Note 5 - Loans Receivable | 3 Months Ended |
Mar. 31, 2014 |
Receivables [Abstract] | ' |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | ' |
5 | LOANS RECEIVABLE | | | | | | | | | | | | | | | | | | | | | | | | | |
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Loans receivable consisted of the following at March 31, 2014 and December 31, 2013 (in thousands): |
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| | March 31, | | | December 31, | | | | | | | | | | | | | | | | | | | |
2014 | 2013 | | | | | | | | | | | | | | | | | | |
Real estate: | | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 126,640 | | | $ | 129,308 | | | | | | | | | | | | | | | | | | | |
Multifamily residential | | | 25,521 | | | | 25,773 | | | | | | | | | | | | | | | | | | | |
Nonfarm nonresidential | | | 177,444 | | | | 168,902 | | | | | | | | | | | | | | | | | | | |
Construction and land development | | | 28,795 | | | | 26,554 | | | | | | | | | | | | | | | | | | | |
Commercial | | | 34,240 | | | | 29,033 | | | | | | | | | | | | | | | | | | | |
Consumer | | | 3,950 | | | | 4,368 | | | | | | | | | | | | | | | | | | | |
Total loans receivable | | | 396,590 | | | | 383,938 | | | | | | | | | | | | | | | | | | | |
Unearned discounts and net deferred loan costs | | | (57 | ) | | | (78 | ) | | | | | | | | | | | | | | | | | | |
Allowance for loan and lease losses | | | (12,478 | ) | | | (12,711 | ) | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Loans receivable—net | | $ | 384,055 | | | $ | 371,149 | | | | | | | | | | | | | | | | | | | |
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Mortgage loans serviced for others are not included in the accompanying consolidated statements of financial condition. The unpaid principal balances of such loans at March 31, 2014 and December 31, 2013 were $10.7 million and $12.9 million, respectively. Servicing loans for others generally consists of collecting payments and disbursing payments to investors. Servicing income for the three months ended March 31, 2014 and 2013 was not significant. |
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As of March 31, 2014 and December 31, 2013, qualifying loans collateralized by first lien one- to four-family mortgages with balances totaling approximately $48.3 million and $50.6 million, respectively, were held in custody by the Federal Home Loan Bank of Dallas (“FHLB”) and were pledged for outstanding advances or available for future advances. The Bank also pledged loans totaling $149.4 million at March 31, 2014 under a blanket lien with the FHLB. On October 17, 2013 the Bank was notified by the FHLB that the Bank has been removed from custody status and upgraded to blanket lien status due to continued improvement in the financial ratios that the FHLB uses to measure a Bank’s status. |
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As of March 31, 2014 and December 31, 2013, qualifying loans collateralized by commercial real estate with balances of $7.6 million and $8.2 million, respectively, were pledged at the FRB. No FRB borrowings were outstanding at March 31, 2014. |
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Age analyses of loans as of the dates indicated, including both accruing and nonaccrual loans, are presented below (in thousands): |
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31-Mar-14 | | 30-89 Days | | | 90 Days or | | | Current | | | Total | | | | | | | | | | | |
Past Due | More Past Due | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 2,677 | | | $ | 1,527 | | | $ | 122,436 | | | $ | 126,640 | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | 25,521 | | | | 25,521 | | | | | | | | | | | |
Nonfarm nonresidential | | | 176 | | | | 2,118 | | | | 175,150 | | | | 177,444 | | | | | | | | | | | |
Construction and land development | | | 82 | | | | 2,244 | | | | 26,469 | | | | 28,795 | | | | | | | | | | | |
Commercial | | | 2 | | | | 18 | | | | 34,220 | | | | 34,240 | | | | | | | | | | | |
Consumer | | | 15 | | | | 2 | | | | 3,933 | | | | 3,950 | | | | | | | | | | | |
Total | | $ | 2,952 | | | $ | 5,909 | | | $ | 387,729 | | | $ | 396,590 | | | | | | | | | | | |
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31-Dec-13 | | 30-89 Days | | | 90 Days or | | | Current | | | Total | | | | | | | | | | | |
Past Due | More Past Due | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 3,511 | | | $ | 1,664 | | | $ | 124,133 | | | $ | 129,308 | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | 25,773 | | | | 25,773 | | | | | | | | | | | |
Nonfarm nonresidential | | | 176 | | | | 2,340 | | | | 166,386 | | | | 168,902 | | | | | | | | | | | |
Construction and land development | | | 30 | | | | 2,799 | | | | 23,725 | | | | 26,554 | | | | | | | | | | | |
Commercial | | | -- | | | | 348 | | | | 28,685 | | | | 29,033 | | | | | | | | | | | |
Consumer | | | -- | | | | 19 | | | | 4,349 | | | | 4,368 | | | | | | | | | | | |
Total | | $ | 3,717 | | | $ | 7,170 | | | $ | 373,051 | | | $ | 383,938 | | | | | | | | | | | |
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There were no loans over 90 days past due and still accruing at March 31, 2014 or December 31, 2013. Restructured loans totaled $2.5 million and $2.6 million as of March 31, 2014 and December 31, 2013, respectively, with $2.0 million and $2.1 million of such restructured loans on nonaccrual status at March 31, 2014 and December 31, 2013, respectively. |
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The following table presents age analyses of nonaccrual loans as of the dates indicated (in thousands): |
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31-Mar-14 | | 30-89 Days | | | 90 Days or | | | Current | | | Total | | | | | | | | | | | |
Past Due | More Past Due | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 806 | | | $ | 1,527 | | | $ | 1,603 | | | $ | 3,936 | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | -- | | | | -- | | | | | | | | | | | |
Nonfarm nonresidential | | | 176 | | | | 2,118 | | | | 1,683 | | | | 3,977 | | | | | | | | | | | |
Construction and land development | | | -- | | | | 2,244 | | | | 154 | | | | 2,398 | | | | | | | | | | | |
Commercial | | | -- | | | | 18 | | | | 576 | | | | 594 | | | | | | | | | | | |
Consumer | | | 5 | | | | 2 | | | | 19 | | | | 26 | | | | | | | | | | | |
Total | | $ | 987 | | | $ | 5,909 | | | $ | 4,035 | | | $ | 10,931 | | | | | | | | | | | |
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31-Dec-13 | | 30-89 Days | | | 90 Days or | | | Current | | | Total | | | | | | | | | | | |
Past Due | More Past Due | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 637 | | | $ | 1,664 | | | $ | 1,957 | | | $ | 4,258 | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | -- | | | | -- | | | | | | | | | | | |
Nonfarm nonresidential | | | -- | | | | 2,340 | | | | 1,717 | | | | 4,057 | | | | | | | | | | | |
Construction and land development | | | -- | | | | 2,799 | | | | 450 | | | | 3,249 | | | | | | | | | | | |
Commercial | | | -- | | | | 348 | | | | 2 | | | | 350 | | | | | | | | | | | |
Consumer | | | -- | | | | 19 | | | | 5 | | | | 24 | | | | | | | | | | | |
Total | | $ | 637 | | | $ | 7,170 | | | $ | 4,131 | | | $ | 11,938 | | | | | | | | | | | |
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The following tables summarize information pertaining to impaired loans as of March 31, 2014 and December 31, 2013 and for the three months ended March 31, 2014 and 2013 (in thousands): |
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| | 31-Mar-14 | | | 31-Dec-13 | | | |
| | Unpaid | | | Recorded | | | Valuation | | | Unpaid | | | Recorded | | | Valuation | | | |
Principal | Investment | Allowance | Principal | Investment | Allowance | | |
Balance | | | Balance | | | | |
Impaired loans with a valuation allowance: | | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 1,300 | | | $ | 1,164 | | | $ | 268 | | | $ | 1,213 | | | $ | 1,085 | | | $ | 279 | | | |
Multifamily residential | | | -- | | | | -- | | | | -- | | | | -- | | | | -- | | | | -- | | | |
Nonfarm nonresidential | | | 2,902 | | | | 2,700 | | | | 1,062 | | | | 3,287 | | | | 3,105 | | | | 1,119 | | | |
Construction and land development | | | 1,770 | | | | 1,285 | | | | 437 | | | | 2,488 | | | | 2,000 | | | | 764 | | | |
Commercial | | | 251 | | | | 251 | | | | 250 | | | | -- | | | | -- | | | | -- | | | |
Consumer | | | 11 | | | | 11 | | | | 11 | | | | -- | | | | -- | | | | -- | | | |
| | | 6,234 | | | | 5,411 | | | | 2,028 | | | | 6,988 | | | | 6,190 | | | | 2,162 | | | |
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Impaired loans without a valuation allowance: | | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | | 4,020 | | | | 3,264 | | | | -- | | | | 4,430 | | | | 3,668 | | | | -- | | | |
Multifamily residential | | | -- | | | | -- | | | | -- | | | | -- | | | | -- | | | | -- | | | |
Nonfarm nonresidential | | | 1,382 | | | | 1,276 | | | | -- | | | | 1,077 | | | | 952 | | | | -- | | | |
Construction and land development | | | 1,497 | | | | 1,113 | | | | -- | | | | 1,743 | | | | 1,249 | | | | -- | | | |
Commercial | | | 391 | | | | 343 | | | | -- | | | | 388 | | | | 350 | | | | -- | | | |
Consumer | | | 19 | | | | 15 | | | | -- | | | | 27 | | | | 24 | | | | -- | | | |
| | | 7,309 | | | | 6,011 | | | | -- | | | | 7,665 | | | | 6,243 | | | | -- | | | |
Total impaired loans | | $ | 13,543 | | | $ | 11,422 | | | $ | 2,028 | | | $ | 14,653 | | | $ | 12,433 | | | $ | 2,162 | | | |
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| | Three Months Ended March 31, | | | | | | | | | | | |
| | 2014 | | | 2013 | | | | | | | | | | | |
| | Average Recorded Investment | | | Interest Income Recognized | | | Average Recorded Investment | | | Interest Income Recognized | | | | | | | | | | | |
Impaired loans with a valuation allowance: | | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | $ | 1,125 | | | $ | 2 | | | $ | 1,814 | | | $ | 6 | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | 1,479 | | | | 40 | | | | | | | | | | | |
Nonfarm nonresidential | | | 2,903 | | | | -- | | | | 2,466 | | | | -- | | | | | | | | | | | |
Construction and land development | | | 1,643 | | | | -- | | | | 957 | | | | -- | | | | | | | | | | | |
Commercial | | | 125 | | | | -- | | | | -- | | | | -- | | | | | | | | | | | |
Consumer | | | 6 | | | | -- | | | | 2 | | | | -- | | | | | | | | | | | |
| | | 5,802 | | | | 2 | | | | 6,718 | | | | 46 | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Impaired loans without a valuation allowance: | | | | | | | | | | | | | | | | | | | | | | | | | | |
One- to four-family residential | | | 3,465 | | | | 1 | | | | 6,538 | | | | -- | | | | | | | | | | | |
Multifamily residential | | | -- | | | | -- | | | | 2,785 | | | | -- | | | | | | | | | | | |
Nonfarm nonresidential | | | 1,114 | | | | -- | | | | 5,423 | | | | -- | | | | | | | | | | | |
Construction and land development | | | 1,181 | | | | -- | | | | 2,918 | | | | -- | | | | | | | | | | | |
Commercial | | | 347 | | | | -- | | | | 150 | | | | -- | | | | | | | | | | | |
Consumer | | | 20 | | | | -- | | | | 26 | | | | -- | | | | | | | | | | | |
| | | 6,127 | | | | 1 | | | | 17,840 | | | | -- | | | | | | | | | | | |
Total impaired loans | | $ | 11,929 | | | $ | 3 | | | $ | 24,558 | | | $ | 46 | | | | | | | | | | | |
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Interest based on original terms | | | | | | $ | 192 | | | | | | | $ | 344 | | | | | | | | | | | |
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Interest income recognized on a cash basis on impaired loans | | | | | | $ | -- | | | | | | | $ | -- | | | | | | | | | | | |
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Credit Quality Indicators. As part of the on-going monitoring of the credit quality of the Bank’s loan portfolio, the Bank categorizes loans into risk categories based on available and relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Bank analyzes loans individually by assigning a credit risk rating to loans on at least an annual basis for non-homogeneous loans over $250,000. The Bank uses the following definitions for risk ratings: |
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Pass (Grades 1 to 5). Loans rated as pass generally meet or exceed normal credit standards and are rated on a scale from 1 to 5, with 1 being the highest quality loan and 5 being a pass/watch loan. Factors influencing the level of pass grade include repayment source and strength, collateral, borrower cash flows, existence of and strength of guarantors, industry/business sector, financial trends, performance history, etc. |
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Special Mention (Grade 6). Loans rated as special mention, while still adequately protected by the borrower’s repayment capability, exhibit distinct weakening trends. If left unchecked or uncorrected, these potential weaknesses may result in deteriorated prospects of repayment. These exposures require management’s close attention so as to avoid becoming adversely classified credits. |
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Substandard (Grade 7). Loans rated as substandard are inadequately protected by the current sound net worth and paying capacity of the borrower or the collateral pledged, if any. These assets must have a well-defined weakness based on objective evidence and be characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. |
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Doubtful (Grade 8). Loans rated as doubtful have all the weaknesses inherent in a substandard asset. In addition, these weaknesses make collection or liquidation in full highly questionable and improbable, based on existing circumstances. |
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Loss (Grade 9). Loans rated as a loss are considered uncollectible and of such little value that continuance as an asset is not warranted. A loss classification does not mean that an asset has no recovery or salvage value, but that it is not practical or desirable to defer writing off or reserving all or a portion of the asset, even though partial recovery may be effected in the future. |
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Based on analyses performed at March 31, 2014 and December 31, 2013, the risk categories of loans are as follows (in thousands): |
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| | 31-Mar-14 | | | |
| | Pass | | | Special Mention | | | Substandard | | | Doubtful | | | Not Rated | | | Total | | | |
One- to four-family residential | | $ | 35,250 | | | $ | 327 | | | $ | 6,391 | | | $ | -- | | | $ | 84,672 | | | $ | 126,640 | | | |
Multifamily residential | | | 25,521 | | | | -- | | | | -- | | | | -- | | | | -- | | | | 25,521 | | | |
Nonfarm nonresidential | | | 168,339 | | | | 4,465 | | | | 3,976 | | | | -- | | | | 664 | | | | 177,444 | | | |
Construction and land development | | | 22,668 | | | | 251 | | | | 3,063 | | | | -- | | | | 2,813 | | | | 28,795 | | | |
Commercial | | | 33,506 | | | | -- | | | | 524 | | | | 70 | | | | 140 | | | | 34,240 | | | |
Consumer | | | 149 | | | | -- | | | | 45 | | | | -- | | | | 3,756 | | | | 3,950 | | | |
Total | | $ | 285,433 | | | $ | 5,043 | | | $ | 13,999 | | | $ | 70 | | | $ | 92,045 | | | $ | 396,590 | | | |
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| | 31-Dec-13 | | | |
| | Pass | | | Special Mention | | | Substandard | | | Doubtful | | | Not Rated | | | Total | | | |
One- to four-family residential | | $ | 34,333 | | | $ | 329 | | | $ | 6,371 | | | $ | -- | | | $ | 88,275 | | | $ | 129,308 | | | |
Multifamily residential | | | 25,773 | | | | -- | | | | -- | | | | -- | | | | -- | | | | 25,773 | | | |
Nonfarm nonresidential | | | 159,629 | | | | 4,490 | | | | 4,057 | | | | -- | | | | 726 | | | | 168,902 | | | |
Construction and land development | | | 19,732 | | | | 295 | | | | 3,942 | | | | -- | | | | 2,585 | | | | 26,554 | | | |
Commercial | | | 28,555 | | | | -- | | | | 350 | | | | -- | | | | 128 | | | | 29,033 | | | |
Consumer | | | 151 | | | | -- | | | | 45 | | | | -- | | | | 4,172 | | | | 4,368 | | | |
Total | | $ | 268,173 | | | $ | 5,114 | | | $ | 14,765 | | | $ | -- | | | $ | 95,886 | | | $ | 383,938 | | | |
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As of March 31, 2014 and December 31, 2013, the Bank did not have any loans classified as loss. |
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Troubled Debt Restructurings. Troubled debt restructurings (“TDRs”) are loans where the contractual terms on the loan have been modified and both of the following conditions exist: (i) the borrower is experiencing financial difficulty and (ii) the restructuring constitutes a concession that the Bank would not otherwise make. The Bank assesses all loan modifications to determine if the modifications constitute a TDR. Restructurings resulting in an insignificant delay in payment are not considered to be TDRs. 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 and 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. |
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All TDRs are considered impaired loans. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. |
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The following table summarizes TDRs as of March 31, 2014 and December 31, 2013: (dollars in thousands) |
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31-Mar-14 | | Number of | | | Balance | | | Number of Nonaccrual | | | Balance | | | Total | | | Total Balance | |
Accruing | TDR Loans | Number of |
TDR Loans | | TDR Loans |
One- to four-family residential | | | 4 | | | $ | 491 | | | | 9 | | | | $ | 750 | | | | 13 | | | | $ | 1,241 | |
Nonfarm nonresidential | | | -- | | | | -- | | | | 3 | | | | | 545 | | | | 3 | | | | | 545 | |
Construction and land development | | | -- | | | | -- | | | | 4 | | | | | 693 | | | | 4 | | | | | 693 | |
Consumer | | | -- | | | | -- | | | | 2 | | | | | 16 | | | | 2 | | | | | 16 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | | 4 | | | $ | 491 | | | | 18 | | | | $ | 2,004 | | | | 22 | | | | $ | 2,495 | |
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31-Dec-13 | | Number of | | | Balance | | | Number of Nonaccrual | | | Balance | | | Total | | | Total Balance | |
Accruing | TDR Loans | Number of |
TDR Loans | | TDR Loans |
One- to four-family residential | | | 4 | | | $ | 495 | | | | 8 | | | | $ | 658 | | | | 12 | | | | $ | 1,153 | |
Nonfarm nonresidential | | | -- | | | | -- | | | | 3 | | | | | 556 | | | | 3 | | | | | 556 | |
Construction and land development | | | -- | | | | -- | | | | 5 | | | | | 856 | | | | 5 | | | | | 856 | |
Consumer | | | -- | | | | -- | | | | 1 | | | | | 5 | | | | 1 | | | | | 5 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | | 4 | | | $ | 495 | | | | 17 | | | | $ | 2,075 | | | | 21 | | | | $ | 2,570 | |
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Loans receivable that were restructured as TDRs during the three months ended March 31, 2014 and 2013 were as follows: (dollars in thousands) |
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| | Three Months Ended March 31, 2014 | | | | | | | |
| | | | | | Balance | | | Balance at | | | Nature of Modification | | | | | | | |
| | Number of | | | Prior to | | | March 31, | | | Payment | | | Other | | | | | | | |
Loans | TDR | 2014 | Term (1) | | | | | | |
One- to four-family residential | | | 1 | | | $ | 103 | | | $ | 100 | | | $ | 103 | | | $ | -- | | | | | | | |
Consumer | | | 1 | | | | 11 | | | $ | 11 | | | $ | 11 | | | $ | -- | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | | 2 | | | $ | 114 | | | $ | 111 | | | $ | 114 | | | $ | -- | | | | | | | |
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| | Three Months Ended March 31, 2013 | | | | | | | |
| | | | | | Balance | | | Balance at | | | Nature of Modification | | | | | | | |
| | Number of | | | Prior to | | | March 31, | | | Payment | | | Other | | | | | | | |
Loans | TDR | 2014 | Term (1) | | | | | | |
One- to four-family residential | | | 1 | | | $ | 6 | | | $ | 6 | | | $ | 6 | | | $ | -- | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | | | 1 | | | $ | 6 | | | $ | 6 | | | $ | 6 | | | $ | -- | | | | | | | |
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| -1 | Concessions represent skipped payments/maturity date extensions or amortization term extensions. | | | | | | | | | | | | | | | | | | | | | | | | |
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There were no loans receivable for which a payment default occurred during the three months ended March 31, 2014 or 2013 that had been modified as a TDR within 12 months or less of the payment default. |