FSBK is too cheap at these levels and is one of my favorite micro-cap holdings. Annualizing the most recent quarter pre-tax, pre-provision income results in nearly $14.75 million of PTPPI. I believe the company has adequately reserved for credit losses (if not over-reserved), has more than adequate capital levels (>10%), and that the run-rate for credit losses in a normalized environment should average 1% of net loans. With $569 million of net loans, this would result in less than $5.7 million of average credit losses per year, resulting in annualized pre-tax profit of more than $9 million. With a tax rate of 35%, after-tax income would be $5.9 million, or $0.60 per share based on 9.75 million shares outstanding. Assign a 12.5x earnings multiple to this, and you have a share price of $7.50 per share. This is much closer to the banks tangible book value per share of $7.74 (taking out goodwill and mortgage servicing rights). That results in upside potential of nearly 90% based on the current share price of $4.00. This back of the envelope analysis does not take into account the fact that management has reduced the size of its balance sheet and the true earnings power is likely much greater than the current run-rate PTPPI. FSBK has an extremely low cost of funds, resulting in net interest margin of 4.64%! How many banks can come close to that! FSBK never took TARP and did not issue dilutive equity in a panic to raise capital, which demostrates management's comittment to building shareholder value as opposed to just holding on to their jobs. Of course, they have quite an incentive to protect shareholder's interests, given that managment owns 13% of the stock! I believe this could easily be $10 stock!