance of January 1, 2016		$	(1,442)
Expiration of capital loss carryforwards			—
Increase in valuation allowance			(1,166)
Balance of December 31, 2016		$	(2,608)
Expiration of capital loss carryforwards			—
Increase in valuation allowance			725
Balance of December 31, 2017		$	(1,883)

As of December 31, 2016 and December 31, 2017, the Bank had remained in a cumulative loss position for three consecutive years and consequently management reevaluated the need for a valuation allowance of the deferred tax asset balance. Management’s evaluation included: management’s ability to fully implement our strategic plan, which included the ability to raise capital through the proposed public stock offering; additional expenses expected to be incurred as the result of becoming a public company; and the ability to generate sufficient taxable income to fully realize the Bank’s net operating loss carryforwards. Management concluded that it is more likely than not the Bank will be unable to generate sufficient taxable income in the foreseeable future to fully utilize the cumulative net operating loss carryforward and, therefore, established a valuation allowance to offset the entire deferred tax asset.

FEDERAL HOME LOAN BANK ADVANCES

Federal Home Loan Bank advances at December 31, 2017 consisted of a Convertible advance and fixed rate advances whereas all Federal Home Loan Bank advances at December 31, 2016 were fixed rate advances. At December 31, 2017, there was a $5,000,000 Convertible advance at a rate of 1.10% with a maturity date of October 6, 2027. On October 6, 2018, and each three months thereafter, the Federal Home Loan Bank has the option to convert the interest rate on this advance from a fixed rate to a variable rate equal to the 3 month Libor. If the advance is converted to an adjustable rate, then the Bank can prepay the advance without penalty.

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Fixed-rate borrowings from the Federal Home Loan Bank are as follows:

(Dollars in thousands)	Interest Rate		December 31, 2017			December 31, 2016
January 20, 2017		0.61			—			6,000
February 27, 2017		4.397			—			1,000
March 12, 2018		1.46			4,000			—
December 14, 2018		1.41			4,000			—
				$	8,000		$	7,000

All advances are collateralized by a blanket-floating lien on one-to four-family residential mortgage loans.

The Bank has a $2,500,000 line of credit with a correspondent bank and access to the Federal Reserve Bank Discount Window. As of December 31, 2017 and 2016, there was nothing outstanding on the credit facility.

RETIREMENT PLANS

In 2005, the Bank instituted a 401(k) Plan covering substantially all of its employees. The Bank recorded expense of $11,000 and $45,000 for the years ended December 31, 2017 and December 31, 2016, respectively. The amounts contributed to the 401(k) were included in expense for the periods reported. For the year ended December 31, 2017, the Board of Directors authorized a 3% matching contribution whereas for the year ended December 31, 2016, the Board of Directors authorized a 3% Safe harbor contribution. The Board may also authorize a discretionary profit sharing contribution, but has not done so since 2005.

10.

EMPLOYEE STOCK OWNERSHIP PLAN

In connection with the Bank’s mutual to stock conversion, the Bank established the Madison Bank of Maryland Employee Stock Ownership Plan (“ESOP”) effective January 1, 2014. The ESOP is a tax-qualified defined contribution plan that is designed to invest primarily in employer stock. All employees who are age 18 or older and were employed by the Bank as of December 29, 2014 (the closing date of the Company’s initial public offering) became participants in the ESOP as of the later of January 1, 2014 or their date of hire. Individuals employed by the Bank after December 29, 2014, must complete one year of service with the Bank before they can commence participation in the ESOP.

The ESOP purchased 169,280 shares of Company common stock in the Company’s initial public offering at $10.00 per share with the proceeds of a fifteen (15) year loan from the Company. The outstanding loan principal balance was $1.3 million and $1.5 million at December 31, 2017 and 2016, respectively. The Bank makes annual contributions to the ESOP equal to the principal and interest due on the loan. Any dividends declared on Company common stock held by the ESOP and not allocated to the account of a participant can be used to repay the loan. As the ESOP loan is repaid, shares of Company common stock pledged as collateral for the loan are released from the loan suspense account for allocation to Plan participants on the basis of each active participant’s proportional share of compensation. Participants vest in their ESOP allocations at the rate of 20% per year over a five-year period. However, in connection with the implementation of the ESOP, participants were given credit for past service with the Bank for vesting purposes. Participants will become fully vested upon age 65, death or disability, a change in control, or termination of the ESOP. Generally, participants will receive distributions from the ESOP upon separation from service. During the year ended December 31, 2017, 2,218 shares were distributed from the ESOP to former employees. The plan reallocates any unvested shares of common stock forfeited upon termination of employment among the remaining participants in the plan.

The ESOP compensation expense for the years ended December 31, 2017 and 2016 was $171,000 and $150,000, respectively. This amount represents the average fair market value of the shares of Company common stock allocated or committed to be released as of that date. Dividends, if any, on allocated shares are recorded as a reduction of retained earnings and dividends, if any, on unallocated shares are recorded as a reduction of the debt service.

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The ESOP shares were as follows as of December 31, 2017 and 2016:

(Dollars in thousands, except per share amount)	December 31, 2017			December 31, 2016
Shares released and allocated			32,577			23,510
Unearned shares			134,485			145,770
			167,062			169,280
Fair value of unearned shares		$	2,381		$	2,157

11.

STOCK BASED COMPENSATION

In May 2016, the Company’s shareholders approved a new Equity Incentive Plan (the “2016 Equity Incentive Plan”). The 2016 Equity Incentive Plan allows for up to 84,640 shares to be issued to employees, executive officers or Directors in the form of restricted stock, and up to 211,600 shares to be issued to employees, executive officers or Directors in the form of stock options. At December 31, 2017, there were 52,500 restricted stock awards issued and outstanding and no stock option awards granted under the 2016 Equity Incentive Plan.

Permissible Awards:

Under the above plan, the following are permissible awards:

•

Options to purchase shares of the Company common stock, which may either be non-qualified stock options or incentive stock options under Section 422 of the U.S. Internal Revenue Code of 1986, as amended;

•

Restricted stock grants, which may be subject to restrictions on transferability and forfeiture; and

•

All awards may be granted with time-based or performance-based vesting.

Restricted Stock:

The specific terms of each restricted stock award are determined by the Compensation Committee at the date of the grant. Compensation expense is recognized over the vesting period of the awards based on the fair value of the stock at the grant date.

A summary of changes in the Company’s nonvested shares for the years ended December 31, 2016 and December 31, 2017 are as follows:

	Shares			Weighted- Average Grant-Date Fair Value
Nonvested at January 1, 2016			—		$	—
Granted			2,500			13.40
Vested			—			—
Forfeited			—			—
Nonvested at December 31, 2016			2,500		$	13.40
Nonvested at January 1, 2017			2,500		$	13.40
Granted			50,000			15.29
Vested			1,250			13.40
Forfeited			—			—
Nonvested at December 31, 2017			51,250		$	15.24
Fair Value of shares vested		$	19,688

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The following table outlines the vesting schedule of the nonvested restricted stock awards as of December 31, 2017:

Year Ending December 31,	Number of restricted shares
2018		11,250
2019		10,000
2020		10,000
2021		10,000
2022		10,000
		51,250

The Company recorded restricted stock awards expense of $65,168 for the year ended December 31, 2017. As of December 31, 2017, there was $728,644 of total unrecognized compensation cost related to nonvested shares granted under the 2016 stock incentive plan. The cost is expected to be recognized over a weighted-average period of 4.75 years.

12.

RELATED PARTY TRANSACTIONS

Certain directors and executive officers have loan transactions with the Bank. Such loans were made in the ordinary course of business on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with outsiders. The following schedule summarizes changes in amounts of loans outstanding, both direct and indirect, to these persons during 2017 and 2016:

(Dollars in thousands)	12 Months Ended December 31, 2017			12 Months Ended December 31, 2016
Balance at beginning of period		$	765		$	923
Additions			181			—
Repayments			(33)			(38)
Change in status			—			(120)
Balance at end of period		$	913		$	765

13.

REGULATORY CAPITAL REQUIREMENTS

The Bank is subject to various regulatory capital requirements administered by the Federal 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 Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The 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 Bank to maintain amounts and ratios (set forth in the table below) of Total and Common Equity and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average assets. Management believes as of December 31, 2017 and 2016 that the Bank met all capital adequacy requirements to which it is subject.

As of December 31, 2017, the most recent notification from the OCC categorized the Bank 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 1 risk-based, and Tier 1 leverage ratios as set forth in the table. There are no conditions or events that management believes will adversely affect the Bank’s ability to remain in the well-capitalized category.

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The following table presents the Bank’s capital position based on the December 31, 2017 and 2016 financial statements and the current capital requirements:

	Actual					Minimum Requirements for Capital Adequacy Purposes and to be Adequately Capitalized Capitalized Under the Prompt Corrective Action Provisions					To Be Well Capitalized Under the Prompt Corrective Action Provisions
(Dollars in thousands)	Amount			Ratio		Amount			Ratio		Amount			Ratio
As of December 31, 2017:
Total risk-based capital (to risk-weighted assets)		$	24,934		32.58%		$	7,078		9.25%		$	7,653		10.00%
Tier I capital (to risk-weighted assets)			23,974		31.33			5,548		7.25			6,122		8.00
Tier I capital (to adjusted total assets)			23,974		16.55			5,795		4.00			7,243		5.00
Common equity tier 1 capital (to risk weighted assets)			23,974		31.33			4,400		5.75			4,974		6.50
As of December 31, 2016:
Total risk-based capital (to risk-weighted assets)		$	24,359		37.47%		$	5,606		8.625%			6,501		10.00%
Tier I capital (to risk-weighted assets)			23,541		36.22			4,306		6.625			5,200		8.00
Tier I capital (to adjusted total assets)			23,541		17.44			5,400		44.00			6,749		5.00
Common equity tier 1 capital (to risk weighted assets)			23,541		36.22			3,331		5.125			4,225		6.50

The following table presents a reconciliation of the Bank’s GAAP capital to each major category of regulatory capital for the dates indicated.

(Dollars in thousands)	December 31, 2017			December 31, 2016
Total Company equity capital		$	30,360		$	30,324
LESS: Parent Only Equity			6,615			6,922
LESS: Net unrealized (losses) gains on available-for-sale securities			(229)			(139)
Tier 1 Capital		$	23,974		$	23,541
Tier 1 Capital		$	23,974		$	23,541
Allowance for loan and lease losses includible in Tier 2 capital			960			818
Total risk-based capital		$	24,934		$	24,359

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14.

OTHER COMPREHENSIVE LOSS

The following table presents the components of other comprehensive gains and losses for the years ended December 31, 2017 and 2016.

(Dollars in thousands)	Before Tax			Tax Effect			Net of Tax
Year Ended December 31, 2017
Net unrealized loss on securities available-for-sale		$	(90)		$	—		$	(90)
Other Comprehensive Loss		$	(90)		$	—		$	(90)
Year Ended December 31, 2016
Net unrealized loss on securities available-for-sale		$	(128)		$	—		$	(128)
Other Comprehensive Loss		$	(128)		$	—		$	(128)

The following table presents the changes in each components of accumulated other comprehensive loss, net of tax, for the years ended December 31, 2017 and 2016.

	Securities Available-for-Sale			Accumulated Other Comprehensive Loss
Year Ended December 31, 2017
Balance at Beginning of Year		$	(139)		$	(139)
Other comprehensive loss			(90)			(90)
Balance at End of Period		$	(229)		$	(229)

	Securities Available-for-Sale			Accumulated Other Comprehensive Loss
Year Ended December 31, 2016
Balance at Beginning of Year		$	(11)		$	(11)
Other comprehensive loss			(128)			(128)
Balance at End of Period		$	(139)		$	(139)

The following table presents the amount reclassified out of accumulated other comprehensive income:

Details about Accumulated Other Comprehensive Income Components	Amount Reclassified from Accumulated Other Comprehensive Income						Affected Line Item in the Statement Where Net Income Is Presented
(Dollars in thousands)	December 31, 2017			December 31, 2016
Redemption of Investment Securities Available-for-sale		$	57		$	—	Realized gain on redemption of investment securities
			—			—	Provision for Income Tax
		$	57		$	—	Net of Tax
Total Reclassifications for the Period		$	57		$	—	Net of Tax

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15.

EARNINGS PER SHARE

	December 31, 2017
(Dollars in thousands, except per share amount)	Income (Loss) (Numerator)			Shares (Denominator)		Per Share Amount
Basic EPS
Net loss available to shareholders		$	73		1,767,742		$	0.04
Diluted EPS
Effect of dilutive shares			—		—			—
Net loss available to shareholders		$	73		1,767,742		$	0.04

	December 31, 2016
(Dollars in thousands, except per share amount)	Income (Loss) (Numerator)			Shares (Denominator)		Per Share Amount
Basic EPS
Net loss available to shareholders		$	(1,751)		1,816,933		$	(0.96)
Diluted EPS
Effect of dilutive shares			—		—			—
Net loss available to shareholders		$	(1,751)		1,816,933		$	(0.96)

There were no common stock equivalents excluded from the December 31, 2017 and 2016 diluted earnings per share calculation.

16.

SIGNIFICANT ESTIMATES AND CONCENTRATIONS

Generally accepted accounting principles require disclosure of information about certain significant estimates and current vulnerabilities due to certain concentrations. These matters include the following:

Interest Rate Risk

The profitability of the Bank is subject to interest rate risk. This risk is based on the gap between interest earned on loans and the rate of interest paid on deposits and Federal Home Loan Bank advances. A significant decrease in this gap could result in a decline in earnings to the Bank.

Geographic Location of Customers

The Bank’s principal business activity of providing mortgage loans is with customers located within its lending territory which is comprised mainly of Baltimore and Harford counties, Maryland. Substantially all of the Bank’s loan receivable and related incomes are collateralized by property located in this area. The Bank’s policy for owner-occupied residential collateral is to require that the loan amount not exceed 80% of the appraised value of the property at origination for conventional uninsured mortgages and 95% for insured loans. A significant decline in property values in this area could result in the Bank’s loans being under collateralized.

17.

COMMITMENTS

At December 31, 2017 and 2016, the Bank had outstanding commitments of $680,000 and $1.5 million to originate mortgage loans and $0 and $42,000 to originate home equity lines of credit loans, respectively. The rate on the home equity line of credit was 3.00% at December 31, 2017.

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18.

FAIR VALUE MEASUREMENTS

ASC Topic 820 which provides a framework for measuring and disclosing fair value under GAAP. ASC Topic 820 requires disclosures about the fair value of assets and liabilities recognized in the balance sheet in periods subsequent to initial recognition, whether the measurements are made on a recurring basis (for example, available-for-sale investment securities) or a nonrecurring basis (for example, impaired loans).

ASC Topic 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC Topic 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The Bank utilizes fair value measurements to record fair value adjustments to certain assets and to determine fair value disclosures. Securities available-for-sale is recorded at fair value on a recurring basis. Additionally, from time to time, the Bank may be required to record at fair value all other assets on a nonrecurring basis, such as loans held for sale, loans held for investment and certain other assets. These nonrecurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets.

ASC Topic 820 establishes a fair value hierarchy that prioritizes the information used to develop those assumptions. The fair value hierarchy is as follows:

Level 1 Inputs — Unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access at the measurement date.

Level 2 Inputs — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and the yield curves that are observable at commonly quoted intervals.

Level 3 Inputs — Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

The following is a description of valuation methodologies used for assets and liabilities recorded at fair value:

Investment Securities Available-for-Sale. Investment securities available-for-sale (“AFS”) is recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange such as the New York Stock Exchange, Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities include mortgage backed securities issued by government sponsored entities, municipal bonds and corporate debt securities. Securities classified as Level 3 include asset-backed securities in illiquid markets.

Loans. The Bank does not report loans at fair value on a recurring basis, however, from time to time, a loan is considered impaired and an allowance for credit loss 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 are considered impaired. Once a loan is identified as individually impaired, management measures impairment in accordance with ASC Topic 450 “Contingencies”. The fair value of impaired loans is estimated using one of several methods, including the collateral value, market value of similar debt, enterprise value, liquidation value and discounted cash flows. Those impaired loans not requiring a specific allowance represent loans for which the fair value of expected repayments or collateral exceed the recorded investment in such loans. At December 31, 2017 and December 31, 2016, substantially all of the totally impaired loans were evaluated based upon the fair value of the collateral. In accordance with ASC Topic 820, impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. When the fair value of the collateral is based on an observable

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market price or a current appraised value, the Bank records the loan as nonrecurring Level 2. When an appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Company records the loan as nonrecurring Level 3.

Assets measured at fair value on a recurring basis are included in the table below:

	Fair Value Measurements at December 31, 2017 Using:
Description (Dollars in thousands)	Fair Value December 31, 2017			Quoted Prices in Active Markets for Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Trading Gains and (Losses)			Total Changes in Fair Values Included in Period Earnings
Investments (available-for-sale):
Obligations of U.S. Government agencies		$	945		$	—		$	945		$	—		$	—		$	—
Municipal securities			497			—			497			—			—			—
Mortgage-backed securities:			15,163			—			15,163			—			—			—
Total assets measured at fair value on a recurring basis		$	16,605		$	—		$	16,605		$	—		$	—		$	—

	Fair Value Measurements at December 31, 2016 Using:
Description (Dollars in thousands)	Fair Value December 31, 2016			Quoted Prices in Active Markets for Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Trading Gains and (Losses)			Total Changes in Fair Values Included in Period Earnings
Investments (available-for-sale):
Obligations of U.S. Government agencies		$	933		$	—		$	933		$	—		$	—		$	—
Mortgage-backed securities			2,765			—			2,765			—			—			—
Total assets measured at fair value on a recurring basis		$	3,698		$	—		$	3,698		$	—		$	—		$	—

The Bank may be required from time to time, to measure certain assets at fair value on a non-recurring basis in accordance with GAAP. These include assets that are measured at the lower of cost or market that were recognized at fair value below cost at the end of the period. Assets measured at fair value on a nonrecurring basis are included in the table below:

	Fair Value Measurements at December 31, 2017 Using:
Description (Dollars in thousands)	Fair Value December 31, 2017			Quoted Prices in Active Markets for Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Trading Gains and (Losses)			Total Changes in Fair Values Included in Period Earnings
Impaired loans:
Residential		$	2,149		$	—		$	1,822		$	327		$	—		$	—
Commercial			1,154			—			1,154			—			—			—
Land			1,094			—			1,094			—			—			—
Construction			—			—			—			—			—			—
Other real estate owned			—			—			—			—			—			—
Total assets measured at fair value on a non-recurring basis		$	4,397		$	—		$	4,070		$	327		$	—		$	—

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The significant unobservable inputs (Level 3) are determined by using the net present value of the expected discounted future cash flows methodology. Loans were modified based on the expected cash flows with modified terms and rate of 3.875% discounted at contractual rates ranging from 5.25% to 6.00%.

	Fair Value Measurements at December 31, 2016 Using:
Description (Dollars in thousands)	Fair Value December 31, 2016			Quoted Prices in Active Markets for Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Trading Gains and (Losses)			Total Changes in Fair Values Included in Period Earnings
Impaired loans:
Residential		$	3,734		$	—		$	2,633		$	1,101		$	—		$	—
Commercial			1,451			—			1,451			—			—			—
Land			2,346			—			2,346			—			—			—
Construction			—			—			—			—			—			—
Other real estate owned			—			—			—			—			—			—
Total assets measured at fair value on a non-recurring basis		$	7,531		$	—		$	6,430		$	1,101		$	—		$	—

The significant unobservable inputs (Level 3) are determined by using the net present value of the expected discounted future cash flows methodology. Loans were modified based on the expected cash flows with modified terms and rates ranging from 3.00% to 4.00% discounted at contractual rates ranging from 5.00% to 7.375%.

In accordance with the disclosure requirements of ASC Topic 825, the estimated fair values of financial instruments at December 31, 2017 and 2016 are as follows:

(Dollars in thousands)	Carrying Value December 31, 2017			Fair Value December 31, 2017			Quoted Prices In Active Markets For Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Observable Inputs (Level 3)
ASSETS
Cash, interest bearing deposits and federal funds sold		$	6,603		$	6,603		$	—		$	6,603		$	—
Other interest bearing deposits in other banks			2,607			2,607			—			2,607			—
Investment securities			34,015			33,613			—			33,613			—
Federal Home Loan Bank stock			754			754			—			754			—
Loans, net			93,765			94,009			—			4,070			89,939
Bank owned life insurance			4,574			4,574			—			4,574			—
Accrued interest receivable			394			394			—			394			—
LIABILITIES
Deposits		$	103,308		$	99,719		$	—		$	—		$	99,719
FHLB advances			13,000			12,978			—			—			12,978

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(Dollars in thousands)	Carrying Value December 31, 2016			Fair Value December 31, 2016			Quoted Prices In Active Markets For Identical Assets (Level 1)			Other Observable Inputs (Level 2)			Significant Observable Inputs (Level 3)
ASSETS
Cash, interest bearing deposits and federal funds sold		$	5,399		$	5,399		$	—		$	5,399		$	—
Other interest bearing deposits in other banks			11,090			11,090			—			11,090			—
Investment securities			22,516			21,969			—			21,969			—
Federal Home Loan Bank stock			418			418			—			418			—
Loans, net			86,030			85,525			—			6,430			79,095
Bank owned life insurance			931			931			—			931			—
Accrued interest receivable			356			356			—			356			—
LIABILITIES
Deposits		$	93,015		$	90,912		$	—		$	—		$	90,912
FHLB advances			7,000			7,005			—			—			7,005

The following methods and assumptions were used to estimate the fair value disclosures for financial instruments as of December 31, 2017 and 2016:

Cash, Interest-Bearing Deposits and Federal Funds Sold and Other Interest-Bearing Deposits in Other Banks

The amounts reported in the balance sheet approximate the fair value of these assets.

Investment Securities

The fair values are based on the quoted market prices, if available. If quoted prices are not available, fair value is measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions.

Federal Home Loan Bank Stock

The par value of Federal Home Loan Bank stock report on the balance sheet is a reasonable estimate of fair value.

Accrued Interest Receivable

The amounts reported in the balance sheet approximate the fair value of these assets.

Loans, Deposits and Federal Home Loan Bank Advances

Loans receivable were discounted using a single discount rate, comparing the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. The fair value of demand deposits, savings accounts and money market deposits is the amount payable on demand at the reporting date. The fair value of fixed-maturity certificates of deposit is estimated using the rates currently offered on deposits of similar remaining maturities. The fair value of Federal Home Loan Bank advances is estimated using rates currently offered on advances of similar remaining maturities.

Bank-Owned Life Insurance

The amounts reported in the balance sheet approximate the fair value of these assets.

Impact of Recent Accounting Pronouncements

In January 2016, the FASB issued, ASU 2016-1, “No. 2016-01, Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” ASU 2016-1, among other things, (i) requires equity investments, with certain exceptions, to be measured at fair

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value with changes in fair value recognized in net income, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) eliminates the requirement for public business entities to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (iv) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (v) requires an entity to present separately in other comprehensive income 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 entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, (vi) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements and (viii) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale. ASU 2016-1 will be effective for the Company on January 1, 2018 and is not expected to have a significant impact on our financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 will, among other things, require lessees to recognize a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 does not significantly change lease accounting requirements applicable to lessors; however, certain changes were made to align, where necessary, lessor accounting with the lessee accounting model and ASC Topic 606, “Revenue from Contracts with Customers.” The updated guidance is effective for the Company on January 1, 2019 and will require transition using a modified retrospective approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the potential impact of ASU 2016-02 on our financial statements.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments — Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments” which updated guidance intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The updated guidance replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires the consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The updated guidance is effective for the Company on January 1, 2020, with early adoption permitted. The Company is currently assessing the potential impact of the new guidance on our consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, “Receivables — Nonrefundable Fees and Other Costs (Subtopic 310-20) — Premium Amortization on Purchased Callable Debt Securities.” ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium to require such premiums to be amortized to the earliest call date unless applicable guidance related to certain pools of securities is applied to consider estimated prepayments. Under prior guidance, entities were generally required to amortize premiums on individual, non-pooled callable debt securities as a yield adjustment over the contractual life of the security. ASU 2017-08 does not change the accounting for callable debt securities held at a discount. ASU 2017-08 will be effective for the Company on January 1, 2019, with early adoption permitted. The Company is currently evaluating the potential impact of ASU 2017-08 on our financial statements.

In May 2017, ASU 2017-09, “Compensation — Stock Compensation (Topic 718) — Scope of Modification Accounting.” ASU 2017-09 clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Under ASU 2017-09, an entity will not apply modification accounting to a share-based payment award if all of the following are the same immediately before and after the change: (i) the award’s fair value, (ii) the award’s vesting conditions and (iii) the award’s classification as an equity or liability instrument. ASU 2017-09 will be effective for the Company on January 1, 2018 and is not expected to have a significant impact on our financial statements.

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On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act, which reduced the corporate tax rate from 35% to 21%. While the effect of such tax act will be tremendously beneficial in future years, it does have a negative impact on those corporate entities with deferred tax assets at December 31, 2017. The primary reason is that the tax law was enacted in 2017, a year prior to the effective date of 2018. The issue centers around deferred tax assets, a balance sheet account, which are simply future tax benefits arising from timing differences between financial statement expenses and tax return deductions. These deferred tax assets are values at enacted future corporate tax rates. Consequently, in 2017, corporations that had deferred tax assets were required to make a one-time adjustment to their income statement to write-down the deferred tax asset value reported on their balance sheets to reflect the lower future tax rates even though they would not receive the benefits of those lower rates until 2018 or later.

19.

PARENT COMPANY ONLY FINANCIAL STATEMENTS

Presented below are the condensed balance sheets, statements of operations and statements of cash flows for MB Bancorp, Inc. for the years ended December 31, 2017 and 2016.

CONDENSED BALANCE SHEET

ASSETS

(Dollars in thousands)	As of December 31, 2017			As of December 31, 2016
ASSETS:
Cash and due from banks		$	4,804		$	3,360
Other interest-bearing deposits in other banks			498			2,241
Loans receivable – ESOP			1,345			1,458
Investment in bank subsidiary			23,713			23,275
Other assets			—			1
TOTAL ASSETS		$	30,360		$	30,335
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Other liabilities		$	—		$	11
Total liabilities			—			11
STOCKHOLDERS’ EQUITY:
Common stock .01 par value; authorized 19,000,000 shares; issued 1,940,200 and 1,902,900 shares at December 31, 2017 and 2016, respectively			19			19
Additional paid-in capital			18,135			18,132
Retained earnings – substantially restricted			13,780			13,770
Accumulated other comprehensive (loss) income			(229)			(139)
Employee stock ownership plan			(1,345)			(1,458)
Total stockholders’ equity			30,360			30,324
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	30,360		$	30,335

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CONDENSED STATEMENT OF OPERATIONS

	For the Years Ended December 31,
(Dollars in thousands)	2017			2016
INCOME:
Interest on ESOP loan		$	47		$	51
Interest and dividends on investment securities			14			39
Total income			61			90
EXPENSE:
Interest on stock purchase refund			—			—
Salaries and employee benefits			9			11
Legal and professional expenses			60			77
Advertising and marketing related expenses			1			3
Other expenses			114			159
Total expenses			184			250
LOSS BEFORE EQUITY IN LOSS OF BANK SUBSIDIARY			(123)			(160)
Equity in net income (loss) of bank subsidiary			196			(1,591)
NET INCOME (LOSS)		$	73		$	(1,751)

CONDENSED STATEMENT OF CASH FLOWS

	For the Years Ended
(Dollars in thousands)	December 31, 2017			December 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)		$	73		$	(1,751)
Adjustment to reconcile net income (loss) to net cash used in operating activities:
Equity in undistributed net (income) loss			(196)			1,591
(Decrease) Increase in accrued interest and other assets			(94)			36
Decrease in accounts payable and other liabilities			(11)			16
Net cash used in operating activities			(228)			(108)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net decrease in other interest bearing deposits in other banks			1,743			3,726
Net decrease in loan-ESOP			113			113
Investment in bank subsidiary			—			—
Net cash provided by investing activities			1,856			3,839
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase of common stock			(184)			(2,817)
Purchase of Employee Stock Ownership Plan			—			—
Net cash used in financing activities			(184)			(2,817)
INCREASE IN CASH AND CASH EQUIVALENTS			1,444			914
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR			3,360			2,446
CASH AND CASH EQUIVALENTS AT END OF YEAR		$	4,804		$	3,360
Supplemental cash flow information:
Interest paid		$	—		$	—
Income taxes paid		$	—		$	—

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PART IV

Item 15. Exhibits and Financial Statement Schedules

(a) List of Documents Filed as Part of this Report

(1) Financial Statements. The following consolidated financial statements are incorporated by reference from Item 8 hereof:

Reports of Independent Registered Public Accounting Firms
Consolidated Balance Sheets as of December 31, 2017 and 2016
Consolidated Statements of Operations for the Years Ended December 31, 2017 and 2016
Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2017 and 2016
Consolidated Statements of Equity for the Years Ended December 31, 2017 and 2016
Consolidated Statements of Cash Flows for the Years Ended December 31, 2017 and 2016
Notes to Consolidated Financial Statements

(b) Exhibits. The following is a list of exhibits filed as part of this Annual Report on Form 10-K/A and is also the Exhibit Index.

No.			Description
3.1			Articles of Incorporation of MB Bancorp, Inc.(1)
3.2			Bylaws of MB Bancorp, Inc.(1)
4.1			Common Stock Certificate of MB Bancorp, Inc.(1)
10.1			Two-Year Change in Control Agreement between Madison Bank of Maryland and Philip P. Phillips+(2)
10.2			Two-Year Change in Control Agreement between Madison Bank of Maryland and Lisa M. McGuire-Dick+(3)
10.3			Two-Year Change in Control Agreement between Madison Bank of Maryland and John M. Wright+(4)
10.4			MB Bancorp, Inc. 2016 Equity Incentive Plan+(5)
10.5			Supplemental Life Insurance Agreement entered into by and between Madison Bank of Maryland and Phil Phillips effective January 2017.(6)
10.6			Supplemental Life Insurance Agreement entered into by and between Madison Bank of Maryland and John M. Wright effective January 2017.(6)
10.7			Supplemental Life Insurance Agreement entered into by and between Madison Bank of Maryland and Lisa M. McGuire-Dick effective January 2017.(6)
10.8			Director Emeritus Plan(6)
10.9			Standstill Agreement, dated February 20, 2018, by and among, MB Bancorp, Inc., Stilwell Activist Fund, L.P., Stilwell Activist Investments, L.P., Stilwell Partners, L.P., Stilwell Value LLC, Joseph Stilwell and Corissa J. Briglia(7)
10.10			Standstill Agreement, dated February 20, 2018, by and between, MB Bancorp, Inc. and Jeffrey Thorp(7)
21.1			Subsidiaries*
23.1			Consent of TGM Group LLC
23.2			Consent of Dixon Hughes Goodman LLP
31.1			Rule 13a-14(a) Certification of Chief Executive Officer
31.2			Rule 13a-14(a) Certification of Chief Financial Officer
32.1			Section 1350 Certifications

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No.			Description
101.1			The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations; (iii) the Consolidated Statements of Comprehensive Income (Loss); (iv) the Consolidated Statements of Equity, (v) the Consolidated Statements of Cash Flows; and (vi) the Notes to the Consolidated Financial Statements*

Previously filed

Management contract or compensatory agreement or arrangement.

(1)

Incorporated herein by reference to the Company’s Registration Statement on Form S-1 (File No. 333-198700), as amended, initially filed with the Securities and Exchange Commission on September 12, 2014.

(2)

Incorporated herein by reference to the Company’s Quarterly Report on Form 10-Q for the Quarter Ended September 30, 2016 (File No. 000-55341).

(3)

Incorporated herein by reference to the Company’s Annual Report on Form 10-K for the Year Ended December 31, 2014 (File No. 000-55341).

(4)

Incorporated herein by reference to the Company Form 8-K filed with the Securities and Exchange Commission on December 23, 2016 (File No. 000-55341).

(5)

Incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement filed with the Securities and Exchange Commission on April 19, 2016.

(6)

Incorporated herein by reference to the Company’s Annual Report on Form 10-K for the Year Ended December 31, 2016 (File No. 000-55341).

(7)

Incorporated herein by reference to the Company Form 8-K filed with the Securities and Exchange Commission on February 21, 2018 (File No. 000-55341).

(c) Financial Statement Schedules. All schedules for which this provision is made in the applicable accounting regulations of the Securities and Exchange Commission are omitted because of the absence of conditions under which they are required or because the required information is included in the consolidated financial statements and related notes thereto.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

				MB BANCORP, INC.
	April 2, 2018			By: /s/ Philip P. Phillips Philip P. Phillips President and Chief Executive Officer

MB Bancorp Inc - FORM 10-K/A - April 2, 2018

Attached files

MB Bancorp Inc Reports