Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 13, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | FOUR OAKS FINCORP INC | |
Entity Central Index Key | 1,040,799 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 33,542,636 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | [1] |
ASSETS | |||
Cash and due from banks | $ 17,543 | $ 15,519 | |
Interest-earning deposits | 30,470 | 143,008 | |
Cash and cash equivalents | 48,013 | 158,527 | |
CDs held for investment | 24,010 | 27,784 | |
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Investment securities held-to-maturity, at amortized cost | 68,992 | 81,583 | |
Total investment securities | 140,974 | 145,794 | |
Loans held for sale | 2,100 | 2,882 | |
Loans | 452,763 | 452,256 | |
Allowance for loan losses | (10,272) | (9,377) | |
Net loans | 442,491 | 442,879 | |
Accrued interest receivable | 1,712 | 1,627 | |
Bank premises and equipment, net | 11,808 | 11,895 | |
FHLB stock | 4,564 | 4,788 | |
Investment in life insurance | 14,733 | 14,590 | |
Foreclosed assets | 2,088 | 3,782 | |
Deferred tax assets, net | 16,480 | 0 | |
Other assets | 5,527 | 6,248 | |
TOTAL ASSETS | 714,500 | 820,796 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | |||
Noninterest-bearing demand | 131,595 | 251,723 | |
Money market, NOW accounts and savings accounts | 181,175 | 175,731 | |
Time deposits, $100,000 and over | 142,325 | 143,336 | |
Other time deposits | 80,669 | 90,395 | |
Total deposits | 535,764 | 661,185 | |
Borrowings | 90,000 | 90,000 | |
Subordinated debentures | 12,372 | 12,372 | |
Subordinated promissory notes | 12,000 | 12,000 | |
Accrued interest payable | 775 | 1,704 | |
Other liabilities | 3,374 | 2,806 | |
TOTAL LIABILITIES | $ 654,285 | $ 780,067 | |
Commitments (Note F) | |||
Shareholders’ equity: | |||
Common stock, $1.00 par value, 80,000,000 shares authorized; 33,542,636 and 32,032,327 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively | $ 33,543 | $ 32,032 | |
Additional paid-in capital | 31,593 | 32,520 | |
Accumulated deficit | (5,381) | (24,579) | |
Accumulated other comprehensive income | 460 | 756 | |
Total shareholders' equity | 60,215 | 40,729 | |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 714,500 | $ 820,796 | |
[1] | Derived from audited consolidated financial statements. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 1 | $ 1 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 33,542,636 | 32,032,327 |
Common stock, shares outstanding | 33,542,636 | 32,032,327 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Interest and dividend income: | ||||
Loans, including fees | $ 6,365 | $ 6,374 | $ 19,013 | $ 19,074 |
Taxable investments | 842 | 516 | 2,467 | 1,799 |
Dividends | 76 | 76 | 242 | 239 |
Interest-earning deposits | 106 | 173 | 414 | 515 |
Total interest and dividend income | 7,389 | 7,139 | 22,136 | 21,627 |
Interest expense: | ||||
Deposits | 608 | 716 | 1,851 | 2,173 |
Borrowings | 787 | 1,025 | 2,334 | 3,041 |
Subordinated debentures | 96 | 50 | 196 | 149 |
Subordinated promissory notes | 257 | 257 | 763 | 763 |
Total interest expense | 1,748 | 2,048 | 5,144 | 6,126 |
Net interest income | 5,641 | 5,091 | 16,992 | 15,501 |
Provision for loan losses | 0 | 7,954 | 0 | 7,954 |
Net interest income after provision for loan losses | 5,641 | (2,863) | 16,992 | 7,547 |
Non-interest income: | ||||
Service charges on deposit accounts | 401 | 446 | 1,198 | 1,259 |
Other service charges, commissions and fees | 877 | 732 | 2,710 | 2,639 |
Gains on sale of investment securities available-for-sale, net | 209 | 51 | 265 | |
Gains on sale of loans held for sale | 100 | 0 | 100 | 0 |
Recovery of impairment loss and gain on redemption of equity securities | 0 | 175 | 0 | 264 |
Income from investment in life insurance | 45 | 50 | 143 | 157 |
Indemnification from third party payment processor clients | 5 | 772 | 348 | 3,049 |
Other non-interest income | 47 | 44 | 140 | 137 |
Total non-interest income | 1,684 | 2,270 | 4,904 | 7,770 |
Non-interest expenses: | ||||
Salaries | 2,892 | 2,254 | 8,284 | 6,709 |
Employee benefits | 454 | 402 | 1,546 | 1,364 |
Occupancy expenses | 328 | 328 | 1,019 | 921 |
Equipment expenses | 163 | 287 | 585 | 918 |
Professional and consulting fees | 562 | 976 | 1,944 | 2,406 |
FDIC assessments | 232 | 460 | 611 | 1,368 |
Foreclosed asset-related costs, net | 80 | 1,359 | 341 | 1,806 |
Collection expenses | 156 | 143 | 301 | 497 |
Prepayment of FHLB borrowings | 0 | 314 | 0 | 314 |
Other operating expenses | 1,632 | 1,482 | 4,547 | 3,836 |
Total non-interest expense | 6,499 | 8,005 | 19,178 | 20,139 |
Income (loss) before income taxes | 826 | (8,598) | 2,718 | (4,822) |
Income tax expense (benefit) | 92 | 0 | (16,480) | 0 |
Net income (loss) | $ 734 | $ (8,598) | $ 19,198 | $ (4,822) |
Basic net income (loss) per common share (in usd per share) | $ 0.02 | $ (0.42) | $ 0.60 | $ (0.38) |
Diluted net income (loss) per common share (in usd per share) | $ 0.02 | $ (0.42) | $ 0.60 | $ (0.38) |
Weighted Average Shares Outstanding, Basic | 32,135,465 | 20,696,393 | 32,089,950 | 12,584,239 |
Weighted Average Shares Outstanding, Diluted | 32,395,315 | 20,696,393 | 32,244,253 | 12,584,239 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 734 | $ (8,598) | $ 19,198 | $ (4,822) |
Securities available-for-sale: | ||||
Unrealized holding gains (losses) on available-for-sale securities | 714 | (47) | 15 | 1,329 |
Tax effect | 0 | 0 | 0 | 0 |
Reclassification of gains recognized in net income | (209) | (51) | (265) | (265) |
Tax effect | 0 | 0 | 0 | 0 |
Amortization of unrealized losses on investment securities transferred from available-for-sale to held-to-maturity | (15) | (21) | (46) | (73) |
Tax effect | 0 | 0 | 0 | 0 |
Total other comprehensive income (loss) | 490 | (119) | (296) | 991 |
Comprehensive income (loss) | $ 1,224 | $ (8,717) | $ 18,902 | $ (3,831) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive (loss) income | |
BEGINNING BALANCE (in shares) at Dec. 31, 2013 | 7,977,657 | |||||
BEGINNING BALANCE at Dec. 31, 2013 | $ 21,623 | $ 7,978 | $ 34,269 | $ (20,390) | $ (234) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (4,822) | (4,822) | ||||
Other comprehensive income (loss) | 991 | 991 | ||||
Stock based compensation | 51 | 51 | ||||
Issuance of common stock (in shares) | 24,045,899 | |||||
Issuance of common stock | 22,229 | $ 24,046 | (1,817) | |||
ENDING BALANCE (in shares) at Sep. 30, 2014 | 32,023,556 | |||||
ENDING BALANCE at Sep. 30, 2014 | 40,072 | $ 32,024 | 32,503 | (25,212) | 757 | |
BEGINNING BALANCE (in shares) at Dec. 31, 2013 | 7,977,657 | |||||
BEGINNING BALANCE at Dec. 31, 2013 | $ 21,623 | $ 7,978 | 34,269 | (20,390) | (234) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock (in shares) | 24,000,000 | |||||
Issuance of common stock | $ 22,200 | |||||
ENDING BALANCE (in shares) at Dec. 31, 2014 | 32,032,327 | |||||
ENDING BALANCE at Dec. 31, 2014 | 40,729 | [1] | $ 32,032 | 32,520 | (24,579) | 756 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 19,198 | 19,198 | ||||
Other comprehensive income (loss) | (296) | (296) | ||||
Stock based compensation | 426 | 426 | ||||
Issuance of common stock (in shares) | 109,309 | |||||
Issuance of common stock | 158 | $ 110 | 48 | |||
Issuance of restricted stock (in shares) | 1,461,000 | |||||
Issuance of restricted stock | 0 | $ 1,461 | (1,461) | |||
Forfeiture of restricted stock (in shares) | (60,000) | |||||
Forfeiture of restricted stock | 0 | $ (60) | 60 | |||
ENDING BALANCE (in shares) at Sep. 30, 2015 | 33,542,636 | |||||
ENDING BALANCE at Sep. 30, 2015 | $ 60,215 | $ 33,543 | $ 31,593 | $ (5,381) | $ 460 | |
[1] | Derived from audited consolidated financial statements. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | ||
Cash flows from operating activities: | |||
Net income (loss) | $ 19,198 | $ (4,822) | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Provision for loan losses | 0 | 7,954 | |
Deferred income tax benefit | (16,480) | 0 | |
Provision for depreciation and amortization | 206 | 649 | |
Net amortization of bond premiums and discounts | 896 | 915 | |
Stock based compensation | 426 | 51 | |
Gain on sale of investment securities | (265) | (265) | |
Loss (gain) on disposition of bank premises and equipment | 24 | (4) | |
Gain on sale of foreclosed assets, net | (34) | (224) | |
Valuation adjustment on foreclosed assets | 283 | 1,680 | |
Earnings on bank-owned life insurance | (143) | (157) | |
Earnings from mortgage banking operations | (476) | (402) | |
Gain on sale of problem loans held for sale | (100) | 0 | |
Originations of mortgage loans held for sale | (22,274) | (17,227) | |
Proceeds from sale of loans held for sale | 26,032 | 16,581 | |
Recovery of impairment loss on redemption of securities | 0 | (264) | |
Changes in assets and liabilities: | |||
Other assets | 721 | 345 | |
Accrued interest receivable | (85) | 90 | |
Other liabilities | 568 | (1,373) | |
Accrued interest payable | (929) | 105 | |
Net cash provided by operating activities | 7,568 | 3,632 | |
Cash flows from investing activities: | |||
Proceeds from sales and calls of investment securities available-for-sale | 8,324 | 22,661 | |
Proceeds from paydowns of investment securities available-for-sale | 4,801 | 888 | |
Proceeds from paydowns of investment securities held-to-maturity | 11,965 | 11,381 | |
Purchases of investment securities available-for-sale | (21,197) | (7,180) | |
Redemption of certificates of deposit | 3,774 | 2,205 | |
Redemption of FHLB stock | 224 | 523 | |
Net (increase) decrease in loans outstanding | (3,181) | 23,424 | |
Purchases of bank premises and equipment | (143) | (131) | |
Proceeds from sales of foreclosed assets | 2,614 | 3,877 | |
Net cash provided by investing activities | 7,181 | 57,648 | |
Cash flows from financing activities: | |||
Net repayments from borrowings | 0 | (5,000) | |
Net (decrease) increase in deposit accounts | (125,421) | 4,192 | |
Proceeds from issuance of common stock | 158 | 22,229 | |
Net cash (used in) provided by financing activities | (125,263) | 21,421 | |
Change in cash and cash equivalents | (110,514) | 82,701 | |
Cash and cash equivalents at beginning of period | 158,527 | [1] | 128,629 |
Cash and cash equivalents at end of period | 48,013 | 211,330 | |
Supplemental disclosures of cash flow information: | |||
Interest paid on deposits and borrowings | 6,073 | 6,021 | |
Income taxes paid | 0 | 110 | |
Supplemental disclosures of noncash investing and financing activities: | |||
Unrealized (losses) gains on investment securities available-for-sale | (250) | 1,231 | |
Amortization of net losses on investment securities transferred to held-to-maturity | (46) | (73) | |
Transfer of loans to foreclosed assets | 1,169 | 1,555 | |
Loans transferred from held for sale to held for investment | 109 | 0 | |
Loans transferred from held for investment to held for sale | $ 2,509 | $ 11,189 | |
[1] | Derived from audited consolidated financial statements. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION In management’s opinion, the financial information contained in the accompanying unaudited consolidated financial statements reflects all adjustments (consisting solely of normal recurring adjustments) necessary for a fair presentation of the financial information as of and for the nine months ended September 30, 2015 and 2014 , in conformity with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts and transactions of Four Oaks Fincorp, Inc., a bank holding company incorporated under the laws of the State of North Carolina (the “Company”), and its wholly-owned subsidiary, Four Oaks Bank & Trust Company (the “Bank”). Operating results for the nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2015 . The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to the consolidated financial statements filed as part of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 . This Quarterly Report should be read in conjunction with such Annual Report. Certain amounts previously presented in the Company's Consolidated Financial Statements for the prior periods have been reclassified to conform to current classifications. All such reclassifications had no impact on the prior periods' Statements of Operations, Comprehensive Income (Loss), or Shareholders' Equity as previously reported. Recent Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The existing recognition and measurement guidance for debt issuance costs are not affected by this update. ASU 2015-03 is effective for annual and interim reporting periods beginning after December 15, 2015. The Company does not believe the adoption of this update will have a material impact on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern . This update requires management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date the financial statements are issued. Substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. If the substantial doubt is alleviated as a result of consideration of management’s plans, the entity should disclose information that enables financial statement users to understand the principal conditions or events that raised substantial doubt, management’s evaluation of the conditions and management’s plans to alleviate the substantial doubt. If substantial doubt exists about an entity’s ability to continue as a going concern, and the substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern. The amendments in this update become effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not believe the adoption of this update will have a material impact on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40): Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure . This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) The loan has a government guarantee that is not separable from the loan before foreclosure, (2) At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for annual and interim periods beginning after December 15, 2014. The adoption of the new guidance did not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) which supersedes the revenue recognition requirements of Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition , and most industry-specific guidance on revenue recognition throughout the ASC. The new standard is principles based and provides a five step model to determine when and how revenue is recognized. The core principle of the new standard is that revenue should be recognized when a company transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of qualitative and quantitative information surrounding the amount, nature, timing and uncertainty of revenues and cash flows arising from contracts with customers. On August 12, 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of the new revenue recognition standard by one year. Based on ASU 2015-14, public organizations would apply the new revenue standard to annual reporting periods beginning after December 15, 2017. Early adoption is permitted, but not before the original effective date (i.e., interim and annual reporting periods beginning after December 15, 2016). The Company is currently evaluating the impact of adoption of the new standard on its consolidated financial statements. In January 2014, the FASB issued ASU No. 2014-04, Receivables–Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This update clarifies that an in-substance repossession or foreclosure occurs upon either the creditor obtaining legal title to the residential real estate property or the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. This amendment is effective for annual and interim periods beginning after December 15, 2014. The adoption of the new guidance did not have a material impact on the Company's consolidated financial statements. Other accounting standards that have been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. From time to time the FASB issues exposure drafts for proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts. |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE Basic net income (loss) per share represents earnings credited to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate to outstanding stock options. Basic and diluted net income (loss) per common share have been computed based upon net income (loss) as presented in the accompanying consolidated statements of operations divided by the weighted average number of common shares outstanding or assumed to be outstanding as summarized below (amounts in thousands, except share data) : Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Net income (loss) available to common shareholders $ 734 $ (8,598 ) $ 19,198 $ (4,822 ) Weighted average number of common shares - basic 32,135,465 20,696,393 32,089,950 12,584,239 Effect of dilutive stock options 17,040 — 15,683 — Effect of dilutive restricted stock awards 242,810 — 138,620 — Weighted average number of common shares - dilutive 32,395,315 20,696,393 32,244,253 12,584,239 Basic earnings (loss) per common share $ 0.02 $ (0.42 ) $ 0.60 $ (0.38 ) Diluted earnings (loss) per common share $ 0.02 $ (0.42 ) $ 0.60 $ (0.38 ) Anti-dilutive awards 155,455 280,982 155,455 280,982 During 2014, 24.0 million shares of common stock were issued in connection with the Company's shareholder rights offering and concurrent private placement standby offering in which a net of $22.2 million of capital was raised. Consequently, the diluted weighted average shares of common stock increased 11.7 million and 19.7 million for the three and nine months ended September 30, 2015 as compared to the same periods in 2014. There are 1,401,000 shares of restricted stock outstanding as of September 30, 2015 that the Company awarded pursuant to the Four Oaks Fincorp, Inc. 2015 Restricted Stock Plan. Of this total, there were 848,000 shares of restricted stock in which performance criteria had not been established and therefore these shares were not considered in the calculation of potentially dilutive shares. Refer to Note I for additional information on the restricted stock grant. |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT SECURITIES | INVESTMENT SECURITIES The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of securities available-for-sale and securities held-to-maturity as of September 30, 2015 and December 31, 2014 are as follows (amounts in thousands) : September 30, 2015 Securities Available-for-Sale: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 24,798 $ 330 $ 163 $ 24,965 Mortgage-backed securities GNMA 13,605 135 — 13,740 FNMA & FHLMC 33,226 86 46 33,266 Equity securities 11 — — 11 Total $ 71,640 $ 551 $ 209 $ 71,982 September 30, 2015 Securities Held-to-Maturity: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 3,544 $ 24 $ — $ 3,568 Mortgage-backed securities GNMA 62,617 883 86 63,414 FNMA 2,831 59 — 2,890 Total $ 68,992 $ 966 $ 86 $ 69,872 December 31, 2014 Securities Available-for-Sale: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 16,412 $ 686 $ 20 $ 17,078 Mortgage-backed securities GNMA 16,204 163 103 16,264 FNMA & FHLMC 30,992 — 134 30,858 Equity securities 11 — — 11 Total $ 63,619 $ 849 $ 257 $ 64,211 December 31, 2014 Securities Held-to-Maturity: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 3,584 $ — $ 28 $ 3,556 Mortgage-backed securities GNMA 74,482 887 244 75,125 FNMA 3,517 44 — 3,561 Total $ 81,583 $ 931 $ 272 $ 82,242 The following tables show gross unrealized losses and fair values of investment securities, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Less Than 12 Months 12 Months or More Total # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Securities Available-for-Sale: Taxable municipal securities 11 $ 9,989 $ 163 — $ — $ — $ 9,989 $ 163 Mortgage-backed securities FNMA & FHLMC 6 14,033 46 — — — 14,033 46 Total temporarily impaired securities 17 $ 24,022 $ 209 — $ — $ — $ 24,022 $ 209 September 30, 2015 Less Than 12 Months 12 Months or More Total Securities Held-to-Maturity: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Mortgage-backed securities GNMA 2 $ 3,074 $ 10 3 $ 5,438 $ 76 $ 8,512 $ 86 Total temporarily impaired securities 2 $ 3,074 $ 10 3 $ 5,438 $ 76 $ 8,512 $ 86 December 31, 2014 Less Than 12 Months 12 Months or More Total Securities Available-for-Sale: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Taxable municipal securities 2 $ 2,580 $ 20 — $ — $ — $ 2,580 $ 20 Mortgage-backed securities GNMA 2 7,425 103 — — — 7,425 103 FNMA & FHLMC 6 30,858 134 — — — 30,858 134 Total temporarily impaired securities 10 $ 40,863 $ 257 — $ — $ — $ 40,863 $ 257 December 31, 2014 Less Than 12 Months 12 Months or More Total Securities Held-to-Maturity: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Taxable municipal securities — $ — $ — 10 $ 3,556 $ 28 $ 3,556 $ 28 Mortgage-backed securities GNMA 6 7,594 41 6 12,240 203 19,834 244 Total temporarily impaired securities 6 $ 7,594 $ 41 16 $ 15,796 $ 231 $ 23,390 $ 272 Management evaluates each quarter whether unrealized losses on securities represent impairment that is other than temporary. For debt securities, the Company considers its intent to sell the securities or if it is more likely than not that the Company will be required to sell the securities. If such impairment is identified, based upon the intent to sell or the more likely than not threshold, the carrying amount of the security is reduced to fair value with a charge to earnings. Upon the result of the aforementioned review, management then reviews for potential other than temporary impairment based upon other qualitative factors. In making this evaluation, management considers changes in market rates relative to those available when the security was acquired, changes in market expectations about the timing of cash flows from securities that can be prepaid, performance of the debt security, and changes in the market's perception of the issuer's financial health and the security's credit quality. If determined that a debt security has incurred other than temporary impairment, then the amount of the credit related impairment is determined. If a credit loss is evident, the amount of the credit loss is charged to earnings and the non-credit related impairment is recognized through other comprehensive income. The unrealized gains and losses on securities at September 30, 2015 resulted from changing market interest rates compared to the yields available at the time the underlying securities were purchased. As of September 30, 2015 , there were 5 of 55 Government National Mortgage Association ("GNMA") mortgage-backed securities ("MBS"), 6 of 14 Federal National Mortgage Association ("FNMA") and Federal Home Loan Mortgage Corporation ("FHLMC") MBS, and 11 of 40 taxable municipal securities that contained net unrealized losses. Management identified no impairment related to credit quality. For debt securities in an unrealized loss position, the Company does not intend to sell and it is not likely that the Company will be required to sell these securities before the anticipated recovery of the amortized cost basis. As a result, no other than temporary impairment losses were recognized during the three and nine months ended September 30, 2015 . The amortized cost and fair value of available-for-sale and held-to-maturity securities at September 30, 2015 by expected maturities are shown on the following table (amounts in thousands) . Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. September 30, 2015 Securities Available-for-Sale: Amortized Cost Fair Value Taxable municipal securities: Due after ten years $ 24,798 $ 24,965 Total taxable municipal securities 24,798 24,965 Mortgage-backed securities - GNMA/FNMA & FHLMC: Due after ten years 46,831 47,006 Total mortgage-backed securities - GNMA/FNMA & FHLMC 46,831 47,006 Other securities: Equity securities 11 11 Total other securities 11 11 Total available-for-sale securities $ 71,640 $ 71,982 Securities Held-to-Maturity: Taxable municipal securities: Due within one year $ 101 $ 101 Due after one year through five years 1,600 1,608 Due after five years through ten years 1,843 1,859 Total taxable municipal securities 3,544 3,568 Mortgage-backed securities - GNMA/FNMA: Due after five years through ten years 7,105 7,307 Due after ten years 58,343 58,997 Total mortgage-backed securities - GNMA/FNMA 65,448 66,304 Total held-to-maturity securities $ 68,992 $ 69,872 Securities with a carrying value of approximately $86.7 million and $101.8 million at September 30, 2015 and December 31, 2014 , respectively, were pledged to secure public deposits and for other purposes required or permitted by law. Sales and calls of securities available-for-sale for the nine months ended September 30, 2015 and 2014 of $8.3 million and $22.7 million generated net realized gains of $265,000 for each respective period, and no gross realized losses for either period. Sales and calls of securities available-for-sale for the three months ended September 30, 2015 and 2014 of $4.7 million and $2.7 million generated net realized gains of $209,000 and $51,000 , respectively, and no gross realized losses for either period. |
LOANS AND ALLOWANCE FOR LOAN LO
LOANS AND ALLOWANCE FOR LOAN LOSSES | 9 Months Ended |
Sep. 30, 2015 | |
Loans and Leases Receivable Disclosure [Abstract] | |
LOANS AND ALLOWANCE FOR LOAN LOSSES | LOANS AND ALLOWANCE FOR LOAN LOSSES The Company has adopted comprehensive lending policies, underwriting standards and loan review procedures, which are reviewed on a regular basis. Each class of loans is subject to risks that could have an adverse impact on the credit quality of the loan portfolio. Loans are primarily made in the Company's market area in North Carolina, principally Johnston County, and parts of Wake, Harnett, Duplin, Sampson, and Moore counties. There have been no significant changes to the loan class definitions outlined in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 . During the third quarter of 2014, the Company transferred loans from held for investment to held for sale in anticipation of loan sales as a result of the Company's previously disclosed asset resolution plan (the "Asset Resolution Plan"). These loans are not included in the tables within Note D; however, additional details about these loans have been added to provide information on the credit quality of these assets. The classification of loan segments as of September 30, 2015 and December 31, 2014 are summarized as follows (amounts in thousands) : September 30, 2015 December 31, 2014 Commercial and industrial $ 23,804 $ 24,286 Commercial construction and land development 50,469 53,642 Commercial real estate 206,548 200,510 Residential construction 31,577 28,130 Residential mortgage 130,588 135,022 Consumer 6,256 7,248 Consumer credit cards 2,140 2,276 Business credit cards 1,299 1,251 Other 832 499 Gross loans 453,513 452,864 Less: Net deferred loan fees (750 ) (608 ) Net loans before allowance 452,763 452,256 Allowance for loan losses (10,272 ) (9,377 ) Total net loans $ 442,491 $ 442,879 Loans held for sale $ 2,100 $ 2,882 Allowance for Loan Losses and Recorded Investment in Loans The allowance for loan losses represents management’s estimate of an amount adequate to provide for known and inherent losses in the loan portfolio in the normal course of business. Management evaluates the adequacy of this allowance on at least a quarterly basis, which includes a review of loans both specifically and collectively evaluated for impairment. The following tables are an analysis of the allowance for loan losses by loan segment as of and for the three and nine months ended September 30, 2015 and 2014 and as of and for the twelve months ended December 31, 2014 (amounts in thousands) . These tables do not include loans classified as held for sale. Three Months Ended September 30, 2015 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 153 $ 5,306 $ 2,669 $ 318 $ 1,224 $ 112 $ 30 $ 9,812 Provision for loan losses (102 ) (209 ) (210 ) 79 409 (18 ) 51 — Loans charged-off — (160 ) 7 — (261 ) (38 ) (28 ) (480 ) Recoveries 73 590 198 — 44 35 — 940 Net recoveries (charge-offs) 73 430 205 — (217 ) (3 ) (28 ) 460 Balance, end of period $ 124 $ 5,527 $ 2,664 $ 397 $ 1,416 $ 91 $ 53 $ 10,272 Nine Months Ended September 30, 2015 Real Estate Allowances for loan losses: Commercial Commercial Commercial Residential Residential Consumer Other Totals Balance, beginning of period $ 119 $ 5,105 $ 2,382 $ 436 $ 1,206 $ 89 $ 40 $ 9,377 Provision for loan losses (161 ) (493 ) 93 (39 ) 469 50 81 — Loans charged-off (47 ) (179 ) (199 ) — (426 ) (136 ) (70 ) (1,057 ) Recoveries 213 1,094 388 — 167 88 2 1,952 Net recoveries (charge-offs) 166 915 189 — (259 ) (48 ) (68 ) 895 Balance, end of period $ 124 $ 5,527 $ 2,664 $ 397 $ 1,416 $ 91 $ 53 $ 10,272 Ending balance: individually evaluated for impairment $ — $ 494 $ 111 $ — $ — $ 3 $ — $ 608 Ending balance: collectively evaluated for impairment (1) $ 124 $ 5,033 $ 2,553 $ 397 $ 1,416 $ 88 $ 53 $ 9,664 Loans: Balance, end of period $ 25,103 $ 50,469 $ 206,548 $ 31,577 $ 130,588 $ 8,396 $ 832 $ 453,513 Ending balance: individually evaluated for impairment $ — $ 2,357 $ 3,427 $ 437 $ 1,778 $ 3 $ 12 $ 8,014 Ending balance: collectively evaluated for impairment (1) $ 25,103 $ 48,112 $ 203,121 $ 31,140 $ 128,810 $ 8,393 $ 820 $ 445,499 (1) At September 30, 2015 , there were $416,000 in impaired loans collectively evaluated for impairment with $34,000 in reserves established. Three Months Ended September 30, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 389 $ 5,567 $ 2,241 $ 620 $ 1,945 $ 169 $ 15 $ 10,946 Provision for loan losses 135 2,282 2,139 23 3,407 (32 ) — 7,954 Loans charged-off (436 ) (2,779 ) (2,529 ) — (4,177 ) (25 ) — (9,946 ) Recoveries 49 113 43 — 123 64 1 393 Net (charge-offs) recoveries (387 ) (2,666 ) (2,486 ) — (4,054 ) 39 1 (9,553 ) Balance, end of period $ 137 $ 5,183 $ 1,894 $ 643 $ 1,298 $ 176 $ 16 $ 9,347 Nine Months Ended September 30, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 487 $ 5,037 $ 2,981 $ 713 $ 2,146 $ 188 $ 38 $ 11,590 Provision for loan losses (53 ) 2,945 1,727 101 3,257 21 (44 ) 7,954 Loans charged-off (460 ) (3,096 ) (3,019 ) (171 ) (4,417 ) (114 ) — (11,277 ) Recoveries 163 297 205 — 312 81 22 1,080 Net (charge-offs) recoveries (297 ) (2,799 ) (2,814 ) (171 ) (4,105 ) (33 ) 22 (10,197 ) Balance, end of period $ 137 $ 5,183 $ 1,894 $ 643 $ 1,298 $ 176 $ 16 $ 9,347 Ending balance: individually evaluated for impairment $ — $ 528 $ 6 $ — $ — $ — $ — $ 534 Ending balance: collectively evaluated for impairment (1) $ 137 $ 4,655 $ 1,888 $ 643 $ 1,298 $ 176 $ 16 $ 8,813 Loans: Balance, end of period $ 25,584 $ 53,009 $ 192,202 $ 31,161 $ 135,120 $ 9,297 $ 522 $ 446,895 Ending balance: individually evaluated for impairment $ — $ 5,504 $ 4,946 $ — $ 2,844 $ 8 $ — $ 13,302 Ending balance: collectively evaluated for impairment (1) $ 25,584 $ 47,505 $ 187,256 $ 31,161 $ 132,276 $ 9,289 $ 522 $ 433,593 (1) At September 30, 2014 , there were no impaired loans collectively evaluated for impairment with $0 in reserves established. Twelve Months Ended December 31, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 487 $ 5,037 $ 2,981 $ 713 $ 2,146 $ 188 $ 38 $ 11,590 Provision for loan losses (84 ) 2,778 2,382 (106 ) 3,041 (36 ) (21 ) 7,954 Loans charged-off (492 ) (3,107 ) (3,315 ) (171 ) (4,847 ) (183 ) — (12,115 ) Recoveries 208 397 334 — 866 120 23 1,948 Net (charge-offs) recoveries (284 ) (2,710 ) (2,981 ) (171 ) (3,981 ) (63 ) 23 (10,167 ) Balance, end of period $ 119 $ 5,105 $ 2,382 $ 436 $ 1,206 $ 89 $ 40 $ 9,377 Ending balance: individually evaluated for impairment $ — $ 516 $ 4 $ — $ — $ 4 $ — $ 524 Ending balance: collectively evaluated for impairment (1) $ 119 $ 4,589 $ 2,378 $ 436 $ 1,206 $ 85 $ 40 $ 8,853 Loans: Balance, end of period $ 25,537 $ 53,642 $ 200,510 $ 28,130 $ 135,022 $ 9,524 $ 499 $ 452,864 Ending balance: individually evaluated for impairment $ — $ 6,678 $ 3,801 $ — $ 2,030 $ 471 $ — $ 12,980 Ending balance: collectively evaluated for impairment (1) $ 25,537 $ 46,964 $ 196,709 $ 28,130 $ 132,992 $ 9,053 $ 499 $ 439,884 (1) At December 31, 2014 , there were $436,000 in impaired loans collectively evaluated for impairment with $139,000 in reserves established. Credit Risk The Company uses an internal grading system to assign the degree of inherent risk on each individual loan. The grade is initially assigned by the lending officer and reviewed by the credit administration function throughout the life of the loan. There have been no significant changes in credit grade definitions as outlined in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 . The following tables are an analysis of the creditworthiness by loan class and credit card portfolio exposure as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Real Estate Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals 1 - Lowest Risk $ 2,085 $ — $ — $ — $ — $ 1,611 $ 3 $ 3,699 2 - Satisfactory Quality 671 739 1,921 — 15,957 260 8 19,556 3 - Satisfactory Quality - Merits Attention 10,623 10,944 95,494 3,111 53,564 1,175 538 175,449 4 - Low Satisfactory 10,156 34,350 101,040 26,991 54,178 3,112 244 230,071 5 - Special Mention 267 2,658 5,863 1,038 5,230 57 27 15,140 6-8 - Substandard (1) 2 1,778 2,230 437 1,659 41 12 6,159 $ 23,804 $ 50,469 $ 206,548 $ 31,577 $ 130,588 $ 6,256 $ 832 $ 450,074 Consumer - Credit Card Business- Credit Card Performing $ 2,136 $ 1,299 Non Performing 4 — Total $ 2,140 $ 1,299 Total Loans $ 453,513 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $2.0 million in Risk Grade 6 loans classified as loans held for sale. December 31, 2014 Real Estate Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals 1 - Lowest Risk $ 2,099 $ — $ — $ — $ — $ 1,638 $ — $ 3,737 2 - Satisfactory Quality 606 630 2,206 — 14,794 314 11 18,561 3 - Satisfactory Quality - Merits Attention 9,506 10,625 81,761 1,893 53,007 3,556 225 160,573 4 - Low Satisfactory 11,932 34,709 110,683 26,074 56,359 1,186 146 241,089 5 - Special Mention 143 1,892 3,989 — 8,720 62 117 14,923 6-8 - Substandard (1) — 5,786 1,871 163 2,142 492 — 10,454 $ 24,286 $ 53,642 $ 200,510 $ 28,130 $ 135,022 $ 7,248 $ 499 $ 449,337 Consumer- Credit Card Business- Credit Card Performing $ 2,263 $ 1,248 Non Performing 13 3 Total $ 2,276 $ 1,251 Total Loans $ 452,864 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $2.5 million in Risk Grade 6 loans classified as held for sale. Asset Quality The following tables are an age analysis of past due loans, including those on nonaccrual by loan class, as of September 30, 2015 and December 31, 2014 (amounts in thousands). September 30, 2015 30-89 Days Past Due (1) Nonaccrual (1) Greater than 90 Days Past Due Total Past Due Current Total Loans Commercial & industrial $ — $ 2 $ — $ 2 $ 23,802 $ 23,804 Commercial construction & land development 1,663 1,132 — 2,795 47,674 50,469 Commercial real estate 1,223 1,072 — 2,295 204,253 206,548 Residential construction — 437 — 437 31,140 31,577 Residential mortgage 288 721 — 1,009 129,579 130,588 Consumer 104 14 — 118 6,138 6,256 Consumer credit cards 21 — 4 25 2,115 2,140 Business credit cards 32 — — 32 1,267 1,299 Other loans 27 12 — 39 793 832 Total $ 3,358 $ 3,390 $ 4 $ 6,752 $ 446,761 $ 453,513 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $0 in loans 30-89 past due and $1.5 million in loans on nonaccrual classified as loans held for sale. December 31, 2014 30-89 Days (1) Nonaccrual (1) Greater than 90 Days Past Due Total Past Current Total Commercial & industrial $ 14 $ — $ — $ 14 $ 24,272 $ 24,286 Commercial construction & land development 27 5,533 — 5,560 48,082 53,642 Commercial real estate — 983 — 983 199,527 200,510 Residential construction — — — — 28,130 28,130 Residential mortgage 1,058 1,271 — 2,329 132,693 135,022 Consumer 82 472 — 554 6,694 7,248 Consumer credit cards 46 — 14 60 2,216 2,276 Business credit cards 41 — 3 44 1,207 1,251 Other loans 84 — — 84 415 499 Total $ 1,352 $ 8,259 $ 17 $ 9,628 $ 443,236 $ 452,864 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $67,000 in loans 30-89 days past due and $1.9 million in loans on nonaccrual classified as held for sale. Nonperforming assets Nonperforming assets at September 30, 2015 and December 31, 2014 consist of the following (amounts in thousands) : September 30, 2015 December 31, 2014 Loans past due ninety days or more and still accruing $ 4 $ 17 Nonaccrual loans 3,390 8,259 Foreclosed assets 2,088 3,782 Loans held for sale - nonperforming 1,462 1,865 Total nonperforming assets $ 6,944 $ 13,923 As of September 30, 2015 , there were $1.5 million of loans held for sale that were in nonaccrual status and therefore considered nonperforming. Impaired Loans Impaired loans are those loans for which the Bank does not expect full repayment of all principal and accrued interest when due either under the terms of the original loan agreement or within reasonably modified contractual terms. If the loan has been restructured, such as in the case of a troubled debt restructuring ("TDR"), the loan continues to be considered impaired for the duration of the restructured loan term. Whereas loans which are classified as Substandard (Risk Grade 6) are not necessarily impaired, all loans which are classified as Doubtful (Risk Grade 7) are considered impaired. Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of a number of available methods; a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan, through the observable market value of the loan or should the loan be collateral dependent, upon the fair market value of the underlying assets securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or charge-off, and is incorporated into the Bank's allowance for loan and lease losses. When a loan has been designated as impaired and full collection of principal and interest under the contractual terms is not assured, the impaired loan will be placed into nonaccrual status and interest income will not be recognized. Payments received against such loans are initially applied fully to the principal balance of the note until the principal balance is satisfied. Subsequent payments are thereupon applied to the accrued interest balance which only then results in the recognition of interest income. Payments received against accruing impaired loans are applied in the same manner as that of accruing loans which have not been deemed impaired. The recorded investment in impaired notes does not include deferred fees or accrued interest and management deems this amount to be immaterial. The following tables illustrate the impaired loans by loan class as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 As of Date Year to Date Recorded Investment (1) Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial construction & land development $ 968 $ 2,250 $ — $ 1,354 $ 13 Commercial real estate 3,063 3,853 — 3,037 95 Residential construction 437 437 — 409 5 Residential mortgage 1,934 2,200 — 2,000 63 Other 12 84 — 61 2 Subtotal: 6,414 8,824 — 6,861 178 With an allowance recorded: Commercial and industrial 2 2 — 3 — Commercial construction & land development 1,325 2,383 502 1,443 68 Commercial real estate 403 651 114 415 12 Residential mortgage 269 332 22 323 8 Consumer 17 19 4 19 1 Subtotal: 2,016 3,387 642 2,203 89 Totals: Commercial 5,761 9,139 616 6,252 188 Consumer & Other 29 103 4 80 3 Residential 2,640 2,969 22 2,732 76 Grand Total $ 8,430 $ 12,211 $ 642 $ 9,064 $ 267 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $1.8 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. December 31, 2014 As of Date Year to Date Recorded Investment (1) Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial construction & land development $ 5,445 $ 6,454 $ — $ 6,715 $ 15 Commercial real estate 3,468 4,295 — 4,103 139 Residential mortgage 2,030 1,614 — 2,279 59 Consumer 467 729 — 524 — Subtotal: 11,410 13,092 — 13,621 213 With an allowance recorded: Commercial construction & land development 1,433 2,656 580 1,866 92 Commercial real estate 372 379 17 378 19 Residential mortgage 192 169 61 224 5 Consumer 8 6 5 8 — Subtotal: 2,005 3,210 663 2,476 116 Totals: Commercial 10,718 13,784 597 13,062 265 Consumer 475 735 5 532 — Residential 2,222 1,783 61 2,503 64 Grand Total: $ 13,415 $ 16,302 $ 663 $ 16,097 $ 329 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $2.4 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. Troubled Debt Restructurings Loans are classified as TDRs when, for economic or legal reasons which result in a debtor experiencing financial difficulties, the Bank grants a concession through a modification of the original loan agreement that would not otherwise be considered. The Bank's policy with respect to accrual of interest on loans restructured in a TDR process follows relevant supervisory guidance. If a borrower has demonstrated performance under the previous loan terms and shows capacity to perform under the restructured loan terms, continued accrual of interest at the restructured interest rate is considered and the loan is considered performing. If the borrower does not perform under the restructured terms, the loan is placed on nonaccrual status. If the borrower was materially delinquent on payments prior to the restructuring but shows the capacity to meet the restructured loan terms, the loan will likely continue as nonaccrual and nonperforming until such time as continued performance has been demonstrated, which is typically a period of at least six consecutive payments. The following table provides a summary of loans modified as TDRs at September 30, 2015 and December 31, 2014 (amounts in thousands). September 30, 2015 Accrual Nonaccrual Total TDRs Allowance for Loan Losses Allocated Commercial construction and land development 1,155 717 1,872 492 Commercial real estate 2,395 596 2,991 20 Residential mortgage 790 28 818 — Consumer 3 — 3 3 Total modifications $ 4,343 $ 1,341 $ 5,684 $ 515 December 31, 2014 Accrual Nonaccrual Total TDRs Allowance for Loan Losses Allocated Commercial construction and land development $ 1,336 $ 2,776 $ 4,112 $ 516 Commercial real estate 2,469 552 3,021 4 Residential mortgage 950 54 1,004 — Consumer 4 467 471 4 Total modifications $ 4,759 $ 3,849 $ 8,608 $ 524 (1) The above table includes loans held for investment only. At September 30, 2015 , there were $157,000 in accruing TDRs and $562,000 in TDRs in nonaccrual and classified as held for sale compared to $203,000 and $932,000 , respectively, at December 31, 2014 . There were no new TDRs made to borrowers for the three and nine months ended September 30, 2015 and there were no TDR loans modified during the previous twelve months that had a payment default for the three and nine months ended September 30, 2015 . The table below details TDRs that the Bank has entered into during the twelve months ended September 30, 2015 . Twelve Months Ended September 30, 2015 Paid in full Paying as restructured Converted to nonaccrual Foreclosure/Default Number of loans Recorded Investment Number of loans Recorded Investment Number of loans Recorded Investment Number of loans Recorded Investment (amounts in thousands, except number of loans) Extended payment terms — $ — 1 $ 3 — $ — — $ — Total — $ — 1 $ 3 — $ — — $ — |
SUBORDINATED DEBT
SUBORDINATED DEBT | 9 Months Ended |
Sep. 30, 2015 | |
Subordinated Debt [Abstract] | |
SUBORDINATED DEBT | SUBORDINATED DEBT Prior to July 30, 2015, the Company was prohibited by the 2011 Written Agreement, described in Note H - Regulatory Restrictions of these Notes to Consolidated Financial Statements, from paying interest on its subordinated promissory notes and on its subordinated debentures in connection with its trust preferred securities ("TPS") without prior approval of the supervisory authorities. The Company and the Bank were also prohibited from declaring or paying dividends without prior approval of the supervisory authorities. On July 30, 2015, the 2011 Written Agreement was terminated and these restrictions were eliminated allowing the Company to pay the deferred interest on its TPS and pay interest on its subordinated promissory notes for the third quarter of 2015 without obtaining approval. The Company is now current with interest payments on the TPS and subordinated promissory notes. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Commitments The following table presents loan commitments at September 30, 2015 (amounts in thousands) . September 30, 2015 Commitments to extend credit $ 29,436 Undisbursed lines of credit 89,212 Financial stand-by letters of credit 368 Performance stand-by letters of credit 668 Legally binding commitments 119,684 Unused credit card lines 13,641 Total $ 133,325 Pledged Assets Certain assets are pledged to secure municipal deposits, borrowings, and borrowing capacity, subject to certain limits, at the Federal Home Loan Bank (the "FHLB") and the Federal Reserve Bank of Richmond (the "FRB"), as well as for other purposes as required or permitted by law. FHLB borrowings are secured by securities and a floating lien covering the Company's loan portfolio of qualifying residential (1-4 units) first mortgage and commercial real estate loans. The following table provides the total market value of pledged assets by asset type at September 30, 2015 (amounts in thousands) . September 30, 2015 Securities 86,666 Loans 35,967 Litigation Proceedings There have been no material developments in the description of material litigation proceedings as reported in Note L to the consolidated financial statements filed as part of the Company's Annual Report on Form 10-K for the year ended December 31, 2014, as updated in Note F to the consolidated financial statements filed as part of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2015. Additionally, the Company is party to certain legal actions in the ordinary course of its business. The Company believes these actions are routine in nature and incidental to the operation of its business. While the outcome of these actions cannot be predicted with certainty, management’s present judgment is that the ultimate resolution of these matters will not have a material adverse impact on its business, financial condition, results of operations, cash flows or prospects. If, however, the Company's assessment of these actions is inaccurate, or there are any significant adverse developments in these actions, its business, financial condition, results of operations, cash flows and prospects could be adversely affected. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT | FAIR VALUE MEASUREMENT Fair Value Measured on a Recurring Basis. The Company measures certain assets at fair value on a recurring basis, as described below. Investment Securities Available-for-Sale Investment securities available-for-sale are 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 the 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 have historically included equity securities traded on an active exchange, such as the New York Stock Exchange. As of September 30, 2015 , there were no Level 1 securities. Level 2 securities include taxable municipalities, mortgage-backed securities issued by government sponsored entities, and certain equity securities. The Company’s mortgage-backed securities were primarily issued by GNMA, FNMA, and FHLMC. As of September 30, 2015 , all of the Company’s mortgage-backed securities were agency issued and designated as Level 2 securities. Securities historically classified as Level 3 include trust preferred securities in less liquid markets; however, as of September 30, 2015 , there were no Level 3 securities. The following table presents information about assets measured at fair value on a recurring basis at September 30, 2015 and December 31, 2014 (amounts in thousands) . Fair Value Measurements at September 30, 2015, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Available-for-Sale Securities: 9/30/2015 9/30/2015 (Level 1) (Level 2) (Level 3) Taxable municipal securities $ 24,965 $ 24,965 $ — $ 24,965 $ — Mortgage-backed securities: GNMA 13,740 13,740 — 13,740 — FNMA & FHLMC 33,266 33,266 — 33,266 — Equity securities 11 11 — 11 — Total available-for-sale securities $ 71,982 $ 71,982 $ — $ 71,982 $ — Fair Value Measurements at December 31, 2014, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Available-for-Sale Securities: 12/31/2014 12/31/2014 (Level 1) (Level 2) (Level 3) Taxable municipal securities $ 17,078 $ 17,078 $ — $ 17,078 $ — Mortgage-backed securities: GNMA 16,264 16,264 — 16,264 — FNMA & FHLMC 30,858 30,858 — 30,858 — Equity securities 11 11 — 11 — Total available-for-sale securities $ 64,211 $ 64,211 $ — $ 64,211 $ — The following table presents the reconciliation for the three and nine months ended September 30, 2015 and 2014 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands) . Three Months Ended Nine Months Ended September 30, September 30, Securities Available-for-Sale: 2015 2014 2015 2014 Beginning Balance $ — $ — $ — $ 1,025 Total realized and unrealized gains or (losses): Included in earnings — 175 — 250 Included in other comprehensive income — — — 150 Purchases, issuances and settlements — (175 ) — (1,425 ) Ending Balance $ — $ — $ — $ — Fair Value Measured on a Nonrecurring Basis. The Company measures certain assets at fair value on a nonrecurring basis, as described below. Loans Held for Sale Loans held for sale are carried at the lower of cost or market value. The fair value of loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics. As such, the Company classifies loans held for sale as a Level 2 valuation. Impaired Loans The Company does not record loans at fair value on a recurring basis. However, when a loan is considered impaired, it is evaluated for impairment and written down to its estimated fair value or an allowance for loan losses is established. When the fair value of an impaired loan is based on an observable market price or a current appraised value with no adjustments, the Company records the impaired loan as nonrecurring Level 2. When there is no observable market prices, an appraised value is not available, or the Company determines the fair value of the collateral is further impaired below the appraised value, the impaired loan is classified as nonrecurring Level 3. Foreclosed Assets Foreclosed assets are adjusted to fair value less estimated selling costs upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. Given the lack of observable market prices for identical properties, the Company records foreclosed assets as non-recurring Level 3. Assets measured at fair value on a non-recurring basis are included in the tables below at September 30, 2015 and December 31, 2014 (amounts in thousands). Fair Value Measurements at September 30, 2015, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 9/30/2015 9/30/2015 (Level 1) (Level 2) (Level 3) Loans held for sale $ 2,100 $ 2,100 $ — $ 2,100 $ — Impaired loans 2,216 2,216 — — 2,216 Foreclosed assets 2,088 2,088 — — 2,088 Fair Value Measurements at December 31, 2014, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 12/31/2014 12/31/2014 (Level 1) (Level 2) (Level 3) Loans held for sale $ 2,882 $ 2,882 $ — $ 2,882 $ — Impaired loans 9,855 9,855 — — 9,855 Foreclosed assets 3,782 3,782 — — 3,782 Quantitative Information about Level 3 Fair Value Measurements The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis at September 30, 2015 (amounts in thousands, except percentages). Total Carrying Amount at September 30, 2015 Valuation Methodology Range of Inputs Nonrecurring measurements: Impaired loans $ 2,216 Collateral discounts 9 - 50% Foreclosed assets $ 2,088 Discounted appraisals 10 - 30% Collateral discounts to determine fair value on impaired loans vary widely and result from the consideration of the following factors: the age of the most recent appraisal (i.e. an appraisal dating from an earlier period of real estate speculation could require as much as a 50% discount), the type of asset serving as collateral, the expected marketability of the asset, its material or environmental condition, and comparisons to actual sales data of similar assets from both internal and external sources. The following table reflects the general range of collateral discounts for impaired loans by segment. Loan Segment: Range of Percentages Commercial construction and land development 10% - 40% Commercial real estate 9% - 50% Residential construction 9% - 30% Residential mortgage 9% - 20% All other segments 9% - 20% As foreclosed assets are brought into other real estate owned through a process which requires a fair market valuation, further discounts typically reflect market conditions specific to the asset. These conditions are usually captured in subsequent appraisals which are required on an annual basis, and depending upon asset type and marketability demonstrate a more restrained variance than that noted above. Fair Value of Financial Instruments The following methods and assumptions were used to estimate the fair value of each class of financial instrument. Cash and Cash Equivalents The carrying amounts of cash and cash equivalents are equal to the fair value due to the liquid nature of the financial instruments. Certificate of Deposits These investments are valued at carrying amounts for fair value purposes. Securities Available-for-Sale and Securities Held-to-Maturity Fair values of investment securities are based on quoted market prices. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities. Loans Held For Sale The fair value of loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics. Loans The fair value of loans has been estimated utilizing the net present value of future cash flows based upon contractual balances, prepayment assumptions, and applicable weighted average interest rates, adjusted for a 5% current liquidity and market discount assumption. The Company has assigned no fair value to off-balance sheet financial instruments since they are either short term in nature or subject to immediate repricing. FHLB Stock The carrying amount of FHLB stock approximates fair value. Deposits The fair value of non-maturing deposits such as noninterest-bearing demand, money market, NOW, and savings accounts, are by definition, equal to the amount payable on demand. Fair value for maturing deposits such as CDs and IRAs are estimated using a discounted cash flow approach that applies current interest rates to expected maturities. Borrowings, Subordinated Debentures, and Subordinated Promissory Notes The fair value of borrowings, subordinated debentures, and subordinated promissory notes, is based on discounting expected cash flows at the interest rate from debt with the same or similar remaining maturities and collection requirements. Accrued Interest Receivable and Payable The carrying amounts of accrued interest approximates fair value. The following table presents information for financial assets and liabilities as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 48,013 $ 48,013 $ 48,013 $ — $ — Certificates of deposit 24,010 24,010 — 24,010 — Securities available-for-sale 71,982 71,982 — 71,982 — Securities held-to-maturity 68,992 69,872 — 69,872 — Loans held for sale 2,100 2,100 — 2,100 — Loans, net 442,491 422,336 — — 422,336 FHLB stock 4,564 4,564 — 4,564 — Accrued interest receivable 1,712 1,712 — 1,712 — Financial liabilities: Deposits $ 535,764 $ 536,210 $ — $ 536,210 $ — Subordinated debentures and subordinated promissory notes 24,372 26,070 — — 26,070 Borrowings 90,000 94,855 — 94,855 — Accrued interest payable 775 775 — 775 — December 31, 2014 Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 158,527 $ 158,527 $ 158,527 $ — $ — Certificates of deposit 27,784 27,784 — 27,784 — Securities available-for-sale 64,211 64,211 — 64,211 — Securities held-to-maturity 81,583 82,242 — 82,242 — Loans held for sale 2,882 2,882 — 2,882 — Loans, net 442,879 422,906 — — 422,906 FHLB stock 4,788 4,788 — 4,788 — Accrued interest receivable 1,627 1,627 — 1,627 — Financial liabilities: Deposits $ 661,185 $ 663,000 $ — $ 663,000 $ — Subordinated debentures and subordinated promissory notes 24,372 25,671 — — 25,671 Borrowings 90,000 95,573 — 95,573 — Accrued interest payable 1,704 1,704 — 1,704 — |
REGULATORY RESTRICTIONS
REGULATORY RESTRICTIONS | 9 Months Ended |
Sep. 30, 2015 | |
Regulatory Capital Requirements [Abstract] | |
REGULATORY RESTRICTIONS | REGULATORY RESTRICTIONS North Carolina banking law requires that the Bank may not pay a dividend that would reduce its capital below the applicable required capital. In addition, regulatory authorities may limit payment of dividends by any bank when it is determined that such a limitation is in the public interest and is necessary to ensure the financial soundness of the Bank. No dividends were paid to the Company by the Bank during the nine months ended September 30, 2015 . Current federal regulations require that the Bank maintain a minimum ratio of total capital to risk weighted assets of 8.0% , with at least 6.0% being in the form of Tier 1 capital, as defined in the regulations. In addition, the Bank must maintain a common equity Tier 1 capital ratio of 4.5% and a leverage ratio of 4.0% . To be categorized as well capitalized, the Bank must maintain minimum amounts and ratios as set forth in the table below. At September 30, 2015 , the Bank was classified as well capitalized for regulatory capital purposes. The Bank’s actual capital amounts and ratios are also presented in the table below (amounts in thousands, except ratios) . Actual Minimum For Capital Adequacy Purposes Minimum to be Well Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio As of September 30, 2015: Total Capital (to Risk Weighted Assets) $ 76,556 15.5 % $ 39,538 8.0 % $ 49,422 10.0 % Tier I Capital (to Risk Weighted Assets) 70,328 14.2 % 29,653 6.0 % 39,538 8.0 % Common Equity Tier 1 Capital (to Risk Weighted Assets) 70,328 14.2 % 22,240 4.5 % 32,125 6.5 % Tier I Capital (to Average Assets) 70,328 10.0 % 28,065 4.0 % 35,081 5.0 % As of December 31, 2014: Total Capital (to Risk Weighted Assets) $ 66,498 14.7 % $ 36,109 8.0 % $ 45,136 10.0 % Tier I Capital (to Risk Weighted Assets) 60,810 13.5 % 18,054 4.0 % 27,082 6.0 % Tier I Capital (to Average Assets) 60,810 7.2 % 33,844 4.0 % 42,305 5.0 % The Company is also subject to capital requirements that differ from the Bank. In order for the Company to be adequately capitalized, total capital to risk weighted assets, Tier 1 capital to risk weighted assets, common equity Tier 1 capital to risk weighted assets, and Tier 1 capital to average assets must be 8.0% , 6.0% , 4.5% , and 4.0% , respectively. At September 30, 2015 , the Company’s total capital to risk weighted assets, Tier 1 capital to risk weighted assets, common equity Tier 1 capital to risk weighted assets, and Tier 1 capital to average assets were 15.1% , 12.4% , 11.2% , and 8.7% , respectively, as compared to total capital to risk weighted assets, Tier 1 capital to risk weighted assets, and Tier 1 capital to average assets of 15.0% , 11.6% , and 6.2% , respectively, at December 31, 2014 . In late May 2011, the Company and the Bank entered into a Written Agreement (the "2011 Written Agreement") with the FRB and the North Carolina Commissioner of Banks (the "NCCOB"). Working closely with its regulatory partners, the Company demonstrated substantial business and risk management progress and was deemed in compliance with the 2011 Written Agreement. The Company's 2014 capital raise, continued asset quality improvements, and implementation of the Asset Resolution Plan were critical to the Bank's ability to demonstrate the required compliance. As a result, on July 30, 2015, the 2011 Written Agreement was terminated by the FRB and the NCCOB. In connection with the termination of the 2011 Written Agreement, the Bank entered into a new Written Agreement on July 30, 2015 (the “2015 Written Agreement”) with only the FRB, which is unrelated to the Bank’s financial condition. Under the terms of the 2015 Written Agreement, the Bank has submitted the following plans for approval: • a written plan to assure ongoing board oversight of the Bank's management and operations; • a written program for the review of new products, services, or business lines acceptable to the FRB; and • an enhanced written program for conducting appropriate levels of customer due diligence by the Bank acceptable to the FRB. In addition, the Bank has agreed that it will: • within ten days of approval by the FRB, adopt the approved programs specified in the second and third bullets, above; and • within 30 days after the end of each calendar quarter following the date of the 2015 Written Agreement, submit to FRB written progress reports detailing the form and manner of all actions taken to secure compliance with the 2015 Written Agreement and the results thereof. |
RESTRICTED STOCK
RESTRICTED STOCK | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
RESTRICTED STOCK | RESTRICTED STOCK In January 2015, the Board of the Company approved and adopted the Four Oaks Fincorp, Inc. 2015 Restricted Stock Plan (the “Plan”). During 2015, the Company awarded 1,461,000 shares of the Company’s common stock at $1.00 par value per share to certain employees, directors and third party service providers in the form of restricted stock. Awards of performance based restricted stock vest in two separate tranches, 15% at the end of the one -year period ending on December 31, 2015, and 85% at the end of the three -year period ending on December 31, 2018 (each such period, a “Performance Period”), in each case based on the attainment of the performance measures and goals for that Performance Period. The performance measures for the one -year period ending December 31, 2015 are (1) budgeted net income as set forth in the Company’s 2015 budget and (2) the Company having net income in each quarter of 2015. Budgeted net income must be achieved at the 70% threshold performance level in order for 10.5% of the awards to vest and at the 100% target performance level in order for 15% of the awards to vest. Where achievement against budgeted net income falls between these performance levels, the number of shares vested will be determined based on straight-line interpolation. If the performance goals are not met, 15% of the awards will be forfeited. The performance measures and related goals for the three -year period ending December 31, 2018 will be determined by the compensation committee of the Board (the "Committee"), in its sole discretion as administrator of the Plan, in the fourth quarter of 2015. Awards of time based restricted stock also vest in two separate tranches, 15% at the end of the one -year period ending on December 31, 2015, and 85% at the end of the three -year period ending on December 31, 2018. In order for these shares to vest, the recipient of the award generally must be employed by the Company on the vesting date. Any restricted stock that has not vested at the time of the termination of the recipient's service relationship will be forfeited; although, the Committee has the power, in its sole and absolute discretion, to accelerate vesting where such termination is a result of the recipient's death or disability or in other termination situations. The following table summarizes non-vested restricted stock awards as of the period ended September 30, 2015 : Restricted Stock Weighted Average Grant-Date Fair Value Balance as of December 31, 2014: — $ — Granted 1,461,000 1.52 Vested — — Forfeited 60,000 1.52 Balance as of September 30, 2015: 1,401,000 $ 1.52 The Company recognized $405,000 in compensation expense related to restricted stock awards for the nine months ended September 30, 2015 and the Company estimates there was $1.9 million in unrecognized compensation expense for restricted stock granted. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For the nine months ended September 30, 2015 , the Company recorded a discrete income tax benefit of $16.5 million . This compares to no income tax benefit or expense for the same period in 2014. The year-over-year variance is due to the Company’s release of $16.6 million of the valuation allowance against its deferred tax assets in the second quarter of 2015 offset by an income tax expense of $92,000 for the three months ended September 30, 2015 as a result of changes to the North Carolina tax rate and its impact on future deferred tax benefits. Under US GAAP, companies are required to assess whether a valuation allowance should be established against their deferred tax assets based on consideration of all available positive and negative evidence using a “more likely than not” standard. During the analysis for the twelve months ended December 31, 2010 and continuing through March 31, 2015, the Company had concluded that it was not more-likely-than-not that the Company would be able to utilize its deferred tax assets and, accordingly, had established a full valuation allowance against the value of the deferred tax assets. This conclusion was based on negative credit quality trends, increasing provision for loan losses, cumulative loss position, and uncertainty regarding the amount of future taxable income that the Company could forecast. As part of the ongoing evaluation of positive and negative factors, the Company determined in the second quarter of 2015, it is more likely than not that it will generate sufficient taxable income to utilize a significant portion of its deferred tax assets. As a result of this change in judgment about the ability to utilize its deferred tax assets in future years, the Company released $16.6 million of the valuation allowance against its deferred tax assets resulting in an income tax benefit. This conclusion, and partial release of the valuation allowance, was based upon a number of factors including continued improvement in quarterly earnings, forecasted future profitability, improved asset quality and the execution of the Asset Resolution Plan. The Company will continue to evaluate its ability to utilize the remaining $4.1 million in net deferred tax assets as more objective information on growth and profitability becomes available. Future evidence may show that it is more likely than not that the remaining deferred tax assets will be utilized at which point the remaining valuation allowance can be reversed. Alternatively, future evidence may prove that it is more likely than not that a portion of the deferred tax assets will not be utilized in which case a valuation allowance may be reestablished. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The existing recognition and measurement guidance for debt issuance costs are not affected by this update. ASU 2015-03 is effective for annual and interim reporting periods beginning after December 15, 2015. The Company does not believe the adoption of this update will have a material impact on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern . This update requires management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date the financial statements are issued. Substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. If the substantial doubt is alleviated as a result of consideration of management’s plans, the entity should disclose information that enables financial statement users to understand the principal conditions or events that raised substantial doubt, management’s evaluation of the conditions and management’s plans to alleviate the substantial doubt. If substantial doubt exists about an entity’s ability to continue as a going concern, and the substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern. The amendments in this update become effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not believe the adoption of this update will have a material impact on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU No. 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40): Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure . This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) The loan has a government guarantee that is not separable from the loan before foreclosure, (2) At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for annual and interim periods beginning after December 15, 2014. The adoption of the new guidance did not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) which supersedes the revenue recognition requirements of Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition , and most industry-specific guidance on revenue recognition throughout the ASC. The new standard is principles based and provides a five step model to determine when and how revenue is recognized. The core principle of the new standard is that revenue should be recognized when a company transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of qualitative and quantitative information surrounding the amount, nature, timing and uncertainty of revenues and cash flows arising from contracts with customers. On August 12, 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of the new revenue recognition standard by one year. Based on ASU 2015-14, public organizations would apply the new revenue standard to annual reporting periods beginning after December 15, 2017. Early adoption is permitted, but not before the original effective date (i.e., interim and annual reporting periods beginning after December 15, 2016). The Company is currently evaluating the impact of adoption of the new standard on its consolidated financial statements. In January 2014, the FASB issued ASU No. 2014-04, Receivables–Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This update clarifies that an in-substance repossession or foreclosure occurs upon either the creditor obtaining legal title to the residential real estate property or the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. This amendment is effective for annual and interim periods beginning after December 15, 2014. The adoption of the new guidance did not have a material impact on the Company's consolidated financial statements. Other accounting standards that have been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. From time to time the FASB issues exposure drafts for proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts. |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Income (Loss) Per Common Share | Basic and diluted net income (loss) per common share have been computed based upon net income (loss) as presented in the accompanying consolidated statements of operations divided by the weighted average number of common shares outstanding or assumed to be outstanding as summarized below (amounts in thousands, except share data) : Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Net income (loss) available to common shareholders $ 734 $ (8,598 ) $ 19,198 $ (4,822 ) Weighted average number of common shares - basic 32,135,465 20,696,393 32,089,950 12,584,239 Effect of dilutive stock options 17,040 — 15,683 — Effect of dilutive restricted stock awards 242,810 — 138,620 — Weighted average number of common shares - dilutive 32,395,315 20,696,393 32,244,253 12,584,239 Basic earnings (loss) per common share $ 0.02 $ (0.42 ) $ 0.60 $ (0.38 ) Diluted earnings (loss) per common share $ 0.02 $ (0.42 ) $ 0.60 $ (0.38 ) Anti-dilutive awards 155,455 280,982 155,455 280,982 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Available-for-sale | December 31, 2014 Securities Available-for-Sale: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 16,412 $ 686 $ 20 $ 17,078 Mortgage-backed securities GNMA 16,204 163 103 16,264 FNMA & FHLMC 30,992 — 134 30,858 Equity securities 11 — — 11 Total $ 63,619 $ 849 $ 257 $ 64,211 September 30, 2015 Securities Available-for-Sale: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 24,798 $ 330 $ 163 $ 24,965 Mortgage-backed securities GNMA 13,605 135 — 13,740 FNMA & FHLMC 33,226 86 46 33,266 Equity securities 11 — — 11 Total $ 71,640 $ 551 $ 209 $ 71,982 |
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Held-to-maturity | December 31, 2014 Securities Held-to-Maturity: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 3,584 $ — $ 28 $ 3,556 Mortgage-backed securities GNMA 74,482 887 244 75,125 FNMA 3,517 44 — 3,561 Total $ 81,583 $ 931 $ 272 $ 82,242 September 30, 2015 Securities Held-to-Maturity: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Taxable municipal securities $ 3,544 $ 24 $ — $ 3,568 Mortgage-backed securities GNMA 62,617 883 86 63,414 FNMA 2,831 59 — 2,890 Total $ 68,992 $ 966 $ 86 $ 69,872 |
Schedule of Gross Unrealized Losses and Fair Values of Investment Securities | The following tables show gross unrealized losses and fair values of investment securities, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Less Than 12 Months 12 Months or More Total # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Securities Available-for-Sale: Taxable municipal securities 11 $ 9,989 $ 163 — $ — $ — $ 9,989 $ 163 Mortgage-backed securities FNMA & FHLMC 6 14,033 46 — — — 14,033 46 Total temporarily impaired securities 17 $ 24,022 $ 209 — $ — $ — $ 24,022 $ 209 September 30, 2015 Less Than 12 Months 12 Months or More Total Securities Held-to-Maturity: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Mortgage-backed securities GNMA 2 $ 3,074 $ 10 3 $ 5,438 $ 76 $ 8,512 $ 86 Total temporarily impaired securities 2 $ 3,074 $ 10 3 $ 5,438 $ 76 $ 8,512 $ 86 December 31, 2014 Less Than 12 Months 12 Months or More Total Securities Available-for-Sale: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Taxable municipal securities 2 $ 2,580 $ 20 — $ — $ — $ 2,580 $ 20 Mortgage-backed securities GNMA 2 7,425 103 — — — 7,425 103 FNMA & FHLMC 6 30,858 134 — — — 30,858 134 Total temporarily impaired securities 10 $ 40,863 $ 257 — $ — $ — $ 40,863 $ 257 December 31, 2014 Less Than 12 Months 12 Months or More Total Securities Held-to-Maturity: # Securities Fair value Unrealized losses # Securities Fair value Unrealized losses Fair value Unrealized losses Taxable municipal securities — $ — $ — 10 $ 3,556 $ 28 $ 3,556 $ 28 Mortgage-backed securities GNMA 6 7,594 41 6 12,240 203 19,834 244 Total temporarily impaired securities 6 $ 7,594 $ 41 16 $ 15,796 $ 231 $ 23,390 $ 272 |
Amortized Cost and Fair Value of Available-for-sale and Held-to-maturity Securities by Expected Maturities | The amortized cost and fair value of available-for-sale and held-to-maturity securities at September 30, 2015 by expected maturities are shown on the following table (amounts in thousands) . Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. September 30, 2015 Securities Available-for-Sale: Amortized Cost Fair Value Taxable municipal securities: Due after ten years $ 24,798 $ 24,965 Total taxable municipal securities 24,798 24,965 Mortgage-backed securities - GNMA/FNMA & FHLMC: Due after ten years 46,831 47,006 Total mortgage-backed securities - GNMA/FNMA & FHLMC 46,831 47,006 Other securities: Equity securities 11 11 Total other securities 11 11 Total available-for-sale securities $ 71,640 $ 71,982 Securities Held-to-Maturity: Taxable municipal securities: Due within one year $ 101 $ 101 Due after one year through five years 1,600 1,608 Due after five years through ten years 1,843 1,859 Total taxable municipal securities 3,544 3,568 Mortgage-backed securities - GNMA/FNMA: Due after five years through ten years 7,105 7,307 Due after ten years 58,343 58,997 Total mortgage-backed securities - GNMA/FNMA 65,448 66,304 Total held-to-maturity securities $ 68,992 $ 69,872 |
LOANS AND ALLOWANCE FOR LOAN 21
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Loans and Leases Receivable Disclosure [Abstract] | |
Classification of Loan Segments | The classification of loan segments as of September 30, 2015 and December 31, 2014 are summarized as follows (amounts in thousands) : September 30, 2015 December 31, 2014 Commercial and industrial $ 23,804 $ 24,286 Commercial construction and land development 50,469 53,642 Commercial real estate 206,548 200,510 Residential construction 31,577 28,130 Residential mortgage 130,588 135,022 Consumer 6,256 7,248 Consumer credit cards 2,140 2,276 Business credit cards 1,299 1,251 Other 832 499 Gross loans 453,513 452,864 Less: Net deferred loan fees (750 ) (608 ) Net loans before allowance 452,763 452,256 Allowance for loan losses (10,272 ) (9,377 ) Total net loans $ 442,491 $ 442,879 Loans held for sale $ 2,100 $ 2,882 |
Analysis of the Allowance for Loan Losses by Loan Segment | The following tables are an analysis of the allowance for loan losses by loan segment as of and for the three and nine months ended September 30, 2015 and 2014 and as of and for the twelve months ended December 31, 2014 (amounts in thousands) . These tables do not include loans classified as held for sale. Three Months Ended September 30, 2015 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 153 $ 5,306 $ 2,669 $ 318 $ 1,224 $ 112 $ 30 $ 9,812 Provision for loan losses (102 ) (209 ) (210 ) 79 409 (18 ) 51 — Loans charged-off — (160 ) 7 — (261 ) (38 ) (28 ) (480 ) Recoveries 73 590 198 — 44 35 — 940 Net recoveries (charge-offs) 73 430 205 — (217 ) (3 ) (28 ) 460 Balance, end of period $ 124 $ 5,527 $ 2,664 $ 397 $ 1,416 $ 91 $ 53 $ 10,272 Nine Months Ended September 30, 2015 Real Estate Allowances for loan losses: Commercial Commercial Commercial Residential Residential Consumer Other Totals Balance, beginning of period $ 119 $ 5,105 $ 2,382 $ 436 $ 1,206 $ 89 $ 40 $ 9,377 Provision for loan losses (161 ) (493 ) 93 (39 ) 469 50 81 — Loans charged-off (47 ) (179 ) (199 ) — (426 ) (136 ) (70 ) (1,057 ) Recoveries 213 1,094 388 — 167 88 2 1,952 Net recoveries (charge-offs) 166 915 189 — (259 ) (48 ) (68 ) 895 Balance, end of period $ 124 $ 5,527 $ 2,664 $ 397 $ 1,416 $ 91 $ 53 $ 10,272 Ending balance: individually evaluated for impairment $ — $ 494 $ 111 $ — $ — $ 3 $ — $ 608 Ending balance: collectively evaluated for impairment (1) $ 124 $ 5,033 $ 2,553 $ 397 $ 1,416 $ 88 $ 53 $ 9,664 Loans: Balance, end of period $ 25,103 $ 50,469 $ 206,548 $ 31,577 $ 130,588 $ 8,396 $ 832 $ 453,513 Ending balance: individually evaluated for impairment $ — $ 2,357 $ 3,427 $ 437 $ 1,778 $ 3 $ 12 $ 8,014 Ending balance: collectively evaluated for impairment (1) $ 25,103 $ 48,112 $ 203,121 $ 31,140 $ 128,810 $ 8,393 $ 820 $ 445,499 (1) At September 30, 2015 , there were $416,000 in impaired loans collectively evaluated for impairment with $34,000 in reserves established. Three Months Ended September 30, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 389 $ 5,567 $ 2,241 $ 620 $ 1,945 $ 169 $ 15 $ 10,946 Provision for loan losses 135 2,282 2,139 23 3,407 (32 ) — 7,954 Loans charged-off (436 ) (2,779 ) (2,529 ) — (4,177 ) (25 ) — (9,946 ) Recoveries 49 113 43 — 123 64 1 393 Net (charge-offs) recoveries (387 ) (2,666 ) (2,486 ) — (4,054 ) 39 1 (9,553 ) Balance, end of period $ 137 $ 5,183 $ 1,894 $ 643 $ 1,298 $ 176 $ 16 $ 9,347 Nine Months Ended September 30, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 487 $ 5,037 $ 2,981 $ 713 $ 2,146 $ 188 $ 38 $ 11,590 Provision for loan losses (53 ) 2,945 1,727 101 3,257 21 (44 ) 7,954 Loans charged-off (460 ) (3,096 ) (3,019 ) (171 ) (4,417 ) (114 ) — (11,277 ) Recoveries 163 297 205 — 312 81 22 1,080 Net (charge-offs) recoveries (297 ) (2,799 ) (2,814 ) (171 ) (4,105 ) (33 ) 22 (10,197 ) Balance, end of period $ 137 $ 5,183 $ 1,894 $ 643 $ 1,298 $ 176 $ 16 $ 9,347 Ending balance: individually evaluated for impairment $ — $ 528 $ 6 $ — $ — $ — $ — $ 534 Ending balance: collectively evaluated for impairment (1) $ 137 $ 4,655 $ 1,888 $ 643 $ 1,298 $ 176 $ 16 $ 8,813 Loans: Balance, end of period $ 25,584 $ 53,009 $ 192,202 $ 31,161 $ 135,120 $ 9,297 $ 522 $ 446,895 Ending balance: individually evaluated for impairment $ — $ 5,504 $ 4,946 $ — $ 2,844 $ 8 $ — $ 13,302 Ending balance: collectively evaluated for impairment (1) $ 25,584 $ 47,505 $ 187,256 $ 31,161 $ 132,276 $ 9,289 $ 522 $ 433,593 (1) At September 30, 2014 , there were no impaired loans collectively evaluated for impairment with $0 in reserves established. Twelve Months Ended December 31, 2014 Real Estate Allowances for loan losses: Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals Balance, beginning of period $ 487 $ 5,037 $ 2,981 $ 713 $ 2,146 $ 188 $ 38 $ 11,590 Provision for loan losses (84 ) 2,778 2,382 (106 ) 3,041 (36 ) (21 ) 7,954 Loans charged-off (492 ) (3,107 ) (3,315 ) (171 ) (4,847 ) (183 ) — (12,115 ) Recoveries 208 397 334 — 866 120 23 1,948 Net (charge-offs) recoveries (284 ) (2,710 ) (2,981 ) (171 ) (3,981 ) (63 ) 23 (10,167 ) Balance, end of period $ 119 $ 5,105 $ 2,382 $ 436 $ 1,206 $ 89 $ 40 $ 9,377 Ending balance: individually evaluated for impairment $ — $ 516 $ 4 $ — $ — $ 4 $ — $ 524 Ending balance: collectively evaluated for impairment (1) $ 119 $ 4,589 $ 2,378 $ 436 $ 1,206 $ 85 $ 40 $ 8,853 Loans: Balance, end of period $ 25,537 $ 53,642 $ 200,510 $ 28,130 $ 135,022 $ 9,524 $ 499 $ 452,864 Ending balance: individually evaluated for impairment $ — $ 6,678 $ 3,801 $ — $ 2,030 $ 471 $ — $ 12,980 Ending balance: collectively evaluated for impairment (1) $ 25,537 $ 46,964 $ 196,709 $ 28,130 $ 132,992 $ 9,053 $ 499 $ 439,884 (1) At December 31, 2014 , there were $436,000 in impaired loans collectively evaluated for impairment with $139,000 in reserves established. |
Creditworthiness Analysis by Loan Class and Credit Card Portfolio Exposure | The following tables are an analysis of the creditworthiness by loan class and credit card portfolio exposure as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Real Estate Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals 1 - Lowest Risk $ 2,085 $ — $ — $ — $ — $ 1,611 $ 3 $ 3,699 2 - Satisfactory Quality 671 739 1,921 — 15,957 260 8 19,556 3 - Satisfactory Quality - Merits Attention 10,623 10,944 95,494 3,111 53,564 1,175 538 175,449 4 - Low Satisfactory 10,156 34,350 101,040 26,991 54,178 3,112 244 230,071 5 - Special Mention 267 2,658 5,863 1,038 5,230 57 27 15,140 6-8 - Substandard (1) 2 1,778 2,230 437 1,659 41 12 6,159 $ 23,804 $ 50,469 $ 206,548 $ 31,577 $ 130,588 $ 6,256 $ 832 $ 450,074 Consumer - Credit Card Business- Credit Card Performing $ 2,136 $ 1,299 Non Performing 4 — Total $ 2,140 $ 1,299 Total Loans $ 453,513 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $2.0 million in Risk Grade 6 loans classified as loans held for sale. December 31, 2014 Real Estate Commercial and Industrial Commercial Construction and Land Development Commercial Real Estate Residential Construction Residential Mortgage Consumer Other Totals 1 - Lowest Risk $ 2,099 $ — $ — $ — $ — $ 1,638 $ — $ 3,737 2 - Satisfactory Quality 606 630 2,206 — 14,794 314 11 18,561 3 - Satisfactory Quality - Merits Attention 9,506 10,625 81,761 1,893 53,007 3,556 225 160,573 4 - Low Satisfactory 11,932 34,709 110,683 26,074 56,359 1,186 146 241,089 5 - Special Mention 143 1,892 3,989 — 8,720 62 117 14,923 6-8 - Substandard (1) — 5,786 1,871 163 2,142 492 — 10,454 $ 24,286 $ 53,642 $ 200,510 $ 28,130 $ 135,022 $ 7,248 $ 499 $ 449,337 Consumer- Credit Card Business- Credit Card Performing $ 2,263 $ 1,248 Non Performing 13 3 Total $ 2,276 $ 1,251 Total Loans $ 452,864 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $2.5 million in Risk Grade 6 loans classified as held for sale. |
Age Analysis of Past Due Loans | The following tables are an age analysis of past due loans, including those on nonaccrual by loan class, as of September 30, 2015 and December 31, 2014 (amounts in thousands). September 30, 2015 30-89 Days Past Due (1) Nonaccrual (1) Greater than 90 Days Past Due Total Past Due Current Total Loans Commercial & industrial $ — $ 2 $ — $ 2 $ 23,802 $ 23,804 Commercial construction & land development 1,663 1,132 — 2,795 47,674 50,469 Commercial real estate 1,223 1,072 — 2,295 204,253 206,548 Residential construction — 437 — 437 31,140 31,577 Residential mortgage 288 721 — 1,009 129,579 130,588 Consumer 104 14 — 118 6,138 6,256 Consumer credit cards 21 — 4 25 2,115 2,140 Business credit cards 32 — — 32 1,267 1,299 Other loans 27 12 — 39 793 832 Total $ 3,358 $ 3,390 $ 4 $ 6,752 $ 446,761 $ 453,513 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $0 in loans 30-89 past due and $1.5 million in loans on nonaccrual classified as loans held for sale. December 31, 2014 30-89 Days (1) Nonaccrual (1) Greater than 90 Days Past Due Total Past Current Total Commercial & industrial $ 14 $ — $ — $ 14 $ 24,272 $ 24,286 Commercial construction & land development 27 5,533 — 5,560 48,082 53,642 Commercial real estate — 983 — 983 199,527 200,510 Residential construction — — — — 28,130 28,130 Residential mortgage 1,058 1,271 — 2,329 132,693 135,022 Consumer 82 472 — 554 6,694 7,248 Consumer credit cards 46 — 14 60 2,216 2,276 Business credit cards 41 — 3 44 1,207 1,251 Other loans 84 — — 84 415 499 Total $ 1,352 $ 8,259 $ 17 $ 9,628 $ 443,236 $ 452,864 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $67,000 in loans 30-89 days past due and $1.9 million in loans on nonaccrual classified as held for sale. |
Summary of Nonperforming Assets | Nonperforming assets at September 30, 2015 and December 31, 2014 consist of the following (amounts in thousands) : September 30, 2015 December 31, 2014 Loans past due ninety days or more and still accruing $ 4 $ 17 Nonaccrual loans 3,390 8,259 Foreclosed assets 2,088 3,782 Loans held for sale - nonperforming 1,462 1,865 Total nonperforming assets $ 6,944 $ 13,923 |
Summary of Impaired Loans | The following tables illustrate the impaired loans by loan class as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 As of Date Year to Date Recorded Investment (1) Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial construction & land development $ 968 $ 2,250 $ — $ 1,354 $ 13 Commercial real estate 3,063 3,853 — 3,037 95 Residential construction 437 437 — 409 5 Residential mortgage 1,934 2,200 — 2,000 63 Other 12 84 — 61 2 Subtotal: 6,414 8,824 — 6,861 178 With an allowance recorded: Commercial and industrial 2 2 — 3 — Commercial construction & land development 1,325 2,383 502 1,443 68 Commercial real estate 403 651 114 415 12 Residential mortgage 269 332 22 323 8 Consumer 17 19 4 19 1 Subtotal: 2,016 3,387 642 2,203 89 Totals: Commercial 5,761 9,139 616 6,252 188 Consumer & Other 29 103 4 80 3 Residential 2,640 2,969 22 2,732 76 Grand Total $ 8,430 $ 12,211 $ 642 $ 9,064 $ 267 (1) The above table includes loans held for investment only. As of September 30, 2015 , there were $1.8 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. December 31, 2014 As of Date Year to Date Recorded Investment (1) Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized With no related allowance recorded: Commercial construction & land development $ 5,445 $ 6,454 $ — $ 6,715 $ 15 Commercial real estate 3,468 4,295 — 4,103 139 Residential mortgage 2,030 1,614 — 2,279 59 Consumer 467 729 — 524 — Subtotal: 11,410 13,092 — 13,621 213 With an allowance recorded: Commercial construction & land development 1,433 2,656 580 1,866 92 Commercial real estate 372 379 17 378 19 Residential mortgage 192 169 61 224 5 Consumer 8 6 5 8 — Subtotal: 2,005 3,210 663 2,476 116 Totals: Commercial 10,718 13,784 597 13,062 265 Consumer 475 735 5 532 — Residential 2,222 1,783 61 2,503 64 Grand Total: $ 13,415 $ 16,302 $ 663 $ 16,097 $ 329 (1) The above table includes loans held for investment only. As of December 31, 2014 , there were $2.4 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. |
Schedule of Loans Modified as TDRs | The following table provides a summary of loans modified as TDRs at September 30, 2015 and December 31, 2014 (amounts in thousands). September 30, 2015 Accrual Nonaccrual Total TDRs Allowance for Loan Losses Allocated Commercial construction and land development 1,155 717 1,872 492 Commercial real estate 2,395 596 2,991 20 Residential mortgage 790 28 818 — Consumer 3 — 3 3 Total modifications $ 4,343 $ 1,341 $ 5,684 $ 515 December 31, 2014 Accrual Nonaccrual Total TDRs Allowance for Loan Losses Allocated Commercial construction and land development $ 1,336 $ 2,776 $ 4,112 $ 516 Commercial real estate 2,469 552 3,021 4 Residential mortgage 950 54 1,004 — Consumer 4 467 471 4 Total modifications $ 4,759 $ 3,849 $ 8,608 $ 524 (1) The above table includes loans held for investment only. At September 30, 2015 , there were $157,000 in accruing TDRs and $562,000 in TDRs in nonaccrual and classified as held for sale compared to $203,000 and $932,000 , respectively, at December 31, 2014 . |
Summary of the Bank's TDRs | The table below details TDRs that the Bank has entered into during the twelve months ended September 30, 2015 . Twelve Months Ended September 30, 2015 Paid in full Paying as restructured Converted to nonaccrual Foreclosure/Default Number of loans Recorded Investment Number of loans Recorded Investment Number of loans Recorded Investment Number of loans Recorded Investment (amounts in thousands, except number of loans) Extended payment terms — $ — 1 $ 3 — $ — — $ — Total — $ — 1 $ 3 — $ — — $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Loan Commitments | The following table presents loan commitments at September 30, 2015 (amounts in thousands) . September 30, 2015 Commitments to extend credit $ 29,436 Undisbursed lines of credit 89,212 Financial stand-by letters of credit 368 Performance stand-by letters of credit 668 Legally binding commitments 119,684 Unused credit card lines 13,641 Total $ 133,325 |
Total Market Value of Pledged Assets by Asset Type | The following table provides the total market value of pledged assets by asset type at September 30, 2015 (amounts in thousands) . September 30, 2015 Securities 86,666 Loans 35,967 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Assets Measured at Fair Value on a Recurring Basis | The following table presents information about assets measured at fair value on a recurring basis at September 30, 2015 and December 31, 2014 (amounts in thousands) . Fair Value Measurements at September 30, 2015, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Available-for-Sale Securities: 9/30/2015 9/30/2015 (Level 1) (Level 2) (Level 3) Taxable municipal securities $ 24,965 $ 24,965 $ — $ 24,965 $ — Mortgage-backed securities: GNMA 13,740 13,740 — 13,740 — FNMA & FHLMC 33,266 33,266 — 33,266 — Equity securities 11 11 — 11 — Total available-for-sale securities $ 71,982 $ 71,982 $ — $ 71,982 $ — Fair Value Measurements at December 31, 2014, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Available-for-Sale Securities: 12/31/2014 12/31/2014 (Level 1) (Level 2) (Level 3) Taxable municipal securities $ 17,078 $ 17,078 $ — $ 17,078 $ — Mortgage-backed securities: GNMA 16,264 16,264 — 16,264 — FNMA & FHLMC 30,858 30,858 — 30,858 — Equity securities 11 11 — 11 — Total available-for-sale securities $ 64,211 $ 64,211 $ — $ 64,211 $ — |
Reconciliation of Level 3 Assets Measured at Fair Value on Recurring Basis | The following table presents the reconciliation for the three and nine months ended September 30, 2015 and 2014 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands) . Three Months Ended Nine Months Ended September 30, September 30, Securities Available-for-Sale: 2015 2014 2015 2014 Beginning Balance $ — $ — $ — $ 1,025 Total realized and unrealized gains or (losses): Included in earnings — 175 — 250 Included in other comprehensive income — — — 150 Purchases, issuances and settlements — (175 ) — (1,425 ) Ending Balance $ — $ — $ — $ — |
Assets Measured at Fair Value on a Non-recurring Basis | Assets measured at fair value on a non-recurring basis are included in the tables below at September 30, 2015 and December 31, 2014 (amounts in thousands). Fair Value Measurements at September 30, 2015, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 9/30/2015 9/30/2015 (Level 1) (Level 2) (Level 3) Loans held for sale $ 2,100 $ 2,100 $ — $ 2,100 $ — Impaired loans 2,216 2,216 — — 2,216 Foreclosed assets 2,088 2,088 — — 2,088 Fair Value Measurements at December 31, 2014, Using Total Carrying Amount in the Consolidated Balance Sheet Assets Measured at Fair Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs 12/31/2014 12/31/2014 (Level 1) (Level 2) (Level 3) Loans held for sale $ 2,882 $ 2,882 $ — $ 2,882 $ — Impaired loans 9,855 9,855 — — 9,855 Foreclosed assets 3,782 3,782 — — 3,782 |
Valuation Methodology and Unobservable Inputs for Level 3 Assets | The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis at September 30, 2015 (amounts in thousands, except percentages). Total Carrying Amount at September 30, 2015 Valuation Methodology Range of Inputs Nonrecurring measurements: Impaired loans $ 2,216 Collateral discounts 9 - 50% Foreclosed assets $ 2,088 Discounted appraisals 10 - 30% |
General Range of Collateral Discounts for Impaired Loans by Segment | The following table reflects the general range of collateral discounts for impaired loans by segment. Loan Segment: Range of Percentages Commercial construction and land development 10% - 40% Commercial real estate 9% - 50% Residential construction 9% - 30% Residential mortgage 9% - 20% All other segments 9% - 20% |
Information for Financial Assets and Liabilities | The following table presents information for financial assets and liabilities as of September 30, 2015 and December 31, 2014 (amounts in thousands) . September 30, 2015 Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 48,013 $ 48,013 $ 48,013 $ — $ — Certificates of deposit 24,010 24,010 — 24,010 — Securities available-for-sale 71,982 71,982 — 71,982 — Securities held-to-maturity 68,992 69,872 — 69,872 — Loans held for sale 2,100 2,100 — 2,100 — Loans, net 442,491 422,336 — — 422,336 FHLB stock 4,564 4,564 — 4,564 — Accrued interest receivable 1,712 1,712 — 1,712 — Financial liabilities: Deposits $ 535,764 $ 536,210 $ — $ 536,210 $ — Subordinated debentures and subordinated promissory notes 24,372 26,070 — — 26,070 Borrowings 90,000 94,855 — 94,855 — Accrued interest payable 775 775 — 775 — December 31, 2014 Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 158,527 $ 158,527 $ 158,527 $ — $ — Certificates of deposit 27,784 27,784 — 27,784 — Securities available-for-sale 64,211 64,211 — 64,211 — Securities held-to-maturity 81,583 82,242 — 82,242 — Loans held for sale 2,882 2,882 — 2,882 — Loans, net 442,879 422,906 — — 422,906 FHLB stock 4,788 4,788 — 4,788 — Accrued interest receivable 1,627 1,627 — 1,627 — Financial liabilities: Deposits $ 661,185 $ 663,000 $ — $ 663,000 $ — Subordinated debentures and subordinated promissory notes 24,372 25,671 — — 25,671 Borrowings 90,000 95,573 — 95,573 — Accrued interest payable 1,704 1,704 — 1,704 — |
REGULATORY RESTRICTIONS (Tables
REGULATORY RESTRICTIONS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Regulatory Capital Requirements [Abstract] | |
Schedule of Actual Capital Amounts and Ratios | The Bank’s actual capital amounts and ratios are also presented in the table below (amounts in thousands, except ratios) . Actual Minimum For Capital Adequacy Purposes Minimum to be Well Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio As of September 30, 2015: Total Capital (to Risk Weighted Assets) $ 76,556 15.5 % $ 39,538 8.0 % $ 49,422 10.0 % Tier I Capital (to Risk Weighted Assets) 70,328 14.2 % 29,653 6.0 % 39,538 8.0 % Common Equity Tier 1 Capital (to Risk Weighted Assets) 70,328 14.2 % 22,240 4.5 % 32,125 6.5 % Tier I Capital (to Average Assets) 70,328 10.0 % 28,065 4.0 % 35,081 5.0 % As of December 31, 2014: Total Capital (to Risk Weighted Assets) $ 66,498 14.7 % $ 36,109 8.0 % $ 45,136 10.0 % Tier I Capital (to Risk Weighted Assets) 60,810 13.5 % 18,054 4.0 % 27,082 6.0 % Tier I Capital (to Average Assets) 60,810 7.2 % 33,844 4.0 % 42,305 5.0 % |
RESTRICTED STOCK (Tables)
RESTRICTED STOCK (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Non-vested Restricted Stock Awards | The following table summarizes non-vested restricted stock awards as of the period ended September 30, 2015 : Restricted Stock Weighted Average Grant-Date Fair Value Balance as of December 31, 2014: — $ — Granted 1,461,000 1.52 Vested — — Forfeited 60,000 1.52 Balance as of September 30, 2015: 1,401,000 $ 1.52 |
NET INCOME (LOSS) PER SHARE (Co
NET INCOME (LOSS) PER SHARE (Computation of Basic and Diluted Net Income (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net income (loss) available to common shareholders | $ 734 | $ (8,598) | $ 19,198 | $ (4,822) |
Weighted average number of common shares outstanding: | ||||
Weighted average number of common shares - basic | 32,135,465 | 20,696,393 | 32,089,950 | 12,584,239 |
Weighted average number of common shares - dilutive | 32,395,315 | 20,696,393 | 32,244,253 | 12,584,239 |
Basic earnings (loss) per common share (in usd per share) | $ 0.02 | $ (0.42) | $ 0.60 | $ (0.38) |
Diluted earnings (loss) per common share (in usd per share) | $ 0.02 | $ (0.42) | $ 0.60 | $ (0.38) |
Anti-dilutive awards (in shares) | 155,455 | 280,982 | 155,455 | 280,982 |
Stock options | ||||
Weighted average number of common shares outstanding: | ||||
Effect of dilutive shares | 17,040 | 0 | 15,683 | 0 |
Restricted stock awards | ||||
Weighted average number of common shares outstanding: | ||||
Effect of dilutive shares | 242,810 | 0 | 138,620 | 0 |
NET INCOME (LOSS) PER SHARE (Ad
NET INCOME (LOSS) PER SHARE (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Issuance of common stock (in shares) | 24,000,000 | |||
Amount raised net of fees and costs | $ 158 | $ 22,229 | $ 22,200 | |
Increase in average weighted shares of common stock (in shares) | 11,700,000 | 19,700,000 | ||
Restricted stock awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock shares outstanding (in shares) | 0 | |||
2015 Restricted Stock Plan | Restricted stock awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock shares outstanding (in shares) | 1,401,000 | 1,401,000 | ||
2015 Restricted Stock Plan | Restricted stock awards | Performance Criteria Had Not Been Established | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock outstanding (in shares) | 848,000 | 848,000 |
INVESTMENT SECURITIES (Securiti
INVESTMENT SECURITIES (Securities Available-for-sale) (Details) $ in Thousands | Sep. 30, 2015USD ($)security | Dec. 31, 2014USD ($)security | |
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | $ 71,640 | $ 63,619 | |
Gross Unrealized Gains | 551 | 849 | |
Gross Unrealized Losses | 209 | 257 | |
Fair Value | $ 71,982 | $ 64,211 | [1] |
Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 17 | 10 | |
12 Months or More | security | 0 | 0 | |
Fair value | |||
Less Than 12 Months | $ 24,022 | $ 40,863 | |
12 Months or More | 0 | 0 | |
Total | 24,022 | 40,863 | |
Unrealized losses | |||
Less Than 12 Months | 209 | 257 | |
12 Months or More | 0 | 0 | |
Total | 209 | 257 | |
Taxable municipal securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 24,798 | 16,412 | |
Gross Unrealized Gains | 330 | 686 | |
Gross Unrealized Losses | 163 | 20 | |
Fair Value | $ 24,965 | $ 17,078 | |
Taxable municipal securities | Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 11 | 2 | |
12 Months or More | security | 0 | 0 | |
Fair value | |||
Less Than 12 Months | $ 9,989 | $ 2,580 | |
12 Months or More | 0 | 0 | |
Total | 9,989 | 2,580 | |
Unrealized losses | |||
Less Than 12 Months | 163 | 20 | |
12 Months or More | 0 | 0 | |
Total | 163 | 20 | |
Mortgage-backed Securities GNMA | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 13,605 | 16,204 | |
Gross Unrealized Gains | 135 | 163 | |
Gross Unrealized Losses | 0 | 103 | |
Fair Value | 13,740 | $ 16,264 | |
Mortgage-backed Securities GNMA | Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 2 | ||
12 Months or More | security | 0 | ||
Fair value | |||
Less Than 12 Months | $ 7,425 | ||
12 Months or More | 0 | ||
Total | 7,425 | ||
Unrealized losses | |||
Less Than 12 Months | 103 | ||
12 Months or More | 0 | ||
Total | 103 | ||
Mortgage-backed securities FNMA & FHLMC | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 33,226 | 30,992 | |
Gross Unrealized Gains | 86 | 0 | |
Gross Unrealized Losses | 46 | 134 | |
Fair Value | $ 33,266 | $ 30,858 | |
Mortgage-backed securities FNMA & FHLMC | Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 6 | 6 | |
12 Months or More | security | 0 | 0 | |
Fair value | |||
Less Than 12 Months | $ 14,033 | $ 30,858 | |
12 Months or More | 0 | 0 | |
Total | 14,033 | 30,858 | |
Unrealized losses | |||
Less Than 12 Months | 46 | 134 | |
12 Months or More | 0 | 0 | |
Total | 46 | 134 | |
Equity securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Amortized Cost | 11 | 11 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | 0 | 0 | |
Fair Value | $ 11 | $ 11 | |
[1] | Derived from audited consolidated financial statements. |
INVESTMENT SECURITIES (Securi29
INVESTMENT SECURITIES (Securities Held-to-maturity) (Details) $ in Thousands | Sep. 30, 2015USD ($)security | Dec. 31, 2014USD ($)security | |
Schedule of Held-to-maturity Securities [Line Items] | |||
Amortized Cost | $ 68,992 | $ 81,583 | [1] |
Gross Unrealized Gains | 966 | 931 | |
Gross Unrealized Losses | 86 | 272 | |
Fair Value | $ 69,872 | $ 82,242 | |
Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 2 | 6 | |
12 Months or More | security | 3 | 16 | |
Fair value | |||
Less Than 12 Months | $ 3,074 | $ 7,594 | |
12 Months or More | 5,438 | 15,796 | |
Total | 8,512 | 23,390 | |
Unrealized losses | |||
Less Than 12 Months | 10 | 41 | |
12 Months or More | 76 | 231 | |
Total | 86 | 272 | |
Taxable municipal securities | |||
Schedule of Held-to-maturity Securities [Line Items] | |||
Amortized Cost | 3,544 | 3,584 | |
Gross Unrealized Gains | 24 | 0 | |
Gross Unrealized Losses | 0 | 28 | |
Fair Value | 3,568 | $ 3,556 | |
Taxable municipal securities | Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 0 | ||
12 Months or More | security | 10 | ||
Fair value | |||
Less Than 12 Months | $ 0 | ||
12 Months or More | 3,556 | ||
Total | 3,556 | ||
Unrealized losses | |||
Less Than 12 Months | 0 | ||
12 Months or More | 28 | ||
Total | 28 | ||
Mortgage-backed Securities GNMA | |||
Schedule of Held-to-maturity Securities [Line Items] | |||
Amortized Cost | 62,617 | 74,482 | |
Gross Unrealized Gains | 883 | 887 | |
Gross Unrealized Losses | 86 | 244 | |
Fair Value | $ 63,414 | $ 75,125 | |
Mortgage-backed Securities GNMA | Total temporarily impaired securities | |||
Number of Securities | |||
Less Than 12 Months | security | 2 | 6 | |
12 Months or More | security | 3 | 6 | |
Fair value | |||
Less Than 12 Months | $ 3,074 | $ 7,594 | |
12 Months or More | 5,438 | 12,240 | |
Total | 8,512 | 19,834 | |
Unrealized losses | |||
Less Than 12 Months | 10 | 41 | |
12 Months or More | 76 | 203 | |
Total | 86 | 244 | |
Mortgage-backed securities FNMA | |||
Schedule of Held-to-maturity Securities [Line Items] | |||
Amortized Cost | 2,831 | 3,517 | |
Gross Unrealized Gains | 59 | 44 | |
Gross Unrealized Losses | 0 | 0 | |
Fair Value | $ 2,890 | $ 3,561 | |
[1] | Derived from audited consolidated financial statements. |
INVESTMENT SECURITIES (Securi30
INVESTMENT SECURITIES (Securities Containing Unrealized Losses) (Details) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2015USD ($)security | Sep. 30, 2015USD ($)security | |
Gain (Loss) on Investments [Line Items] | ||
Credit loss on other than temporarily impaired security | $ | $ 0 | $ 0 |
Mortgage-backed Securities GNMA | ||
Gain (Loss) on Investments [Line Items] | ||
Number of securities held | 5 | 5 |
Number of securities containing unrealized losses | 55 | 55 |
Mortgage-backed securities FNMA & FHLMC | ||
Gain (Loss) on Investments [Line Items] | ||
Number of securities held | 6 | 6 |
Number of securities containing unrealized losses | 14 | 14 |
Taxable municipal securities | ||
Gain (Loss) on Investments [Line Items] | ||
Number of securities held | 11 | 11 |
Number of securities containing unrealized losses | 40 | 40 |
INVESTMENT SECURITIES (Investme
INVESTMENT SECURITIES (Investment Securities by Contractual Maturities) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Amortized Cost | |||
Total securities | $ 71,640 | $ 63,619 | |
Fair Value | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | [1] |
Amortized Cost | |||
Amortized Cost | 68,992 | ||
Fair Value | |||
Fair Value | 69,872 | 82,242 | |
Taxable municipal securities | |||
Amortized Cost | |||
Due after ten years | 24,798 | ||
Total securities | 24,798 | 16,412 | |
Fair Value | |||
Due after ten years | 24,965 | ||
Investment securities available-for-sale, at fair value | 24,965 | 17,078 | |
Amortized Cost | |||
Due within one year | 101 | ||
Due after one year through five years | 1,600 | ||
Due after five years through ten years | 1,843 | ||
Amortized Cost | 3,544 | ||
Fair Value | |||
Due within one year | 101 | ||
Due after one year through five years | 1,608 | ||
Due after five years through ten years | 1,859 | ||
Fair Value | 3,568 | 3,556 | |
Mortgage-backed securities - GNMA/FNMA & FHLMC | |||
Amortized Cost | |||
Due after ten years | 46,831 | ||
Total securities | 46,831 | ||
Fair Value | |||
Due after ten years | 47,006 | ||
Investment securities available-for-sale, at fair value | 47,006 | ||
Equity securities | |||
Amortized Cost | |||
Total securities | 11 | 11 | |
Fair Value | |||
Investment securities available-for-sale, at fair value | 11 | $ 11 | |
Total other securities | |||
Amortized Cost | |||
Total securities | 11 | ||
Fair Value | |||
Investment securities available-for-sale, at fair value | 11 | ||
Mortgage-backed securities - GNMA/FNMA | |||
Amortized Cost | |||
Due after five years through ten years | 7,105 | ||
Due after ten years | 58,343 | ||
Amortized Cost | 65,448 | ||
Fair Value | |||
Due after five years through ten years | 7,307 | ||
Due after ten years | 58,997 | ||
Fair Value | $ 66,304 | ||
[1] | Derived from audited consolidated financial statements. |
INVESTMENT SECURITIES (Securi32
INVESTMENT SECURITIES (Securities Pledged and Sold) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Investments, Debt and Equity Securities [Abstract] | |||||
Carrying value of securities | $ 86,700,000 | $ 86,700,000 | $ 101,800,000 | ||
Proceeds from sales and calls of investment securities available-for-sale | 4,700,000 | $ 2,700,000 | 8,324,000 | $ 22,661,000 | |
Net realized gains | 209,000 | 51,000 | 265,000 | 265,000 | |
Gross realized losses | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS AND ALLOWANCE FOR LOAN 33
LOANS AND ALLOWANCE FOR LOAN LOSSES (Classification of Loan Segments) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | |
Loans and Leases Receivable Disclosure [Abstract] | |||||||
Commercial and industrial | $ 23,804 | $ 24,286 | |||||
Commercial construction and land development | 50,469 | 53,642 | |||||
Commercial real estate | 206,548 | 200,510 | |||||
Residential construction | 31,577 | 28,130 | |||||
Residential mortgage | 130,588 | 135,022 | |||||
Consumer | 6,256 | 7,248 | |||||
Consumer credit cards | 2,140 | 2,276 | |||||
Business credit cards | 1,299 | 1,251 | |||||
Other | 832 | 499 | |||||
Gross loans | 453,513 | 452,864 | $ 446,895 | ||||
Net deferred loan fees | (750) | (608) | |||||
Net loans before allowance | 452,763 | 452,256 | [1] | ||||
Allowance for loan losses | (10,272) | $ (9,812) | (9,377) | [1] | $ (9,347) | $ (10,946) | $ (11,590) |
Net loans | 442,491 | 442,879 | [1] | ||||
Loans held for sale | $ 2,100 | $ 2,882 | |||||
[1] | Derived from audited consolidated financial statements. |
LOANS AND ALLOWANCE FOR LOAN 34
LOANS AND ALLOWANCE FOR LOAN LOSSES (Allowance for Loan Losses by Loan Class) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |||
Allowances for loan losses: | |||||||
Balance, beginning of period | $ 9,812,000 | $ 10,946,000 | $ 9,377,000 | [1] | $ 11,590,000 | $ 11,590,000 | |
Provision for loan losses | 0 | 7,954,000 | 0 | 7,954,000 | 7,954,000 | ||
Loans charged-off | (480,000) | (9,946,000) | (1,057,000) | (11,277,000) | (12,115,000) | ||
Recoveries | 940,000 | 393,000 | 1,952,000 | 1,080,000 | 1,948,000 | ||
Net recoveries (charge-offs) | 460,000 | (9,553,000) | 895,000 | (10,197,000) | (10,167,000) | ||
Balance, end of period | 10,272,000 | 9,347,000 | 10,272,000 | 9,347,000 | 9,377,000 | [1] | |
Ending balance: individually evaluated for impairment | 608,000 | 534,000 | 608,000 | 534,000 | 524,000 | ||
Ending balance: collectively evaluated for impairment | 9,664,000 | 8,813,000 | 9,664,000 | 8,813,000 | 8,853,000 | ||
Loans: | |||||||
Gross loans | 453,513,000 | 446,895,000 | 453,513,000 | 446,895,000 | 452,864,000 | ||
Ending balance: individually evaluated for impairment | 8,014,000 | 13,302,000 | 8,014,000 | 13,302,000 | 12,980,000 | ||
Ending balance, collectively evaluated for impairment | 445,499,000 | 433,593,000 | 445,499,000 | 433,593,000 | 439,884,000 | ||
Commercial and Industrial | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 153,000 | 389,000 | 119,000 | 487,000 | 487,000 | ||
Provision for loan losses | (102,000) | 135,000 | (161,000) | (53,000) | (84,000) | ||
Loans charged-off | 0 | (436,000) | (47,000) | (460,000) | (492,000) | ||
Recoveries | 73,000 | 49,000 | 213,000 | 163,000 | 208,000 | ||
Net recoveries (charge-offs) | 73,000 | (387,000) | 166,000 | (297,000) | (284,000) | ||
Balance, end of period | 124,000 | 137,000 | 124,000 | 137,000 | 119,000 | ||
Ending balance: individually evaluated for impairment | 0 | 0 | 0 | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 124,000 | 137,000 | 124,000 | 137,000 | 119,000 | ||
Loans: | |||||||
Gross loans | 25,103,000 | 25,584,000 | 25,103,000 | 25,584,000 | 25,537,000 | ||
Ending balance: individually evaluated for impairment | 0 | 0 | 0 | 0 | 0 | ||
Ending balance, collectively evaluated for impairment | 25,103,000 | 25,584,000 | 25,103,000 | 25,584,000 | 25,537,000 | ||
Commercial Construction and Land Development | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 5,306,000 | 5,567,000 | 5,105,000 | 5,037,000 | 5,037,000 | ||
Provision for loan losses | (209,000) | 2,282,000 | (493,000) | 2,945,000 | 2,778,000 | ||
Loans charged-off | (160,000) | (2,779,000) | (179,000) | (3,096,000) | (3,107,000) | ||
Recoveries | 590,000 | 113,000 | 1,094,000 | 297,000 | 397,000 | ||
Net recoveries (charge-offs) | 430,000 | (2,666,000) | 915,000 | (2,799,000) | (2,710,000) | ||
Balance, end of period | 5,527,000 | 5,183,000 | 5,527,000 | 5,183,000 | 5,105,000 | ||
Ending balance: individually evaluated for impairment | 494,000 | 528,000 | 494,000 | 528,000 | 516,000 | ||
Ending balance: collectively evaluated for impairment | 5,033,000 | 4,655,000 | 5,033,000 | 4,655,000 | 4,589,000 | ||
Loans: | |||||||
Gross loans | 50,469,000 | 53,009,000 | 50,469,000 | 53,009,000 | 53,642,000 | ||
Ending balance: individually evaluated for impairment | 2,357,000 | 5,504,000 | 2,357,000 | 5,504,000 | 6,678,000 | ||
Ending balance, collectively evaluated for impairment | 48,112,000 | 47,505,000 | 48,112,000 | 47,505,000 | 46,964,000 | ||
Commercial Real Estate | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 2,669,000 | 2,241,000 | 2,382,000 | 2,981,000 | 2,981,000 | ||
Provision for loan losses | (210,000) | 2,139,000 | 93,000 | 1,727,000 | 2,382,000 | ||
Loans charged-off | 7,000 | (2,529,000) | (199,000) | (3,019,000) | (3,315,000) | ||
Recoveries | 198,000 | 43,000 | 388,000 | 205,000 | 334,000 | ||
Net recoveries (charge-offs) | 205,000 | (2,486,000) | 189,000 | (2,814,000) | (2,981,000) | ||
Balance, end of period | 2,664,000 | 1,894,000 | 2,664,000 | 1,894,000 | 2,382,000 | ||
Ending balance: individually evaluated for impairment | 111,000 | 6,000 | 111,000 | 6,000 | 4,000 | ||
Ending balance: collectively evaluated for impairment | 2,553,000 | 1,888,000 | 2,553,000 | 1,888,000 | 2,378,000 | ||
Loans: | |||||||
Gross loans | 206,548,000 | 192,202,000 | 206,548,000 | 192,202,000 | 200,510,000 | ||
Ending balance: individually evaluated for impairment | 3,427,000 | 4,946,000 | 3,427,000 | 4,946,000 | 3,801,000 | ||
Ending balance, collectively evaluated for impairment | 203,121,000 | 187,256,000 | 203,121,000 | 187,256,000 | 196,709,000 | ||
Residential Construction | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 318,000 | 620,000 | 436,000 | 713,000 | 713,000 | ||
Provision for loan losses | 79,000 | 23,000 | (39,000) | 101,000 | (106,000) | ||
Loans charged-off | 0 | 0 | 0 | (171,000) | (171,000) | ||
Recoveries | 0 | 0 | 0 | 0 | 0 | ||
Net recoveries (charge-offs) | 0 | 0 | 0 | (171,000) | (171,000) | ||
Balance, end of period | 397,000 | 643,000 | 397,000 | 643,000 | 436,000 | ||
Ending balance: individually evaluated for impairment | 0 | 0 | 0 | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 397,000 | 643,000 | 397,000 | 643,000 | 436,000 | ||
Loans: | |||||||
Gross loans | 31,577,000 | 31,161,000 | 31,577,000 | 31,161,000 | 28,130,000 | ||
Ending balance: individually evaluated for impairment | 437,000 | 0 | 437,000 | 0 | 0 | ||
Ending balance, collectively evaluated for impairment | 31,140,000 | 31,161,000 | 31,140,000 | 31,161,000 | 28,130,000 | ||
Residential Mortgage | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 1,224,000 | 1,945,000 | 1,206,000 | 2,146,000 | 2,146,000 | ||
Provision for loan losses | 409,000 | 3,407,000 | 469,000 | 3,257,000 | 3,041,000 | ||
Loans charged-off | (261,000) | (4,177,000) | (426,000) | (4,417,000) | (4,847,000) | ||
Recoveries | 44,000 | 123,000 | 167,000 | 312,000 | 866,000 | ||
Net recoveries (charge-offs) | (217,000) | (4,054,000) | (259,000) | (4,105,000) | (3,981,000) | ||
Balance, end of period | 1,416,000 | 1,298,000 | 1,416,000 | 1,298,000 | 1,206,000 | ||
Ending balance: individually evaluated for impairment | 0 | 0 | 0 | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 1,416,000 | 1,298,000 | 1,416,000 | 1,298,000 | 1,206,000 | ||
Loans: | |||||||
Gross loans | 130,588,000 | 135,120,000 | 130,588,000 | 135,120,000 | 135,022,000 | ||
Ending balance: individually evaluated for impairment | 1,778,000 | 2,844,000 | 1,778,000 | 2,844,000 | 2,030,000 | ||
Ending balance, collectively evaluated for impairment | 128,810,000 | 132,276,000 | 128,810,000 | 132,276,000 | 132,992,000 | ||
Consumer | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 112,000 | 169,000 | 89,000 | 188,000 | 188,000 | ||
Provision for loan losses | (18,000) | (32,000) | 50,000 | 21,000 | (36,000) | ||
Loans charged-off | (38,000) | (25,000) | (136,000) | (114,000) | (183,000) | ||
Recoveries | 35,000 | 64,000 | 88,000 | 81,000 | 120,000 | ||
Net recoveries (charge-offs) | (3,000) | 39,000 | (48,000) | (33,000) | (63,000) | ||
Balance, end of period | 91,000 | 176,000 | 91,000 | 176,000 | 89,000 | ||
Ending balance: individually evaluated for impairment | 3,000 | 0 | 3,000 | 0 | 4,000 | ||
Ending balance: collectively evaluated for impairment | 88,000 | 176,000 | 88,000 | 176,000 | 85,000 | ||
Loans: | |||||||
Gross loans | 8,396,000 | 9,297,000 | 8,396,000 | 9,297,000 | 9,524,000 | ||
Ending balance: individually evaluated for impairment | 3,000 | 8,000 | 3,000 | 8,000 | 471,000 | ||
Ending balance, collectively evaluated for impairment | 8,393,000 | 9,289,000 | 8,393,000 | 9,289,000 | 9,053,000 | ||
Other | |||||||
Allowances for loan losses: | |||||||
Balance, beginning of period | 30,000 | 15,000 | 40,000 | 38,000 | 38,000 | ||
Provision for loan losses | 51,000 | 0 | 81,000 | (44,000) | (21,000) | ||
Loans charged-off | (28,000) | 0 | (70,000) | 0 | 0 | ||
Recoveries | 0 | 1,000 | 2,000 | 22,000 | 23,000 | ||
Net recoveries (charge-offs) | (28,000) | 1,000 | (68,000) | 22,000 | 23,000 | ||
Balance, end of period | 53,000 | 16,000 | 53,000 | 16,000 | 40,000 | ||
Ending balance: individually evaluated for impairment | 0 | 0 | 0 | 0 | 0 | ||
Ending balance: collectively evaluated for impairment | 53,000 | 16,000 | 53,000 | 16,000 | 40,000 | ||
Loans: | |||||||
Gross loans | 832,000 | 522,000 | 832,000 | 522,000 | 499,000 | ||
Ending balance: individually evaluated for impairment | 12,000 | 0 | 12,000 | 0 | 0 | ||
Ending balance, collectively evaluated for impairment | 820,000 | 522,000 | 820,000 | 522,000 | 499,000 | ||
Small Dollar Homogeneous Impaired Loans | |||||||
Allowances for loan losses: | |||||||
Ending balance: collectively evaluated for impairment | 34,000 | 0 | 34,000 | 0 | 139,000 | ||
Loans: | |||||||
Ending balance, collectively evaluated for impairment | $ 416,000 | $ 0 | $ 416,000 | $ 0 | $ 436,000 | ||
[1] | Derived from audited consolidated financial statements. |
LOANS AND ALLOWANCE FOR LOAN 35
LOANS AND ALLOWANCE FOR LOAN LOSSES (Credit Quality) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | |
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | $ 23,804 | $ 24,286 | ||
Commercial Construction and Land Development | 50,469 | 53,642 | ||
Commercial Real Estate | 206,548 | 200,510 | ||
Residential Construction | 31,577 | 28,130 | ||
Residential Mortgage | 130,588 | 135,022 | ||
Consumer | 6,256 | 7,248 | ||
Other | 832 | 499 | ||
Totals | 450,074 | 449,337 | ||
Consumer - Credit Card | 2,140 | 2,276 | ||
Business- Credit Card | 1,299 | 1,251 | ||
Total Loans | 453,513 | 452,864 | $ 446,895 | |
Loans held for sale | 2,100 | 2,882 | [1] | |
Credit Card Portfolio Exposure | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Consumer - Credit Card | 2,140 | 2,276 | ||
Business- Credit Card | 1,299 | 1,251 | ||
1 - Lowest Risk | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 2,085 | 2,099 | ||
Commercial Construction and Land Development | 0 | 0 | ||
Commercial Real Estate | 0 | 0 | ||
Residential Construction | 0 | 0 | ||
Residential Mortgage | 0 | 0 | ||
Consumer | 1,611 | 1,638 | ||
Other | 3 | 0 | ||
Totals | 3,699 | 3,737 | ||
2 - Satisfactory Quality | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 671 | 606 | ||
Commercial Construction and Land Development | 739 | 630 | ||
Commercial Real Estate | 1,921 | 2,206 | ||
Residential Construction | 0 | 0 | ||
Residential Mortgage | 15,957 | 14,794 | ||
Consumer | 260 | 314 | ||
Other | 8 | 11 | ||
Totals | 19,556 | 18,561 | ||
3 - Satisfactory Quality - Merits Attention | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 10,623 | 9,506 | ||
Commercial Construction and Land Development | 10,944 | 10,625 | ||
Commercial Real Estate | 95,494 | 81,761 | ||
Residential Construction | 3,111 | 1,893 | ||
Residential Mortgage | 53,564 | 53,007 | ||
Consumer | 1,175 | 3,556 | ||
Other | 538 | 225 | ||
Totals | 175,449 | 160,573 | ||
4 - Low Satisfactory | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 10,156 | 11,932 | ||
Commercial Construction and Land Development | 34,350 | 34,709 | ||
Commercial Real Estate | 101,040 | 110,683 | ||
Residential Construction | 26,991 | 26,074 | ||
Residential Mortgage | 54,178 | 56,359 | ||
Consumer | 3,112 | 1,186 | ||
Other | 244 | 146 | ||
Totals | 230,071 | 241,089 | ||
5 - Special Mention | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 267 | 143 | ||
Commercial Construction and Land Development | 2,658 | 1,892 | ||
Commercial Real Estate | 5,863 | 3,989 | ||
Residential Construction | 1,038 | 0 | ||
Residential Mortgage | 5,230 | 8,720 | ||
Consumer | 57 | 62 | ||
Other | 27 | 117 | ||
Totals | 15,140 | 14,923 | ||
6-8 - Substandard | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Commercial and Industrial | 2 | 0 | ||
Commercial Construction and Land Development | 1,778 | 5,786 | ||
Commercial Real Estate | 2,230 | 1,871 | ||
Residential Construction | 437 | 163 | ||
Residential Mortgage | 1,659 | 2,142 | ||
Consumer | 41 | 492 | ||
Other | 12 | 0 | ||
Totals | 6,159 | 10,454 | ||
Loans held for sale | 2,000 | 2,500 | ||
Performing | Credit Card Portfolio Exposure | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Consumer - Credit Card | 2,136 | 2,263 | ||
Business- Credit Card | 1,299 | 1,248 | ||
Non Performing | Credit Card Portfolio Exposure | ||||
Financing Receivable, Recorded Investment [Line Items] | ||||
Consumer - Credit Card | 4 | 13 | ||
Business- Credit Card | $ 0 | $ 3 | ||
[1] | Derived from audited consolidated financial statements. |
LOANS AND ALLOWANCE FOR LOAN 36
LOANS AND ALLOWANCE FOR LOAN LOSSES (Age Analysis of Past Due Loans) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | $ 3,358 | $ 1,352 | |
Nonaccrual | 3,390 | 8,259 | |
Greater than 90 Days Past Due | 4 | 17 | |
Total Past Due | 6,752 | 9,628 | |
Current | 446,761 | 443,236 | |
Gross loans | 453,513 | 452,864 | $ 446,895 |
Loans 30-89 past due classified as held-for-sale | 0 | 67 | |
Loans held for sale - nonaccrual status | 1,462 | 1,865 | |
Commercial & industrial | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 0 | 14 | |
Nonaccrual | 2 | 0 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 2 | 14 | |
Current | 23,802 | 24,272 | |
Gross loans | 23,804 | 24,286 | |
Commercial construction & land development | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 1,663 | 27 | |
Nonaccrual | 1,132 | 5,533 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 2,795 | 5,560 | |
Current | 47,674 | 48,082 | |
Gross loans | 50,469 | 53,642 | |
Commercial real estate | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 1,223 | 0 | |
Nonaccrual | 1,072 | 983 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 2,295 | 983 | |
Current | 204,253 | 199,527 | |
Gross loans | 206,548 | 200,510 | |
Residential construction | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 0 | 0 | |
Nonaccrual | 437 | 0 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 437 | 0 | |
Current | 31,140 | 28,130 | |
Gross loans | 31,577 | 28,130 | |
Residential mortgage | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 288 | 1,058 | |
Nonaccrual | 721 | 1,271 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 1,009 | 2,329 | |
Current | 129,579 | 132,693 | |
Gross loans | 130,588 | 135,022 | |
Consumer | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 104 | 82 | |
Nonaccrual | 14 | 472 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 118 | 554 | |
Current | 6,138 | 6,694 | |
Gross loans | 6,256 | 7,248 | |
Consumer credit cards | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 21 | 46 | |
Nonaccrual | 0 | 0 | |
Greater than 90 Days Past Due | 4 | 14 | |
Total Past Due | 25 | 60 | |
Current | 2,115 | 2,216 | |
Gross loans | 2,140 | 2,276 | |
Business credit cards | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 32 | 41 | |
Nonaccrual | 0 | 0 | |
Greater than 90 Days Past Due | 0 | 3 | |
Total Past Due | 32 | 44 | |
Current | 1,267 | 1,207 | |
Gross loans | 1,299 | 1,251 | |
Other loans | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
30-89 Days Past Due | 27 | 84 | |
Nonaccrual | 12 | 0 | |
Greater than 90 Days Past Due | 0 | 0 | |
Total Past Due | 39 | 84 | |
Current | 793 | 415 | |
Gross loans | $ 832 | $ 499 |
LOANS AND ALLOWANCE FOR LOAN 37
LOANS AND ALLOWANCE FOR LOAN LOSSES (Nonperforming Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Loans and Leases Receivable Disclosure [Abstract] | |||
Loans past due ninety days or more and still accruing | $ 4 | $ 17 | |
Nonaccrual loans | 3,390 | 8,259 | |
Foreclosed assets | 2,088 | 3,782 | [1] |
Loans held for sale - nonperforming | 1,462 | 1,865 | |
Total nonperforming assets | $ 6,944 | $ 13,923 | |
[1] | Derived from audited consolidated financial statements. |
LOANS AND ALLOWANCE FOR LOAN 38
LOANS AND ALLOWANCE FOR LOAN LOSSES (Impaired Loans) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Recorded Investment | ||
With no related allowance recorded | $ 6,414 | $ 11,410 |
With an allowance recorded | 2,016 | 2,005 |
Totals | 8,430 | 13,415 |
Unpaid Principal Balance | ||
With no related allowance recorded | 8,824 | 13,092 |
With an allowance recorded | 3,387 | 3,210 |
Totals | 12,211 | 16,302 |
Related Allowance | 642 | 663 |
Average Recorded Investment | ||
With no related allowance recorded | 6,861 | 13,621 |
With an allowance recorded | 2,203 | 2,476 |
Totals | 9,064 | 16,097 |
Interest Income Recognized | ||
With no related allowance recorded | 178 | 213 |
With an allowance recorded | 89 | 116 |
Totals | 267 | 329 |
Recorded investment in impaired loans classified as held for sale | 1,800 | 2,400 |
Commercial | ||
Recorded Investment | ||
Totals | 5,761 | 10,718 |
Unpaid Principal Balance | ||
Totals | 9,139 | 13,784 |
Related Allowance | 616 | 597 |
Average Recorded Investment | ||
Totals | 6,252 | 13,062 |
Interest Income Recognized | ||
Totals | 188 | 265 |
Commercial and industrial | ||
Recorded Investment | ||
With an allowance recorded | 2 | |
Unpaid Principal Balance | ||
With an allowance recorded | 2 | |
Related Allowance | 0 | |
Average Recorded Investment | ||
With an allowance recorded | 3 | |
Interest Income Recognized | ||
With an allowance recorded | 0 | |
Commercial construction and land development | ||
Recorded Investment | ||
With no related allowance recorded | 968 | 5,445 |
With an allowance recorded | 1,325 | 1,433 |
Unpaid Principal Balance | ||
With no related allowance recorded | 2,250 | 6,454 |
With an allowance recorded | 2,383 | 2,656 |
Related Allowance | 502 | 580 |
Average Recorded Investment | ||
With no related allowance recorded | 1,354 | 6,715 |
With an allowance recorded | 1,443 | 1,866 |
Interest Income Recognized | ||
With no related allowance recorded | 13 | 15 |
With an allowance recorded | 68 | 92 |
Commercial real estate | ||
Recorded Investment | ||
With no related allowance recorded | 3,063 | 3,468 |
With an allowance recorded | 403 | 372 |
Unpaid Principal Balance | ||
With no related allowance recorded | 3,853 | 4,295 |
With an allowance recorded | 651 | 379 |
Related Allowance | 114 | 17 |
Average Recorded Investment | ||
With no related allowance recorded | 3,037 | 4,103 |
With an allowance recorded | 415 | 378 |
Interest Income Recognized | ||
With no related allowance recorded | 95 | 139 |
With an allowance recorded | 12 | 19 |
Residential | ||
Recorded Investment | ||
Totals | 2,640 | 2,222 |
Unpaid Principal Balance | ||
Totals | 2,969 | 1,783 |
Related Allowance | 22 | 61 |
Average Recorded Investment | ||
Totals | 2,732 | 2,503 |
Interest Income Recognized | ||
Totals | 76 | 64 |
Residential construction | ||
Recorded Investment | ||
With no related allowance recorded | 437 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 437 | |
Average Recorded Investment | ||
With no related allowance recorded | 409 | |
Interest Income Recognized | ||
With no related allowance recorded | 5 | |
Residential mortgage | ||
Recorded Investment | ||
With no related allowance recorded | 1,934 | 2,030 |
With an allowance recorded | 269 | 192 |
Unpaid Principal Balance | ||
With no related allowance recorded | 2,200 | 1,614 |
With an allowance recorded | 332 | 169 |
Related Allowance | 22 | 61 |
Average Recorded Investment | ||
With no related allowance recorded | 2,000 | 2,279 |
With an allowance recorded | 323 | 224 |
Interest Income Recognized | ||
With no related allowance recorded | 63 | 59 |
With an allowance recorded | 8 | 5 |
Other | ||
Recorded Investment | ||
With no related allowance recorded | 12 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 84 | |
Average Recorded Investment | ||
With no related allowance recorded | 61 | |
Interest Income Recognized | ||
With no related allowance recorded | 2 | |
Consumer | ||
Recorded Investment | ||
With no related allowance recorded | 467 | |
With an allowance recorded | 17 | 8 |
Totals | 475 | |
Unpaid Principal Balance | ||
With no related allowance recorded | 729 | |
With an allowance recorded | 19 | 6 |
Totals | 735 | |
Related Allowance | 4 | 5 |
Average Recorded Investment | ||
With no related allowance recorded | 524 | |
With an allowance recorded | 19 | 8 |
Totals | 532 | |
Interest Income Recognized | ||
With no related allowance recorded | 0 | |
With an allowance recorded | 1 | 0 |
Totals | $ 0 | |
Consumer & Other | ||
Recorded Investment | ||
Totals | 29 | |
Unpaid Principal Balance | ||
Totals | 103 | |
Related Allowance | 4 | |
Average Recorded Investment | ||
Totals | 80 | |
Interest Income Recognized | ||
Totals | $ 3 |
LOANS AND ALLOWANCE FOR LOAN 39
LOANS AND ALLOWANCE FOR LOAN LOSSES (Summary of Loans Modified as TDRs) (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($)consecutive_payment | Dec. 31, 2014USD ($) | |
Loans and Leases Receivable Disclosure [Abstract] | ||
Number of consecutive payments required | consecutive_payment | 6 | |
Financing Receivable, Modifications [Line Items] | ||
Accrual | $ 4,343 | $ 4,759 |
Nonaccrual | 1,341 | 3,849 |
Total TDRs | 5,684 | 8,608 |
Allowance for Loan Losses Allocated | 515 | 524 |
Accruing TDRs classified as held for sale | 157 | 203 |
TDRs in nonaccrual classified as held for sale | 562 | 932 |
Commercial construction and land development | ||
Financing Receivable, Modifications [Line Items] | ||
Accrual | 1,155 | 1,336 |
Nonaccrual | 717 | 2,776 |
Total TDRs | 1,872 | 4,112 |
Allowance for Loan Losses Allocated | 492 | 516 |
Commercial real estate | ||
Financing Receivable, Modifications [Line Items] | ||
Accrual | 2,395 | 2,469 |
Nonaccrual | 596 | 552 |
Total TDRs | 2,991 | 3,021 |
Allowance for Loan Losses Allocated | 20 | 4 |
Residential mortgage | ||
Financing Receivable, Modifications [Line Items] | ||
Accrual | 790 | 950 |
Nonaccrual | 28 | 54 |
Total TDRs | 818 | 1,004 |
Allowance for Loan Losses Allocated | 0 | 0 |
Consumer | ||
Financing Receivable, Modifications [Line Items] | ||
Accrual | 3 | 4 |
Nonaccrual | 0 | 467 |
Total TDRs | 3 | 471 |
Allowance for Loan Losses Allocated | $ 3 | $ 4 |
LOANS AND ALLOWANCE FOR LOAN 40
LOANS AND ALLOWANCE FOR LOAN LOSSES (Bank's TDRs) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015USD ($)loans | Sep. 30, 2015USD ($)loans | Dec. 31, 2014USD ($) | |
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | 0 | |
Recorded Investment | $ | $ 5,684 | $ 5,684 | $ 8,608 |
Number of loans | 0 | 0 | |
Paid in full | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | $ 0 | $ 0 | |
Paid in full | Extended payment terms | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | 0 | $ 0 | |
Paying as restructured | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 1 | ||
Recorded Investment | $ | 3 | $ 3 | |
Paying as restructured | Extended payment terms | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 1 | ||
Recorded Investment | $ | 3 | $ 3 | |
Converted to nonaccrual | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | 0 | $ 0 | |
Converted to nonaccrual | Extended payment terms | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | $ 0 | $ 0 | |
Foreclosure/Default | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | $ 0 | ||
Foreclosure/Default | Extended payment terms | |||
Financing Receivable, Modifications [Line Items] | |||
Number of loans | 0 | ||
Recorded Investment | $ | $ 0 |
COMMITMENTS AND CONTINGENCIES41
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Loan Commitments [Line Items] | |
Loan commitments | $ 133,325 |
Securities | 86,666 |
Loans | 35,967 |
Legally binding commitments | |
Loan Commitments [Line Items] | |
Loan commitments | 119,684 |
Commitments to extend credit | |
Loan Commitments [Line Items] | |
Loan commitments | 29,436 |
Undisbursed lines of credit | |
Loan Commitments [Line Items] | |
Loan commitments | 89,212 |
Financial stand-by letters of credit | |
Loan Commitments [Line Items] | |
Loan commitments | 368 |
Performance stand-by letters of credit | |
Loan Commitments [Line Items] | |
Loan commitments | 668 |
Unused credit card lines | |
Loan Commitments [Line Items] | |
Loan commitments | $ 13,641 |
FAIR VALUE MEASUREMENT (Assets
FAIR VALUE MEASUREMENT (Assets Measured at Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | $ 71,982 | $ 64,211 | [1] |
Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 24,965 | 17,078 | |
Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 13,740 | 16,264 | |
Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 33,266 | 30,858 | |
Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 11 | 11 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Total Carrying Amount in the Consolidated Balance Sheet | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Assets Measured at Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Recurring Basis | Significant Other Observable Inputs (Level 2) | Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 24,965 | 17,078 | |
Recurring Basis | Significant Other Observable Inputs (Level 2) | Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 13,740 | 16,264 | |
Recurring Basis | Significant Other Observable Inputs (Level 2) | Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 33,266 | 30,858 | |
Recurring Basis | Significant Other Observable Inputs (Level 2) | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 11 | 11 | |
Recurring Basis | Significant Unobservable Inputs (Level 3) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Significant Unobservable Inputs (Level 3) | Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Significant Unobservable Inputs (Level 3) | Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Significant Unobservable Inputs (Level 3) | Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Significant Unobservable Inputs (Level 3) | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 0 | 0 | |
Recurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Recurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 24,965 | 17,078 | |
Recurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 13,740 | 16,264 | |
Recurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 33,266 | 30,858 | |
Recurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 11 | 11 | |
Recurring Basis | Assets Measured at Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 71,982 | 64,211 | |
Recurring Basis | Assets Measured at Fair Value | Taxable municipal securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 24,965 | 17,078 | |
Recurring Basis | Assets Measured at Fair Value | Mortgage-backed Securities GNMA | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 13,740 | 16,264 | |
Recurring Basis | Assets Measured at Fair Value | Mortgage-backed securities FNMA & FHLMC | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | 33,266 | 30,858 | |
Recurring Basis | Assets Measured at Fair Value | Equity securities | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investment securities available-for-sale, at fair value | $ 11 | $ 11 | |
[1] | Derived from audited consolidated financial statements. |
FAIR VALUE MEASUREMENT (Level 3
FAIR VALUE MEASUREMENT (Level 3 Assets Measured at Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Level 3 assets measured at fair value on a recurring basis [Roll Forward] | ||||
Beginning Balance | $ 0 | $ 0 | $ 0 | $ 1,025 |
Total realized and unrealized gains or (losses) included in earnings | 0 | 175 | 0 | 250 |
Total realized and unrealized gains or (losses) included in other comprehensive income | 0 | 0 | 0 | 150 |
Purchases, issuances and settlements | 0 | (175) | 0 | (1,425) |
Ending Balance | $ 0 | $ 0 | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT (Asset44
FAIR VALUE MEASUREMENT (Assets Measured at Fair Value on Nonrecurring Basis) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets measured at fair value: | ||
Loans held for sale | $ 0 | $ 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Significant Unobservable Inputs (Level 3) | ||
Assets measured at fair value: | ||
Loans held for sale | 0 | 0 |
Total Carrying Amount in the Consolidated Balance Sheet | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Assets Measured at Fair Value | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Nonrecurring Basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets measured at fair value: | ||
Loans held for sale | 0 | 0 |
Impaired loans | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring Basis | Significant Other Observable Inputs (Level 2) | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Impaired loans | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring Basis | Significant Unobservable Inputs (Level 3) | ||
Assets measured at fair value: | ||
Loans held for sale | 0 | 0 |
Impaired loans | 2,216 | 9,855 |
Foreclosed assets | 2,088 | 3,782 |
Nonrecurring Basis | Total Carrying Amount in the Consolidated Balance Sheet | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Impaired loans | 2,216 | 9,855 |
Foreclosed assets | 2,088 | 3,782 |
Nonrecurring Basis | Assets Measured at Fair Value | ||
Assets measured at fair value: | ||
Loans held for sale | 2,100 | 2,882 |
Impaired loans | 2,216 | 9,855 |
Foreclosed assets | $ 2,088 | $ 3,782 |
FAIR VALUE MEASUREMENT (Quantit
FAIR VALUE MEASUREMENT (Quantitative Information, Unobservable Input) (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Impaired loans | $ 8,430 | $ 13,415 | |
Foreclosed assets | $ 2,088 | $ 3,782 | [1] |
Nonrecurring Basis | Maximum | Loans Receivable | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Collateral discounts (as a percent) | 50.00% | ||
Significant Unobservable Inputs (Level 3) | Nonrecurring Basis | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Impaired loans | $ 2,216 | ||
Foreclosed assets | $ 2,088 | ||
Significant Unobservable Inputs (Level 3) | Nonrecurring Basis | Minimum | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Collateral discounts (as a percent) | 9.00% | ||
Discounted appraisals (as a percent) | 10.00% | ||
Significant Unobservable Inputs (Level 3) | Nonrecurring Basis | Maximum | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Collateral discounts (as a percent) | 50.00% | ||
Discounted appraisals (as a percent) | 30.00% | ||
[1] | Derived from audited consolidated financial statements. |
FAIR VALUE MEASUREMENT (Range o
FAIR VALUE MEASUREMENT (Range of Collateral Discounts) (Details) | 9 Months Ended |
Sep. 30, 2015 | |
Commercial construction and land development | Minimum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 10.00% |
Commercial construction and land development | Maximum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 40.00% |
Commercial real estate | Minimum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 9.00% |
Commercial real estate | Maximum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 50.00% |
Residential construction | Minimum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 9.00% |
Residential construction | Maximum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 30.00% |
Residential mortgage | Minimum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 9.00% |
Residential mortgage | Maximum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 20.00% |
All other segments | Minimum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 9.00% |
All other segments | Maximum | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Collateral discounts (as a percent) | 20.00% |
FAIR VALUE MEASUREMENT (Informa
FAIR VALUE MEASUREMENT (Information on Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | ||
Financial assets: | |||
Certificates of deposit | $ 24,010 | $ 27,784 | [1] |
Securities available-for-sale | 71,982 | 64,211 | [1] |
Securities held-to-maturity | 69,872 | 82,242 | |
Level 1 | |||
Financial assets: | |||
Cash and cash equivalents | 48,013 | 158,527 | |
Certificates of deposit | 0 | 0 | |
Securities available-for-sale | 0 | 0 | |
Securities held-to-maturity | 0 | 0 | |
Loans held for sale | 0 | 0 | |
Loans, net | 0 | 0 | |
FHLB stock | 0 | 0 | |
Accrued interest receivable | 0 | 0 | |
Financial liabilities: | |||
Deposits | 0 | 0 | |
Subordinated debentures and subordinated promissory notes | 0 | 0 | |
Borrowings | 0 | 0 | |
Accrued interest payable | 0 | 0 | |
Level 2 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | |
Certificates of deposit | 24,010 | 27,784 | |
Securities available-for-sale | 71,982 | 64,211 | |
Securities held-to-maturity | 69,872 | 82,242 | |
Loans held for sale | 2,100 | 2,882 | |
Loans, net | 0 | 0 | |
FHLB stock | 4,564 | 4,788 | |
Accrued interest receivable | 1,712 | 1,627 | |
Financial liabilities: | |||
Deposits | 536,210 | 663,000 | |
Subordinated debentures and subordinated promissory notes | 0 | 0 | |
Borrowings | 94,855 | 95,573 | |
Accrued interest payable | 775 | 1,704 | |
Level 3 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | |
Certificates of deposit | 0 | 0 | |
Securities available-for-sale | 0 | 0 | |
Securities held-to-maturity | 0 | 0 | |
Loans held for sale | 0 | 0 | |
Loans, net | 422,336 | 422,906 | |
FHLB stock | 0 | 0 | |
Accrued interest receivable | 0 | 0 | |
Financial liabilities: | |||
Deposits | 0 | 0 | |
Subordinated debentures and subordinated promissory notes | 26,070 | 25,671 | |
Borrowings | 0 | 0 | |
Accrued interest payable | 0 | 0 | |
Carrying Value | |||
Financial assets: | |||
Cash and cash equivalents | 48,013 | 158,527 | |
Certificates of deposit | 24,010 | 27,784 | |
Securities available-for-sale | 71,982 | 64,211 | |
Securities held-to-maturity | 68,992 | 81,583 | |
Loans held for sale | 2,100 | 2,882 | |
Loans, net | 442,491 | 442,879 | |
FHLB stock | 4,564 | 4,788 | |
Accrued interest receivable | 1,712 | 1,627 | |
Financial liabilities: | |||
Deposits | 535,764 | 661,185 | |
Subordinated debentures and subordinated promissory notes | 24,372 | 24,372 | |
Borrowings | 90,000 | 90,000 | |
Accrued interest payable | 775 | 1,704 | |
Estimated Fair Value | |||
Financial assets: | |||
Cash and cash equivalents | 48,013 | 158,527 | |
Certificates of deposit | 24,010 | 27,784 | |
Securities available-for-sale | 71,982 | 64,211 | |
Securities held-to-maturity | 69,872 | 82,242 | |
Loans held for sale | 2,100 | 2,882 | |
Loans, net | 422,336 | 422,906 | |
FHLB stock | 4,564 | 4,788 | |
Accrued interest receivable | 1,712 | 1,627 | |
Financial liabilities: | |||
Deposits | 536,210 | 663,000 | |
Subordinated debentures and subordinated promissory notes | 26,070 | 25,671 | |
Borrowings | 94,855 | 95,573 | |
Accrued interest payable | $ 775 | $ 1,704 | |
Loans Receivable | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Adjustment for current liquidity and market discount, rate | 5.00% | ||
[1] | Derived from audited consolidated financial statements. |
REGULATORY RESTRICTIONS (Detail
REGULATORY RESTRICTIONS (Details) - USD ($) | 1 Months Ended | 9 Months Ended | |
May. 31, 2011 | Sep. 30, 2015 | Dec. 31, 2014 | |
Tier I Capital (to Average Assets), Ratio | |||
Adoption of approved programs after approval by FRB, period | 10 days | ||
Submission to FRB of written progress reports, period after the end of each calendar quarter following the 2015 Written Agreement | 30 days | ||
Bank | |||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Dividends paid to the Company by the Bank | $ 0 | ||
Total Capital (to Risk Weighted Assets), Amount | |||
Total Capital (to Risk Weighted Assets), Amount, Actual | 76,556,000 | $ 66,498,000 | |
Total Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 39,538,000 | 36,109,000 | |
Total Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 49,422,000 | 45,136,000 | |
Tier I Capital (to Risk Weighted Assets), Amount | |||
Tier I Capital (to Risk Weighted Assets), Amount, Actual | 70,328,000 | 60,810,000 | |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 29,653,000 | 18,054,000 | |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 39,538,000 | 27,082,000 | |
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount, Actual | 70,328,000 | ||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount, Minimum For Capital Adequacy Purposes | 22,240,000 | ||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 32,125,000 | ||
Tier I Capital (to Average Assets), Amount | |||
Tier I Capital (to Average Assets), Amount, Actual | 70,328,000 | 60,810,000 | |
Tier I Capital (to Average Assets), Amount, Minimum for Capital Adequacy Purposes | 28,065,000 | 33,844,000 | |
Tier I Capital (to Average Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | $ 35,081,000 | $ 42,305,000 | |
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | |||
Total Capital (to Risk Weighted Assets), Ratio, Actual | 15.50% | 14.70% | |
Total Capital (to Risk Weighted Assets), Ratio, Minimum for Capital Adequacy Purposes | 8.00% | 8.00% | |
Total Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 10.00% | 10.00% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Actual | 14.20% | 13.50% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum for Capital Adequacy Purposes | 6.00% | 4.00% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 8.00% | 6.00% | |
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio, Actual | 14.20% | ||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio, Minimum For Capital Adequacy Purposes | 4.50% | ||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 6.50% | ||
Tier I Capital (to Average Assets), Ratio | |||
Tier I Capital (to Average Assets), Ratio, Actual | 10.00% | 7.20% | |
Tier I Capital (to Average Assets), Ratio, Minimum for Capital Adequacy Purposes | 4.00% | 4.00% | |
Tier I Capital (to Average Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 5.00% | 5.00% | |
Parent Company | |||
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | |||
Total Capital (to Risk Weighted Assets), Ratio, Actual | 15.10% | 15.00% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Actual | 12.40% | 11.60% | |
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio | |||
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio, Actual | 11.20% | ||
Tier I Capital (to Average Assets), Ratio | |||
Tier I Capital (to Average Assets), Ratio, Actual | 8.70% | 6.20% |
RESTRICTED STOCK (Additional In
RESTRICTED STOCK (Additional Information) (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 9 Months Ended | |
Jan. 31, 2015tranche$ / shares | Sep. 30, 2015USD ($)$ / sharesshares | Dec. 31, 2014$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock, par value (in usd per share) | $ / shares | $ 1 | $ 1 | |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 405 | ||
Unrecognized compensation expense | $ 1,900 | ||
2015 Restricted Stock Plan | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Issuance of restricted stock (in shares) | shares | 1,461,000 | ||
Common stock, par value (in usd per share) | $ / shares | $ 1 | ||
Number of tranches | tranche | 2 | ||
2015 Restricted Stock Plan | Restricted Stock | Tranche One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting percentage | 15.00% | ||
Award vesting period | 1 year | ||
Award forfeitures, percentage | 15.00% | ||
2015 Restricted Stock Plan | Restricted Stock | Tranche One | Threshold Performance Level Achieved | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting percentage | 10.50% | ||
Budgeted net income, performance level percentage | 70.00% | ||
2015 Restricted Stock Plan | Restricted Stock | Tranche One | Target Performance Level Achieved | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting percentage | 15.00% | ||
Budgeted net income, performance level percentage | 100.00% | ||
2015 Restricted Stock Plan | Restricted Stock | Tranche Two | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting percentage | 85.00% | ||
Award vesting period | 3 years |
RESTRICTED STOCK (Non-vested Re
RESTRICTED STOCK (Non-vested Restricted Stock Awards) (Details) - Restricted Stock | 9 Months Ended |
Sep. 30, 2015$ / sharesshares | |
Restricted Stock | |
Balance as of beginning of period (in shares) | shares | 0 |
Granted (in shares) | shares | 1,461,000 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | 60,000 |
Weighted Average Grant-Date Fair Value | |
Balance as of beginning of period (in usd per share) | $ 0 |
Granted (in usd per share) | 1.52 |
Vested (in usd per share) | 0 |
Forfeited (in usd per share) | 1.52 |
Balance as of end of period (in usd per share) | $ 1.52 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense (benefit) | $ 92 | $ 0 | $ (16,480) | $ 0 | |
Release of the valuation allowance against deferred tax assets | $ 16,600 | 16,600 | |||
Remaining valuation allowance to be utilized | $ 4,100 | $ 4,100 |