noninterest income to average assets is a ratio that reflects our effectiveness in generating these other forms of revenue . the company incurs noninterest expenses as result of the operations of the business . primary expenses are those of employees , occupancy and equipment , professional services , and data processing . the company seeks to minimize the amount of non-interest expense relative to the amount of total assets ; non-interest expense to assets is a key ratio that measures the efficiency of the costs incurred to operate the business . 28 executive summary the following is a summary of the company 's financial highlights and significant events during 2016 : the company merged cornerstone community bank into smartbank in the first quarter of 2016. earnings available to common shareholders were approximately $ 4.8 million , or $ 0.78 per diluted common share , in 2016 , compared to $ 1.4 million , or $ 0.32 per diluted share , in 2015 . return on average assets was 0.57 percent for 2016 , compared to 0.22 percent for 2015 . return on average equity was 5.59 percent in 2016 , compared to 2.15 percent in 2015 , and 3.41 percent in 2014. non-performing assets to total assets in 2016 were 0.42 percent , an improvement from 0.79 percent in 2015 . net interest margin , fully taxable equivalent , remained above 4 percent at 4.06 percent for 2016 . efficiency ratio , fully taxable equivalent , of 75.7 percent in 2016 was down substantially from 85.0 percent in 2015 . analysis of results of operations 2016 compared to 2015 net income was $ 5.8 million in 2016 , which was up substantially from $ 1.5 million in 2015 . net income available to common shareholders was $ 4.8 million , or $ 0.78 per diluted common share , in 2016 , an increase from $ 1.4 million , or $ 0.32 per diluted common share , in 2015 . net interest income to average assets of 3.77 percent in 2016 was up from 3.66 percent in 2015 , with the increase as a result of a higher percentage of average earning assets to average total assets . noninterest income to average assets of 0.41 percent was up from 0.33 percent in 2015 as a result of increases in customer service fees , higher gains on the sale of securities , gains on the sale of loans and other assets compared to losses in 2015 , and higher other noninterest income . noninterest expense to average assets decreased from 3.39 percent in 2015 to 3.20 percent in 2016 due to realized efficiencies of scale and the absences of merger and conversion related costs . the resulting pretax income to average assets was 0.95 percent in 2016 compared to 0.46 percent in 2015 . finally , in 2016 the effective tax rate was 36.70 percent , which was down substantially from 2015 when taxes were elevated due to merger and acquisition expenses which were nondeductible . 2015 compared to 2014 net income was $ 1.5 million in 2015 , which was down from $ 1.8 million in 2014. net income available to common shareholders was $ 1.4 million , or $ 0.32 per diluted common share , in 2015 , a decrease from $ 1.7 million , or $ 0.52 per diluted common share , in 2014. net interest income to average assets of 3.66 percent in 2015 was down from 3.71 percent in 2014 , with the decrease as a result of lower rates on earning assets . noninterest income to average assets of 0.33 percent was up substantially from 0.22 percent in 2014 as a result of gains on the sale of foreclosed assets in 2015 compared to losses in 2014. noninterest expense to average assets increased from 3.26 percent in 2014 to 3.39 percent in 2015 due to merger and conversion related costs . the resulting pretax income to average assets was 0.46 percent in 2015 compared to 0.57 percent in 2014. finally , in 2015 taxes were elevated by $ 0.3 million due to merger and acquisition expenses which were nondeductible . net interest income and yield analysis 2016 compared to 2015 net interest income , taxable equivalent , improved to $ 38.3 million in 2016 from $ 25.0 million in 2015 . the increase in net interest income , taxable equivalent , was the result of a significant increase in earning assets primarily from the merger but also from organic business activity . average earning assets increased from $ 615.3 million in 2015 to $ 944.6 million in 2016 . over this period , average loan balances increased by 282,537 thousand and average securities and interest bearing balances at other financial institutions increased by $ 54.1 million . in addition , total average interest-bearing deposits increased by $ 219.0 million . net interest income to average assets of 3.77 percent in 2016 was up from 3.66 percent in 2015 . net interest margin , taxable equivalent , was 4.06 percent in 2016 , compared to 4.07 percent in 2015 . net interest margin , taxable equivalent , was negatively affected by an increase in the cost of interest bearing liabilities from 0.52 percent in 2015 to 0.56 percent in 2016 . in 2017 we expect net interest income to average assets and net interest margin , taxable equivalent , to experience pressure as most new assets will be lower yielding and there is the potential for pressure to increase deposit rates as short term rates increase . 29 2015 compared to 2014 net interest income improved to $ 25.0 million in 2015 from $ 18.7 million in 2014 . the increase in net interest income was the result of a significant increase in earning assets primarily from the merger but also from organic business activity . average earning assets increased from $ 455.5 million in 2014 to $ 615.3 million in 2015 . story_separator_special_tag potential problem loans , which are not included in nonperforming loans , represent those loans with a well-defined weakness and where information about possible credit problems of borrowers has caused management to have doubts about the borrower 's ability to comply with present repayment terms . this definition is believed to be substantially consistent with the standards established by the bank 's primary regulators , for loans classified as substandard or worse , but not considered nonperforming loans . allocation of the allowance for loan losses we maintain the allowance at a level that we deem appropriate to adequately cover the probable losses inherent in the loan portfolio . as of december 31 , 2016 and december 31 , 2015 , our allowance for loan losses was $ 5.1 million and $ 4.4 million , respectively , which we deemed to be adequate at each of the respective dates . the increase in the allowance for loan losses in 2016 as compared to 2015 is primarily the result of increases in organic loan growth offset slightly by improving overall credit metrics within our portfolio , including the reduction in net charge-offs . our allowance for loan loss as a percentage of total loans has increased from 0.60 percent at december 31 , 2015 to 0.63 percent at december 31 , 2016 , as a result of the increase in organic loan balances as a percentage of the total portfolio . as a percentage of organic loans the allowance for loan losses decreased from 0.95 percent at december 31 , 2015 to 0.83 percent at december 31 , 2016 . in 2017 , we expect the allowance to organic loans to remain in the range of 0.80 to 0.90 percent . our purchased loans were recorded at fair value upon acquisition . the fair value adjustments on the performing purchased loans will be accreted into income over the life of the loans . at december 31 , 2016 , the remaining accretable yield was $ 9.0 million . also at the end of 2016 , the balance on pci loans was $ 35.6 million and the carrying value was $ 27.2 million , for a net difference of $ 8.4 million in discounts . these loans are subject to the same allowance methodology as our legacy portfolio . the calculated allowance is compared to the remaining fair value discount to determine if additional provisioning should be recognized . at december 31 , 2016 , there were no allowances on purchased loans . the judgments and estimates associated with our allowance determination are described in note 1 in the “ notes to consolidated financial statements . ” the following table sets forth , based on our best estimate , the allocation of the allowance to types of loans as well as the unallocated portion as of december 31 for each of the past five years and the percentage of loans in each category to total loans ( in thousands ) : replace_table_token_13_th the increase in the overall allowance for loan losses is due to the increased balance of organic loans offset by improvements of our loan portfolio and the reduction of nonperforming loans and net charge-offs , which is largely influenced by the overall improvement in the economies in our market areas . the allocation by category is determined based on the assigned risk rating , if applicable , and environmental factors applicable to each category of loans . for impaired loans , those loans are reviewed for a specific allowance allocation . as we have worked to rehabilitate impaired loans and total impaired loans has decreased , the specific allocations for impaired loans have generally decreased . specific valuation allowances related to impaired loans were approximately $ 4 thousand at december 31 , 2016 , compared to $ 258 thousand at december 31 , 2015 . additional information on the allocation of the allowance between performing and impaired loans is provided in note 4 to the “ notes to consolidated financial statements . ” 37 analysis of the allowance for loan losses the following is a summary of changes in the allowance for loan losses for each of the years in the five-year period ended december 31 , 2016 and the ratio of the allowance for loan losses to total loans as of the end of each period ( in thousands ) : replace_table_token_14_th we assess the adequacy of the allowance at the end of each calendar quarter . this assessment includes procedures to estimate the allowance and test the adequacy and appropriateness of the resulting balance . the level of the allowance is based upon our evaluation of the loan portfolios , past loan loss experience , known and inherent risks in the portfolio , the views of the bank 's regulators , adverse situations that may affect the borrower 's ability to repay ( including the timing of future payments ) , the estimated value of any underlying collateral , composition of the loan portfolio , economic conditions , industry and peer bank loan quality indications and other pertinent factors . this evaluation is inherently subjective as it requires material estimates including the amounts and timing of future cash flows expected to be received on impaired loans that may be susceptible to significant change . investment portfolio our investment portfolio , consisting primarily of federal agency bonds , mortgage-backed securities , and state and municipal securities amounted to $ 129.4 million and $ 166.4 million at december 31 , 2016 and 2015 , respectively . this decrease was a result of selling portions of the investment portfolio to fund loan demand . in 2014 , the investment portfolio amounted to $ 98.9 million and it increased in 2015 to $ 166.4 million a primarily as a result of the merger . our investment to asset ratio has decreased from18.5 percent at december 31 , 2014 , to 16.3 percent at december 31 , 2015 , and then to 12.2

capital resources the company uses leverage analysis to examine the potential of the institution to increase assets and liabilities using the current capital base . the key measurements included in this analysis are the banks ' common equity tier 1 capital , tier 1 capital , leverage and total capital ratios . at december 31 , 2016 and 2015 , our capital ratios , including our banks ' capital ratios , exceeded regulatory minimum capital requirements . from time to time we may be required to support the capital needs of our bank subsidiary . we believe we have various capital raising techniques available to us to provide for the capital needs of our bank , if necessary . additional information on capital is provided in note 13 to the “ notes to consolidated financial statements. ” 40 off-balance sheet arrangements at december 31 , 2016 , we had $ 145.3 million of pre-approved but unused lines of credit and $ 3.2 million of standby letters of credit . these commitments generally have fixed expiration dates and many will expire without being drawn upon . the total commitment level does not necessarily represent future cash requirements . if needed to fund these outstanding commitments , the bank has the ability to liquidate federal funds sold or securities available-for-sale , or on a short-term basis to borrow and purchase federal funds from other financial institutions .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```capital resources the company uses leverage analysis to examine the potential of the institution to increase assets and liabilities using the current capital base . the key measurements included in this analysis are the banks ' common equity tier 1 capital , tier 1 capital , leverage and total capital ratios . at december 31 , 2016 and 2015 , our capital ratios , including our banks ' capital ratios , exceeded regulatory minimum capital requirements . from time to time we may be required to support the capital needs of our bank subsidiary . we believe we have various capital raising techniques available to us to provide for the capital needs of our bank , if necessary . additional information on capital is provided in note 13 to the “ notes to consolidated financial statements. ” 40 off-balance sheet arrangements at december 31 , 2016 , we had $ 145.3 million of pre-approved but unused lines of credit and $ 3.2 million of standby letters of credit . these commitments generally have fixed expiration dates and many will expire without being drawn upon . the total commitment level does not necessarily represent future cash requirements . if needed to fund these outstanding commitments , the bank has the ability to liquidate federal funds sold or securities available-for-sale , or on a short-term basis to borrow and purchase federal funds from other financial institutions .
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 Suspicious Activity Report : noninterest income to average assets is a ratio that reflects our effectiveness in generating these other forms of revenue . the company incurs noninterest expenses as result of the operations of the business . primary expenses are those of employees , occupancy and equipment , professional services , and data processing . the company seeks to minimize the amount of non-interest expense relative to the amount of total assets ; non-interest expense to assets is a key ratio that measures the efficiency of the costs incurred to operate the business . 28 executive summary the following is a summary of the company 's financial highlights and significant events during 2016 : the company merged cornerstone community bank into smartbank in the first quarter of 2016. earnings available to common shareholders were approximately $ 4.8 million , or $ 0.78 per diluted common share , in 2016 , compared to $ 1.4 million , or $ 0.32 per diluted share , in 2015 . return on average assets was 0.57 percent for 2016 , compared to 0.22 percent for 2015 . return on average equity was 5.59 percent in 2016 , compared to 2.15 percent in 2015 , and 3.41 percent in 2014. non-performing assets to total assets in 2016 were 0.42 percent , an improvement from 0.79 percent in 2015 . net interest margin , fully taxable equivalent , remained above 4 percent at 4.06 percent for 2016 . efficiency ratio , fully taxable equivalent , of 75.7 percent in 2016 was down substantially from 85.0 percent in 2015 . analysis of results of operations 2016 compared to 2015 net income was $ 5.8 million in 2016 , which was up substantially from $ 1.5 million in 2015 . net income available to common shareholders was $ 4.8 million , or $ 0.78 per diluted common share , in 2016 , an increase from $ 1.4 million , or $ 0.32 per diluted common share , in 2015 . net interest income to average assets of 3.77 percent in 2016 was up from 3.66 percent in 2015 , with the increase as a result of a higher percentage of average earning assets to average total assets . noninterest income to average assets of 0.41 percent was up from 0.33 percent in 2015 as a result of increases in customer service fees , higher gains on the sale of securities , gains on the sale of loans and other assets compared to losses in 2015 , and higher other noninterest income . noninterest expense to average assets decreased from 3.39 percent in 2015 to 3.20 percent in 2016 due to realized efficiencies of scale and the absences of merger and conversion related costs . the resulting pretax income to average assets was 0.95 percent in 2016 compared to 0.46 percent in 2015 . finally , in 2016 the effective tax rate was 36.70 percent , which was down substantially from 2015 when taxes were elevated due to merger and acquisition expenses which were nondeductible . 2015 compared to 2014 net income was $ 1.5 million in 2015 , which was down from $ 1.8 million in 2014. net income available to common shareholders was $ 1.4 million , or $ 0.32 per diluted common share , in 2015 , a decrease from $ 1.7 million , or $ 0.52 per diluted common share , in 2014. net interest income to average assets of 3.66 percent in 2015 was down from 3.71 percent in 2014 , with the decrease as a result of lower rates on earning assets . noninterest income to average assets of 0.33 percent was up substantially from 0.22 percent in 2014 as a result of gains on the sale of foreclosed assets in 2015 compared to losses in 2014. noninterest expense to average assets increased from 3.26 percent in 2014 to 3.39 percent in 2015 due to merger and conversion related costs . the resulting pretax income to average assets was 0.46 percent in 2015 compared to 0.57 percent in 2014. finally , in 2015 taxes were elevated by $ 0.3 million due to merger and acquisition expenses which were nondeductible . net interest income and yield analysis 2016 compared to 2015 net interest income , taxable equivalent , improved to $ 38.3 million in 2016 from $ 25.0 million in 2015 . the increase in net interest income , taxable equivalent , was the result of a significant increase in earning assets primarily from the merger but also from organic business activity . average earning assets increased from $ 615.3 million in 2015 to $ 944.6 million in 2016 . over this period , average loan balances increased by 282,537 thousand and average securities and interest bearing balances at other financial institutions increased by $ 54.1 million . in addition , total average interest-bearing deposits increased by $ 219.0 million . net interest income to average assets of 3.77 percent in 2016 was up from 3.66 percent in 2015 . net interest margin , taxable equivalent , was 4.06 percent in 2016 , compared to 4.07 percent in 2015 . net interest margin , taxable equivalent , was negatively affected by an increase in the cost of interest bearing liabilities from 0.52 percent in 2015 to 0.56 percent in 2016 . in 2017 we expect net interest income to average assets and net interest margin , taxable equivalent , to experience pressure as most new assets will be lower yielding and there is the potential for pressure to increase deposit rates as short term rates increase . 29 2015 compared to 2014 net interest income improved to $ 25.0 million in 2015 from $ 18.7 million in 2014 . the increase in net interest income was the result of a significant increase in earning assets primarily from the merger but also from organic business activity . average earning assets increased from $ 455.5 million in 2014 to $ 615.3 million in 2015 . story_separator_special_tag potential problem loans , which are not included in nonperforming loans , represent those loans with a well-defined weakness and where information about possible credit problems of borrowers has caused management to have doubts about the borrower 's ability to comply with present repayment terms . this definition is believed to be substantially consistent with the standards established by the bank 's primary regulators , for loans classified as substandard or worse , but not considered nonperforming loans . allocation of the allowance for loan losses we maintain the allowance at a level that we deem appropriate to adequately cover the probable losses inherent in the loan portfolio . as of december 31 , 2016 and december 31 , 2015 , our allowance for loan losses was $ 5.1 million and $ 4.4 million , respectively , which we deemed to be adequate at each of the respective dates . the increase in the allowance for loan losses in 2016 as compared to 2015 is primarily the result of increases in organic loan growth offset slightly by improving overall credit metrics within our portfolio , including the reduction in net charge-offs . our allowance for loan loss as a percentage of total loans has increased from 0.60 percent at december 31 , 2015 to 0.63 percent at december 31 , 2016 , as a result of the increase in organic loan balances as a percentage of the total portfolio . as a percentage of organic loans the allowance for loan losses decreased from 0.95 percent at december 31 , 2015 to 0.83 percent at december 31 , 2016 . in 2017 , we expect the allowance to organic loans to remain in the range of 0.80 to 0.90 percent . our purchased loans were recorded at fair value upon acquisition . the fair value adjustments on the performing purchased loans will be accreted into income over the life of the loans . at december 31 , 2016 , the remaining accretable yield was $ 9.0 million . also at the end of 2016 , the balance on pci loans was $ 35.6 million and the carrying value was $ 27.2 million , for a net difference of $ 8.4 million in discounts . these loans are subject to the same allowance methodology as our legacy portfolio . the calculated allowance is compared to the remaining fair value discount to determine if additional provisioning should be recognized . at december 31 , 2016 , there were no allowances on purchased loans . the judgments and estimates associated with our allowance determination are described in note 1 in the “ notes to consolidated financial statements . ” the following table sets forth , based on our best estimate , the allocation of the allowance to types of loans as well as the unallocated portion as of december 31 for each of the past five years and the percentage of loans in each category to total loans ( in thousands ) : replace_table_token_13_th the increase in the overall allowance for loan losses is due to the increased balance of organic loans offset by improvements of our loan portfolio and the reduction of nonperforming loans and net charge-offs , which is largely influenced by the overall improvement in the economies in our market areas . the allocation by category is determined based on the assigned risk rating , if applicable , and environmental factors applicable to each category of loans . for impaired loans , those loans are reviewed for a specific allowance allocation . as we have worked to rehabilitate impaired loans and total impaired loans has decreased , the specific allocations for impaired loans have generally decreased . specific valuation allowances related to impaired loans were approximately $ 4 thousand at december 31 , 2016 , compared to $ 258 thousand at december 31 , 2015 . additional information on the allocation of the allowance between performing and impaired loans is provided in note 4 to the “ notes to consolidated financial statements . ” 37 analysis of the allowance for loan losses the following is a summary of changes in the allowance for loan losses for each of the years in the five-year period ended december 31 , 2016 and the ratio of the allowance for loan losses to total loans as of the end of each period ( in thousands ) : replace_table_token_14_th we assess the adequacy of the allowance at the end of each calendar quarter . this assessment includes procedures to estimate the allowance and test the adequacy and appropriateness of the resulting balance . the level of the allowance is based upon our evaluation of the loan portfolios , past loan loss experience , known and inherent risks in the portfolio , the views of the bank 's regulators , adverse situations that may affect the borrower 's ability to repay ( including the timing of future payments ) , the estimated value of any underlying collateral , composition of the loan portfolio , economic conditions , industry and peer bank loan quality indications and other pertinent factors . this evaluation is inherently subjective as it requires material estimates including the amounts and timing of future cash flows expected to be received on impaired loans that may be susceptible to significant change . investment portfolio our investment portfolio , consisting primarily of federal agency bonds , mortgage-backed securities , and state and municipal securities amounted to $ 129.4 million and $ 166.4 million at december 31 , 2016 and 2015 , respectively . this decrease was a result of selling portions of the investment portfolio to fund loan demand . in 2014 , the investment portfolio amounted to $ 98.9 million and it increased in 2015 to $ 166.4 million a primarily as a result of the merger . our investment to asset ratio has decreased from18.5 percent at december 31 , 2014 , to 16.3 percent at december 31 , 2015 , and then to 12.2

