Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 30, 2014 | Jun. 30, 2013 | |
Entity Information [Line Items] | ' | ' | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Entity Registrant Name | 'FOUR OAKS FINCORP INC | ' | ' |
Entity Central Index Key | '0001040799 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 8,867,654 | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $9,241,381 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Cash and due from banks | $11,890 | $18,862 |
Interest-earning deposits | 116,739 | 164,288 |
Cash and cash equivalents | 128,629 | 183,150 |
CDs held for investment | 31,850 | 26,460 |
Investment securities available for sale, at fair value | 32,566 | 73,722 |
Investment securities held to maturity, at amortized cost | 98,013 | 20,329 |
Total investment securities | 130,579 | 94,051 |
Loans held for sale | 0 | 19,297 |
Loans | 492,712 | 497,929 |
Allowance for loan losses | -11,590 | -16,549 |
Net loans | 481,122 | 481,380 |
Accrued interest receivable | 1,576 | 1,869 |
Bank premises and equipment held for sale, net | 0 | 1,901 |
Bank premises and equipment, net | 12,571 | 13,382 |
FHLB stock | 6,076 | 6,415 |
Investment in life insurance | 14,380 | 14,139 |
Foreclosed assets | 8,502 | 15,136 |
Other assets | 6,261 | 8,318 |
TOTAL ASSETS | 821,546 | 865,498 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ' | ' |
Noninterest-bearing demand | 228,203 | 189,048 |
Money market, NOW accounts and savings accounts | 166,102 | 164,614 |
Time deposits, $100,000 and over | 162,403 | 215,984 |
Other time deposits | 100,912 | 130,210 |
Total deposits | 657,620 | 699,856 |
Borrowings | 112,000 | 112,000 |
Subordinated debentures | 12,372 | 12,372 |
Subordinated promissory notes | 12,000 | 12,000 |
Accrued interest payable | 1,642 | 1,736 |
Other liabilities | 4,289 | 4,858 |
TOTAL LIABILITIES | 799,923 | 842,822 |
Commitments and Contingencies (Notes C, L, O and P) | ' | ' |
Common stock, $1.00 par value, 80,000,000 shares authorized at December 31, 2013 and 20,000,000 shares authorized at December 31, 2012; 7,977,658 shares issued and outstanding at December 31, 2013 and 7,815,315 shares issued and outstanding at December 31, 2012 | 7,978 | 7,815 |
Additional paid-in capital | 34,269 | 34,192 |
Accumulated deficit | -20,390 | -20,040 |
Accumulated other comprehensive income (loss) | -234 | 709 |
Total shareholders' equity | 21,623 | 22,676 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $821,546 | $865,498 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Stockholders' Equity: | ' | ' |
Common stock, par value (in usd per share) | $1 | $1 |
Common stock, shares authorized | 80,000,000 | 20,000,000 |
Common stock, shares issued | 7,977,658 | 7,815,315 |
Common stock, shares outstanding | 7,977,658 | 7,815,315 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Interest and dividend income: | ' | ' |
Loans, including fees | $27,503 | $31,704 |
Taxable investments | 1,419 | 1,710 |
Dividends | 322 | 313 |
Interest-earning deposits | 686 | 652 |
Total interest and dividend income | 29,930 | 34,379 |
Interest expense: | ' | ' |
Deposits | 3,482 | 6,666 |
Borrowings | 4,065 | 4,076 |
Subordinated debentures | 204 | 227 |
Subordinated promissory notes | 1,020 | 1,036 |
Total interest expense | 8,771 | 12,005 |
Net Interest Income | 21,159 | 22,374 |
Provision for loan losses | 35 | 7,381 |
Net interest income after provision for loan losses | 21,124 | 14,993 |
Non-interest income: | ' | ' |
Service charges on deposit accounts | 1,744 | 1,934 |
Other service charges, commissions and fees | 3,608 | 2,757 |
Gains on sale of investment securities, net | 462 | 1,981 |
Other-than-temporary impairment loss | 0 | -79 |
Portion of loss recognized in other comprehensive income | 0 | 79 |
Net impairment loss recognized in earnings | 0 | 0 |
Income from investment in life insurance | 241 | 312 |
Other non-interest income | 1,168 | 410 |
Total non-interest income | 7,223 | 7,394 |
Non-interest expenses: | ' | ' |
Salaries | 10,340 | 10,406 |
Employee benefits | 1,813 | 1,920 |
Occupancy expenses | 1,196 | 1,337 |
Equipment expenses | 1,422 | 1,470 |
Professional and consulting fees | 3,095 | 2,647 |
FDIC assessments | 1,737 | 2,168 |
Foreclosed asset writedowns and expenses | 2,219 | 3,111 |
Collection expenses | 839 | 1,313 |
Other operating expenses | 6,036 | 5,159 |
Total non-interest expenses | 28,697 | 29,531 |
Loss before income taxes | -350 | -7,144 |
Income tax benefit | 0 | -175 |
Net loss | ($350) | ($6,969) |
Basic net loss per common share (in usd per share) | ($0.04) | ($0.90) |
Diluted net loss per common share (in usd per share) | ($0.04) | ($0.90) |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Net loss | ($350) | ($6,969) |
Other comprehensive loss: | ' | ' |
Unrealized holding gains (losses) on available for sale securities | -1,027 | 1,490 |
Tax effect | 307 | -567 |
Reclassification of gains recognized in net loss | -462 | -1,981 |
Tax effect | 178 | 764 |
Amortization of unrealized gains on investment securities transferred from available-for-sale to held-to-maturity | 100 | 0 |
Tax effect | -39 | 0 |
Portion of other-than-temporary impairment loss recognized in other comprehensive loss | 0 | -79 |
Tax effect | 0 | 30 |
Other comprehensive loss net of tax amount | -943 | -343 |
Comprehensive loss | ($1,293) | ($7,312) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, except Share data, unless otherwise specified | |||||
BEGINNING BALANCE at Dec. 31, 2011 | $29,692 | $7,663 | $34,048 | ($13,071) | $1,052 |
BEGINNING BALANCE (in shares) at Dec. 31, 2011 | ' | 7,663,387 | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' |
Net loss | -6,969 | ' | ' | -6,969 | ' |
Other comprehensive loss | -343 | ' | ' | ' | -343 |
Issuance of common stock (in shares) | ' | 151,998 | ' | ' | ' |
Issuance of common stock | 234 | 152 | 82 | ' | ' |
Stock based compensation | 62 | ' | 62 | ' | ' |
ENDING BALANCE at Dec. 31, 2012 | 22,676 | 7,815 | 34,192 | -20,040 | 709 |
ENDING BALANCE (in shares) at Dec. 31, 2012 | ' | 7,815,385 | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' |
Net loss | -350 | ' | ' | -350 | ' |
Other comprehensive loss | -943 | ' | ' | ' | -943 |
Issuance of common stock (in shares) | ' | 162,272 | ' | ' | ' |
Issuance of common stock | 220 | 163 | 57 | ' | ' |
Stock based compensation | 20 | ' | 20 | ' | ' |
ENDING BALANCE at Dec. 31, 2013 | $21,623 | $7,978 | $34,269 | ($20,390) | ($234) |
ENDING BALANCE (in shares) at Dec. 31, 2013 | ' | 7,977,657 | ' | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | ' | ' |
Net loss | ($350) | ($6,969) |
Adjustments to reconcile net loss to net cash provided by operations: | ' | ' |
Provision for loan losses | 35 | 7,381 |
Provision for depreciation and amortization | 970 | 1,142 |
Net amortization of bond premiums and discounts | 1,714 | 1,876 |
Stock based compensation | 20 | 62 |
Gain on sale of investment securities | -462 | -1,981 |
Gain on sale of branches | -586 | 0 |
Loss on sale of foreclosed assets, net | 47 | 429 |
Valuation adjustment on foreclosed assets | 1,590 | 2,321 |
Earnings on bank-owned life insurance | -241 | -312 |
Gain on sale of mortgage loans held for sale | -628 | 0 |
Originations of mortgage loans held for sale | -20,767 | 0 |
Proceeds from sale of mortgage loans held for sale | 21,993 | 0 |
Changes in assets and liabilities: | ' | ' |
Other assets | 2,274 | -1,296 |
Accrued interest receivable | 293 | 116 |
Other liabilities | -569 | 1,612 |
Accrued interest payable | -94 | 299 |
Net cash provided by operating activities | 5,239 | 4,680 |
Cash flows from investing activities: | ' | ' |
Proceeds from sales and calls of investment securities available for sale | 20,873 | 50,414 |
Proceeds from paydowns of investment securities available for sale | 5,631 | 12,619 |
Proceeds from paydowns of investment securities held to maturity | 12,384 | 4,861 |
Purchases of investment securities available for sale | -53,397 | -43,855 |
Purchases of investment securities held to maturity | -24,660 | -5,319 |
Purchases of CDs held for investment | -5,390 | -2,691 |
Net cash from sale of branches | -39,622 | 0 |
Redemption of FHLB stock | 339 | 138 |
Net decrease in loans outstanding | 566 | 60,063 |
Purchases of bank premises and equipment | -125 | -401 |
Proceeds from sales of foreclosed assets | 8,292 | 7,254 |
Net recoveries (expenditures) on foreclosed assets | ' | -11 |
Net cash (used in) provided by investing activities | -75,109 | 83,072 |
Cash flows from financing activities: | ' | ' |
Net increase (decrease) in deposit accounts | 15,129 | -46,033 |
Proceeds from issuance of common stock | 220 | 234 |
Net cash provided by (used in) financing activities | 15,349 | -45,799 |
Change in cash and cash equivalents | -54,521 | 41,953 |
Cash and cash equivalents at beginning of period | 183,150 | 141,197 |
Cash and cash equivalents at end of period | 128,629 | 183,150 |
Supplemental disclosures of cash flow information: | ' | ' |
Interest paid on deposits and borrowings | 8,865 | 11,706 |
Supplemental disclosures of noncash investing and financing activities: | ' | ' |
Unrealized (losses) on investment securities available for sale, net of taxes | -943 | -343 |
Due from broker for investment securities sold | 0 | 3,333 |
Loans transferred from held for investment to held for sale | 0 | 19,297 |
Transfers of loans to foreclosed assets | 3,295 | 12,970 |
Bank premise and equipment transferred from held for sale to held for investment | 34 | 1,901 |
Loans transferred from held for sale to held for investment | 3,638 | 0 |
Supplemental disclosure for sale of branches: | ' | ' |
Proceeds from sale of fixed assets | 1,867 | 0 |
Proceeds from sale of loans | 15,061 | 0 |
Assumption of customer deposits | -57,365 | 0 |
Gain on sale of branches | 586 | 0 |
Proceeds from sale of other assets | 229 | 0 |
Total proceeds paid to First Bank | ($39,622) | $0 |
ORGANIZATION_AND_SUMMARY_OF_SI
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||
Nature of Operations | ||||||
Four Oaks Fincorp, Inc. (the "Company") was incorporated under the laws of the State of North Carolina on February 5, 1997. The Company’s primary function is to serve as the holding company for its wholly owned subsidiaries, Four Oaks Bank & Trust Company, Inc. (the "Bank") and Four Oaks Mortgage Services, L.L.C. The Bank operates thirteen offices in eastern and central North Carolina, and its primary source of revenue is derived from loans to customers and from its securities portfolio. The loan portfolio is comprised mainly of real estate, commercial, and consumer loans. These loans are primarily collateralized by residential and commercial properties, commercial equipment, and personal property. | ||||||
Basis of Presentation | ||||||
The consolidated financial statements include the accounts and transactions of the Company, a bank holding company incorporated under the laws of the State of North Carolina, and its wholly owned subsidiaries, the bank, and Four Oaks Mortgage Services, L.L.C., which became inactive on September 30, 2012. All significant intercompany transactions have been eliminated. In March 2006, the Company formed Four Oaks Statutory Trust I, a wholly owned Delaware statutory business trust (the “Trust”), for the sole purpose of issuing Trust Preferred Securities (as defined in Note H - Trust Preferred Securities). The Trust is not included in the consolidated financial statements of the Company. | ||||||
Use of Estimates | ||||||
Preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, fair value of impaired loans, fair value of foreclosed assets, other than temporary impairment of investment securities available for sale and held to maturity, and the valuation allowance against deferred tax assets. | ||||||
Going Concern Considerations | ||||||
The consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. Management believes that its current operations and its cash availability are sufficient for the Company to discharge its liabilities and meet its commitments in the normal course of business. While management does not anticipate further significant deterioration in the bank's loan portfolio and has performed stress tests and financial modeling under various potential scenarios in determining that the Company and the bank will maintain at least adequate capitalization under federal regulatory guidelines, no assurances regarding these expectations can be made. These consolidated financial statements do not include any adjustments relating to the recoverability or classification of assets or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. | ||||||
The banking industry continues to operate in a challenging and volatile economic environment, which has adversely impacted the Company's and the bank's results of operations and capital levels. Losses declined in 2013, however, the net loss continues to reduce the Company's and the bank's capital levels. The loan loss provision for 2013 was $35,000 compared to $7.4 million for 2012, net charge offs for the year 2013 were $5.0 million compared to $12.0 million in 2012. At December 31, 2013 the Company's total capital to risk weighted assets, Tier 1 capital to risk weighted assets, and Tier 1 capital to average assets were 10.7%, 6.3%, and 3.6%, respectively, compared to 10.1%, 5.9% and 3.3%, respectively, at December 31, 2012. At December 31, 2013, the bank's total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets were 10.9%, 9.7% and 5.5%, respectively, compared to 10.2%, 8.9%, and 5.0%, respectively, at December 31, 2012. | ||||||
In response to the difficult operating conditions that exist within the bank's marketing area, the bank committed substantial additional resources to management in an effort to accelerate resolution of non-performing and other problem assets in 2012 and continued these efforts in 2013. This resolution activity has included bulk asset sales, short sales (settlements with borrowers at less than the residual principal balance of the loan), increasing the variety and scope of asset marketing activities, negotiating and entering into forbearance agreements in order to minimize loan losses and engaging in other programs to facilitate the reduction of the level of problem assets. | ||||||
As a result of these activities, the level of non-performing assets has declined by 30.1% from a recorded investment of $51.1 million as of December 31, 2012 to $35.8 million as of December 31, 2013. Impaired loans declined by 33.4%, from a recorded investment of $58.9 million as of December 31, 2012 to $39.2 million as of December 31, 2013. Net charge-offs over the course of the reporting period totaled $5.0 million, or 11.6% of the average recorded investment in impaired loans of $43.1 million. This is in comparison to net charge-offs during the 2012 fiscal year of $12.0 million or 19.8% of the average recorded investment in impaired loans of $60.5 million. | ||||||
Foreclosed assets decreased from $15.1 million as of December 31, 2012 to $8.5 million as of December 31, 2013, inclusive of a transfer of foreclosed loans with a recorded investment of $3.3 million over the period. Sales of foreclosed assets increased from $7.3 million in fiscal year 2012 to $8.3 million during 2013 while write downs decreased from $2.3 million in 2012 to $1.6 million in 2013. | ||||||
The Bank continues to maintain its commitment to resolve its non-performing assets and will continue to explore other additional resolution options which are determined to be both effective and result in the minimization of additional losses and expense. | ||||||
The Company and the bank entered into a formal written agreement (the “Written Agreement”) with the Federal Reserve Bank of Richmond (“FRB”) and the North Carolina Office of the Commissioner of Banks (“NCCOB”) that imposes certain restrictions on the Company and the bank, as described in Notes H - Trust Preferred Securities and Note K - Regulatory Restrictions. A material failure to comply with the Written Agreement's terms could subject the Company to additional regulatory actions and further restrictions on its business, which may have a material adverse effect on the Company's future results of operations and financial condition. | ||||||
In order for the Company and the bank to maintain its well capitalized position under federal banking agencies' guidelines, management believes that the Company may need to raise additional capital to absorb the potential future credit losses associated with the disposition of its nonperforming assets. On March 24, 2014, the Company entered into the Securities Purchase Agreement with the Standby Investor, which could result in net proceeds to the Company of up to $26.6 million. Please see "Note S - Subsequent Events" for a description of the Securities Purchase Agreement and the contemplated Rights Offering and Standby Offering.There can be no assurance as to whether these efforts will be successful, either on a short-term or long-term basis. Should these efforts be unsuccessful, the Company may be unable to discharge its liabilities in the normal course of business. There can be no assurance that the Company will be successful in any efforts to raise additional capital during 2014. | ||||||
Cash and cash equivalents at December 31, 2013 were approximately $128.6 million. Based on our liquidity analysis, management anticipates that the Company will be able to meet its obligations as they become due. If unanticipated market factors emerge, or if the Company is not successful in its efforts to comply with the requirements set forth in the Written Agreement, the FRB and/or the NCCOB may take further enforcement or other actions. These actions might include greater restrictions on the Company's operations, or a revocation of its charter and the placement of the bank into receivership if the situation materially deteriorates. | ||||||
Cash and Cash Equivalents | ||||||
For the purpose of presentation in the consolidated statements of cash flows, cash and cash equivalents are defined as those amounts included in the balance sheet captions cash and due from banks, and interest-earning deposits. | ||||||
Federal regulations require institutions to set aside specified amounts of cash as reserves against transactions and time deposits. As of December 31, 2013, the daily average gross reserve requirement was $3.1 million. | ||||||
Investment Securities | ||||||
Investment securities are classified into three categories: | ||||||
(1) Held to Maturity - Debt securities that the Company has the positive intent and the ability to hold to maturity are classified as held to maturity and reported at amortized cost. The Company began using this category in 2011. | ||||||
(2) Trading - Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. The Company does not use this category. | ||||||
(3) Available for Sale - Debt and equity securities not classified as either securities held to maturity or trading securities are reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of income taxes, as other comprehensive income, a separate component of shareholders' equity. The Company had historically classified all securities as available for sale until 2011. Gains and losses on sales of securities, computed based on specific identification of adjusted cost of each security, are included in income at the time of the sale. Premiums and discounts are amortized into interest income using a method that approximates the interest method over the period to maturity. | ||||||
Transfers of securities into held to maturity from available for sale are made at fair value as of the transfer date. The unrealized gain or loss as of the transfer date is retained in accumulated other comprehensive income and in the carrying value of the held to maturity securities. The unrealized gain or loss is then amortized over the remaining life of the securities. | ||||||
Other Than Temporary Impairment | ||||||
Each investment security in a loss position is evaluated for other-than-temporary impairment on at least a quarterly basis. The review includes an analysis of the facts and circumstances of each individual investment such as: (1) the length of time and the extent to which the fair value has been below cost, (2) changes in the earnings performance, credit rating, asset quality, or business prospects of the issuer, (3) the ability of the issuer to make principal and interest payments, (4) changes in the regulatory, economic, or technological environment of the issuer, and (5) changes in the general market condition of either the geographic area or industry in which the issuer operates. | ||||||
Regardless of these factors, if we have developed a plan to sell the security or it is likely that we will be forced to sell the security in the near future, then the impairment is considered other-than-temporary and the carrying value of the security is permanently written down to the current fair value with the difference between the new carrying value and the amortized cost charged to earnings. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current period credit loss, the other-than-temporary impairment is separated into the following: (1) the amount representing the credit loss and (2) the amount related to all other factors. The amount of the total other-than- temporary impairment related to the credit loss is recognized in earnings, and the amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. | ||||||
Loans Held for Sale | ||||||
Loans held for sale generally represent single-family, residential first mortgage loans on a pre-sold basis originated by our mortgage division. Generally, commitments to sell these loans are made after the intent to proceed with mortgage applications are initiated with borrowers, and all necessary components of the loan are approved according to secondary market underwriting standards of the investor that purchases the loan. Upon closing, these loans, together with their servicing rights, are sold to mortgage loan investors under prearranged terms. Loans held for sale are subsequently measured at the lower of cost or fair value on an aggregated basis within the consolidated balance sheet under the caption “loans held for sale”. | ||||||
Additionally, for the year ending December 31, 2012 we identified certain loans to be sold as part of a branch sale which are also identified within the consolidated balance sheet under the caption “loans held for sale”. | ||||||
Rate Lock Commitments | ||||||
The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). As required by ASC 815, Derivatives and Hedging, rate lock commitments related to the origination of mortgage loans held for sale and the corresponding forward loan sale commitments are considered to be derivatives. The commitments are generally for periods of 60 days and are at market rates. | ||||||
In order to mitigate the risk from interest rate fluctuations, the Company enters into forward loan sale commitments on a “best efforts” basis while the loan is in the pipeline. Interest rate lock commitments and forward sales commitments are not material to the financial statements for any period presented. | ||||||
Loans | ||||||
Loans are stated at the amount of unpaid principal, reduced by an allowance for loan losses. Interest on all loan classifications is calculated by using the simple interest method on daily balances of the principal amount outstanding. | ||||||
Loan origination fees are deferred, as well as certain direct loan origination costs. Such costs and fees are recognized as an adjustment to yield over the contractual lives of the related loans utilizing the interest method. | ||||||
Purchased loans acquired in a business combination are recorded at estimated fair value on their purchase date; the purchaser cannot carry over the related allowance for loan losses for acquisitions subsequent to January 1, 2009. Purchased loans are accounted for under Financial Accounting Standards Board (“FASB") Accounting Standard Codification ("ASC') 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality (formerly American Institute of Certified Public Accountants (“AICPA”) Statement of Position 03-3), when the loans have evidence of credit deterioration since origination and it is probable at the date of acquisition that the Company will not collect all contractually required principal and interest payments. Evidence of credit quality deterioration as of the purchase date may include statistics such as past due and nonaccrual status. Generally, acquired loans that meet the Company’s definition for nonaccrual status fall within the scope of FASB ASC 310-30. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the nonaccretable difference. Subsequent decreases to the expected cash flows will generally result in a provision for loan losses. Subsequent increases in cash flows result in a reversal of the provision for loan losses to the extent of prior charges, or a reclassification of the difference from nonaccretable to accretable with a positive impact on interest income. Any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized into interest income over the remaining life of the loan when there is a reasonable expectation about the amount and timing of such cash flows. For all other acquired loans that do not fall under the definition of ASC 310-30, the Company will account for these loans as described in the previous paragraphs. | ||||||
For all classes of loans, a loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect 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. Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following 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 or by determining the fair market value of the underlying collateral securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or reserve or charge-off, and is incorporated into the bank's allowance for loan and lease losses. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. | ||||||
Income Recognition on Impaired and Nonaccrual Loans | ||||||
Loans, including impaired loans, are generally classified as nonaccrual when doubts arise regarding the full collectibility of principal or interest and we are therefore uncertain that the borrower can satisfy the contractual terms of the loan agreement. In addition our policy is to place a loan on nonaccrual status at the point when the loan becomes past due 90 days unless there is sufficient documentation to establish that the loan is well secured and in the process of collection. If a loan or a portion of a loan is classified as doubtful or is partially charged-off, the loan is generally classified as nonaccrual. | ||||||
While a loan is classified as nonaccrual and the future collectibility of the recorded loan balance is doubtful, collections of interest and principal are generally applied as a reduction to the principal outstanding, except in the case of loans with scheduled amortizations where the payment is generally applied to the oldest payment due. When the future collectibility of the recorded loan balance is expected, interest income may be recognized on a cash basis. In the case where a nonaccrual loan had been partially charged-off, recognition of interest on a cash basis is limited to that which would have been recognized on the recorded loan balance at the contractual interest rate. Receipts in excess of that amount are recorded as recoveries to the allowance for loan losses until prior charge-offs have been fully recovered. | ||||||
Allowance for Loan Losses | ||||||
The allowance for loan losses is established through periodic charges to earnings in the form of a provision for loan losses. Increases to the allowance for loan losses occur as a result of provisions charged to operations and recoveries of amounts previously charged-off, and decreases to the allowance occur when loans are charged-off because management believes that the uncollectibility of a loan balance is confirmed. Management evaluates the adequacy of our allowance for loan losses on a monthly basis. The evaluation of the adequacy of the allowance for loan losses involves the consideration of loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, adverse conditions that might affect a borrower’s ability to repay the loan, estimated value of underlying collateral, prevailing economic conditions and all other relevant factors derived from our history of operations. Additionally, regulatory agencies review our allowance for loan losses and may require additional provisions for estimated losses based on judgments that differ from those of management. | ||||||
Management has developed a model for evaluating the adequacy of the allowance for loan losses. The model uses the Company’s internal grading system to quantify the risk of each loan. The grade is initially assigned by the lending officer and/or the credit administration function. The internal grading system is reviewed and tested periodically by an independent internal loan review function as well as an independent external credit review firm. The testing process involves the evaluation of a sample of new loans, loans having been identified as possessing potential weakness in credit quality, and past due and nonaccrual loans to determine the ongoing effectiveness of the internal grading system. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses. Such agencies may require us to recognize adjustments to the allowance based on their judgments of information available to them at the time of their examination. | ||||||
The grading system is comprised of seven risk categories for active loans. Grades 1 through 4 demonstrate various degrees of risk, but each is considered to have the capacity to perform in accordance with the terms of the loan. Loans possessing a grade of 5 exhibit characteristics which indicate higher risk that the loan may not be able to perform in accordance with the terms of the loan. Grade 6 loans are considered substandard and are generally impaired. Grade 7 loans are considered doubtful and would be included in nonaccrual loans. Loans can also be classified as non-accrual, troubled debt restructure, or otherwise impaired, all of which are considered impaired and evaluated for specific reserve under FASB ASC 310-10 regardless of the risk grade assigned. | ||||||
Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following 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 or by determining the fair market value of the underlying collateral securing the loan. If the fair value market value of collateral method is selected for use, an updated collateral value is generally obtained based on where the loan is in the collection process and the age of the existing appraisal. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. Other impaired loans are then analyzed individually to determine the net value of collateral or cash flows and an estimate of potential loss. The net value of collateral per our analysis is determined using various subjective discounts, selling expenses and a review of the assumptions used to generate the current appraisal. If collection is deemed to be collateral dependent then the deficiency is generally charged off . Appraised values on real estate collateral are subject to constant change and management makes certain assumptions about how the age of an appraisal impacts current value. Impaired loans are re-evaluated periodically to determine the adequacy of specific reserves and charge-offs. | ||||||
Loans that are not assessed for specific reserves under FASB ASC 310-10 are reserved for under FASB ASC 450. The loans analyzed under FASB ASC 450 are assigned a reserve based on a quantitative factor and a qualitative factor. The quantitative factor is based on historical charge-off levels for each call report category and is adjusted for the loan's risk grade. The qualitative factors address loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, prevailing economic conditions and all other relevant factors derived from our history of operations. Together these two components comprise the ASC 450, or general, reserve. | ||||||
The Bank determines the quantitative ASC 450 reserve using a charge-off metric of the greater of (i) the charge-off rate from the most recent 8 quarters (rolling two years) or (ii) the charge-off rate from the most recent 12 quarters (rolling three years). This provides for the highest base charge-off rate regardless of whether the historical charge-offs are improving or declining. In addition, the bank assigns a different percentage ("multiplier") of the base charge-off rate to the balances for each risk grade within a loan category to reflect the varied risk of charge-off for each. The standard multipliers range from 0% for a risk grade 1 to 300% for a risk grade 6. In addition, categories that have a concentrated level of charge-offs associated with a particular risk grade could have an additional reserve factor of 50% to 100% added to that particular risk grade. Lastly, categories that have had historically high charge-offs also have an additional reserve factor between 25% to 100% added to the risk grade 5s and 6s to account for the additional risk in those categories. The reserve amount by risk grade is calculated and then combined for a blended quantitative reserve factor for each loan category. | ||||||
The allowance for loan losses represents management’s estimate of an appropriate amount to provide for known and inherent losses in the loan portfolio in the normal course of business. While management believes the methodology used to establish the allowance for loan losses incorporates the best information available at the time, future adjustments to the level of the allowance may be necessary and the results of operations could be adversely affected should circumstances differ substantially from the assumptions initially used. We believe that the allowance for loan losses was established in conformity with generally accepted accounting principles. However, upon examination by various regulatory agencies, adjustments to the allowance may be required. Likewise, there can be no assurance that the existing allowance for loan losses is adequate should there be deterioration in the quality of any loans or changes in any of the factors discussed above. Any increases in the provision for loan losses resulting from such deterioration or change in condition could adversely affect our financial condition and results of operations. | ||||||
Bank Premises and Equipment | ||||||
Land is carried at cost. Buildings, furniture, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of assets. Useful lives range from 5 to 10 years for furniture and equipment and 40 years for buildings. Expenditures for repairs and maintenance are charged to expense as incurred. | ||||||
Stock in Federal Home Loan Bank of Atlanta | ||||||
The Company owned Federal Home Loan Bank of Atlanta (“FHLB”) stock totaling $6.1 million at December 31, 2013 and $6.4 million at December 31, 2012. Based on the continued payment of dividends and that redemption of this stock has historically been at par, management believes that its investment in FHLB stock was not other-than-temporarily impaired as of December 31, 2013 or December 31, 2012. However, there can be no assurance that the impact of recent or future legislation on the Federal Home Loan Banks will not cause a decrease in the value of the FHLB stock held by the Company. | ||||||
Foreclosed Assets | ||||||
Assets acquired as a result of foreclosure are valued at fair value, less estimated selling costs, at the date of foreclosure establishing a new cost basis. After foreclosure, valuations of the property are periodically performed by management and the assets are carried at the lower of cost or fair value minus estimated costs to sell. Losses from the acquisition of property in full or partial satisfaction of debt are treated as credit losses. Routine holding costs, subsequent declines in value, and gains or losses on disposition are included in other income and expense. | ||||||
Income Taxes | ||||||
Accrued taxes represent the estimated amount payable to or receivable from taxing jurisdictions, either currently or in the future, and are reported, on a net basis, as a component of “other assets” in the consolidated balance sheets. The calculation of the Company’s income tax expense is complex and requires the use of many estimates and judgments in its determination. | ||||||
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. These temporary differences consist primarily of the allowance for loan losses, differences in the financial statement and income tax basis in premises and equipment and differences in financial statement and income tax basis in accrued liabilities. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that the tax benefits will not be fully realized. | ||||||
Management’s determination of the realization of the net deferred tax asset is based upon management’s judgment of various future events and uncertainties, including the timing and amount of future income and the implementation of various tax plans to maximize realization of the deferred tax asset. As of December 31, 2013, a $22.5 million valuation allowance has been established. | ||||||
From time to time, management bases the estimates of related tax liabilities on its belief that future events will validate management’s current assumptions regarding the ultimate outcome of tax-related exposures. While the Company has obtained the opinion of advisors that the anticipated tax treatment of these transactions should prevail and has assessed the relative merits and risks of the appropriate tax treatment, examination of the Company’s income tax returns, changes in tax law and regulatory guidance may impact the treatment of these transactions and resulting provisions for income taxes. | ||||||
Stock Compensation Plans | ||||||
The Company accounts for stock based awards granted to employees using the fair value method. The cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (usually the vesting period). The cost of employee services received in exchange for an award is based on the grant-date fair value of the award. Excess tax benefits are reported as financing cash inflows, rather than as a reduction of taxes paid, which is included within operating cash flows. | ||||||
Net Loss Per Common Share and Common Shares Outstanding | ||||||
Basic loss per share represents loss available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted loss per share reflect 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 solely to outstanding stock options. | ||||||
Basic and diluted net loss per common share have been computed based upon net 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: | ||||||
Weighted Average Shares | ||||||
2013 | 2012 | |||||
Weighted average number of common shares used in computing basic net loss per share | 7,914,110 | 7,745,342 | ||||
Effect of dilutive stock options | — | — | ||||
Weighted average number of commons shares and dilutive potential common shares used in computing diluted net loss per share | 7,914,110 | 7,745,342 | ||||
Stock options that have exercise prices greater than the average market price of the common shares outstanding do not have a dilutive effect and are considered antidilutive. Outstanding antidilutive options of 301,705 and 253,680 in 2013 and 2012, respectively, had no dilutive effect because the Company reported a net loss for these years. | ||||||
Recent Accounting Pronouncements | ||||||
In May 2011, the FASB issued Accounting Standards Update (“ASU”) No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. The purpose of this standard is to clarify and combine fair value measurements and disclosure requirements for U.S. generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS). The new ASU provides amendments and wording changes used to describe certain requirements for measuring fair value and for disclosing information about fair value measurements. This guidance is effective for interim and annual reporting periods beginning after December 15, 2011, and should be applied prospectively to the beginning of the annual period of adoption. The Company has fully adopted all of the provisions within this ASU and has provided all required disclosures. | ||||||
In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. This update requires that all non-owner changes in stockholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The objective is to improve the comparability, consistency, and transparency of financial reporting, and to increase the prominence of items reported in other comprehensive income. These amendments are to be applied retrospectively and are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Disclosures required by ASU 2011-05 are included in Consolidated Statements of Comprehensive Income (Loss). The adoption of the disclosure requirements had no material impact on the Company’s consolidated financial position, results of operations, and earnings per share. In December 2011, the FASB issued ASU 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05, to allow time to redeliberate whether to present on the face of the financial statements the effects of reclassifications out of accumulated other comprehensive income on the components of net income and other comprehensive income for all periods presented. Adoption of this ASU did not have any impact on the Company’s consolidated financial statements or results of operations. | ||||||
In December 2011, the FASB issued ASU No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. This update requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The amendment is effective for annual and interim periods beginning on or after January 1, 2013. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In July 2012, the FASB issued ASU No. 2012-02, Intangibles–Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment. This update permits entities to perform an optional qualitative assessment for determining whether it is more likely than not than an indefinite-lived intangible asset is impaired. The guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. This update seeks to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income, if the amount being reclassified is required under U.S. GAAP to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is reclassified to a balance sheet account (for example, inventory) instead of directly to income or expense in the same reporting period. For public entities, the amendments are effective prospectively for reporting periods beginning after December 15, 2012. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This update seeks to eliminate the diversity in practice in the presentation of unrecognized tax benefits by providing explicit guidance on the financial statement presentation of an unrecognized tax benefit with a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This amendment is effective for annual and interim periods beginning after December 15, 2013. We do not expect the adoption of this guidance to have a material impact on our 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. We do not expect the adoption of this guidance to have a material impact on our 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. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||||||
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 as of December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair Value | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 6,176 | $ | — | $ | 243 | $ | 5,933 | $ | 5,459 | $ | 454 | $ | — | $ | 5,913 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 25,773 | — | 296 | 25,477 | 60,056 | 704 | 17 | 60,743 | ||||||||||||||||||||||||
FNMA | — | — | — | — | 5,872 | 10 | 2 | 5,880 | ||||||||||||||||||||||||
Trust preferred securities | 1,175 | — | 150 | 1,025 | 1,175 | — | 169 | 1,006 | ||||||||||||||||||||||||
Equity securities | 98 | 33 | — | 131 | 170 | 11 | 1 | 180 | ||||||||||||||||||||||||
Total | $ | 33,222 | $ | 33 | $ | 689 | $ | 32,566 | $ | 72,732 | $ | 1,179 | $ | 189 | $ | 73,722 | ||||||||||||||||
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities held to maturity as of December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held to Maturity | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair Value | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 3,635 | $ | 3 | $ | 157 | $ | 3,481 | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 89,892 | 162 | 2,171 | 87,883 | 20,329 | 339 | — | 20,668 | ||||||||||||||||||||||||
FNMA | 4,486 | — | 19 | 4,467 | — | — | — | — | ||||||||||||||||||||||||
Total | $ | 98,013 | $ | 165 | $ | 2,347 | $ | 95,831 | $ | 20,329 | $ | 339 | $ | — | $ | 20,668 | ||||||||||||||||
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 debt securities at December 31, 2013 resulted from changing market interest rates over the yields available at the time the underlying securities were purchased. Fourteen of sixteen GNMA collateralized mortgage obligations, thirty-seven of forty-five MBS pass-through securities, fourteen of sixteen taxable municipal securities, and two of two trust preferred securities contained net unrealized losses at December 31, 2013. Management identified no impairment related to credit quality. At December 31, 2013 management had the intent and ability to hold impaired securities and no impairment was evaluated as other than temporary. As a result, no other than temporary impairment losses were recognized during the twelve months ended December 31, 2013. | ||||||||||||||||||||||||||||||||
The unrealized gains and losses on equity securities at December 31, 2013 resulted from changes in market values and available third party valuations. There were no equity securities with unrealized losses at December 31, 2013. Management has identified no other-than-temporary impairment in equity securities value that remains unrecognized. | ||||||||||||||||||||||||||||||||
The Bank owns two trust preferred securities. The first trust preferred security, with unrealized losses at December 31, 2013 was initially deemed other than temporarily impaired as of and for the year-ended December 31, 2011 and is classified as such for the year-ended December 31, 2013. As a result of management's determination that $75,000 of the $146,000 unrealized losses at December 31, 2011 related to credit quality of the security, the basis in the investment was adjusted from $750,000 to $675,000. The fair value of the trust preferred security for the year-ended December 31, 2013 was $615,000, which resulted in an aggregate unrealized loss on the trust preferred security of $60,000. In its previous determination of the credit loss related to this investment, including the probability of repayment of principal and interest, management considered and evaluated the deteriorating credit profile/rating for this issuer over a prolonged period of time. As of the most recently available financial information, the issuer's income, margin, capital, liquidity, asset quality, and credit rating have all maintained satisfactory and stable or improved. In addition, management was notified during the fourth quarter of 2013 of the issuer's intent to redeem the security at par during the first quarter of 2014. Based on this information and knowledge of the current market environment, management has concluded that the unrealized loss for this trust preferred security as of December 31, 2013 is not credit related and will therefore be recognized in other comprehensive income for the twelve months ended December 31, 2013. | ||||||||||||||||||||||||||||||||
The second trust preferred security, with an unrealized loss of $90,000 at December 31, 2013, is also deemed to be other than temporarily impaired. As of December 31, 2013, the basis of the trust preferred security was $500,000 and the fair value was $410,000. Management continued to monitor the creditworthiness of the issuer during the fourth quarter of 2013 in considering key factors such as the issuer's income, margin, capital, credit rating, and asset quality have all remained satisfactory and stable. All interest payments have been made and no deferrals have been announced to management's knowledge. The entity's credit rating has been stable over recent quarters. Based on this information and knowledge of the current market environment, management has concluded that the unrealized loss for this trust preferred security as of December 31, 2013 is not credit related and will therefore not be recognized in other comprehensive income for the twelve months ended December 31, 2013. | ||||||||||||||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities available for sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 243 | $ | — | $ | — | $ | 5,933 | $ | 243 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 25,477 | 296 | — | — | 25,477 | 296 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 31,410 | $ | 539 | $ | — | $ | — | $ | 31,410 | $ | 539 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | — | 1,025 | 150 | 1,025 | 150 | ||||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,025 | $ | 150 | $ | 1,025 | $ | 150 | ||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | $ | 5,132 | $ | 17 | $ | — | $ | — | $ | 5,132 | $ | 17 | ||||||||||||||||||||
FNMA | 1,998 | 2 | — | — | 1,998 | 2 | ||||||||||||||||||||||||||
Equity securities | — | — | 2 | 1 | 2 | 1 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 7,130 | $ | 19 | $ | 2 | $ | 1 | $ | 7,132 | $ | 20 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | $ | — | 1,006 | 169 | 1,006 | 169 | |||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,006 | $ | 169 | $ | 1,006 | $ | 169 | ||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities held to maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. There were no unrealized losses in the held to maturity portfolio in 2012. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held to Maturity | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,776 | $ | 157 | $ | — | $ | — | $ | 2,776 | $ | 157 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,830 | 2,073 | 2,223 | 98 | 77,053 | 2,171 | ||||||||||||||||||||||||||
FNMA | 4,467 | 19 | — | — | 4,467 | 19 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 82,073 | $ | 2,249 | $ | 2,223 | $ | 98 | $ | 84,296 | $ | 2,347 | ||||||||||||||||||||
The following table shows a roll forward of the amount related to credit losses recognized on debt securities held by the Company for which a portion of an other-than-temporary impairment was recognized in other comprehensive income (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the beginning of the period | $ | 75 | 75 | |||||||||||||||||||||||||||||
Additional increase related to the credit loss for which an other-than-temporary impairment was previously recognized | — | — | ||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the end of the period | $ | 75 | $ | 75 | ||||||||||||||||||||||||||||
The amortized cost and fair value of available for sale and held to maturity securities at December 31, 2013 by expected maturities are shown below(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. | ||||||||||||||||||||||||||||||||
Available for Sale | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities -GNMA | Mortgage-backed securities -FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | — | — | 25,773 | 25,477 | — | — | ||||||||||||||||||||||||||
Due after ten years | 6,176 | 5,933 | — | — | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 6,176 | $ | 5,933 | $ | 25,773 | $ | 25,477 | $ | — | $ | — | ||||||||||||||||||||
Securities without a specific maturity: | ||||||||||||||||||||||||||||||||
Trust preferred securities | $ | 1,175 | $ | 1,025 | ||||||||||||||||||||||||||||
Equity securities | 98 | 131 | ||||||||||||||||||||||||||||||
Total other securities | $ | 1,273 | $ | 1,156 | ||||||||||||||||||||||||||||
Held to Maturity | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities -GNMA | Mortgage-backed securities -FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | 803 | 785 | 51,419 | 50,936 | 4,486 | 4,467 | ||||||||||||||||||||||||||
Due after five years through ten years | 2,832 | 2,696 | 34,261 | 32,920 | — | — | ||||||||||||||||||||||||||
Due after ten years | — | — | 4,212 | 4,027 | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 3,635 | $ | 3,481 | $ | 89,892 | $ | 87,883 | $ | 4,486 | $ | 4,467 | ||||||||||||||||||||
Securities with a carrying value of approximately $92.8 million and $93.2 million at December 31, 2013 and 2012, respectively, were pledged to secure public deposits and for other purposes required or permitted by law. | ||||||||||||||||||||||||||||||||
Sales and calls of securities available for sale during 2013 and 2012 of $20.9 million and $50.4 million generated gross realized gains of $462,460 and $2.0 million, respectively, and no gross realized losses for 2013 and 2012. |
LOANS_AND_ALLOWANCE_FOR_LOAN_L
LOANS AND ALLOWANCE FOR LOAN LOSSES | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||||||
Loans and Leases Receivable Disclosure [Abstract] | ' | |||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR LOAN LOSSES | ' | |||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR LOAN LOSSES | ||||||||||||||||||||||||||||||||
The classification of loan segments as of December 31, 2013 and 2012 are summarized as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial and industrial | $ | 25,858 | $ | 28,377 | ||||||||||||||||||||||||||||
Commercial construction and land development | 66,253 | 90,899 | ||||||||||||||||||||||||||||||
Commercial real estate | 194,238 | 181,194 | ||||||||||||||||||||||||||||||
Residential construction | 28,697 | 20,445 | ||||||||||||||||||||||||||||||
Residential mortgage | 167,221 | 165,009 | ||||||||||||||||||||||||||||||
Consumer | 6,750 | 7,399 | ||||||||||||||||||||||||||||||
Other | 738 | 1,278 | ||||||||||||||||||||||||||||||
Consumer credit cards | 2,339 | 2,265 | ||||||||||||||||||||||||||||||
Business credit cards | 1,124 | 1,186 | ||||||||||||||||||||||||||||||
493,218 | 498,052 | |||||||||||||||||||||||||||||||
Deferred cost and (fees), net | (506 | ) | (123 | ) | ||||||||||||||||||||||||||||
Allowance for loan losses | (11,590 | ) | (16,549 | ) | ||||||||||||||||||||||||||||
Net Loans | $ | 481,122 | $ | 481,380 | ||||||||||||||||||||||||||||
Loans held for sale | $ | — | $ | 19,297 | ||||||||||||||||||||||||||||
Nonperforming assets | ||||||||||||||||||||||||||||||||
Nonperforming assets at December 31, 2013 and 2012 consist of the following (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Loans past due ninety days or more and still accruing | $ | 23 | $ | 32 | ||||||||||||||||||||||||||||
Nonaccrual loans | 27,227 | 35,970 | ||||||||||||||||||||||||||||||
Foreclosed assets | 8,502 | 15,136 | ||||||||||||||||||||||||||||||
Total | $ | 35,752 | $ | 51,138 | ||||||||||||||||||||||||||||
Purchased Loans | ||||||||||||||||||||||||||||||||
The population of purchased impaired loans at December 31, 2013 and 2012 includes one loan with a fair value of $131,000 and $134,000, respectively, for which no further credit deterioration was noted. Therefore no additional allowance for loan loss reserves has been established because the originally determined credit discounts for such purchased impaired loans was deemed sufficient. The amount of, and changes within, the accretable difference was deemed immaterial for the years ended December 31, 2013 and 2012. | ||||||||||||||||||||||||||||||||
Related Party Loans | ||||||||||||||||||||||||||||||||
The Company had loan and deposit relationships with directors, executive officers, and associates of these parties as of December 31, 2013 and 2012. The following is a reconciliation of these loans (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 15,009 | 15,825 | |||||||||||||||||||||||||||||
New loans | 2,600 | 937 | ||||||||||||||||||||||||||||||
Principal repayments | (7,769 | ) | (1,753 | ) | ||||||||||||||||||||||||||||
Ending balance | $ | 9,840 | 15,009 | |||||||||||||||||||||||||||||
As a matter of policy, these loans and credit lines are approved by the Company’s Board of Directors and are made with interest rates, terms, and collateral requirements comparable to those required of other borrowers. In the opinion of management, these loans do not involve more than the normal risk of collectibility. At December 31, 2013 the Company had pre-approved but unused lines of credit totaling $1.1 million to executive officers, directors and their affiliates. | ||||||||||||||||||||||||||||||||
Credit Risk | ||||||||||||||||||||||||||||||||
We use 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 loan administration function throughout the life of the loan. The credit grades have been defined as follows: | ||||||||||||||||||||||||||||||||
• | Grade 1 - Lowest Risk | |||||||||||||||||||||||||||||||
Loans secured by properly margined liquid collateral such as certificates of deposit, government securities, cash value of life insurance, stock actively traded on one of the major stock exchanges, etc. Repayment is definite and being handled as agreed. Maintains a strong, liquid financial condition as evidenced by a current financial statement in the bank. Repayment agreement is definite, realistic, and being handled as agreed. | ||||||||||||||||||||||||||||||||
• | Grade 2 - Satisfactory Quality | |||||||||||||||||||||||||||||||
Loans secured by properly margined collateral with a definite repayment agreement in effect. Unsecured loans with repayment agreements that are definite, realistic, and are being handled as agreed. Repayment source well defined by proven income, cash flow, trade asset turn, etc. Multiple repayment sources exist. Individual and businesses will typically have a sound financial condition. | ||||||||||||||||||||||||||||||||
• | Grade 3 – Satisfactory - Merits Attention | |||||||||||||||||||||||||||||||
Loans being repaid as agreed that require close following because of complexity, information or underwriting deficiencies, emerging signs of weakness or non-standard terms. Secured loans repaying as agreed where collateral value or marketability are questionable but do not materially affect risk. Repayment sources well defined by proven income, cash flow, trade asset turn, etc., but may be weaker than Grade 2. Loans to weak individuals or business borrowers with a strong endorser or guarantor. Fully collectible, unsecured loans or loans secured by other than approved collateral for which an acceptable repayment agreement has not been established. | ||||||||||||||||||||||||||||||||
• | Grade 4 - Low Satisfactory | |||||||||||||||||||||||||||||||
New Loans - Applicants with excessive minor exceptions as defined by the Risk Grade forms. Applicants with major credit history or Beacon score issues as defined by the Risk Grade forms. Applicants with two or more major exceptions with mitigating factors identified on the Fair Lending form. | ||||||||||||||||||||||||||||||||
Existing Loans - Borrower’s ability to repay from primary (intended) repayment sources is not clearly sufficient to ensure performance as contracted; but the loan is performing as contracted, and secondary repayment sources are clearly sufficient to protect against the risk of principal or income loss; and it is reasonable to expect that the circumstances causing repayment capacity to be uncertain will be resolved within six months. Access to alternative financing sources exists but may be limited to institutions specializing in higher risk financing. | ||||||||||||||||||||||||||||||||
• | Grade 5 - Special Mention | |||||||||||||||||||||||||||||||
Special Mention risk loans include the following characteristics: Loans currently performing satisfactorily but with potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the bank’s position at some future date. Potential weaknesses exist, generally the result of deviations from prudent lending practices, such as over advances on collateral or unproven primary repayment sources. Loans where adverse economic conditions that develop subsequent to the loan origination that do not jeopardize liquidation of the debt but do increase the level of risk may also warrant this rating. Such trends may be in the borrower’s options, credit quality or financial strength. New loans with exceptions where no mitigating factors are justified, however, loans are not typically made if the grade is Special Mention at inception without management approval. | ||||||||||||||||||||||||||||||||
• | Grades 6-8 - Substandard (Grade 6), Doubtful (Grade 7) and Loss (Grade 8) | |||||||||||||||||||||||||||||||
A substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. Loans classified as Loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthless loan even though partial recovery may be affected in the future. Loans are not typically made if graded Substandard or worse at inception without management's approval. | ||||||||||||||||||||||||||||||||
The following table illustrates credit risk profile by creditworthiness class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - Loans | Total | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | |||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,014 | $ | — | $ | — | $ | — | $ | — | $ | 1,365 | $ | 8 | $ | 3,387 | ||||||||||||||||
2 - Satisfactory Quality | 646 | 374 | 2,548 | 2 | 12,959 | 412 | 15 | 16,956 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,639 | 14,296 | 71,250 | 3,473 | 57,792 | 3,628 | 482 | 160,560 | ||||||||||||||||||||||||
4 - Low Satisfactory | 12,616 | 36,723 | 106,652 | 23,779 | 72,330 | 1,235 | 107 | 253,442 | ||||||||||||||||||||||||
5 - Special mention | 137 | 1,922 | 2,303 | 262 | 8,705 | 63 | 126 | 13,518 | ||||||||||||||||||||||||
6 - Substandard or worse | 806 | 12,938 | 11,485 | 1,181 | 15,435 | 47 | — | 41,892 | ||||||||||||||||||||||||
$ | 25,858 | $ | 66,253 | $ | 194,238 | $ | 28,697 | $ | 167,221 | $ | 6,750 | $ | 738 | $ | 489,755 | |||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - | Total | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | Loans | ||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,446 | $ | — | $ | — | $ | — | $ | 51 | $ | 1,372 | $ | 13 | $ | 3,882 | ||||||||||||||||
2 - Satisfactory Quality | 441 | 595 | 2,429 | 109 | 10,595 | 288 | — | 14,457 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 10,222 | 22,278 | 51,384 | 1,337 | 58,140 | 4,526 | 1,091 | 148,978 | ||||||||||||||||||||||||
4 - Low Satisfactory | 13,558 | 35,502 | 104,652 | 17,008 | 68,148 | 1,019 | 125 | 240,012 | ||||||||||||||||||||||||
5 - Special mention | 323 | 9,064 | 6,228 | 356 | 9,720 | 91 | 49 | 25,831 | ||||||||||||||||||||||||
6 - Substandard or worse | 1,387 | 23,460 | 16,501 | 1,635 | 18,355 | 103 | — | 61,441 | ||||||||||||||||||||||||
$ | 28,377 | $ | 90,899 | $ | 181,194 | $ | 20,445 | $ | 165,009 | $ | 7,399 | $ | 1,278 | $ | 494,601 | |||||||||||||||||
Total loans within risk grade categories 5 (Special Mention) and 6 (Substandard) were $55.4 million at December 31, 2013, compared to $87.3 million at December 31, 2012. This represents a 36.5% reduction in these specific categories. | ||||||||||||||||||||||||||||||||
The following table illustrates the credit card portfolio exposure as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||||||||||
Consumer - | Business- | Consumer - | Business- | |||||||||||||||||||||||||||||
Credit Card | Credit Card | Credit Card | Credit Card | |||||||||||||||||||||||||||||
Performing | $ | 2,316 | $ | 1,124 | $ | 2,233 | $ | 1,186 | ||||||||||||||||||||||||
Non Performing | 23 | — | 32 | — | ||||||||||||||||||||||||||||
$ | 2,339 | $ | 1,124 | $ | 2,265 | $ | 1,186 | |||||||||||||||||||||||||
Nonaccruals | ||||||||||||||||||||||||||||||||
The following table represents the loans on nonaccrual status as of December 31, 2013 and 2012 by loan class (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial & industrial | $ | 651 | $ | 664 | ||||||||||||||||||||||||||||
Commercial construction and land development | 9,536 | 15,941 | ||||||||||||||||||||||||||||||
Commercial real estate | 6,391 | 9,091 | ||||||||||||||||||||||||||||||
Residential construction | 695 | 833 | ||||||||||||||||||||||||||||||
Residential mortgage | 9,943 | 9,408 | ||||||||||||||||||||||||||||||
Consumer | 11 | 33 | ||||||||||||||||||||||||||||||
Other | — | — | ||||||||||||||||||||||||||||||
Total | $ | 27,227 | $ | 35,970 | ||||||||||||||||||||||||||||
The following tables illustrates the age analysis of past due loans by loan class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccruals & Greater than 90 Days Past Due (1) | Total Past | Current | Total | ||||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 34 | $ | 651 | $ | 685 | $ | 25,173 | $ | 25,858 | ||||||||||||||||||||||
Commercial construction & land development | 252 | 9,536 | 9,788 | 56,465 | 66,253 | |||||||||||||||||||||||||||
Commercial real estate | 749 | 6,391 | 7,140 | 187,098 | 194,238 | |||||||||||||||||||||||||||
Residential construction | — | 695 | 695 | 28,002 | 28,697 | |||||||||||||||||||||||||||
Residential mortgage | 421 | 9,943 | 10,364 | 156,857 | 167,221 | |||||||||||||||||||||||||||
Consumer | 11 | 11 | 22 | 6,728 | 6,750 | |||||||||||||||||||||||||||
Consumer credit cards | 76 | 23 | 99 | 2,240 | 2,339 | |||||||||||||||||||||||||||
Business credit cards | 52 | — | 52 | 1,072 | 1,124 | |||||||||||||||||||||||||||
Other loans | — | — | — | 738 | 738 | |||||||||||||||||||||||||||
Total | $ | 1,595 | $ | 27,250 | $ | 28,845 | $ | 464,373 | $ | 493,218 | ||||||||||||||||||||||
-1 | Nonaccruals and Greater than 90 Days Past Due is comprised of $23,000 of loans that were past due more than 90 days and still accruing interest, as well as $27.2 million of loans in nonaccrual status. | |||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccruals & Greater than 90 Days Past Due (1) | Total Past | Current | Total | ||||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 119 | $ | 664 | $ | 783 | $ | 27,594 | $ | 28,377 | ||||||||||||||||||||||
Commercial construction & land development | 819 | 15,941 | 16,760 | 74,139 | 90,899 | |||||||||||||||||||||||||||
Commercial real estate | 499 | 9,091 | 9,590 | 171,604 | 181,194 | |||||||||||||||||||||||||||
Residential construction | — | 833 | 833 | 19,612 | 20,445 | |||||||||||||||||||||||||||
Residential mortgage | 1,076 | 9,408 | 10,484 | 154,525 | 165,009 | |||||||||||||||||||||||||||
Consumer | 34 | 33 | 67 | 7,332 | 7,399 | |||||||||||||||||||||||||||
Consumer credit cards | 67 | 32 | 99 | 2,166 | 2,265 | |||||||||||||||||||||||||||
Business credit cards | 12 | — | 12 | 1,174 | 1,186 | |||||||||||||||||||||||||||
Other loans | — | — | — | 1,278 | 1,278 | |||||||||||||||||||||||||||
Total | $ | 2,626 | $ | 36,002 | $ | 38,628 | $ | 459,424 | $ | 498,052 | ||||||||||||||||||||||
-1 | Nonaccruals and Greater than 90 Days Past Due is comprised of $32,000 of loans that were past due more than 90 days and still accruing interest, as well as $36.0 million of loans in nonaccrual status. | |||||||||||||||||||||||||||||||
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 reserve 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 illustrates the impaired loans by loan class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Average | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Recorded | Income | ||||||||||||||||||||||||||||
Balance | Investment | Recognized | ||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 380 | $ | 517 | $ | — | $ | 491 | $ | 2 | ||||||||||||||||||||||
Commercial construction & land development | 11,142 | 15,809 | — | 13,259 | 168 | |||||||||||||||||||||||||||
Commercial real estate | 8,437 | 10,131 | — | 9,190 | 132 | |||||||||||||||||||||||||||
Residential construction | 486 | 486 | — | 474 | 26 | |||||||||||||||||||||||||||
Residential mortgage | 10,948 | 12,731 | — | 11,624 | 121 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 31,404 | $ | 39,696 | $ | — | $ | 35,055 | $ | 449 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 309 | $ | 322 | $ | 80 | $ | 321 | $ | — | ||||||||||||||||||||||
Commercial construction and land development | 1,315 | 2,033 | 264 | 1,348 | — | |||||||||||||||||||||||||||
Commercial real estate | 4,026 | 4,096 | 888 | 4,104 | 136 | |||||||||||||||||||||||||||
Residential construction | 695 | 1,134 | 137 | 749 | — | |||||||||||||||||||||||||||
Residential mortgage | 1,427 | 1,593 | 456 | 1,499 | 8 | |||||||||||||||||||||||||||
Consumer | — | — | — | — | — | |||||||||||||||||||||||||||
Subtotal: | $ | 7,772 | $ | 9,178 | $ | 1,825 | $ | 8,021 | $ | 144 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 25,609 | 32,908 | 1,232 | 28,713 | 438 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Residential | 13,556 | 15,944 | 593 | 14,346 | 155 | |||||||||||||||||||||||||||
Grand Total | $ | 39,176 | $ | 48,874 | $ | 1,825 | $ | 43,076 | $ | 593 | ||||||||||||||||||||||
At December 31, 2013, the recorded investment in loans considered impaired totaled $39.2 million. Of the total investment in loans considered impaired, $7.8 million were found to show specific impairment for which a $1.8 million valuation allowance was recorded; the remaining $31.4 million in impaired loans required no specific valuation allowance because either previously established valuation allowances had been absorbed by partial charge-offs or loan evaluations had no indication of impairment which would require a valuation allowance. For the year ended December 31, 2013, the average recorded investment in impaired loans was approximately $43.1 million. The amount of interest recognized on impaired loans during the portion of the year that they were considered impaired was approximately $593,000. | ||||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | YTD | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Average | Income | ||||||||||||||||||||||||||||
Balance | Recorded | Recognized | ||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 498 | $ | 686 | $ | — | $ | 484 | $ | 1 | ||||||||||||||||||||||
Commercial construction and land development | 11,266 | 15,889 | — | 13,008 | 22 | |||||||||||||||||||||||||||
Commercial real estate other | 12,865 | 14,263 | — | 12,328 | 64 | |||||||||||||||||||||||||||
Residential construction | 340 | 340 | — | 162 | — | |||||||||||||||||||||||||||
Residential mortgage | 10,106 | 11,542 | — | 9,937 | 132 | |||||||||||||||||||||||||||
Consumer | 25 | 42 | — | 26 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 35,100 | $ | 42,762 | $ | — | $ | 35,945 | $ | 219 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 939 | $ | 956 | $ | 636 | $ | 528 | $ | 11 | ||||||||||||||||||||||
Commercial construction and land development | 9,619 | 13,033 | 1,693 | 10,003 | 36 | |||||||||||||||||||||||||||
Commercial real estate other | 4,877 | 6,852 | 640 | 5,623 | 46 | |||||||||||||||||||||||||||
Residential construction | 833 | 1,134 | 86 | 884 | — | |||||||||||||||||||||||||||
Residential mortgage | 7,467 | 8,081 | 2,334 | 7,493 | 44 | |||||||||||||||||||||||||||
Consumer | 25 | 34 | — | 25 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 23,760 | $ | 30,090 | $ | 5,389 | $ | 24,556 | $ | 137 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 40,064 | 51,679 | 2,969 | 41,974 | 180 | |||||||||||||||||||||||||||
Consumer | 50 | 76 | — | 51 | — | |||||||||||||||||||||||||||
Residential | 18,746 | 21,097 | 2,420 | 18,476 | 176 | |||||||||||||||||||||||||||
Grand Total: | $ | 58,860 | $ | 72,852 | $ | 5,389 | $ | 60,501 | $ | 356 | ||||||||||||||||||||||
At December 31, 2012, the recorded investment in loans considered impaired totaled $58.9 million. Of the total investment in loans considered impaired, $23.8 million were found to show specific impairment for which a $5.4 million valuation allowance was recorded; the remaining $35.1 million in impaired loans required no specific valuation allowance because either previously established valuation allowances had been absorbed by partial charge-offs or loan evaluations had no indication of impairment which would require a valuation allowance. For the year ended December 31, 2012, the average recorded investment in impaired loans was approximately $60.5 million. The amount of interest recognized on impaired loans during the portion of the year that they were considered impaired was approximately $356,000. | ||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | ||||||||||||||||||||||||||||||||
Loans are classified as a TDR 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. Generally concessions are granted as a result of a borrower's inability to meet the contractual repayment obligations of the initial loan terms and in the interest of improving the likelihood of recovery of the loan. We may grant these concessions by a number of means such as (1) forgiving principal or interest, (2) reducing the stated interest rate to a below market rate, (3) deferring principal payments, (4) changing repayment terms from amortizing to interest only, (5) extending the repayment period, or (6) accepting a change in terms based upon a bankruptcy plan. However, the bank only restructures loans for borrowers that demonstrate the willingness and capacity to repay the loan under reasonable terms and where the bank has sufficient protection provided by the cash flow of the underlying collateral or business. | ||||||||||||||||||||||||||||||||
Loans in the process of renewal or modification are reviewed by the bank to determine if the risk grade assigned is accurate based on updated information. All loans identified by the bank's internal loan grading system to pose a heightened level of risk at or prior to renewal or modification are additionally reviewed to determine if the loan should be classified as a TDR. The Bank's knowledge of the borrower's situation and any updated financial information obtained is first used to determine whether the borrower is experiencing financial difficulty. Once this is determined, the bank reviews the modification terms to determine whether a concession has been granted. If the bank determines that both conditions have been met, the loan will be classified as a TDR. If the bank determines that both conditions have not been met, the loan is not classified as a TDR, but would typically then be monitored for any additional deterioration. Documentation to support this determination of TDR classification is maintained within the credit file. | ||||||||||||||||||||||||||||||||
For the year ended December 31, 2013, the bank modified 3 loans totaling $235,000 which were deemed TDRs. The following tables presents a breakdown of TDRs by loan class and the type of concession made to the borrower for the periods indicated(amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Classification | Post-Modification | ||||||||||||||||||||||||||||||
Outstanding | Outstanding | |||||||||||||||||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||||||||
Investment | Investment | |||||||||||||||||||||||||||||||
Below market interest rate: | ||||||||||||||||||||||||||||||||
Subtotal | — | — | — | |||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Residential mortgage | 2 | 202 | 202 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 202 | $ | 202 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Subtotal | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Total | 3 | $ | 235 | $ | 235 | |||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Number | Pre-Modification | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
of loans | Outstanding | |||||||||||||||||||||||||||||||
Recorded | ||||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
Below market interest rate: | ||||||||||||||||||||||||||||||||
Residential mortgage | 1 | 395 | 395 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 395 | $ | 395 | |||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Commercial real estate | 4 | 513 | 513 | |||||||||||||||||||||||||||||
Residential mortgage | 2 | 66 | 66 | |||||||||||||||||||||||||||||
Consumer | 1 | 19 | 19 | |||||||||||||||||||||||||||||
Subtotal | 7 | $ | 598 | $ | 598 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 5 | 695 | 695 | |||||||||||||||||||||||||||||
Consumer | 2 | 49 | 49 | |||||||||||||||||||||||||||||
Subtotal | 7 | $ | 744 | $ | 744 | |||||||||||||||||||||||||||
Total | 15 | $ | 1,737 | $ | 1,737 | |||||||||||||||||||||||||||
The following table presents loans that were modified as troubled debt restructurings and for which there was a payment default for the year ended December 31, 2012. There were no modified TDRs for the year ended December 31, 2013. (amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Number of loans | Recorded Investment | |||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | $ | 28 | |||||||||||||||||||||||||||||
Consumer | 2 | 49 | ||||||||||||||||||||||||||||||
Subtotal | 3 | $ | 77 | |||||||||||||||||||||||||||||
Total | 3 | $ | 77 | |||||||||||||||||||||||||||||
The table below details the progression of troubled debt restructurings which have been entered into during the previous 12 months(amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Paid in full | Paying as restructured | Converted to non-accrual | Foreclosure/Default | |||||||||||||||||||||||||||||
Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | |||||||||||||||||||||||||
Below market interest rate | — | — | — | $ | — | — | $ | — | — | $ | — | |||||||||||||||||||||
Extended payment terms | — | — | 1 | 146 | 1 | 56 | — | — | ||||||||||||||||||||||||
Forgiveness of principal | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Other | — | — | — | — | 1 | 33 | — | — | ||||||||||||||||||||||||
Total | — | $ | — | 1 | $ | 146 | 2 | $ | 89 | — | $ | — | ||||||||||||||||||||
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 a monthly basis which includes a review of loans both specifically and collectively evaluated for impairment. | ||||||||||||||||||||||||||||||||
Following is an analysis of the allowance for loan losses by loan segment as of and for the years ended December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial | Commercial construction | Commercial | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
and | and land development | real estate | ||||||||||||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Provision for loan losses | 2 | 4 | 15 | 2 | 11 | 1 | — | 35 | ||||||||||||||||||||||||
Loans charged-off | (411 | ) | (3,759 | ) | (2,220 | ) | (138 | ) | (1,559 | ) | (271 | ) | — | (8,358 | ) | |||||||||||||||||
Recoveries | 514 | 587 | 1,506 | — | 599 | 154 | 4 | 3,364 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | 103 | (3,172 | ) | (714 | ) | (138 | ) | (960 | ) | (117 | ) | 4 | (4,994 | ) | ||||||||||||||||||
Balance, end of period | $ | 1,290 | $ | 4,083 | $ | 2,262 | $ | 287 | $ | 3,522 | $ | 72 | $ | 74 | $ | 11,590 | ||||||||||||||||
Ending Balance: individually | $ | 80 | $ | 264 | $ | 887 | $ | 137 | $ | 384 | $ | — | $ | — | $ | 1,752 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Ending balance: collectively | $ | 1,210 | $ | 3,819 | $ | 1,375 | $ | 150 | $ | 3,138 | $ | 72 | $ | 74 | $ | 9,838 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Financing receivables: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 26,982 | $ | 66,253 | $ | 194,238 | $ | 28,697 | $ | 167,221 | $ | 9,089 | $ | 738 | $ | 493,218 | ||||||||||||||||
Ending Balance: individually | $ | 652 | $ | 12,234 | $ | 12,345 | $ | 1,181 | $ | 11,043 | $ | — | $ | — | $ | 37,455 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Ending balance: collectively | $ | 26,330 | $ | 54,019 | $ | 181,893 | $ | 27,516 | $ | 156,178 | $ | 9,089 | $ | 738 | $ | 455,763 | ||||||||||||||||
evaluated for impairment (1) | ||||||||||||||||||||||||||||||||
-1 | In 2013, the bank began evaluating small dollar homogeneous impaired loans collectively for impairment and these impaired loans are included in this total. At December 31, 2013 there were $1.7 million in impaired loans collectively evaluated for impairment with $73,000 in reserves established. | |||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial | Commercial construction | Commercial | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
and | and land development | real estate | ||||||||||||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 2,730 | $ | 8,799 | $ | 3,800 | $ | 740 | $ | 4,630 | $ | 413 | $ | 29 | $ | 21,141 | ||||||||||||||||
Provision for loan losses | (1,464 | ) | 5,205 | 2,486 | (214 | ) | 1,184 | 143 | 41 | 7,381 | ||||||||||||||||||||||
Loans charged-off | (703 | ) | (7,929 | ) | (3,691 | ) | (103 | ) | (1,801 | ) | (516 | ) | — | (14,743 | ) | |||||||||||||||||
Recoveries | 622 | 1,176 | 366 | — | 458 | 148 | — | 2,770 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | (81 | ) | (6,753 | ) | (3,325 | ) | (103 | ) | (1,343 | ) | (368 | ) | — | (11,973 | ) | |||||||||||||||||
Balance, end of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Ending Balance: individually evaluated for impairment | $ | 636 | $ | 1,693 | $ | 640 | $ | 86 | $ | 2,334 | $ | — | $ | — | $ | 5,389 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 549 | $ | 5,558 | $ | 2,321 | $ | 337 | $ | 2,137 | $ | 188 | $ | 70 | $ | 11,160 | ||||||||||||||||
Financing Receivables: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 29,563 | $ | 90,899 | $ | 181,194 | $ | 20,445 | $ | 165,009 | $ | 9,664 | $ | 1,278 | $ | 498,052 | ||||||||||||||||
Ending Balance: individually evaluated for impairment | $ | 1,437 | $ | 20,885 | $ | 17,742 | $ | 1,173 | $ | 17,573 | $ | 50 | $ | — | $ | 58,860 | ||||||||||||||||
Ending balance: collectively | $ | 28,126 | $ | 70,014 | $ | 163,452 | $ | 19,272 | $ | 147,436 | $ | 9,614 | $ | 1,278 | $ | 439,192 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
BANK_AND_PREMISES_EQUIPMENT
BANK AND PREMISES EQUIPMENT | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
BANK PREMISES AND EQUIPMENT | ' | |||||||
BANK PREMISES AND EQUIPMENT | ||||||||
Company premises and equipment at December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||
2013 | 2012 | |||||||
Land | $ | 4,394 | $ | 4,884 | ||||
Buildings and leasehold improvements | 11,171 | 11,139 | ||||||
Furniture and equipment | 11,511 | 11,586 | ||||||
Construction in process | 509 | — | ||||||
27,585 | 27,609 | |||||||
Less accumulated depreciation | (15,014 | ) | (14,227 | ) | ||||
$ | 12,571 | $ | 13,382 | |||||
Depreciation expense was $1.0 million and $1.1 million for the years ended December 31, 2013 and 2012, respectively. |
OTHER_INTANGIBLES
OTHER INTANGIBLES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
OTHER INTANGIBLES | ' | |||||||
OTHER INTANGIBLES | ||||||||
The following is a summary of other intangible assets at December 31, 2013 and 2012 (amounts in thousands): | ||||||||
2013 | 2012 | |||||||
Other intangibles – gross | $ | 3 | $ | 494 | ||||
Less accumulated amortization | 2 | 491 | ||||||
Other intangibles – net | $ | 1 | $ | 3 | ||||
The other intangibles acquired in connection with the LongLeaf Community Bank merger were written off at the end of 2012 due to the sale of those deposits to First Bank which closed in the first quarter of 2013. Other intangibles amortization expense for the years ended December 31, 2013 and 2012 amounted to $2,000 and $300,000, respectively. Estimated amortization expense for other intangibles for 2014 is $1,115 with no additional amortization expense in future years. |
DEPOSITS
DEPOSITS | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Banking and Thrift [Abstract] | ' | |||||||||||
DEPOSITS | ' | |||||||||||
DEPOSITS | ||||||||||||
At December 31, 2013, the scheduled maturities of time deposits are as follows (amounts in thousands): | ||||||||||||
Less than | $100,000 | Total | ||||||||||
$100,000 | or more | |||||||||||
2014 | $ | 55,078 | $ | 84,649 | $ | 139,727 | ||||||
2015 | 31,686 | 45,275 | 76,961 | |||||||||
2016 | 9,257 | 17,817 | 27,074 | |||||||||
2017 | 2,207 | 7,417 | 9,624 | |||||||||
2018 | 2,402 | 4,522 | 6,924 | |||||||||
2019 and beyond | 282 | 2,723 | 3,005 | |||||||||
Total time deposits | $ | 100,912 | $ | 162,403 | $ | 263,315 | ||||||
BORROWINGS
BORROWINGS | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||
BORROWINGS | ' | ||||||||||||
BORROWINGS | |||||||||||||
At December 31, 2013 and 2012, borrowed funds included the following FHLB advances (amounts in thousands): | |||||||||||||
Maturity | Interest Rate | 2013 | 2012 | ||||||||||
May 25, 2016 | 4.46% | Fixed | $ | 5,000 | $ | 5,000 | |||||||
November 17, 2016 | 4.11% | Fixed | 5,000 | 5,000 | |||||||||
November 30, 2016 | 4.09% | Fixed | 7,000 | 7,000 | |||||||||
June 5, 2017 | 4.35% | Fixed | 10,000 | 10,000 | |||||||||
July 3, 2017 | 4.36% | Fixed | 13,000 | 13,000 | |||||||||
July 24, 2017 | 4.34% | Fixed | 5,000 | 5,000 | |||||||||
July 31, 2017 | 4.35% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 4.08% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 3.94% | Fixed | 5,000 | 5,000 | |||||||||
October 4, 2017 | 3.95% | Fixed | 7,000 | 7,000 | |||||||||
February 5, 2018 | 2.06% | Fixed | 10,000 | 10,000 | |||||||||
June 5, 2018 | 2.25% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 2.55% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 3.03% | Fixed | 5,000 | 5,000 | |||||||||
September 10, 2018 | 3.14% | Fixed | 10,000 | 10,000 | |||||||||
September 18, 2018 | 2.71% | Fixed | 10,000 | 10,000 | |||||||||
$ | 112,000 | $ | 112,000 | ||||||||||
FHLB advances are secured by a floating lien covering the Company’s loan portfolio of qualifying residential (1-4 units) first mortgage loans. At December 31, 2013, the Company has available lines of credit totaling $164.0 million with the FHLB for borrowing dependent on adequate collateralization. The weighted average rates for the above borrowings at December 31, 2013 and 2012 were 3.58%. | |||||||||||||
In addition to the above advances, the Company has lines of credit of $16.0 million from various financial institutions to purchase federal funds on a short-term basis. The Company has no federal fund purchases outstanding as of December 31, 2013. |
TRUST_PREFERRED_SECURITIES
TRUST PREFERRED SECURITIES | 12 Months Ended |
Dec. 31, 2013 | |
Trust Preferred Securities [Abstract] | ' |
TRUST PREFERRED SECURITIES | ' |
TRUST PREFERRED SECURITIES | |
On March 30, 2006, $12.0 million of trust preferred securities (“Trust Preferred Securities”) were placed through the Trust. The Trust has invested the net proceeds from the sale of the Trust Preferred Securities in Junior Subordinated Deferrable Interest Debentures (the “Debentures”) issued by the Company and recorded in borrowings on the accompanying consolidated balance sheets. The Trust Preferred Securities pay cumulative cash distributions quarterly at an annual rate, reset quarterly, equal to three month LIBOR plus 1.35%. The dividends paid to holders of the Trust Preferred Securities, which will be recorded as interest expense, are deductible for income tax purposes. The Trust Preferred Securities are redeemable on June 15, 2011 or afterwards in whole or in part, on any June 15, September 15, December 15, or March 15. Redemption is mandatory by June 15, 2036. The Company has fully and unconditionally guaranteed the Trust Preferred Securities through the combined operation of the Debentures and other related documents. The Company’s obligation under the guarantee is unsecured and subordinate to senior and subordinated indebtedness of the Company. The Trust Preferred Securities qualify as Tier I capital for regulatory capital purposes subject to certain limitations. We have the right to defer payment of interest on the Debentures at any time and from time to time for a period not exceeding five years, provided that no deferral period extends beyond the stated maturities of the Debentures. Such deferral of interest payments by the Company will result in a deferral of distribution payments on the related Trust Preferred Securities. Whenever we defer the payment of interest on the Debentures, the Company will be precluded from the payment of cash dividends to shareholders. In January 2011, the Company elected to defer the regularly scheduled interest payments on the Debentures related to our outstanding Trust Preferred Securities. | |
The Company is currently prohibited by the Written Agreement, described in Note K - Regulatory Restrictions, of these Notes to Consolidated Financial Statements, from paying interest on its Debentures without prior approval of the supervisory authorities. The Company and the bank are prohibited from declaring or paying dividends without prior approval of the supervisory authorities. The Company exercised its right to defer regularly scheduled interest payments on the Debentures and as of December 31, 2013, $700,000 of interest payments have been accrued for and deferred pursuant to the terms of the indenture governing the Debentures. |
SUBORDINATED_PROMISSORY_NOTES
SUBORDINATED PROMISSORY NOTES | 12 Months Ended |
Dec. 31, 2013 | |
Subordinated Debt [Abstract] | ' |
SUBORDINATED PROMISSORY NOTES | ' |
SUBORDINATED PROMISSORY NOTES | |
The Company sold $12.0 million aggregate principal amount of subordinated promissory notes to certain accredited investors between May and August 2009. These notes are due 10 years after the date of issuance, beginning May 15, 2019, and the Company is obligated to pay interest at an annualized rate of 8.5% payable in quarterly installments beginning on the third month anniversary of the date of issuance. The Company may prepay the notes at any time after the fifth anniversary of the date of issuance, subject to compliance with applicable law. The Company is currently prohibited by the Written Agreement, described in Note K - Regulatory Restrictions of these Notes to Consolidated Financial Statements, from paying interest on its subordinated promissory notes without prior approval of the supervisory authorities. The Company obtained approval to pay the interest on its subordinated promissory notes for 2013 and 2012. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
INCOME TAXES | ' | |||||||
INCOME TAXES | ||||||||
Allocation of income tax expense between current and deferred portions is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Current tax benefit: | ||||||||
Federal | $ | — | $ | (175 | ) | |||
State | — | — | ||||||
— | (175 | ) | ||||||
Deferred tax expense (benefit): | ||||||||
Federal | 279 | (2,617 | ) | |||||
State | (987 | ) | (444 | ) | ||||
(708 | ) | (3,061 | ) | |||||
Income tax benefit before adjustment to deferred tax asset valuation allowance | (708 | ) | (3,236 | ) | ||||
Increase in the valuation allowance | 708 | 3,061 | ||||||
Net deferred tax benefit | $ | — | $ | (175 | ) | |||
The reconciliation of expected income tax at the statutory federal rate of 34% with income tax expense is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Expense computed at statutory rate of 34% | $ | (119 | ) | $ | (2,429 | ) | ||
Effect of state income taxes, net of federal benefit | (28 | ) | (36 | ) | ||||
Tax exempt income | (494 | ) | (293 | ) | ||||
Bank owned life insurance income | (82 | ) | (106 | ) | ||||
Valuation allowance | 708 | 3,061 | ||||||
Other, net | 15 | (372 | ) | |||||
$ | — | $ | (175 | ) | ||||
Deferred income taxes consist of the following (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Deferred tax assets: | ||||||||
Allowance for loan losses | $ | 4,389 | $ | 6,335 | ||||
Non-qualified stock options | 368 | 365 | ||||||
OTTI | 602 | 623 | ||||||
Net deferred loan fees | 189 | 43 | ||||||
Net operating loss | 16,313 | 12,818 | ||||||
FMV adjustment on purchased assets | 104 | 136 | ||||||
SERP accrual | 179 | 162 | ||||||
Other | 1,354 | 2,071 | ||||||
Unrealized loss on securities | 166 | — | ||||||
Total deferred tax assets | 23,664 | 22,553 | ||||||
Less valuation allowance | (22,542 | ) | (21,669 | ) | ||||
Net deferred tax assets | 1,122 | 884 | ||||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 765 | $ | 528 | ||||
Prepaid expense | 328 | 333 | ||||||
Unrealized gain on securities | — | (280 | ) | |||||
Other | 29 | 23 | ||||||
Total deferred tax liabilities | 1,122 | 604 | ||||||
Net deferred tax liability, included in other liabilities | $ | — | $ | 280 | ||||
When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely to be realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. For the years ended December 31, 2013 and 2012, there were no uncertain tax positions taken by the Company. The Company classifies interest and penalties related to income tax assessments, if any, in income tax expense in the consolidated statements of operations. Fiscal years ending December 31, 2009 and thereafter are subject to IRS examination. | ||||||||
We calculate income taxes in accordance with U.S. GAAP, which requires the use of the asset and liability method. The largest components of our net deferred tax asset at December 31, 2013 were related to the activity in our allowance for loan losses and net operating loss carryforwards. In accordance with U.S. GAAP, we regularly assess available positive and negative evidence to determine whether it is more likely than not that our deferred tax asset balances will be recovered. Based upon our analysis of our tax position, including taxes paid in prior years available through carryback and the use of tax planning strategies, at December 31, 2013 and 2012 we recognized a valuation allowance of $22.5 million and $21.7 million, respectively, to properly state our ability to realize this deferred tax asset. Our analysis of our tax position did not include future taxable earnings. Realization of a deferred tax asset requires us to apply significant judgment and is inherently speculative because it may require the future occurrence of circumstances that cannot be predicted with certainty. | ||||||||
As a result of the net operating loss carryforward of $40.5 million at December 31, 2013 which will begin to expire beginning in 2028, and the $22.5 million deferred tax asset valuation allowance, the Company will not record tax expense or tax benefit until positive operating earnings utilizing existing tax loss carryforwards result in exhibited positive performance which would support the partial or full reinstatement of deferred tax assets. |
REGULATORY_RESTRICTIONS
REGULATORY RESTRICTIONS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
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 2013. | |||||||||||||||||||||
Current federal regulations require that the bank maintain a minimum ratio of total capital to risk weighted assets of 8.0%, with at least 4.0% being in the form of Tier 1 capital, as defined in the regulations. In addition, the bank must maintain 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 December 31, 2013 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 | Minimum To Be Well | |||||||||||||||||||
Adequacy Purposes | Capitalized Under | ||||||||||||||||||||
Prompt Corrective | |||||||||||||||||||||
Action Provisions | |||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||
As of December 31, 2013: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,601 | 10.9 | % | $ | 37,057 | 8 | % | $ | 46,322 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 44,739 | 9.7 | % | 18,529 | 4 | % | 27,793 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 44,739 | 5.5 | % | 32,529 | 4 | % | 40,661 | 5 | % | ||||||||||||
As of December 31, 2012: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,044 | 10.2 | % | $ | 39,246 | 8 | % | $ | 49,057 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 43,797 | 8.9 | % | 19,623 | 4 | % | 29,434 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 43,797 | 5 | % | 34,949 | 4 | % | 43,687 | 5 | % | ||||||||||||
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 and Tier 1 capital to average assets must be 8.0%, 4.0% and 4.0%, respectively. At December 31, 2013 and 2012, the Company’s total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets were 10.7%, 6.3% and 3.6% and 10.1%, 5.9%, and 3.3%, respectively. | |||||||||||||||||||||
In late May 2011, the Company and the bank entered into the Written Agreement with the FRB and the NCCOB. Under the terms of the Written Agreement, the bank developed and submitted for approval, within the time periods specified, plans to: | |||||||||||||||||||||
• | revise lending and credit administration policies and procedures at the bank and provide relevant training | ||||||||||||||||||||
• | enhance the bank's real estate appraisal policies and procedures | ||||||||||||||||||||
• | enhance the bank's loan grading and independent loan review programs | ||||||||||||||||||||
• | improve the bank's position with respect to loans, relationships, or other assets in excess of $750,000, which are now or in the future become past due more than 90 days, are on the bank's problem loan list, or adversely classified in any report of examination of the bank, and | ||||||||||||||||||||
• | review and revise the bank's current policy regarding the bank's allowance for loan and lease losses and maintain a program for the maintenance of an adequate allowance | ||||||||||||||||||||
In addition, the bank agreed that it will: | |||||||||||||||||||||
• | refrain from extending, renewing, or restructuring any credit to or for the benefit of any borrower, or related interest, whose loans or other extensions of credit have been criticized in any report of examination of the bank absent prior approval by the bank's board of directors or a designated committee of the board in accordance with the restrictions in the Written Agreement | ||||||||||||||||||||
• | eliminate from its books, by charge-off or collection, all assets or portions of assets classified as “loss” in any report of examination of the bank, unless otherwise approved by the FRB and the NCCOB, and | ||||||||||||||||||||
• | take all necessary steps to correct all violations of law or regulation cited by the FRB and the NCCOB | ||||||||||||||||||||
In addition, the Company has agreed that it will: | |||||||||||||||||||||
• | refrain from taking any form of payment representing a reduction in capital from the bank or make any distributions of interest, principal, or other sums on subordinated debentures or trust preferred securities absent prior regulatory approval | ||||||||||||||||||||
• | refrain from incurring, increasing, or guaranteeing any debt without the prior written approval of the FRB, and | ||||||||||||||||||||
• | refrain from purchasing or redeeming any shares of its stock without the prior written consent of the FRB | ||||||||||||||||||||
Under the terms of the Written Agreement, both the Company and the bank have agreed to: | |||||||||||||||||||||
• | submit for approval a joint plan to maintain sufficient capital at the Company on a consolidated basis and at the bank on a stand-alone basis | ||||||||||||||||||||
• | notify the FRB and the NCCOB if the Company's or the bank's capital ratios fall below the approved capital plan's minimum ratios | ||||||||||||||||||||
• | refrain from declaring or paying any dividends absent prior regulatory approval | ||||||||||||||||||||
• | comply with applicable notice provisions with respect to the appointment of new directors and senior executive officers of the Company and the bank and legal and regulatory limitations on indemnification and severance payments, and | ||||||||||||||||||||
• | submit annual business plans and budgets and quarterly joint written progress reports regarding compliance with the Written Agreement | ||||||||||||||||||||
The Company and the bank continue to be committed to addressing and resolving the issues raised in the Written Agreement. Upon initial receipt of the agreement, the Board of Directors established an Enforcement Action Committee that meets regularly to monitor the bank's progress on compliance with the Written Agreement. The Bank has made progress on multiple provisions included in the Written Agreement and continues to address outstanding items that are not in full compliance. In our initial efforts to comply, several control changes were implemented to address the identification and valuation of impaired loans, the support and validation of the allowance for loan losses, and the valuation of foreclosed assets. Additionally, the bank implemented additional controls around obtaining updated collateral valuations as required by regulation and established new policies to further reduce Commercial Real Estate concentrations, ensure current financial information is evaluated, and control interest only loans. The bank also created a separate Special Assets department and in 2012 added additional resources to provide adequate attention and expertise to problem loan management. Other areas also addressed include the adequacy of credit resources, portfolio risk management and reporting, and consistency and compliance when dealing with loan workouts. A material failure to comply with the terms of the Written Agreement could subject the Company to additional regulatory actions and further restrictions on its business. These regulatory actions and resulting restrictions on the Company's business may have a material adverse effect on its future results of operations and financial condition. | |||||||||||||||||||||
Since the Company and the bank entered the Written Agreement, management has had frequent and regular communication with the FRB and NCCOB. This communication has involved: | |||||||||||||||||||||
• | updates on the progress involving each of the actions outlined in the Written Agreement | ||||||||||||||||||||
• | specific steps taken by the Company to remain in compliance with the Written Agreement, and | ||||||||||||||||||||
• | communications, verbally and via interim internal reports, regarding the financial status of the Company including, but not limited to, the Company's key capital ratios | ||||||||||||||||||||
To date, the Company has not received any disagreement from the regulatory authorities regarding actions taken or contemplated. At this time, the Company is in partial compliance with the provisions of the Written Agreement. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
COMMITMENTS AND CONTINGENCIES | ' | |||||||
COMMITMENTS AND CONTINGENCIES | ||||||||
The Company is a party to financial instruments with off-balance sheet credit risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the balance sheet. The contract or notional amounts of those instruments reflect the extent of involvement the bank has in particular classes of financial instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. | ||||||||
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of conditions established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company, upon extension of credit is based on management’s credit evaluation of the borrower. Collateral obtained varies but may include real estate, stocks, bonds, and certificates of deposit. | ||||||||
Unfunded commitments under lines of credit are commitments for possible future extensions of credit to existing customers. These lines of credit usually do not contain a specified maturity date and may not be drawn upon to the total extent to which the bank is committed. | ||||||||
Stand-by letters of credit are conditional lending commitments issued by the bank to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Essentially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. | ||||||||
At December 31, 2013 and 2012, financial instruments whose contract amounts represent credit risk were (amounts in thousands) : | ||||||||
2013 | 2012 | |||||||
Commitments to extend credit | $ | 35,983 | $ | 37,920 | ||||
Undisbursed lines of credit | 16,500 | 20,852 | ||||||
Financial stand-by letters of credit | 798 | 416 | ||||||
Performance stand-by letters of credit | 193 | 2,422 | ||||||
Legally binding commitments | 53,474 | 61,610 | ||||||
Credit card lines | 13,858 | 13,152 | ||||||
Total | $ | 67,332 | $ | 74,762 | ||||
Litigation Proceedings | ||||||||
On May 20, 2013, the U.S. Department of Justice ("DOJ") issued a subpoena to the Bank requiring the production of documents in connection with an investigation of consumer fraud related to third party payment processing. In connection with this investigation, the Bank negotiated a civil settlement with the DOJ (the "Consent Order"), which was filed with the United States District Court for the Eastern District of North Carolina on January 8, 2014. The Consent Order was filed contemporaneously with the filing of a complaint by the DOJ alleging violation of a variety of laws, including money laundering laws. As part of the terms of the Consent Order, the Bank has agreed to pay a civil monetary penalty in the amount of $1.0 million, plus a civil forfeiture in the amount of $200,000. The Consent Order remains subject to approval by the United States District Court for the Eastern District of North Carolina. | ||||||||
In October 2013, multiple putative class action lawsuits were filed in United States district courts across the country against a number of different banks based on the banks' alleged role in "payday lending". Four of these lawsuits, pending in the Northern District of Georgia, the Middle District of North Carolina, the District of Maryland, and the Southern District of Florida, name the Bank as one of the defendants. The lawsuits allege that, by processing Automatic Clearing House transactions indirectly on behalf of "payday" lenders, the bank is illegally participating in an enterprise to collect unlawful debts and is therefore liable to plaintiffs for damages under the federal Racketeer Influenced and Corrupt Organizations Act. The lawsuits also allege a variety of state law claims. The Bank has moved to dismiss each of these lawsuits: those motions to dismiss are awaiting decision. | ||||||||
We are party to certain other legal actions in the ordinary course of our business. We believe these actions are routine in nature and incidental to the operation of our 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 our business, financial condition, results of operations, cash flows or prospects. If, however, our assessment of these actions is inaccurate, or there are any significant adverse developments in these actions, our business, financial condition, results of operations, cash flows and prospects could be adversely affected. |
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | ||||||||||||||||||||
FAIR VALUE MEASUREMENTS | |||||||||||||||||||||
ASC 820 defines fair value, establishes a framework for measuring fair value under U.S. GAAP and expands disclosures about fair value measurements. ASC 820 applies whenever other accounting pronouncements require or permit assets or liabilities to be measured at fair value. Accordingly, ASC 820 does not expand the use of fair value in any new circumstances. ASC 825 provides companies with an option to report selected financial assets and liabilities at fair value. As of December 31, 2013, the Company had not elected to measure any financial assets or liabilities using the fair value option under ASC 825; therefore the adoption of ASC 825 had no effect on the Company’s financial condition or results of operations. | |||||||||||||||||||||
The Company records securities available for sale at fair value on a recurring basis. Fair value is a market-based measurement and is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The transaction to sell the asset or transfer the liability is a hypothetical transaction at the measurement date, considered from the perspective of a market participant that holds the assets or owes the liability. In general, the transaction price will equal the exit price and, therefore, represent the fair value of the asset or liability at initial recognition. In determining whether a transaction price represents the fair value of the asset or liability at initial recognition, each reporting entity is required to consider factors specific to the transaction and the asset or liability, the principal or most advantageous market for the asset or liability, and market participants with whom the entity would transact in the market. | |||||||||||||||||||||
ASC 820 establishes a fair value hierarchy to prioritize the inputs of valuation techniques used to measure fair value. The inputs are evaluated and an overall level for the fair value measurement is determined. This overall level is an indication of how market-observable the fair value measurement is and defines the level of disclosure. ASC 820 clarifies fair value in terms of the price in an orderly transaction between market participants to sell an asset or transfer a liability in the principal (or most advantageous) market for the asset or liability at the measurement date (an exit price). In order to determine the fair value or the exit price, entities must determine the unit of account, highest and best use, principal market, and market participants. These determinations allow the reporting entity to define the inputs for fair value and level of hierarchy. | |||||||||||||||||||||
Outlined below is the application of the fair value hierarchy established by ASC 820 to the Company’s financial assets that are carried at fair value. | |||||||||||||||||||||
Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. An active market for the asset or liability is a market in which the transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |||||||||||||||||||||
Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | |||||||||||||||||||||
Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs are supported by little or no market activity or by the entity’s own assumptions. | |||||||||||||||||||||
Fair Value 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 include equity securities traded on an active exchange, such as the New York Stock Exchange. Level 2 securities include taxable municipalities, and mortgage-backed securities issued by government sponsored entities, and certain equity securities. The Company’s mortgage-backed securities were primarily issued by the Government National Mortgage Association (“GNMA”), with additional mortgage-backed securities issued by and the Federal National Mortgage Association (“FNMA”). As of December 31, 2013, all of the Company’s mortgage-backed securities were agency issued and designated as Level 2 securities. Securities classified as Level 3 include trust preferred securities in less liquid markets. | |||||||||||||||||||||
Below are tables that present information about assets measured at fair value on a recurring basis at December 31, 2013 and 2012 (amounts in thousands): | |||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Assets | Significant | Significant | |||||||||||||||||||
Total Carrying | Measured | Quoted Prices in | Other | Unobservable | |||||||||||||||||
Amount in the | at Fair Value | Active Markets | Observable | Inputs | |||||||||||||||||
Consolidated | for Identical | Inputs | |||||||||||||||||||
Balance Sheet | Assets | ||||||||||||||||||||
Description | 2013 | 2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 5,933 | $ | — | $ | 5,933 | $ | — | |||||||||||
Mortgage-backed securities | — | ||||||||||||||||||||
GNMA | 25,477 | 25,477 | — | 25,477 | — | ||||||||||||||||
FNMA | — | — | — | — | — | ||||||||||||||||
Trust preferred securities | 1,025 | 1,025 | — | — | 1,025 | ||||||||||||||||
Equity securities | 131 | 131 | 70 | 61 | — | ||||||||||||||||
Total available for sale securities | $ | 32,566 | $ | 32,566 | $ | 70 | $ | 31,471 | $ | 1,025 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2012 Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices in | Significant | Significant | |||||||||||||||||
Amount in the | Measured | Active Markets | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | for Identical | Observable | Inputs | |||||||||||||||||
Balance Sheet | Assets | Inputs | |||||||||||||||||||
Description | 2012 | 2012 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
Taxable municipal securities | $ | 5,913 | $ | 5,913 | $ | — | $ | 5,913 | $ | — | |||||||||||
Mortgage-backed securities | |||||||||||||||||||||
GNMA | 60,743 | 60,743 | — | 60,743 | — | ||||||||||||||||
FNMA | 5,880 | 5,880 | — | 5,880 | — | ||||||||||||||||
Trust preferred securities | 1,006 | 1,006 | — | — | 1,006 | ||||||||||||||||
Equity securities | 180 | 180 | 56 | 124 | — | ||||||||||||||||
Total available for sale securities | $ | 73,722 | $ | 73,722 | $ | 56 | $ | 72,660 | $ | 1,006 | |||||||||||
The table below presents reconciliation for the years ended December 31, 2013 and 2012 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands). During the year ended December 31, 2013, no securities were transferred from Level 3 to Level 2. | |||||||||||||||||||||
Available-for-sale Securities | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Beginning Balance | $ | 1,006 | $ | 1,085 | |||||||||||||||||
Total realized and unrealized gains or (losses): | |||||||||||||||||||||
Included in earnings | — | — | |||||||||||||||||||
Included in other comprehensive income | 19 | (79 | ) | ||||||||||||||||||
Purchases, issuances and settlements | — | — | |||||||||||||||||||
Transfers in (out) of Level 3 | — | — | |||||||||||||||||||
Ending Balance | $ | 1,025 | $ | 1,006 | |||||||||||||||||
Fair Value on a Nonrecurring Basis. The Company measures certain assets at fair value on a nonrecurring basis, as described below. | |||||||||||||||||||||
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. The fair value of impaired loans is estimated using one of the following available methods: a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate or by determining the fair market value of the underlying collateral securing the loan using appraised values discounted for other market adjustments. Those impaired loans not requiring a write down or valuation allowance represent loans for which the estimated fair value exceeds the recorded investment in such loans. 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 an appraised value is not available, or the Company determines the fair value of the collateral is further impaired below the appraised value, and there is no observable market price, the impaired loan is classified as nonrecurring Level 3. | |||||||||||||||||||||
As of December 31, 2013, the bank identified $20.0 million in impaired loans that were carried at fair value which included $7.8 million in loans that required a specific valuation allowance of $1.8 million and an additional $12.3 million in loans without a specific valuation allowance that have previously been written down to fair value. As of December 31, 2012, the bank identified $36.5 million in impaired loans that were carried at fair value which included $23.8 million in loans that required a specific valuation allowance of $5.4 million and an additional $12.7 million in loans without a specific valuation allowance that have previously been written down to fair value. | |||||||||||||||||||||
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. At December 31, 2013, there were $1.6 million of fair value adjustments required after transfer related to foreclosed real estate of $8.5 million compared to $2.3 million and $15.1 million respectively at December 31, 2012. | |||||||||||||||||||||
Assets measured at fair value on a non-recurring basis are included in the table below at December 31, 2013 and 2012 (amounts in thousands): | |||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet 2013 | Assets Measured at Fair Value 2013 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired Loans | $ | 18,215 | $ | 18,215 | $ | — | $ | — | $ | 18,215 | |||||||||||
Foreclosed assets | $ | 8,502 | $ | 8,502 | $ | — | $ | — | $ | 8,502 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2012, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet 2012 | Assets Measured at Fair Value 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired Loans | $ | 31,072 | $ | 31,072 | $ | — | $ | — | $ | 31,072 | |||||||||||
Foreclosed assets | $ | 15,136 | $ | 15,136 | $ | — | $ | — | $ | 15,136 | |||||||||||
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 recurring and nonrecurring basis at December 31, 2013 (amounts in thousands, except percentages): | |||||||||||||||||||||
Total Carrying Amount in the Consolidated Balance Sheet at December 31, 2013 | |||||||||||||||||||||
Recurring measurement: | Probability of default | 10-20% | |||||||||||||||||||
Trust preferred securities | $ | 1,025 | Loss given default | 100% | |||||||||||||||||
Nonrecurring measurements: | |||||||||||||||||||||
Impaired loans | $ | 18,215 | Collateral discounts | 9-50% | |||||||||||||||||
Foreclosed assets | $ | 8,502 | Discounted appraisals | 10-30% | |||||||||||||||||
Collateral discounts to determine fair value on impaired loans varies 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 40% 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 | 10.5% - 40% | ||||||||||||||||||||
Commercial real estate other | 12.5% - 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. |
STOCK_OPTION_PLAN
STOCK OPTION PLAN | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
STOCK OPTION PLAN | ' | ||||||||||||
STOCK OPTION PLAN | |||||||||||||
The Company has a non-qualified stock option plan for certain key employees under which it is authorized to issue options for up to 1,542,773 shares of common stock. Options are granted at the discretion of the Company’s Board of Directors at an exercise price approximating market value, as determined by a committee of Board members. All options granted subsequent to a 1997 amendment will be 100% vested after either one or two years from the grant date and will expire after such a period as is determined by the Board at the time of grant. Options granted in 2012 and 2013 have a two year vesting provision. | |||||||||||||
A summary of option activity under the Plan for the year ended December 31, 2013, is presented below: | |||||||||||||
Shares | Option | Weighted Average Remaining Contractual Term | Aggregate | ||||||||||
Price Per | Intrinsic | ||||||||||||
Share | Value | ||||||||||||
Outstanding at January 1, 2013 | 253,680 | $ | 7 | ||||||||||
Issued | 59,300 | 1.15 | |||||||||||
Exercised | — | — | |||||||||||
Forfeited | 11,275 | 3.33 | |||||||||||
Expired | — | — | |||||||||||
Balance at December 31, 2013 | 301,705 | $ | 5.99 | 2.26 | $ | 25,200 | |||||||
Exercisable at December 31, 2013 | 190,049 | $ | 8.67 | 1.43 | $ | — | |||||||
The weighted average exercise price of all exercisable options at December 31, 2013 is $8.67. There were 131,673 shares reserved for future issuance under the Company’s stock option plan at December 31, 2013. | |||||||||||||
A summary of the status of the Company's non-vested options as of December 31, 2013 and changes during the year then ended is presented below: | |||||||||||||
Shares | Weighted average grant date fair value | ||||||||||||
Non-vested - December 31, 2012 | 112,131 | $ | 1.09 | ||||||||||
Granted | 56,000 | 0.69 | |||||||||||
Vested | 3,075 | 0.87 | |||||||||||
Forfeited/Expired | 53,400 | 1.34 | |||||||||||
Non-vested - December 31, 2013 | 111,656 | $ | 0.78 | ||||||||||
As of December 31, 2013 and 2012, there was $39,908 and $61,493 of unrecognized compensation cost related to non-vested share-based compensation arrangements, respectively. | |||||||||||||
Additional information concerning the Company’s stock options at December 31, 2013 is as follows: | |||||||||||||
Exercise Price | Number | Contractual | Number | ||||||||||
Outstanding | Life (Years) | Exercisable | |||||||||||
1.15-1.69 | 56,000 | 4.19 | — | ||||||||||
1.70 - 2.99 | 55,625 | 3.16 | — | ||||||||||
3.00 - 5.49 | 51,750 | 2.16 | 51,746 | ||||||||||
5.50 - 8.63 | 51,125 | 1.15 | 51,102 | ||||||||||
8.64 - 10.91 | 47,775 | 0.15 | 47,774 | ||||||||||
10.92 - 40.78 | 27,125 | 1.59 | 27,122 | ||||||||||
40.79 | 12,305 | 4.07 | 12,305 | ||||||||||
301,705 | 2.26 | 190,049 | |||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions used for grants in 2013 and 2012: | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||
Expected volatility | 73.3 | % | 60.37 | % | |||||||||
Risk free interest rate | 0.9 | % | 0.84 | % | |||||||||
Expected life | 5 years | 5 years | |||||||||||
The weighted average fair value of options granted during 2013 and 2012, was $0.69 and $0.87, respectively. |
OTHER_EMPLOYEE_BENEFITS
OTHER EMPLOYEE BENEFITS | 12 Months Ended |
Dec. 31, 2013 | |
Compensation and Retirement Disclosure [Abstract] | ' |
OTHER EMPLOYEE BENEFITS | ' |
OTHER EMPLOYEE BENEFITS | |
Supplemental Retirement | |
In 1998, the bank adopted a Supplemental Executive Retirement Plan (“SERP”) for its president. The Company has purchased life insurance policies in order to provide future funding of benefit payments. SERP benefits will accrue and vest during the period of employment and will be paid in annual benefit payments over the officer’s remaining life commencing with the officer’s retirement. The liability accrued under the SERP plan amounts to $481,000 and $420,000 at December 31, 2013 and 2012, respectively. During 2013 and 2012, the expense attributable to the SERP amounted to $61,000 and $55,000 respectively. | |
Employment Agreements | |
The Company has entered into employment agreements with certain of its executive officers to ensure a stable and competent management base. The agreements provide for benefits as spelled out in the contracts and cannot be terminated by the Company’s Board of Directors, except for cause, without prejudicing the officers’ rights to receive certain vested rights, including compensation. In addition, the Company has entered into severance compensation agreements with certain of its executive officers and key employees to provide them with severance pay benefits in the event of a change in control of the Company, as outlined in the agreements; the acquirer will be bound to the terms of the contracts. | |
Defined Contribution Plan | |
The Company sponsors a contributory profit-sharing plan in effect for substantially all employees. Participants may make voluntary contributions resulting in salary deferrals in accordance with Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”). The plans provide for employee contributions up to $17,500 of the participant's annual salary and an employer contribution of 25% matching of the first 6% of pre-tax salary contributed by each participant. Expenses related to these plans for the years ended December 31, 2013 and 2012 were $138,000 and $145,000, respectively. Contributions under the plan are made at the discretion of the Company’s Board of Directors. | |
Employee Stock Ownership Plan | |
The Company sponsors an employee stock ownership plan (ESOP) which makes the employees of the Company, owners of stock in the Company. The Four Oaks Bank & Trust Company’s Employee Stock Ownership Plan is available to full-time employees at least 21 years of age after six months of service. Contributions are voluntary by the Company and employees cannot contribute. Stock issued is purchased on the open market and the Company did not issue new shares in conjunction with this plan in 2013 and 2012. | |
Voluntary contributions are determined by the Company’s Board of Directors annually based on Company performance and are allocated to employees based on annual compensation. The Board of Directors determined that, due to the financial results for 2013 and 2012, no contributions would be made to the plan for 2013 and 2012. | |
Employee Stock Purchase and Bonus Plan | |
The Employee Stock Purchase and Bonus Plan (the “Purchase Plan”) is a voluntary plan that enables full-time employees of the Company and its subsidiaries to purchase shares of the Company’s common stock. The Purchase Plan is administered by a committee of the Board of Directors, which has broad discretionary authority to administer the Purchase Plan. The Company’s Board of Directors may amend or terminate the Purchase Plan at any time. The Purchase Plan is not intended to be qualified as an employee stock purchase plan under Section 423 of the Code. | |
Once a year, participants in the Purchase Plan purchase the Company’s common stock at fair market value. Participants are permitted to purchase shares under the Purchase Plan up to five percent (5%) of their compensation, with a maximum purchase amount of $1,000 per year. The Company matches, in cash, fifty percent (50%) of the amount of each participant’s purchase, up to $500. After withholding for income and employment taxes, participants use the balance of the Company’s matching grant to purchase shares of the Company’s common stock. | |
As of December 31, 2013, 118,000 shares of the Company’s common stock had been reserved for future issuance under the Purchase Plan, and 401,000 total shares had been purchased to date. During the years ended December 31, 2013 and 2012, 76,000 and 63,058 shares, respectively, were purchased under the Purchase Plan. | |
Sick Leave Plan | |
The Company allows employees to accrue up to 60 days of sick leave that can be carried forward from one year to the next. Employees with 10 consecutive years of service who retire after age 55, are paid for unused sick leave up to a maximum of 60 days. As of December 31, 2013 and 2012 the Company maintained an accrued liability for future obligations in the amount of $521,000 and $534,000, respectively. Future obligations under the plan are assessed on an annual basis. Deferred compensation expenses under the plan totaled $41,000 and $114,000 for 2013 and 2012, respectively. Cash benefits paid to retiring employees totaled $54,000 and $15,000 for 2013 and 2012, respectively. |
LEASES
LEASES | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Leases [Abstract] | ' | |||
LEASES | ' | |||
LEASES | ||||
The Company has entered into non-cancelable operating leases for six facilities. Future minimum lease payments under the leases for future years are as follows (amounts in thousands): | ||||
Leases | ||||
2014 | $ | 329 | ||
2015 | 319 | |||
2016 | 260 | |||
2017 | 211 | |||
2018 | 185 | |||
2019 and beyond | 627 | |||
$ | 1,931 | |||
Total rental expense under operating leases for the years ended December 31, 2013 and 2012 amounted to $306,000 and $367,000, respectively. |
PARENT_COMPANY_FINANCIAL_INFOR
PARENT COMPANY FINANCIAL INFORMATION | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ' | |||||||
PARENT COMPANY FINANCIAL INFORMATION | ' | |||||||
PARENT COMPANY FINANCIAL INFORMATION | ||||||||
Condensed financial information of Four Oaks Fincorp, Inc. at December 31, 2013 and 2012, and for the years ended December 31, 2013 and 2012 is presented below (amounts in thousands): | ||||||||
Condensed Balance Sheets | 2013 | 2012 | ||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 456 | $ | 784 | ||||
Equity investment in subsidiaries | 44,925 | 45,025 | ||||||
Investment securities available for sale | 1,156 | 1,186 | ||||||
Other assets | 195 | 587 | ||||||
Total assets | $ | 46,732 | $ | 47,582 | ||||
Liabilities and Shareholders’ Equity: | ||||||||
Other liabilities | $ | 737 | $ | 534 | ||||
Subordinated debentures | 12,372 | 12,372 | ||||||
Subordinated promissory notes | 12,000 | 12,000 | ||||||
Shareholders' equity | 21,623 | 22,676 | ||||||
Total liabilities and shareholders’ equity | $ | 46,732 | $ | 47,582 | ||||
For the Years Ended December 31, | ||||||||
Condensed Statements of Operations | 2013 | 2012 | ||||||
Equity in undistributed income (loss) of subsidiaries | $ | 899 | $ | (5,848 | ) | |||
Interest income | 2 | 113 | ||||||
Gain on sale of investments, available for sale | — | — | ||||||
Impairment loss on investment securities available for sale | — | — | ||||||
Other income | 87 | 154 | ||||||
Other expenses | (1,338 | ) | (1,388 | ) | ||||
Net loss | $ | (350 | ) | $ | (6,969 | ) | ||
Condensed Statements of Cash Flows | 2013 | 2012 | ||||||
Operating activities: | ||||||||
Net income (loss) | $ | (350 | ) | $ | (6,969 | ) | ||
Equity in undistributed loss of subsidiaries | (899 | ) | 5,848 | |||||
Stock based compensation | — | 62 | ||||||
Decrease in other assets | 427 | 5 | ||||||
Increase in other liabilities | 203 | 217 | ||||||
Net cash used in operating activities | (619 | ) | (837 | ) | ||||
Investing activities: | ||||||||
Investment in subsidiaries | — | (40 | ) | |||||
Sales and maturities of securities | 72 | |||||||
Net cash used in investing activities | 72 | (40 | ) | |||||
Financing activities: | ||||||||
Proceeds from issuance of common stock | 219 | 234 | ||||||
Net cash provided by financing activities | 219 | 234 | ||||||
Net decrease in cash and cash equivalents | (328 | ) | (643 | ) | ||||
Cash and cash equivalents, beginning of year | 784 | 1,427 | ||||||
Cash and cash equivalents, end of year | $ | 456 | $ | 784 | ||||
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ' | |||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||||||||||||||||||
ASC 825-10-65-1 requires the disclosure of estimated fair values for financial instruments. Quoted market prices, if available, are utilized as an estimate of the fair value of financial instruments. Because no quoted market prices exist for a significant part of the Company’s financial instruments, the fair value of such instruments has been derived based on management’s assumptions with respect to future economic conditions, the amount and timing of future cash flows and estimated discount rates. Different assumptions could significantly affect these estimates. Accordingly, the net realizable value could be materially different from the estimates presented below. In addition, the estimates are only indicative of individual financial instruments’ values and should not be considered an indication of the fair value of the Company taken as a whole. 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. | ||||||||||||||||||
CDs Held for Investment | ||||||||||||||||||
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 mortgage loans held for sale is based on commitments on hand from investors within the secondary market for loans 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. | ||||||||||||||||||
Premises and Equipment, Held for Sale | ||||||||||||||||||
The carrying amount of Premises and equipment held for sale 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 December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||
December 31, 2013 | ||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | ||||||||||||||
Value | Fair Value | |||||||||||||||||
Financial assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 128,629 | $ | 128,629 | $ | 128,629 | $ | — | $ | — | ||||||||
CDs held for investment | 31,850 | 31,850 | — | 31,850 | — | |||||||||||||
Securities available for sale | 32,566 | 32,566 | 50 | 31,491 | 1,025 | |||||||||||||
Securities held to maturity | 98,013 | 95,831 | — | 95,831 | — | |||||||||||||
Loans, net | 481,122 | 458,254 | — | — | 458,254 | |||||||||||||
FHLB stock | 6,076 | 6,076 | — | 6,076 | — | |||||||||||||
Accrued interest receivable | 1,576 | 1,576 | — | 1,576 | — | |||||||||||||
Financial liabilities: | ||||||||||||||||||
Deposits | $ | 657,620 | $ | 659,733 | $ | — | $ | 659,733 | $ | — | ||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 24,369 | — | — | 24,369 | |||||||||||||
Borrowings | 112,000 | 121,519 | — | 121,519 | — | |||||||||||||
Accrued interest payable | 1,642 | 1,642 | — | 1,642 | — | |||||||||||||
31-Dec-12 | ||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | ||||||||||||||
Value | Fair Value | |||||||||||||||||
Financial assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 183,150 | $ | 183,150 | $ | 183,150 | $ | — | $ | — | ||||||||
CDs held for investment | 26,460 | 26,460 | — | 26,460 | — | |||||||||||||
Securities available for sale | 73,722 | 73,722 | 56 | 72,660 | 1,006 | |||||||||||||
Securities held to maturity | 20,329 | 20,668 | — | 20,668 | — | |||||||||||||
Loans held for sale | 19,297 | 19,297 | — | — | 19,297 | |||||||||||||
Loans, net | 462,083 | 460,422 | — | — | 460,422 | |||||||||||||
FHLB stock | 6,415 | 6,415 | — | 6,415 | — | |||||||||||||
Premises and equipment, held for sale | 1,901 | 1,901 | — | — | 1,901 | |||||||||||||
Accrued interest receivable | 1,869 | 1,869 | — | 1,869 | — | |||||||||||||
Financial liabilities: | ||||||||||||||||||
Deposits | $ | 699,856 | $ | 702,990 | $ | — | $ | 702,990 | $ | — | ||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 15,598 | — | — | 15,598 | |||||||||||||
Borrowings | 112,000 | 126,738 | — | 126,738 | — | |||||||||||||
Accrued interest payable | 1,736 | 1,736 | — | 1,736 | — | |||||||||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2013 | |
Subsequent Events [Abstract] | ' |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | |
On March 24, 2014, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with Kenneth R. Lehman, a private investor (the “Standby Investor”). Pursuant to the Securities Purchase Agreement, the Standby Investor has agreed to purchase from the Company (the “Standby Offering”), for $1.00 per share, the lesser of (i) 10,000,000 shares of common stock, $1.00 par value per share (the “Common Stock”), (ii) if the Rights Offering (as defined below) is completed, all shares of Common Stock not purchased by shareholders exercising their basic subscription privilege, and (iii) the maximum number of shares that he may purchase without causing an “ownership change” under Section 382(g) of the Internal Revenue Code of 1986, as amended (based on all shares of Common Stock outstanding at the completion of the Rights Offering and the Standby Offering). In addition, the Securities Purchase Agreement provides the Standby Investor a right of first refusal to purchase an additional 6,000,000 shares subject to the limitations outlined in clauses (ii) and (iii) above. | |
Pursuant to the Securities Purchase Agreement, on March 27, 2014, the Company closed the initial sale of 875,000 shares of Common Stock to the Standby Investor. The Securities Purchase Agreement contemplates a subsequent closing of the remaining number of shares based on the formula above and the Standby Investor’s decision on whether to exercise his right of first refusal. The Standby Investor may participate in the Rights Offering with respect to the 875,000 shares of Common Stock issued in the initial closing. The number of shares the Standby Investor is committed to purchase in the Standby Offering will be reduced by the number of shares he purchases in the Rights Offering. The Company has agreed that if for any reason it does not complete the Rights Offering, the Standby Investor will still be permitted to purchase shares of Common Stock as set forth above. | |
The Securities Purchase Agreement contains customary representations, warranties, and various covenants, including, among others, covenants by the Company to (i) adopt a restricted stock plan for the benefit of the Company’s officers, (ii) adopt an asset resolution plan, and (iii) establish a rights plan to protect the Company’s deferred tax asset. Consummation of the Standby Offering is subject to (a) receipt of required regulatory approvals and non-objections, (b) receipt by the Company of a letter from an independent accounting firm related to the Company’s deferred tax asset, and (c) other customary closing conditions set forth in the Securities Purchase Agreement. The Company has also agreed to enter into a registration rights agreement with the Standby Investor (the “Registration Rights Agreement”), which will provide the Standby Investor demand registration and piggyback registration rights with respect to the Standby Investor’s resale of shares purchased under the Securities Purchase Agreement, subject to customary limitations. The Company has agreed to pay the expenses associated with any registration statements filed with the Securities and Exchange Commission (the “SEC”) pursuant to the Registration Rights Agreement. Between the closing of the Standby Offering and the third anniversary of the closing date, for as long as the Standby Investor owns at least 25% of the Company’s outstanding shares of Common Stock, if the Company makes any public or non-public offering of any equity or any securities, options, or debt that are convertible or exchangeable into equity or that include an equity component, the Standby Investor will be afforded the opportunity to acquire from the Company for the same price and on the same terms as such securities are proposed to be offered to others, up to the amount in the aggregate required to enable him to maintain his proportionate common stock-equivalent interest in the Company. | |
In addition, on March 26, 2014, the Company announced that it intends to conduct a rights offering of up to approximately $26.6 million (the “Rights Offering”). In the Rights Offering, the Company will distribute, at no charge, non-transferable subscription rights to its shareholders as of a future record date. For each share of Common Stock held as of the record date, a shareholder will receive a non-transferable right to purchase three shares of Common Stock at a subscription price of $1.00 per share (the “Basic Subscription Privilege”). Shareholders who exercise their Basic Subscription Privilege in full will have the opportunity to subscribe for additional shares for pro rata allocation in the event that not all available shares are purchased pursuant to the Basic Subscription Privilege or by the Standby Investor pursuant to the Securities Purchase Agreement, subject to certain limitations. | |
Subject to review of the registration statement to be filed with the SEC, the Company intends to commence the Rights Offering during the second quarter of 2014. |
ORGANIZATION_AND_SUMMARY_OF_SI1
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||
Basis of Presentation | ' | |||||
Basis of Presentation | ||||||
The consolidated financial statements include the accounts and transactions of the Company, a bank holding company incorporated under the laws of the State of North Carolina, and its wholly owned subsidiaries, the bank, and Four Oaks Mortgage Services, L.L.C., which became inactive on September 30, 2012. All significant intercompany transactions have been eliminated. In March 2006, the Company formed Four Oaks Statutory Trust I, a wholly owned Delaware statutory business trust (the “Trust”), for the sole purpose of issuing Trust Preferred Securities (as defined in Note H - Trust Preferred Securities). The Trust is not included in the consolidated financial statements of the Company. | ||||||
Use of Estimates | ' | |||||
Use of Estimates | ||||||
Preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, fair value of impaired loans, fair value of foreclosed assets, other than temporary impairment of investment securities available for sale and held to maturity, and the valuation allowance against deferred tax assets. | ||||||
Going Concern Considerations | ' | |||||
Going Concern Considerations | ||||||
The consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. Management believes that its current operations and its cash availability are sufficient for the Company to discharge its liabilities and meet its commitments in the normal course of business. While management does not anticipate further significant deterioration in the bank's loan portfolio and has performed stress tests and financial modeling under various potential scenarios in determining that the Company and the bank will maintain at least adequate capitalization under federal regulatory guidelines, no assurances regarding these expectations can be made. These consolidated financial statements do not include any adjustments relating to the recoverability or classification of assets or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. | ||||||
The banking industry continues to operate in a challenging and volatile economic environment, which has adversely impacted the Company's and the bank's results of operations and capital levels. Losses declined in 2013, however, the net loss continues to reduce the Company's and the bank's capital levels. The loan loss provision for 2013 was $35,000 compared to $7.4 million for 2012, net charge offs for the year 2013 were $5.0 million compared to $12.0 million in 2012. At December 31, 2013 the Company's total capital to risk weighted assets, Tier 1 capital to risk weighted assets, and Tier 1 capital to average assets were 10.7%, 6.3%, and 3.6%, respectively, compared to 10.1%, 5.9% and 3.3%, respectively, at December 31, 2012. At December 31, 2013, the bank's total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets were 10.9%, 9.7% and 5.5%, respectively, compared to 10.2%, 8.9%, and 5.0%, respectively, at December 31, 2012. | ||||||
In response to the difficult operating conditions that exist within the bank's marketing area, the bank committed substantial additional resources to management in an effort to accelerate resolution of non-performing and other problem assets in 2012 and continued these efforts in 2013. This resolution activity has included bulk asset sales, short sales (settlements with borrowers at less than the residual principal balance of the loan), increasing the variety and scope of asset marketing activities, negotiating and entering into forbearance agreements in order to minimize loan losses and engaging in other programs to facilitate the reduction of the level of problem assets. | ||||||
As a result of these activities, the level of non-performing assets has declined by 30.1% from a recorded investment of $51.1 million as of December 31, 2012 to $35.8 million as of December 31, 2013. Impaired loans declined by 33.4%, from a recorded investment of $58.9 million as of December 31, 2012 to $39.2 million as of December 31, 2013. Net charge-offs over the course of the reporting period totaled $5.0 million, or 11.6% of the average recorded investment in impaired loans of $43.1 million. This is in comparison to net charge-offs during the 2012 fiscal year of $12.0 million or 19.8% of the average recorded investment in impaired loans of $60.5 million. | ||||||
Foreclosed assets decreased from $15.1 million as of December 31, 2012 to $8.5 million as of December 31, 2013, inclusive of a transfer of foreclosed loans with a recorded investment of $3.3 million over the period. Sales of foreclosed assets increased from $7.3 million in fiscal year 2012 to $8.3 million during 2013 while write downs decreased from $2.3 million in 2012 to $1.6 million in 2013. | ||||||
The Bank continues to maintain its commitment to resolve its non-performing assets and will continue to explore other additional resolution options which are determined to be both effective and result in the minimization of additional losses and expense. | ||||||
The Company and the bank entered into a formal written agreement (the “Written Agreement”) with the Federal Reserve Bank of Richmond (“FRB”) and the North Carolina Office of the Commissioner of Banks (“NCCOB”) that imposes certain restrictions on the Company and the bank, as described in Notes H - Trust Preferred Securities and Note K - Regulatory Restrictions. A material failure to comply with the Written Agreement's terms could subject the Company to additional regulatory actions and further restrictions on its business, which may have a material adverse effect on the Company's future results of operations and financial condition. | ||||||
In order for the Company and the bank to maintain its well capitalized position under federal banking agencies' guidelines, management believes that the Company may need to raise additional capital to absorb the potential future credit losses associated with the disposition of its nonperforming assets. On March 24, 2014, the Company entered into the Securities Purchase Agreement with the Standby Investor, which could result in net proceeds to the Company of up to $26.6 million. Please see "Note S - Subsequent Events" for a description of the Securities Purchase Agreement and the contemplated Rights Offering and Standby Offering.There can be no assurance as to whether these efforts will be successful, either on a short-term or long-term basis. Should these efforts be unsuccessful, the Company may be unable to discharge its liabilities in the normal course of business. There can be no assurance that the Company will be successful in any efforts to raise additional capital during 2014. | ||||||
Cash and cash equivalents at December 31, 2013 were approximately $128.6 million. Based on our liquidity analysis, management anticipates that the Company will be able to meet its obligations as they become due. If unanticipated market factors emerge, or if the Company is not successful in its efforts to comply with the requirements set forth in the Written Agreement, the FRB and/or the NCCOB may take further enforcement or other actions. These actions might include greater restrictions on the Company's operations, or a revocation of its charter and the placement of the bank into receivership if the situation materially deteriorates. | ||||||
Cash and Cash Equivalents | ' | |||||
Cash and Cash Equivalents | ||||||
For the purpose of presentation in the consolidated statements of cash flows, cash and cash equivalents are defined as those amounts included in the balance sheet captions cash and due from banks, and interest-earning deposits. | ||||||
Federal regulations require institutions to set aside specified amounts of cash as reserves against transactions and time deposits. | ||||||
Investment Securities | ' | |||||
Investment Securities | ||||||
Investment securities are classified into three categories: | ||||||
(1) Held to Maturity - Debt securities that the Company has the positive intent and the ability to hold to maturity are classified as held to maturity and reported at amortized cost. The Company began using this category in 2011. | ||||||
(2) Trading - Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. The Company does not use this category. | ||||||
(3) Available for Sale - Debt and equity securities not classified as either securities held to maturity or trading securities are reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of income taxes, as other comprehensive income, a separate component of shareholders' equity. The Company had historically classified all securities as available for sale until 2011. Gains and losses on sales of securities, computed based on specific identification of adjusted cost of each security, are included in income at the time of the sale. Premiums and discounts are amortized into interest income using a method that approximates the interest method over the period to maturity. | ||||||
Other Than Temporary Impairment | ' | |||||
Other Than Temporary Impairment | ||||||
Each investment security in a loss position is evaluated for other-than-temporary impairment on at least a quarterly basis. The review includes an analysis of the facts and circumstances of each individual investment such as: (1) the length of time and the extent to which the fair value has been below cost, (2) changes in the earnings performance, credit rating, asset quality, or business prospects of the issuer, (3) the ability of the issuer to make principal and interest payments, (4) changes in the regulatory, economic, or technological environment of the issuer, and (5) changes in the general market condition of either the geographic area or industry in which the issuer operates. | ||||||
Regardless of these factors, if we have developed a plan to sell the security or it is likely that we will be forced to sell the security in the near future, then the impairment is considered other-than-temporary and the carrying value of the security is permanently written down to the current fair value with the difference between the new carrying value and the amortized cost charged to earnings. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current period credit loss, the other-than-temporary impairment is separated into the following: (1) the amount representing the credit loss and (2) the amount related to all other factors. The amount of the total other-than- temporary impairment related to the credit loss is recognized in earnings, and the amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. | ||||||
Loans Held for Sale | ' | |||||
Loans Held for Sale | ||||||
Loans held for sale generally represent single-family, residential first mortgage loans on a pre-sold basis originated by our mortgage division. Generally, commitments to sell these loans are made after the intent to proceed with mortgage applications are initiated with borrowers, and all necessary components of the loan are approved according to secondary market underwriting standards of the investor that purchases the loan. Upon closing, these loans, together with their servicing rights, are sold to mortgage loan investors under prearranged terms. Loans held for sale are subsequently measured at the lower of cost or fair value on an aggregated basis within the consolidated balance sheet under the caption “loans held for sale”. | ||||||
Additionally, for the year ending December 31, 2012 we identified certain loans to be sold as part of a branch sale which are also identified within the consolidated balance sheet under the caption “loans held for sale”. | ||||||
Rate Lock Commitments | ' | |||||
Rate Lock Commitments | ||||||
The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). As required by ASC 815, Derivatives and Hedging, rate lock commitments related to the origination of mortgage loans held for sale and the corresponding forward loan sale commitments are considered to be derivatives. The commitments are generally for periods of 60 days and are at market rates. | ||||||
In order to mitigate the risk from interest rate fluctuations, the Company enters into forward loan sale commitments on a “best efforts” basis while the loan is in the pipeline. Interest rate lock commitments and forward sales commitments are not material to the financial statements for any period presented. | ||||||
Loans, Allowance for Loan Losses and Foreclosed Asset | ' | |||||
Foreclosed Assets | ||||||
Assets acquired as a result of foreclosure are valued at fair value, less estimated selling costs, at the date of foreclosure establishing a new cost basis. After foreclosure, valuations of the property are periodically performed by management and the assets are carried at the lower of cost or fair value minus estimated costs to sell. Losses from the acquisition of property in full or partial satisfaction of debt are treated as credit losses. Routine holding costs, subsequent declines in value, and gains or losses on disposition are included in other income and expense. | ||||||
Allowance for Loan Losses | ||||||
The allowance for loan losses is established through periodic charges to earnings in the form of a provision for loan losses. Increases to the allowance for loan losses occur as a result of provisions charged to operations and recoveries of amounts previously charged-off, and decreases to the allowance occur when loans are charged-off because management believes that the uncollectibility of a loan balance is confirmed. Management evaluates the adequacy of our allowance for loan losses on a monthly basis. The evaluation of the adequacy of the allowance for loan losses involves the consideration of loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, adverse conditions that might affect a borrower’s ability to repay the loan, estimated value of underlying collateral, prevailing economic conditions and all other relevant factors derived from our history of operations. Additionally, regulatory agencies review our allowance for loan losses and may require additional provisions for estimated losses based on judgments that differ from those of management. | ||||||
Management has developed a model for evaluating the adequacy of the allowance for loan losses. The model uses the Company’s internal grading system to quantify the risk of each loan. The grade is initially assigned by the lending officer and/or the credit administration function. The internal grading system is reviewed and tested periodically by an independent internal loan review function as well as an independent external credit review firm. The testing process involves the evaluation of a sample of new loans, loans having been identified as possessing potential weakness in credit quality, and past due and nonaccrual loans to determine the ongoing effectiveness of the internal grading system. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses. Such agencies may require us to recognize adjustments to the allowance based on their judgments of information available to them at the time of their examination. | ||||||
The grading system is comprised of seven risk categories for active loans. Grades 1 through 4 demonstrate various degrees of risk, but each is considered to have the capacity to perform in accordance with the terms of the loan. Loans possessing a grade of 5 exhibit characteristics which indicate higher risk that the loan may not be able to perform in accordance with the terms of the loan. Grade 6 loans are considered substandard and are generally impaired. Grade 7 loans are considered doubtful and would be included in nonaccrual loans. Loans can also be classified as non-accrual, troubled debt restructure, or otherwise impaired, all of which are considered impaired and evaluated for specific reserve under FASB ASC 310-10 regardless of the risk grade assigned. | ||||||
Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following 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 or by determining the fair market value of the underlying collateral securing the loan. If the fair value market value of collateral method is selected for use, an updated collateral value is generally obtained based on where the loan is in the collection process and the age of the existing appraisal. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. Other impaired loans are then analyzed individually to determine the net value of collateral or cash flows and an estimate of potential loss. The net value of collateral per our analysis is determined using various subjective discounts, selling expenses and a review of the assumptions used to generate the current appraisal. If collection is deemed to be collateral dependent then the deficiency is generally charged off . Appraised values on real estate collateral are subject to constant change and management makes certain assumptions about how the age of an appraisal impacts current value. Impaired loans are re-evaluated periodically to determine the adequacy of specific reserves and charge-offs. | ||||||
Loans that are not assessed for specific reserves under FASB ASC 310-10 are reserved for under FASB ASC 450. The loans analyzed under FASB ASC 450 are assigned a reserve based on a quantitative factor and a qualitative factor. The quantitative factor is based on historical charge-off levels for each call report category and is adjusted for the loan's risk grade. The qualitative factors address loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, prevailing economic conditions and all other relevant factors derived from our history of operations. Together these two components comprise the ASC 450, or general, reserve. | ||||||
The Bank determines the quantitative ASC 450 reserve using a charge-off metric of the greater of (i) the charge-off rate from the most recent 8 quarters (rolling two years) or (ii) the charge-off rate from the most recent 12 quarters (rolling three years). This provides for the highest base charge-off rate regardless of whether the historical charge-offs are improving or declining. In addition, the bank assigns a different percentage ("multiplier") of the base charge-off rate to the balances for each risk grade within a loan category to reflect the varied risk of charge-off for each. The standard multipliers range from 0% for a risk grade 1 to 300% for a risk grade 6. In addition, categories that have a concentrated level of charge-offs associated with a particular risk grade could have an additional reserve factor of 50% to 100% added to that particular risk grade. Lastly, categories that have had historically high charge-offs also have an additional reserve factor between 25% to 100% added to the risk grade 5s and 6s to account for the additional risk in those categories. The reserve amount by risk grade is calculated and then combined for a blended quantitative reserve factor for each loan category. | ||||||
The allowance for loan losses represents management’s estimate of an appropriate amount to provide for known and inherent losses in the loan portfolio in the normal course of business. While management believes the methodology used to establish the allowance for loan losses incorporates the best information available at the time, future adjustments to the level of the allowance may be necessary and the results of operations could be adversely affected should circumstances differ substantially from the assumptions initially used. We believe that the allowance for loan losses was established in conformity with generally accepted accounting principles. However, upon examination by various regulatory agencies, adjustments to the allowance may be required. Likewise, there can be no assurance that the existing allowance for loan losses is adequate should there be deterioration in the quality of any loans or changes in any of the factors discussed above. Any increases in the provision for loan losses resulting from such deterioration or change in condition could adversely affect our financial condition and results of operations. | ||||||
Loans | ||||||
Loans are stated at the amount of unpaid principal, reduced by an allowance for loan losses. Interest on all loan classifications is calculated by using the simple interest method on daily balances of the principal amount outstanding. | ||||||
Loan origination fees are deferred, as well as certain direct loan origination costs. Such costs and fees are recognized as an adjustment to yield over the contractual lives of the related loans utilizing the interest method. | ||||||
Purchased loans acquired in a business combination are recorded at estimated fair value on their purchase date; the purchaser cannot carry over the related allowance for loan losses for acquisitions subsequent to January 1, 2009. Purchased loans are accounted for under Financial Accounting Standards Board (“FASB") Accounting Standard Codification ("ASC') 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality (formerly American Institute of Certified Public Accountants (“AICPA”) Statement of Position 03-3), when the loans have evidence of credit deterioration since origination and it is probable at the date of acquisition that the Company will not collect all contractually required principal and interest payments. Evidence of credit quality deterioration as of the purchase date may include statistics such as past due and nonaccrual status. Generally, acquired loans that meet the Company’s definition for nonaccrual status fall within the scope of FASB ASC 310-30. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the nonaccretable difference. Subsequent decreases to the expected cash flows will generally result in a provision for loan losses. Subsequent increases in cash flows result in a reversal of the provision for loan losses to the extent of prior charges, or a reclassification of the difference from nonaccretable to accretable with a positive impact on interest income. Any excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable yield and is recognized into interest income over the remaining life of the loan when there is a reasonable expectation about the amount and timing of such cash flows. For all other acquired loans that do not fall under the definition of ASC 310-30, the Company will account for these loans as described in the previous paragraphs. | ||||||
For all classes of loans, a loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect 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. Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following 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 or by determining the fair market value of the underlying collateral securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or reserve or charge-off, and is incorporated into the bank's allowance for loan and lease losses. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. | ||||||
Income Recognition on Impaired and Nonaccrual Loans | ' | |||||
Income Recognition on Impaired and Nonaccrual Loans | ||||||
Loans, including impaired loans, are generally classified as nonaccrual when doubts arise regarding the full collectibility of principal or interest and we are therefore uncertain that the borrower can satisfy the contractual terms of the loan agreement. In addition our policy is to place a loan on nonaccrual status at the point when the loan becomes past due 90 days unless there is sufficient documentation to establish that the loan is well secured and in the process of collection. If a loan or a portion of a loan is classified as doubtful or is partially charged-off, the loan is generally classified as nonaccrual. | ||||||
While a loan is classified as nonaccrual and the future collectibility of the recorded loan balance is doubtful, collections of interest and principal are generally applied as a reduction to the principal outstanding, except in the case of loans with scheduled amortizations where the payment is generally applied to the oldest payment due. When the future collectibility of the recorded loan balance is expected, interest income may be recognized on a cash basis. In the case where a nonaccrual loan had been partially charged-off, recognition of interest on a cash basis is limited to that which would have been recognized on the recorded loan balance at the contractual interest rate. Receipts in excess of that amount are recorded as recoveries to the allowance for loan losses until prior charge-offs have been fully recovered. | ||||||
Bank Premises and Equipment | ' | |||||
Bank Premises and Equipment | ||||||
Land is carried at cost. Buildings, furniture, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of assets. Useful lives range from 5 to 10 years for furniture and equipment and 40 years for buildings. Expenditures for repairs and maintenance are charged to expense as incurred. | ||||||
Income Taxes | ' | |||||
Income Taxes | ||||||
Accrued taxes represent the estimated amount payable to or receivable from taxing jurisdictions, either currently or in the future, and are reported, on a net basis, as a component of “other assets” in the consolidated balance sheets. The calculation of the Company’s income tax expense is complex and requires the use of many estimates and judgments in its determination. | ||||||
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. These temporary differences consist primarily of the allowance for loan losses, differences in the financial statement and income tax basis in premises and equipment and differences in financial statement and income tax basis in accrued liabilities. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that the tax benefits will not be fully realized. | ||||||
Management’s determination of the realization of the net deferred tax asset is based upon management’s judgment of various future events and uncertainties, including the timing and amount of future income and the implementation of various tax plans to maximize realization of the deferred tax asset. As of December 31, 2013, a $22.5 million valuation allowance has been established. | ||||||
From time to time, management bases the estimates of related tax liabilities on its belief that future events will validate management’s current assumptions regarding the ultimate outcome of tax-related exposures. While the Company has obtained the opinion of advisors that the anticipated tax treatment of these transactions should prevail and has assessed the relative merits and risks of the appropriate tax treatment, examination of the Company’s income tax returns, changes in tax law and regulatory guidance may impact the treatment of these transactions and resulting provisions for income taxes. | ||||||
Stock Compensation Plans | ' | |||||
Stock Compensation Plans | ||||||
The Company accounts for stock based awards granted to employees using the fair value method. The cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (usually the vesting period). The cost of employee services received in exchange for an award is based on the grant-date fair value of the award. Excess tax benefits are reported as financing cash inflows, rather than as a reduction of taxes paid, which is included within operating cash flows. | ||||||
Net Loss Per Common Share and Common Shares Outstanding | ' | |||||
Net Loss Per Common Share and Common Shares Outstanding | ||||||
Basic loss per share represents loss available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted loss per share reflect 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 solely to outstanding stock options. | ||||||
Basic and diluted net loss per common share have been computed based upon net 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: | ||||||
Weighted Average Shares | ||||||
2013 | 2012 | |||||
Weighted average number of common shares used in computing basic net loss per share | 7,914,110 | 7,745,342 | ||||
Effect of dilutive stock options | — | — | ||||
Weighted average number of commons shares and dilutive potential common shares used in computing diluted net loss per share | 7,914,110 | 7,745,342 | ||||
Stock options that have exercise prices greater than the average market price of the common shares outstanding do not have a dilutive effect and are considered antidilutive. | ||||||
Recent Accounting Pronouncements | ' | |||||
Recent Accounting Pronouncements | ||||||
In May 2011, the FASB issued Accounting Standards Update (“ASU”) No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. The purpose of this standard is to clarify and combine fair value measurements and disclosure requirements for U.S. generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS). The new ASU provides amendments and wording changes used to describe certain requirements for measuring fair value and for disclosing information about fair value measurements. This guidance is effective for interim and annual reporting periods beginning after December 15, 2011, and should be applied prospectively to the beginning of the annual period of adoption. The Company has fully adopted all of the provisions within this ASU and has provided all required disclosures. | ||||||
In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. This update requires that all non-owner changes in stockholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The objective is to improve the comparability, consistency, and transparency of financial reporting, and to increase the prominence of items reported in other comprehensive income. These amendments are to be applied retrospectively and are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Disclosures required by ASU 2011-05 are included in Consolidated Statements of Comprehensive Income (Loss). The adoption of the disclosure requirements had no material impact on the Company’s consolidated financial position, results of operations, and earnings per share. In December 2011, the FASB issued ASU 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05, to allow time to redeliberate whether to present on the face of the financial statements the effects of reclassifications out of accumulated other comprehensive income on the components of net income and other comprehensive income for all periods presented. Adoption of this ASU did not have any impact on the Company’s consolidated financial statements or results of operations. | ||||||
In December 2011, the FASB issued ASU No. 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. This update requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The amendment is effective for annual and interim periods beginning on or after January 1, 2013. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In July 2012, the FASB issued ASU No. 2012-02, Intangibles–Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment. This update permits entities to perform an optional qualitative assessment for determining whether it is more likely than not than an indefinite-lived intangible asset is impaired. The guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. This update seeks to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income, if the amount being reclassified is required under U.S. GAAP to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is reclassified to a balance sheet account (for example, inventory) instead of directly to income or expense in the same reporting period. For public entities, the amendments are effective prospectively for reporting periods beginning after December 15, 2012. Adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations. | ||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This update seeks to eliminate the diversity in practice in the presentation of unrecognized tax benefits by providing explicit guidance on the financial statement presentation of an unrecognized tax benefit with a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This amendment is effective for annual and interim periods beginning after December 15, 2013. We do not expect the adoption of this guidance to have a material impact on our 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. We do not expect the adoption of this guidance to have a material impact on our 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. |
ORGANIZATION_AND_SUMMARY_OF_SI2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | |||||
Dec. 31, 2013 | ||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||
Schedule of Weighted Average Number of Shares | ' | |||||
Basic and diluted net loss per common share have been computed based upon net 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: | ||||||
Weighted Average Shares | ||||||
2013 | 2012 | |||||
Weighted average number of common shares used in computing basic net loss per share | 7,914,110 | 7,745,342 | ||||
Effect of dilutive stock options | — | — | ||||
Weighted average number of commons shares and dilutive potential common shares used in computing diluted net loss per share | 7,914,110 | 7,745,342 | ||||
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ' | |||||||||||||||||||||||||||||||
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Available for Sale | ' | |||||||||||||||||||||||||||||||
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities available for sale as of December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair Value | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 6,176 | $ | — | $ | 243 | $ | 5,933 | $ | 5,459 | $ | 454 | $ | — | $ | 5,913 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 25,773 | — | 296 | 25,477 | 60,056 | 704 | 17 | 60,743 | ||||||||||||||||||||||||
FNMA | — | — | — | — | 5,872 | 10 | 2 | 5,880 | ||||||||||||||||||||||||
Trust preferred securities | 1,175 | — | 150 | 1,025 | 1,175 | — | 169 | 1,006 | ||||||||||||||||||||||||
Equity securities | 98 | 33 | — | 131 | 170 | 11 | 1 | 180 | ||||||||||||||||||||||||
Total | $ | 33,222 | $ | 33 | $ | 689 | $ | 32,566 | $ | 72,732 | $ | 1,179 | $ | 189 | $ | 73,722 | ||||||||||||||||
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Held to Maturity | ' | |||||||||||||||||||||||||||||||
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities held to maturity as of December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held to Maturity | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair Value | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 3,635 | $ | 3 | $ | 157 | $ | 3,481 | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 89,892 | 162 | 2,171 | 87,883 | 20,329 | 339 | — | 20,668 | ||||||||||||||||||||||||
FNMA | 4,486 | — | 19 | 4,467 | — | — | — | — | ||||||||||||||||||||||||
Total | $ | 98,013 | $ | 165 | $ | 2,347 | $ | 95,831 | $ | 20,329 | $ | 339 | $ | — | $ | 20,668 | ||||||||||||||||
Schedule of Unrealized Losses and Fair Values of Investment Securities | ' | |||||||||||||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities available for sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 243 | $ | — | $ | — | $ | 5,933 | $ | 243 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 25,477 | 296 | — | — | 25,477 | 296 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 31,410 | $ | 539 | $ | — | $ | — | $ | 31,410 | $ | 539 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | — | 1,025 | 150 | 1,025 | 150 | ||||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,025 | $ | 150 | $ | 1,025 | $ | 150 | ||||||||||||||||||||
Securities Available for Sale | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | $ | 5,132 | $ | 17 | $ | — | $ | — | $ | 5,132 | $ | 17 | ||||||||||||||||||||
FNMA | 1,998 | 2 | — | — | 1,998 | 2 | ||||||||||||||||||||||||||
Equity securities | — | — | 2 | 1 | 2 | 1 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 7,130 | $ | 19 | $ | 2 | $ | 1 | $ | 7,132 | $ | 20 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | $ | — | 1,006 | 169 | 1,006 | 169 | |||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,006 | $ | 169 | $ | 1,006 | $ | 169 | ||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities held to maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. There were no unrealized losses in the held to maturity portfolio in 2012. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held to Maturity | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,776 | $ | 157 | $ | — | $ | — | $ | 2,776 | $ | 157 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,830 | 2,073 | 2,223 | 98 | 77,053 | 2,171 | ||||||||||||||||||||||||||
FNMA | 4,467 | 19 | — | — | 4,467 | 19 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 82,073 | $ | 2,249 | $ | 2,223 | $ | 98 | $ | 84,296 | $ | 2,347 | ||||||||||||||||||||
Roll Forward of Credit Losses on Debt Securities | ' | |||||||||||||||||||||||||||||||
The following table shows a roll forward of the amount related to credit losses recognized on debt securities held by the Company for which a portion of an other-than-temporary impairment was recognized in other comprehensive income (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the beginning of the period | $ | 75 | 75 | |||||||||||||||||||||||||||||
Additional increase related to the credit loss for which an other-than-temporary impairment was previously recognized | — | — | ||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the end of the period | $ | 75 | $ | 75 | ||||||||||||||||||||||||||||
Investment Securities Classified by Contractual Maturities | ' | |||||||||||||||||||||||||||||||
The amortized cost and fair value of available for sale and held to maturity securities at December 31, 2013 by expected maturities are shown below(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. | ||||||||||||||||||||||||||||||||
Available for Sale | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities -GNMA | Mortgage-backed securities -FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | — | — | 25,773 | 25,477 | — | — | ||||||||||||||||||||||||||
Due after ten years | 6,176 | 5,933 | — | — | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 6,176 | $ | 5,933 | $ | 25,773 | $ | 25,477 | $ | — | $ | — | ||||||||||||||||||||
Securities without a specific maturity: | ||||||||||||||||||||||||||||||||
Trust preferred securities | $ | 1,175 | $ | 1,025 | ||||||||||||||||||||||||||||
Equity securities | 98 | 131 | ||||||||||||||||||||||||||||||
Total other securities | $ | 1,273 | $ | 1,156 | ||||||||||||||||||||||||||||
Held to Maturity | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities -GNMA | Mortgage-backed securities -FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | 803 | 785 | 51,419 | 50,936 | 4,486 | 4,467 | ||||||||||||||||||||||||||
Due after five years through ten years | 2,832 | 2,696 | 34,261 | 32,920 | — | — | ||||||||||||||||||||||||||
Due after ten years | — | — | 4,212 | 4,027 | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 3,635 | $ | 3,481 | $ | 89,892 | $ | 87,883 | $ | 4,486 | $ | 4,467 | ||||||||||||||||||||
LOANS_AND_ALLOWANCE_FOR_LOAN_L1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||||||||||
Loans and Leases Receivable Disclosure [Abstract] | ' | |||||||||||||||||||||||||||||||
Summary of Loans Outstanding | ' | |||||||||||||||||||||||||||||||
The classification of loan segments as of December 31, 2013 and 2012 are summarized as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial and industrial | $ | 25,858 | $ | 28,377 | ||||||||||||||||||||||||||||
Commercial construction and land development | 66,253 | 90,899 | ||||||||||||||||||||||||||||||
Commercial real estate | 194,238 | 181,194 | ||||||||||||||||||||||||||||||
Residential construction | 28,697 | 20,445 | ||||||||||||||||||||||||||||||
Residential mortgage | 167,221 | 165,009 | ||||||||||||||||||||||||||||||
Consumer | 6,750 | 7,399 | ||||||||||||||||||||||||||||||
Other | 738 | 1,278 | ||||||||||||||||||||||||||||||
Consumer credit cards | 2,339 | 2,265 | ||||||||||||||||||||||||||||||
Business credit cards | 1,124 | 1,186 | ||||||||||||||||||||||||||||||
493,218 | 498,052 | |||||||||||||||||||||||||||||||
Deferred cost and (fees), net | (506 | ) | (123 | ) | ||||||||||||||||||||||||||||
Allowance for loan losses | (11,590 | ) | (16,549 | ) | ||||||||||||||||||||||||||||
Net Loans | $ | 481,122 | $ | 481,380 | ||||||||||||||||||||||||||||
Loans held for sale | $ | — | $ | 19,297 | ||||||||||||||||||||||||||||
Summary of Nonperforming Assets | ' | |||||||||||||||||||||||||||||||
Nonperforming assets at December 31, 2013 and 2012 consist of the following (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Loans past due ninety days or more and still accruing | $ | 23 | $ | 32 | ||||||||||||||||||||||||||||
Nonaccrual loans | 27,227 | 35,970 | ||||||||||||||||||||||||||||||
Foreclosed assets | 8,502 | 15,136 | ||||||||||||||||||||||||||||||
Total | $ | 35,752 | $ | 51,138 | ||||||||||||||||||||||||||||
Schedule of Related Party Loans | ' | |||||||||||||||||||||||||||||||
The following is a reconciliation of these loans (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 15,009 | 15,825 | |||||||||||||||||||||||||||||
New loans | 2,600 | 937 | ||||||||||||||||||||||||||||||
Principal repayments | (7,769 | ) | (1,753 | ) | ||||||||||||||||||||||||||||
Ending balance | $ | 9,840 | 15,009 | |||||||||||||||||||||||||||||
Summary of Segments of Loans by Grade | ' | |||||||||||||||||||||||||||||||
The following table illustrates the credit card portfolio exposure as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||||||||||
Consumer - | Business- | Consumer - | Business- | |||||||||||||||||||||||||||||
Credit Card | Credit Card | Credit Card | Credit Card | |||||||||||||||||||||||||||||
Performing | $ | 2,316 | $ | 1,124 | $ | 2,233 | $ | 1,186 | ||||||||||||||||||||||||
Non Performing | 23 | — | 32 | — | ||||||||||||||||||||||||||||
$ | 2,339 | $ | 1,124 | $ | 2,265 | $ | 1,186 | |||||||||||||||||||||||||
The following table illustrates credit risk profile by creditworthiness class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - Loans | Total | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | |||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,014 | $ | — | $ | — | $ | — | $ | — | $ | 1,365 | $ | 8 | $ | 3,387 | ||||||||||||||||
2 - Satisfactory Quality | 646 | 374 | 2,548 | 2 | 12,959 | 412 | 15 | 16,956 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,639 | 14,296 | 71,250 | 3,473 | 57,792 | 3,628 | 482 | 160,560 | ||||||||||||||||||||||||
4 - Low Satisfactory | 12,616 | 36,723 | 106,652 | 23,779 | 72,330 | 1,235 | 107 | 253,442 | ||||||||||||||||||||||||
5 - Special mention | 137 | 1,922 | 2,303 | 262 | 8,705 | 63 | 126 | 13,518 | ||||||||||||||||||||||||
6 - Substandard or worse | 806 | 12,938 | 11,485 | 1,181 | 15,435 | 47 | — | 41,892 | ||||||||||||||||||||||||
$ | 25,858 | $ | 66,253 | $ | 194,238 | $ | 28,697 | $ | 167,221 | $ | 6,750 | $ | 738 | $ | 489,755 | |||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - | Total | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | Loans | ||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,446 | $ | — | $ | — | $ | — | $ | 51 | $ | 1,372 | $ | 13 | $ | 3,882 | ||||||||||||||||
2 - Satisfactory Quality | 441 | 595 | 2,429 | 109 | 10,595 | 288 | — | 14,457 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 10,222 | 22,278 | 51,384 | 1,337 | 58,140 | 4,526 | 1,091 | 148,978 | ||||||||||||||||||||||||
4 - Low Satisfactory | 13,558 | 35,502 | 104,652 | 17,008 | 68,148 | 1,019 | 125 | 240,012 | ||||||||||||||||||||||||
5 - Special mention | 323 | 9,064 | 6,228 | 356 | 9,720 | 91 | 49 | 25,831 | ||||||||||||||||||||||||
6 - Substandard or worse | 1,387 | 23,460 | 16,501 | 1,635 | 18,355 | 103 | — | 61,441 | ||||||||||||||||||||||||
$ | 28,377 | $ | 90,899 | $ | 181,194 | $ | 20,445 | $ | 165,009 | $ | 7,399 | $ | 1,278 | $ | 494,601 | |||||||||||||||||
Schedule of Loans, Non Accrual Status | ' | |||||||||||||||||||||||||||||||
The following table represents the loans on nonaccrual status as of December 31, 2013 and 2012 by loan class (amounts in thousands): | ||||||||||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||||||||||
Commercial & industrial | $ | 651 | $ | 664 | ||||||||||||||||||||||||||||
Commercial construction and land development | 9,536 | 15,941 | ||||||||||||||||||||||||||||||
Commercial real estate | 6,391 | 9,091 | ||||||||||||||||||||||||||||||
Residential construction | 695 | 833 | ||||||||||||||||||||||||||||||
Residential mortgage | 9,943 | 9,408 | ||||||||||||||||||||||||||||||
Consumer | 11 | 33 | ||||||||||||||||||||||||||||||
Other | — | — | ||||||||||||||||||||||||||||||
Total | $ | 27,227 | $ | 35,970 | ||||||||||||||||||||||||||||
Age Analysis of Past Due Loans | ' | |||||||||||||||||||||||||||||||
The following tables illustrates the age analysis of past due loans by loan class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccruals & Greater than 90 Days Past Due (1) | Total Past | Current | Total | ||||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 34 | $ | 651 | $ | 685 | $ | 25,173 | $ | 25,858 | ||||||||||||||||||||||
Commercial construction & land development | 252 | 9,536 | 9,788 | 56,465 | 66,253 | |||||||||||||||||||||||||||
Commercial real estate | 749 | 6,391 | 7,140 | 187,098 | 194,238 | |||||||||||||||||||||||||||
Residential construction | — | 695 | 695 | 28,002 | 28,697 | |||||||||||||||||||||||||||
Residential mortgage | 421 | 9,943 | 10,364 | 156,857 | 167,221 | |||||||||||||||||||||||||||
Consumer | 11 | 11 | 22 | 6,728 | 6,750 | |||||||||||||||||||||||||||
Consumer credit cards | 76 | 23 | 99 | 2,240 | 2,339 | |||||||||||||||||||||||||||
Business credit cards | 52 | — | 52 | 1,072 | 1,124 | |||||||||||||||||||||||||||
Other loans | — | — | — | 738 | 738 | |||||||||||||||||||||||||||
Total | $ | 1,595 | $ | 27,250 | $ | 28,845 | $ | 464,373 | $ | 493,218 | ||||||||||||||||||||||
-1 | Nonaccruals and Greater than 90 Days Past Due is comprised of $23,000 of loans that were past due more than 90 days and still accruing interest, as well as $27.2 million of loans in nonaccrual status. | |||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccruals & Greater than 90 Days Past Due (1) | Total Past | Current | Total | ||||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 119 | $ | 664 | $ | 783 | $ | 27,594 | $ | 28,377 | ||||||||||||||||||||||
Commercial construction & land development | 819 | 15,941 | 16,760 | 74,139 | 90,899 | |||||||||||||||||||||||||||
Commercial real estate | 499 | 9,091 | 9,590 | 171,604 | 181,194 | |||||||||||||||||||||||||||
Residential construction | — | 833 | 833 | 19,612 | 20,445 | |||||||||||||||||||||||||||
Residential mortgage | 1,076 | 9,408 | 10,484 | 154,525 | 165,009 | |||||||||||||||||||||||||||
Consumer | 34 | 33 | 67 | 7,332 | 7,399 | |||||||||||||||||||||||||||
Consumer credit cards | 67 | 32 | 99 | 2,166 | 2,265 | |||||||||||||||||||||||||||
Business credit cards | 12 | — | 12 | 1,174 | 1,186 | |||||||||||||||||||||||||||
Other loans | — | — | — | 1,278 | 1,278 | |||||||||||||||||||||||||||
Total | $ | 2,626 | $ | 36,002 | $ | 38,628 | $ | 459,424 | $ | 498,052 | ||||||||||||||||||||||
-1 | Nonaccruals and Greater than 90 Days Past Due is comprised of $32,000 of loans that were past due more than 90 days and still accruing interest, as well as $36.0 million of loans in nonaccrual status. | |||||||||||||||||||||||||||||||
Summary of Impaired Loans | ' | |||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | YTD | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Average | Income | ||||||||||||||||||||||||||||
Balance | Recorded | Recognized | ||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 498 | $ | 686 | $ | — | $ | 484 | $ | 1 | ||||||||||||||||||||||
Commercial construction and land development | 11,266 | 15,889 | — | 13,008 | 22 | |||||||||||||||||||||||||||
Commercial real estate other | 12,865 | 14,263 | — | 12,328 | 64 | |||||||||||||||||||||||||||
Residential construction | 340 | 340 | — | 162 | — | |||||||||||||||||||||||||||
Residential mortgage | 10,106 | 11,542 | — | 9,937 | 132 | |||||||||||||||||||||||||||
Consumer | 25 | 42 | — | 26 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 35,100 | $ | 42,762 | $ | — | $ | 35,945 | $ | 219 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 939 | $ | 956 | $ | 636 | $ | 528 | $ | 11 | ||||||||||||||||||||||
Commercial construction and land development | 9,619 | 13,033 | 1,693 | 10,003 | 36 | |||||||||||||||||||||||||||
Commercial real estate other | 4,877 | 6,852 | 640 | 5,623 | 46 | |||||||||||||||||||||||||||
Residential construction | 833 | 1,134 | 86 | 884 | — | |||||||||||||||||||||||||||
Residential mortgage | 7,467 | 8,081 | 2,334 | 7,493 | 44 | |||||||||||||||||||||||||||
Consumer | 25 | 34 | — | 25 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 23,760 | $ | 30,090 | $ | 5,389 | $ | 24,556 | $ | 137 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 40,064 | 51,679 | 2,969 | 41,974 | 180 | |||||||||||||||||||||||||||
Consumer | 50 | 76 | — | 51 | — | |||||||||||||||||||||||||||
Residential | 18,746 | 21,097 | 2,420 | 18,476 | 176 | |||||||||||||||||||||||||||
Grand Total: | $ | 58,860 | $ | 72,852 | $ | 5,389 | $ | 60,501 | $ | 356 | ||||||||||||||||||||||
The following tables illustrates the impaired loans by loan class as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Average | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Recorded | Income | ||||||||||||||||||||||||||||
Balance | Investment | Recognized | ||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 380 | $ | 517 | $ | — | $ | 491 | $ | 2 | ||||||||||||||||||||||
Commercial construction & land development | 11,142 | 15,809 | — | 13,259 | 168 | |||||||||||||||||||||||||||
Commercial real estate | 8,437 | 10,131 | — | 9,190 | 132 | |||||||||||||||||||||||||||
Residential construction | 486 | 486 | — | 474 | 26 | |||||||||||||||||||||||||||
Residential mortgage | 10,948 | 12,731 | — | 11,624 | 121 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 31,404 | $ | 39,696 | $ | — | $ | 35,055 | $ | 449 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 309 | $ | 322 | $ | 80 | $ | 321 | $ | — | ||||||||||||||||||||||
Commercial construction and land development | 1,315 | 2,033 | 264 | 1,348 | — | |||||||||||||||||||||||||||
Commercial real estate | 4,026 | 4,096 | 888 | 4,104 | 136 | |||||||||||||||||||||||||||
Residential construction | 695 | 1,134 | 137 | 749 | — | |||||||||||||||||||||||||||
Residential mortgage | 1,427 | 1,593 | 456 | 1,499 | 8 | |||||||||||||||||||||||||||
Consumer | — | — | — | — | — | |||||||||||||||||||||||||||
Subtotal: | $ | 7,772 | $ | 9,178 | $ | 1,825 | $ | 8,021 | $ | 144 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 25,609 | 32,908 | 1,232 | 28,713 | 438 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Residential | 13,556 | 15,944 | 593 | 14,346 | 155 | |||||||||||||||||||||||||||
Grand Total | $ | 39,176 | $ | 48,874 | $ | 1,825 | $ | 43,076 | $ | 593 | ||||||||||||||||||||||
Summary of Troubled Debt Restructurings by Loan Class | ' | |||||||||||||||||||||||||||||||
The following tables presents a breakdown of TDRs by loan class and the type of concession made to the borrower for the periods indicated(amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Classification | Post-Modification | ||||||||||||||||||||||||||||||
Outstanding | Outstanding | |||||||||||||||||||||||||||||||
Recorded | Recorded | |||||||||||||||||||||||||||||||
Investment | Investment | |||||||||||||||||||||||||||||||
Below market interest rate: | ||||||||||||||||||||||||||||||||
Subtotal | — | — | — | |||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Residential mortgage | 2 | 202 | 202 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 202 | $ | 202 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Subtotal | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Total | 3 | $ | 235 | $ | 235 | |||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Number | Pre-Modification | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
of loans | Outstanding | |||||||||||||||||||||||||||||||
Recorded | ||||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
Below market interest rate: | ||||||||||||||||||||||||||||||||
Residential mortgage | 1 | 395 | 395 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 395 | $ | 395 | |||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Commercial real estate | 4 | 513 | 513 | |||||||||||||||||||||||||||||
Residential mortgage | 2 | 66 | 66 | |||||||||||||||||||||||||||||
Consumer | 1 | 19 | 19 | |||||||||||||||||||||||||||||
Subtotal | 7 | $ | 598 | $ | 598 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 5 | 695 | 695 | |||||||||||||||||||||||||||||
Consumer | 2 | 49 | 49 | |||||||||||||||||||||||||||||
Subtotal | 7 | $ | 744 | $ | 744 | |||||||||||||||||||||||||||
Total | 15 | $ | 1,737 | $ | 1,737 | |||||||||||||||||||||||||||
Summary of Troubled Debt Restructurings with Subsequent Payment Default | ' | |||||||||||||||||||||||||||||||
The following table presents loans that were modified as troubled debt restructurings and for which there was a payment default for the year ended December 31, 2012. There were no modified TDRs for the year ended December 31, 2013. (amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||||||||||||||
Number of loans | Recorded Investment | |||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | $ | 28 | |||||||||||||||||||||||||||||
Consumer | 2 | 49 | ||||||||||||||||||||||||||||||
Subtotal | 3 | $ | 77 | |||||||||||||||||||||||||||||
Total | 3 | $ | 77 | |||||||||||||||||||||||||||||
Summary of Successes and Failures of Troubled Debt Restructurings | ' | |||||||||||||||||||||||||||||||
The table below details the progression of troubled debt restructurings which have been entered into during the previous 12 months(amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Paid in full | Paying as restructured | Converted to non-accrual | Foreclosure/Default | |||||||||||||||||||||||||||||
Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | |||||||||||||||||||||||||
Below market interest rate | — | — | — | $ | — | — | $ | — | — | $ | — | |||||||||||||||||||||
Extended payment terms | — | — | 1 | 146 | 1 | 56 | — | — | ||||||||||||||||||||||||
Forgiveness of principal | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Other | — | — | — | — | 1 | 33 | — | — | ||||||||||||||||||||||||
Total | — | $ | — | 1 | $ | 146 | 2 | $ | 89 | — | $ | — | ||||||||||||||||||||
Analysis of the Allowance for Loan Losses by Loan Class | ' | |||||||||||||||||||||||||||||||
Following is an analysis of the allowance for loan losses by loan segment as of and for the years ended December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial | Commercial construction | Commercial | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
and | and land development | real estate | ||||||||||||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Provision for loan losses | 2 | 4 | 15 | 2 | 11 | 1 | — | 35 | ||||||||||||||||||||||||
Loans charged-off | (411 | ) | (3,759 | ) | (2,220 | ) | (138 | ) | (1,559 | ) | (271 | ) | — | (8,358 | ) | |||||||||||||||||
Recoveries | 514 | 587 | 1,506 | — | 599 | 154 | 4 | 3,364 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | 103 | (3,172 | ) | (714 | ) | (138 | ) | (960 | ) | (117 | ) | 4 | (4,994 | ) | ||||||||||||||||||
Balance, end of period | $ | 1,290 | $ | 4,083 | $ | 2,262 | $ | 287 | $ | 3,522 | $ | 72 | $ | 74 | $ | 11,590 | ||||||||||||||||
Ending Balance: individually | $ | 80 | $ | 264 | $ | 887 | $ | 137 | $ | 384 | $ | — | $ | — | $ | 1,752 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Ending balance: collectively | $ | 1,210 | $ | 3,819 | $ | 1,375 | $ | 150 | $ | 3,138 | $ | 72 | $ | 74 | $ | 9,838 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Financing receivables: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 26,982 | $ | 66,253 | $ | 194,238 | $ | 28,697 | $ | 167,221 | $ | 9,089 | $ | 738 | $ | 493,218 | ||||||||||||||||
Ending Balance: individually | $ | 652 | $ | 12,234 | $ | 12,345 | $ | 1,181 | $ | 11,043 | $ | — | $ | — | $ | 37,455 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
Ending balance: collectively | $ | 26,330 | $ | 54,019 | $ | 181,893 | $ | 27,516 | $ | 156,178 | $ | 9,089 | $ | 738 | $ | 455,763 | ||||||||||||||||
evaluated for impairment (1) | ||||||||||||||||||||||||||||||||
-1 | In 2013, the bank began evaluating small dollar homogeneous impaired loans collectively for impairment and these impaired loans are included in this total. At December 31, 2013 there were $1.7 million in impaired loans collectively evaluated for impairment with $73,000 in reserves established. | |||||||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial | Commercial construction | Commercial | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
and | and land development | real estate | ||||||||||||||||||||||||||||||
Industrial | ||||||||||||||||||||||||||||||||
Balance, beginning of period | $ | 2,730 | $ | 8,799 | $ | 3,800 | $ | 740 | $ | 4,630 | $ | 413 | $ | 29 | $ | 21,141 | ||||||||||||||||
Provision for loan losses | (1,464 | ) | 5,205 | 2,486 | (214 | ) | 1,184 | 143 | 41 | 7,381 | ||||||||||||||||||||||
Loans charged-off | (703 | ) | (7,929 | ) | (3,691 | ) | (103 | ) | (1,801 | ) | (516 | ) | — | (14,743 | ) | |||||||||||||||||
Recoveries | 622 | 1,176 | 366 | — | 458 | 148 | — | 2,770 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | (81 | ) | (6,753 | ) | (3,325 | ) | (103 | ) | (1,343 | ) | (368 | ) | — | (11,973 | ) | |||||||||||||||||
Balance, end of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Ending Balance: individually evaluated for impairment | $ | 636 | $ | 1,693 | $ | 640 | $ | 86 | $ | 2,334 | $ | — | $ | — | $ | 5,389 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 549 | $ | 5,558 | $ | 2,321 | $ | 337 | $ | 2,137 | $ | 188 | $ | 70 | $ | 11,160 | ||||||||||||||||
Financing Receivables: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 29,563 | $ | 90,899 | $ | 181,194 | $ | 20,445 | $ | 165,009 | $ | 9,664 | $ | 1,278 | $ | 498,052 | ||||||||||||||||
Ending Balance: individually evaluated for impairment | $ | 1,437 | $ | 20,885 | $ | 17,742 | $ | 1,173 | $ | 17,573 | $ | 50 | $ | — | $ | 58,860 | ||||||||||||||||
Ending balance: collectively | $ | 28,126 | $ | 70,014 | $ | 163,452 | $ | 19,272 | $ | 147,436 | $ | 9,614 | $ | 1,278 | $ | 439,192 | ||||||||||||||||
evaluated for impairment | ||||||||||||||||||||||||||||||||
BANK_AND_PREMISES_EQUIPMENT_Ta
BANK AND PREMISES EQUIPMENT (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Schedule of Premises and Equipment | ' | |||||||
Company premises and equipment at December 31, 2013 and 2012 are as follows (amounts in thousands): | ||||||||
2013 | 2012 | |||||||
Land | $ | 4,394 | $ | 4,884 | ||||
Buildings and leasehold improvements | 11,171 | 11,139 | ||||||
Furniture and equipment | 11,511 | 11,586 | ||||||
Construction in process | 509 | — | ||||||
27,585 | 27,609 | |||||||
Less accumulated depreciation | (15,014 | ) | (14,227 | ) | ||||
$ | 12,571 | $ | 13,382 | |||||
OTHER_INTANGIBLES_Tables
OTHER INTANGIBLES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
Schedule of Intangible Assets | ' | |||||||
The following is a summary of other intangible assets at December 31, 2013 and 2012 (amounts in thousands): | ||||||||
2013 | 2012 | |||||||
Other intangibles – gross | $ | 3 | $ | 494 | ||||
Less accumulated amortization | 2 | 491 | ||||||
Other intangibles – net | $ | 1 | $ | 3 | ||||
DEPOSITS_Tables
DEPOSITS (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Banking and Thrift [Abstract] | ' | |||||||||||
Schedule of Maturities of Time Deposits | ' | |||||||||||
At December 31, 2013, the scheduled maturities of time deposits are as follows (amounts in thousands): | ||||||||||||
Less than | $100,000 | Total | ||||||||||
$100,000 | or more | |||||||||||
2014 | $ | 55,078 | $ | 84,649 | $ | 139,727 | ||||||
2015 | 31,686 | 45,275 | 76,961 | |||||||||
2016 | 9,257 | 17,817 | 27,074 | |||||||||
2017 | 2,207 | 7,417 | 9,624 | |||||||||
2018 | 2,402 | 4,522 | 6,924 | |||||||||
2019 and beyond | 282 | 2,723 | 3,005 | |||||||||
Total time deposits | $ | 100,912 | $ | 162,403 | $ | 263,315 | ||||||
BORROWINGS_Tables
BORROWINGS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||
Schedule of Federal Home Loan Bank, Advances | ' | ||||||||||||
At December 31, 2013 and 2012, borrowed funds included the following FHLB advances (amounts in thousands): | |||||||||||||
Maturity | Interest Rate | 2013 | 2012 | ||||||||||
May 25, 2016 | 4.46% | Fixed | $ | 5,000 | $ | 5,000 | |||||||
November 17, 2016 | 4.11% | Fixed | 5,000 | 5,000 | |||||||||
November 30, 2016 | 4.09% | Fixed | 7,000 | 7,000 | |||||||||
June 5, 2017 | 4.35% | Fixed | 10,000 | 10,000 | |||||||||
July 3, 2017 | 4.36% | Fixed | 13,000 | 13,000 | |||||||||
July 24, 2017 | 4.34% | Fixed | 5,000 | 5,000 | |||||||||
July 31, 2017 | 4.35% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 4.08% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 3.94% | Fixed | 5,000 | 5,000 | |||||||||
October 4, 2017 | 3.95% | Fixed | 7,000 | 7,000 | |||||||||
February 5, 2018 | 2.06% | Fixed | 10,000 | 10,000 | |||||||||
June 5, 2018 | 2.25% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 2.55% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 3.03% | Fixed | 5,000 | 5,000 | |||||||||
September 10, 2018 | 3.14% | Fixed | 10,000 | 10,000 | |||||||||
September 18, 2018 | 2.71% | Fixed | 10,000 | 10,000 | |||||||||
$ | 112,000 | $ | 112,000 | ||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Schedule of Components of Income Tax Expense (Benefit) | ' | |||||||
Allocation of income tax expense between current and deferred portions is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Current tax benefit: | ||||||||
Federal | $ | — | $ | (175 | ) | |||
State | — | — | ||||||
— | (175 | ) | ||||||
Deferred tax expense (benefit): | ||||||||
Federal | 279 | (2,617 | ) | |||||
State | (987 | ) | (444 | ) | ||||
(708 | ) | (3,061 | ) | |||||
Income tax benefit before adjustment to deferred tax asset valuation allowance | (708 | ) | (3,236 | ) | ||||
Increase in the valuation allowance | 708 | 3,061 | ||||||
Net deferred tax benefit | $ | — | $ | (175 | ) | |||
Schedule of Effective Income Tax Rate Reconciliation | ' | |||||||
The reconciliation of expected income tax at the statutory federal rate of 34% with income tax expense is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Expense computed at statutory rate of 34% | $ | (119 | ) | $ | (2,429 | ) | ||
Effect of state income taxes, net of federal benefit | (28 | ) | (36 | ) | ||||
Tax exempt income | (494 | ) | (293 | ) | ||||
Bank owned life insurance income | (82 | ) | (106 | ) | ||||
Valuation allowance | 708 | 3,061 | ||||||
Other, net | 15 | (372 | ) | |||||
$ | — | $ | (175 | ) | ||||
Schedule of Deferred Tax Assets | ' | |||||||
Deferred income taxes consist of the following (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2013 | 2012 | |||||||
Deferred tax assets: | ||||||||
Allowance for loan losses | $ | 4,389 | $ | 6,335 | ||||
Non-qualified stock options | 368 | 365 | ||||||
OTTI | 602 | 623 | ||||||
Net deferred loan fees | 189 | 43 | ||||||
Net operating loss | 16,313 | 12,818 | ||||||
FMV adjustment on purchased assets | 104 | 136 | ||||||
SERP accrual | 179 | 162 | ||||||
Other | 1,354 | 2,071 | ||||||
Unrealized loss on securities | 166 | — | ||||||
Total deferred tax assets | 23,664 | 22,553 | ||||||
Less valuation allowance | (22,542 | ) | (21,669 | ) | ||||
Net deferred tax assets | 1,122 | 884 | ||||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 765 | $ | 528 | ||||
Prepaid expense | 328 | 333 | ||||||
Unrealized gain on securities | — | (280 | ) | |||||
Other | 29 | 23 | ||||||
Total deferred tax liabilities | 1,122 | 604 | ||||||
Net deferred tax liability, included in other liabilities | $ | — | $ | 280 | ||||
REGULATORY_RESTRICTIONS_Tables
REGULATORY RESTRICTIONS (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Regulatory Capital Requirements [Abstract] | ' | ||||||||||||||||||||
Schedule of 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 | Minimum To Be Well | |||||||||||||||||||
Adequacy Purposes | Capitalized Under | ||||||||||||||||||||
Prompt Corrective | |||||||||||||||||||||
Action Provisions | |||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||
As of December 31, 2013: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,601 | 10.9 | % | $ | 37,057 | 8 | % | $ | 46,322 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 44,739 | 9.7 | % | 18,529 | 4 | % | 27,793 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 44,739 | 5.5 | % | 32,529 | 4 | % | 40,661 | 5 | % | ||||||||||||
As of December 31, 2012: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,044 | 10.2 | % | $ | 39,246 | 8 | % | $ | 49,057 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 43,797 | 8.9 | % | 19,623 | 4 | % | 29,434 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 43,797 | 5 | % | 34,949 | 4 | % | 43,687 | 5 | % | ||||||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Schedule of Loan Commitments | ' | |||||||
At December 31, 2013 and 2012, financial instruments whose contract amounts represent credit risk were (amounts in thousands) : | ||||||||
2013 | 2012 | |||||||
Commitments to extend credit | $ | 35,983 | $ | 37,920 | ||||
Undisbursed lines of credit | 16,500 | 20,852 | ||||||
Financial stand-by letters of credit | 798 | 416 | ||||||
Performance stand-by letters of credit | 193 | 2,422 | ||||||
Legally binding commitments | 53,474 | 61,610 | ||||||
Credit card lines | 13,858 | 13,152 | ||||||
Total | $ | 67,332 | $ | 74,762 | ||||
FAIR_VALUE_MEASUREMENT_Tables
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
Assets Measured at Fair Value on a Recurring Basis | ' | ||||||||||||||||||||
Below are tables that present information about assets measured at fair value on a recurring basis at December 31, 2013 and 2012 (amounts in thousands): | |||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Assets | Significant | Significant | |||||||||||||||||||
Total Carrying | Measured | Quoted Prices in | Other | Unobservable | |||||||||||||||||
Amount in the | at Fair Value | Active Markets | Observable | Inputs | |||||||||||||||||
Consolidated | for Identical | Inputs | |||||||||||||||||||
Balance Sheet | Assets | ||||||||||||||||||||
Description | 2013 | 2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 5,933 | $ | — | $ | 5,933 | $ | — | |||||||||||
Mortgage-backed securities | — | ||||||||||||||||||||
GNMA | 25,477 | 25,477 | — | 25,477 | — | ||||||||||||||||
FNMA | — | — | — | — | — | ||||||||||||||||
Trust preferred securities | 1,025 | 1,025 | — | — | 1,025 | ||||||||||||||||
Equity securities | 131 | 131 | 70 | 61 | — | ||||||||||||||||
Total available for sale securities | $ | 32,566 | $ | 32,566 | $ | 70 | $ | 31,471 | $ | 1,025 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2012 Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices in | Significant | Significant | |||||||||||||||||
Amount in the | Measured | Active Markets | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | for Identical | Observable | Inputs | |||||||||||||||||
Balance Sheet | Assets | Inputs | |||||||||||||||||||
Description | 2012 | 2012 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||
Taxable municipal securities | $ | 5,913 | $ | 5,913 | $ | — | $ | 5,913 | $ | — | |||||||||||
Mortgage-backed securities | |||||||||||||||||||||
GNMA | 60,743 | 60,743 | — | 60,743 | — | ||||||||||||||||
FNMA | 5,880 | 5,880 | — | 5,880 | — | ||||||||||||||||
Trust preferred securities | 1,006 | 1,006 | — | — | 1,006 | ||||||||||||||||
Equity securities | 180 | 180 | 56 | 124 | — | ||||||||||||||||
Total available for sale securities | $ | 73,722 | $ | 73,722 | $ | 56 | $ | 72,660 | $ | 1,006 | |||||||||||
Level 3 Assets Measured at Fair Value on a Recurring Basis | ' | ||||||||||||||||||||
The table below presents reconciliation for the years ended December 31, 2013 and 2012 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands). During the year ended December 31, 2013, no securities were transferred from Level 3 to Level 2. | |||||||||||||||||||||
Available-for-sale Securities | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Beginning Balance | $ | 1,006 | $ | 1,085 | |||||||||||||||||
Total realized and unrealized gains or (losses): | |||||||||||||||||||||
Included in earnings | — | — | |||||||||||||||||||
Included in other comprehensive income | 19 | (79 | ) | ||||||||||||||||||
Purchases, issuances and settlements | — | — | |||||||||||||||||||
Transfers in (out) of Level 3 | — | — | |||||||||||||||||||
Ending Balance | $ | 1,025 | $ | 1,006 | |||||||||||||||||
Impaired Loans and Foreclosed Assets Measured at Fair Value on a Nonrecurring Basis | ' | ||||||||||||||||||||
Assets measured at fair value on a non-recurring basis are included in the table below at December 31, 2013 and 2012 (amounts in thousands): | |||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet 2013 | Assets Measured at Fair Value 2013 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired Loans | $ | 18,215 | $ | 18,215 | $ | — | $ | — | $ | 18,215 | |||||||||||
Foreclosed assets | $ | 8,502 | $ | 8,502 | $ | — | $ | — | $ | 8,502 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2012, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet 2012 | Assets Measured at Fair Value 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired Loans | $ | 31,072 | $ | 31,072 | $ | — | $ | — | $ | 31,072 | |||||||||||
Foreclosed assets | $ | 15,136 | $ | 15,136 | $ | — | $ | — | $ | 15,136 | |||||||||||
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 recurring and nonrecurring basis at December 31, 2013 (amounts in thousands, except percentages): | |||||||||||||||||||||
Total Carrying Amount in the Consolidated Balance Sheet at December 31, 2013 | |||||||||||||||||||||
Recurring measurement: | Probability of default | 10-20% | |||||||||||||||||||
Trust preferred securities | $ | 1,025 | Loss given default | 100% | |||||||||||||||||
Nonrecurring measurements: | |||||||||||||||||||||
Impaired loans | $ | 18,215 | Collateral discounts | 9-50% | |||||||||||||||||
Foreclosed assets | $ | 8,502 | Discounted appraisals | 10-30% | |||||||||||||||||
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 | 10.5% - 40% | ||||||||||||||||||||
Commercial real estate other | 12.5% - 50% | ||||||||||||||||||||
Residential construction | 9% - 30% | ||||||||||||||||||||
Residential mortgage | 9% - 20% | ||||||||||||||||||||
All other segments | 9% - 20% |
STOCK_OPTION_PLAN_Tables
STOCK OPTION PLAN (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||
Summary of Option Activity | ' | ||||||||||||
A summary of option activity under the Plan for the year ended December 31, 2013, is presented below: | |||||||||||||
Shares | Option | Weighted Average Remaining Contractual Term | Aggregate | ||||||||||
Price Per | Intrinsic | ||||||||||||
Share | Value | ||||||||||||
Outstanding at January 1, 2013 | 253,680 | $ | 7 | ||||||||||
Issued | 59,300 | 1.15 | |||||||||||
Exercised | — | — | |||||||||||
Forfeited | 11,275 | 3.33 | |||||||||||
Expired | — | — | |||||||||||
Balance at December 31, 2013 | 301,705 | $ | 5.99 | 2.26 | $ | 25,200 | |||||||
Exercisable at December 31, 2013 | 190,049 | $ | 8.67 | 1.43 | $ | — | |||||||
Schedule of Shares Authorized under Stock Option Plans, by Exercise Price Range | ' | ||||||||||||
Additional information concerning the Company’s stock options at December 31, 2013 is as follows: | |||||||||||||
Exercise Price | Number | Contractual | Number | ||||||||||
Outstanding | Life (Years) | Exercisable | |||||||||||
1.15-1.69 | 56,000 | 4.19 | — | ||||||||||
1.70 - 2.99 | 55,625 | 3.16 | — | ||||||||||
3.00 - 5.49 | 51,750 | 2.16 | 51,746 | ||||||||||
5.50 - 8.63 | 51,125 | 1.15 | 51,102 | ||||||||||
8.64 - 10.91 | 47,775 | 0.15 | 47,774 | ||||||||||
10.92 - 40.78 | 27,125 | 1.59 | 27,122 | ||||||||||
40.79 | 12,305 | 4.07 | 12,305 | ||||||||||
301,705 | 2.26 | 190,049 | |||||||||||
Schedule of Stock Options, Valuation Assumptions | ' | ||||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions used for grants in 2013 and 2012: | |||||||||||||
2013 | 2012 | ||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||
Expected volatility | 73.3 | % | 60.37 | % | |||||||||
Risk free interest rate | 0.9 | % | 0.84 | % | |||||||||
Expected life | 5 years | 5 years | |||||||||||
Stock Options [Member] | ' | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ||||||||||||
Summary of Non-vested Options | ' | ||||||||||||
A summary of the status of the Company's non-vested options as of December 31, 2013 and changes during the year then ended is presented below: | |||||||||||||
Shares | Weighted average grant date fair value | ||||||||||||
Non-vested - December 31, 2012 | 112,131 | $ | 1.09 | ||||||||||
Granted | 56,000 | 0.69 | |||||||||||
Vested | 3,075 | 0.87 | |||||||||||
Forfeited/Expired | 53,400 | 1.34 | |||||||||||
Non-vested - December 31, 2013 | 111,656 | $ | 0.78 | ||||||||||
LEASES_Tables
LEASES (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Leases [Abstract] | ' | |||
Schedule of Future Minimum Rental Payments | ' | |||
Future minimum lease payments under the leases for future years are as follows (amounts in thousands): | ||||
Leases | ||||
2014 | $ | 329 | ||
2015 | 319 | |||
2016 | 260 | |||
2017 | 211 | |||
2018 | 185 | |||
2019 and beyond | 627 | |||
$ | 1,931 | |||
PARENT_COMPANY_FINANCIAL_INFOR1
PARENT COMPANY FINANCIAL INFORMATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ' | |||||||
Schedule of Condensed Balance Sheets | ' | |||||||
Condensed financial information of Four Oaks Fincorp, Inc. at December 31, 2013 and 2012, and for the years ended December 31, 2013 and 2012 is presented below (amounts in thousands): | ||||||||
Condensed Balance Sheets | 2013 | 2012 | ||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 456 | $ | 784 | ||||
Equity investment in subsidiaries | 44,925 | 45,025 | ||||||
Investment securities available for sale | 1,156 | 1,186 | ||||||
Other assets | 195 | 587 | ||||||
Total assets | $ | 46,732 | $ | 47,582 | ||||
Liabilities and Shareholders’ Equity: | ||||||||
Other liabilities | $ | 737 | $ | 534 | ||||
Subordinated debentures | 12,372 | 12,372 | ||||||
Subordinated promissory notes | 12,000 | 12,000 | ||||||
Shareholders' equity | 21,623 | 22,676 | ||||||
Total liabilities and shareholders’ equity | $ | 46,732 | $ | 47,582 | ||||
Schedule of Condensed Statements of Operations | ' | |||||||
For the Years Ended December 31, | ||||||||
Condensed Statements of Operations | 2013 | 2012 | ||||||
Equity in undistributed income (loss) of subsidiaries | $ | 899 | $ | (5,848 | ) | |||
Interest income | 2 | 113 | ||||||
Gain on sale of investments, available for sale | — | — | ||||||
Impairment loss on investment securities available for sale | — | — | ||||||
Other income | 87 | 154 | ||||||
Other expenses | (1,338 | ) | (1,388 | ) | ||||
Net loss | $ | (350 | ) | $ | (6,969 | ) | ||
Schedule of Condensed Statements of Cash Flows | ' | |||||||
Condensed Statements of Cash Flows | 2013 | 2012 | ||||||
Operating activities: | ||||||||
Net income (loss) | $ | (350 | ) | $ | (6,969 | ) | ||
Equity in undistributed loss of subsidiaries | (899 | ) | 5,848 | |||||
Stock based compensation | — | 62 | ||||||
Decrease in other assets | 427 | 5 | ||||||
Increase in other liabilities | 203 | 217 | ||||||
Net cash used in operating activities | (619 | ) | (837 | ) | ||||
Investing activities: | ||||||||
Investment in subsidiaries | — | (40 | ) | |||||
Sales and maturities of securities | 72 | |||||||
Net cash used in investing activities | 72 | (40 | ) | |||||
Financing activities: | ||||||||
Proceeds from issuance of common stock | 219 | 234 | ||||||
Net cash provided by financing activities | 219 | 234 | ||||||
Net decrease in cash and cash equivalents | (328 | ) | (643 | ) | ||||
Cash and cash equivalents, beginning of year | 784 | 1,427 | ||||||
Cash and cash equivalents, end of year | $ | 456 | $ | 784 | ||||
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | |||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||||
Information for Financial Assets and Liabilities | ' | |||||||||||||||||
The following table presents information for financial assets and liabilities as of December 31, 2013 and 2012 (amounts in thousands): | ||||||||||||||||||
December 31, 2013 | ||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | ||||||||||||||
Value | Fair Value | |||||||||||||||||
Financial assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 128,629 | $ | 128,629 | $ | 128,629 | $ | — | $ | — | ||||||||
CDs held for investment | 31,850 | 31,850 | — | 31,850 | — | |||||||||||||
Securities available for sale | 32,566 | 32,566 | 50 | 31,491 | 1,025 | |||||||||||||
Securities held to maturity | 98,013 | 95,831 | — | 95,831 | — | |||||||||||||
Loans, net | 481,122 | 458,254 | — | — | 458,254 | |||||||||||||
FHLB stock | 6,076 | 6,076 | — | 6,076 | — | |||||||||||||
Accrued interest receivable | 1,576 | 1,576 | — | 1,576 | — | |||||||||||||
Financial liabilities: | ||||||||||||||||||
Deposits | $ | 657,620 | $ | 659,733 | $ | — | $ | 659,733 | $ | — | ||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 24,369 | — | — | 24,369 | |||||||||||||
Borrowings | 112,000 | 121,519 | — | 121,519 | — | |||||||||||||
Accrued interest payable | 1,642 | 1,642 | — | 1,642 | — | |||||||||||||
31-Dec-12 | ||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | ||||||||||||||
Value | Fair Value | |||||||||||||||||
Financial assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 183,150 | $ | 183,150 | $ | 183,150 | $ | — | $ | — | ||||||||
CDs held for investment | 26,460 | 26,460 | — | 26,460 | — | |||||||||||||
Securities available for sale | 73,722 | 73,722 | 56 | 72,660 | 1,006 | |||||||||||||
Securities held to maturity | 20,329 | 20,668 | — | 20,668 | — | |||||||||||||
Loans held for sale | 19,297 | 19,297 | — | — | 19,297 | |||||||||||||
Loans, net | 462,083 | 460,422 | — | — | 460,422 | |||||||||||||
FHLB stock | 6,415 | 6,415 | — | 6,415 | — | |||||||||||||
Premises and equipment, held for sale | 1,901 | 1,901 | — | — | 1,901 | |||||||||||||
Accrued interest receivable | 1,869 | 1,869 | — | 1,869 | — | |||||||||||||
Financial liabilities: | ||||||||||||||||||
Deposits | $ | 699,856 | $ | 702,990 | $ | — | $ | 702,990 | $ | — | ||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 15,598 | — | — | 15,598 | |||||||||||||
Borrowings | 112,000 | 126,738 | — | 126,738 | — | |||||||||||||
Accrued interest payable | 1,736 | 1,736 | — | 1,736 | — | |||||||||||||
ORGANIZATION_AND_SUMMARY_OF_SI3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) (USD $) | 12 Months Ended | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Mar. 26, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Building [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | Risk Grade 1 [Member] | Risk Grade 6 [Member] | Risk Grade 5s and 6s [Member] | Risk Grade 5s and 6s [Member] | Current Model [Member] | Current Model [Member] | Interest Rate Lock Commitments [Member] | Subsequent Event [Member] | Parent Company [Member] | Parent Company [Member] | Four Oaks Bank & Trust Company (the bBankb) [Member] | Four Oaks Bank & Trust Company (the bBankb) [Member] | ||||
Furniture and Equipment [Member] | Furniture and Equipment [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Rolling Two Years Charge-offs [Member] | Rolling Three Yeard Charge-offs [Member] | |||||||||||||
Going Concern Consideration: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Provision for loan losses | $35,000 | $7,381,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Allowance for loan losses, net charge-offs | 4,994,000 | 11,973,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total capital to risk weighted assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.70% | 10.10% | 10.90% | 10.20% |
Tier 1 capital to risk weighted assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.30% | 5.90% | 9.70% | 8.90% |
Tier 1 capital to average assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.60% | 3.30% | 5.50% | 5.00% |
Decline in the level of non-performing assets | -30.10% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recorded investment of non-erforming assets | 35,800,000 | 51,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Decrease in recorded investment in impaired loans | -33.40% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impaired loans | 39,176,000 | 58,860,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of net charge-offs to average recorded investment on nonperforming Loans | 11.60% | 19.80% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Average recorded investment in impaired loans | 43,076,000 | 60,501,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreclosed assets | 8,502,000 | 15,136,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transfer of loans to foreclosed assets | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sales of foreclosed assets | 8,292,000 | 7,254,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Valuation adjustment on foreclosed assets | 1,590,000 | 2,321,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum net proceeds from the Securities Purchase Agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 26,600,000 | ' | ' | ' | ' |
Cash and cash equivalents | 128,629,000 | 183,150,000 | 141,197,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and Cash Equivalents: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Daily average gross reserve requirement | 3,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rate Lock Commitments: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate lock commitment period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days | ' | ' | ' | ' | ' |
Allowance for Loan Losses: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Charge-off rate, period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | '3 years | ' | ' | ' | ' | ' | ' |
Standard multipliers | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | 300.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional reserve factor for categories with concentrated level of charge-offs | ' | ' | ' | ' | 50.00% | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional reserve factor for categories with historically high charge-offs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Bank Premises and Equipment: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Bank premises and equipment, useful life | ' | ' | ' | '40 years | ' | '5 years | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock in Federal Home Loan Bank of Atlanta: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FHLB stock | 6,076,000 | 6,415,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income Taxes: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Valuation allowance | $22,542,000 | $21,669,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Loss Per Common Share and Common Shares Outstanding: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding antidilutive options (in shares) | 301,705 | 253,680 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
ORGANIZATION_AND_SUMMARY_OF_SI4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Net Loss Per Common Share and Common Shares Outstanding) (Details) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Weighted average number of common shares outstanding: | ' | ' |
Weighted average number of common shares used in computing basic net loss per share | 7,914,110 | 7,745,342 |
Effect of dilutive stock options (in shares) | 0 | 0 |
Weighted average number of commons shares and dilutive potential common shares used in computing diluted net loss per share | 7,914,110 | 7,745,342 |
INVESTMENT_SECURITIES_Availabl
INVESTMENT SECURITIES (Available for Sale Securities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | $33,222 | $72,732 |
Gross Unrealized Gains | 33 | 1,179 |
Gross Unrealized Losses | 689 | 189 |
Fair Value | 32,566 | 73,722 |
Taxable Municipal Securities [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | 6,176 | 5,459 |
Gross Unrealized Gains | 0 | 454 |
Gross Unrealized Losses | 243 | 0 |
Fair Value | 5,933 | 5,913 |
Mortgage-backed Securities GNMA [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | 25,773 | 60,056 |
Gross Unrealized Gains | 0 | 704 |
Gross Unrealized Losses | 296 | 17 |
Fair Value | 25,477 | 60,743 |
Mortgage-backed Securities FNMA [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | 0 | 5,872 |
Gross Unrealized Gains | 0 | 10 |
Gross Unrealized Losses | 0 | 2 |
Fair Value | 0 | 5,880 |
Trust Preferred Securities [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | 1,175 | 1,175 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 150 | 169 |
Fair Value | 1,025 | 1,006 |
Equity Securities [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost | 98 | 170 |
Gross Unrealized Gains | 33 | 11 |
Gross Unrealized Losses | 0 | 1 |
Fair Value | $131 | $180 |
INVESTMENT_SECURITIES_Held_to_
INVESTMENT SECURITIES (Held to Maturity Securities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Schedule of Held-to-maturity Securities [Line Items] | ' | ' |
Amortized Cost | $98,013 | $20,329 |
Gross Unrealized Gains | 165 | 339 |
Gross Unrealized Losses | 2,347 | 0 |
Fair Value | 95,831 | 20,668 |
Taxable Municipal Securities [Member] | ' | ' |
Schedule of Held-to-maturity Securities [Line Items] | ' | ' |
Amortized Cost | 3,635 | 0 |
Gross Unrealized Gains | 3 | 0 |
Gross Unrealized Losses | 157 | 0 |
Fair Value | 3,481 | 0 |
Mortgage-backed Securities GNMA [Member] | ' | ' |
Schedule of Held-to-maturity Securities [Line Items] | ' | ' |
Amortized Cost | 89,892 | 20,329 |
Gross Unrealized Gains | 162 | 339 |
Gross Unrealized Losses | 2,171 | 0 |
Fair Value | 87,883 | 20,668 |
Mortgage-backed Securities FNMA [Member] | ' | ' |
Schedule of Held-to-maturity Securities [Line Items] | ' | ' |
Amortized Cost | 4,486 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 19 | 0 |
Fair Value | $4,467 | $0 |
INVESTMENT_SECURITIES_Unrealiz
INVESTMENT SECURITIES (Unrealized Losses and Fair Values of Investment Securities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Temporarily Impaired Securities [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | $31,410,000 | $7,130,000 |
Less Than 12 Months, Unrealized losses | 539,000 | 19,000 |
12 Months or More, Fair value | 0 | 2,000 |
12 Months or More, Unrealized losses | 0 | 1,000 |
Total, Fair value | 31,410,000 | 7,132,000 |
Total, Unrealized losses | 539,000 | 20,000 |
Securities Held to Maturity: | ' | ' |
Less Than 12 Months, Fair value | 82,073,000 | ' |
Less Than 12 Months, Unrealized losses | 2,249,000 | ' |
12 Months or More, Fair value | 2,223,000 | ' |
12 Months or More, Unrealized losses | 98,000 | ' |
Total, Fair value | 84,296,000 | ' |
Total, Unrealized losses | 2,347,000 | ' |
Temporarily Impaired Securities [Member] | Taxable Municipal Securities [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | 5,933,000 | ' |
Less Than 12 Months, Unrealized losses | 243,000 | ' |
12 Months or More, Fair value | 0 | ' |
12 Months or More, Unrealized losses | 0 | ' |
Total, Fair value | 5,933,000 | ' |
Total, Unrealized losses | 243,000 | ' |
Securities Held to Maturity: | ' | ' |
Less Than 12 Months, Fair value | 2,776,000 | ' |
Less Than 12 Months, Unrealized losses | 157,000 | ' |
12 Months or More, Fair value | 0 | ' |
12 Months or More, Unrealized losses | 0 | ' |
Total, Fair value | 2,776,000 | ' |
Total, Unrealized losses | 157,000 | ' |
Temporarily Impaired Securities [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | 25,477,000 | 5,132,000 |
Less Than 12 Months, Unrealized losses | 296,000 | 17,000 |
12 Months or More, Fair value | 0 | 0 |
12 Months or More, Unrealized losses | 0 | 0 |
Total, Fair value | 25,477,000 | 5,132,000 |
Total, Unrealized losses | 296,000 | 17,000 |
Securities Held to Maturity: | ' | ' |
Less Than 12 Months, Fair value | 74,830,000 | ' |
Less Than 12 Months, Unrealized losses | 2,073,000 | ' |
12 Months or More, Fair value | 2,223,000 | ' |
12 Months or More, Unrealized losses | 98,000 | ' |
Total, Fair value | 77,053,000 | ' |
Total, Unrealized losses | 2,171,000 | ' |
Temporarily Impaired Securities [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | ' | 1,998,000 |
Less Than 12 Months, Unrealized losses | ' | 2,000 |
12 Months or More, Fair value | ' | 0 |
12 Months or More, Unrealized losses | ' | 0 |
Total, Fair value | ' | 1,998,000 |
Total, Unrealized losses | ' | 2,000 |
Securities Held to Maturity: | ' | ' |
Less Than 12 Months, Fair value | 4,467,000 | ' |
Less Than 12 Months, Unrealized losses | 19,000 | ' |
12 Months or More, Fair value | 0 | ' |
12 Months or More, Unrealized losses | 0 | ' |
Total, Fair value | 4,467,000 | ' |
Total, Unrealized losses | 19,000 | ' |
Temporarily Impaired Securities [Member] | Equity Securities [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | ' | 0 |
Less Than 12 Months, Unrealized losses | ' | 0 |
12 Months or More, Fair value | ' | 2,000 |
12 Months or More, Unrealized losses | ' | 1,000 |
Total, Fair value | ' | 2,000 |
Total, Unrealized losses | ' | 1,000 |
Other than Temporarily Impaired Securities [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | 0 | 0 |
Less Than 12 Months, Unrealized losses | 0 | 0 |
12 Months or More, Fair value | 1,025,000 | 1,006,000 |
12 Months or More, Unrealized losses | 150,000 | 169,000 |
Total, Fair value | 1,025,000 | 1,006,000 |
Total, Unrealized losses | 150,000 | 169,000 |
Other than Temporarily Impaired Securities [Member] | Trust Preferred Securities [Member] | ' | ' |
Securities available for sale: | ' | ' |
Less Than 12 Months, Fair value | 0 | 0 |
Less Than 12 Months, Unrealized losses | 0 | 0 |
12 Months or More, Fair value | 1,025,000 | 1,006,000 |
12 Months or More, Unrealized losses | 150,000 | 169,000 |
Total, Fair value | 1,025,000 | 1,006,000 |
Total, Unrealized losses | $150,000 | $169,000 |
INVESTMENT_SECURITIES_Roll_For
INVESTMENT SECURITIES (Roll Forward of Credit Losses on Debt Securities) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Roll forward of credit losses recognized on debt securities held with OTTI recognized in OCI: | ' | ' |
Balance of credit losses on debt securities at the beginning of the period | $75 | $75 |
Additional increase related to the credit loss for which an other-than-temporary impairment was previously recognized | 0 | 0 |
Balance of credit losses on debt securities at the end of the period | $75 | $75 |
INVESTMENT_SECURITIES_Investme
INVESTMENT SECURITIES (Investment Securities Classified by Contractual Maturities) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Available for Sale, Amortized Cost | ' | ' |
Total amortized cost | $33,222 | $72,732 |
Available for Sale, Fair Value | ' | ' |
Fair Value | 32,566 | 73,722 |
Held to Maturity, Fair Value | ' | ' |
Fair Value | 95,831 | 20,668 |
Taxable Municipal Securities [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 6,176 | ' |
Total amortized cost | 6,176 | 5,459 |
Available for Sale, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 5,933 | ' |
Fair Value | 5,933 | 5,913 |
Held to Maturity, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 803 | ' |
Due after five years through ten years | 2,832 | ' |
Due after ten years | 0 | ' |
Total amortized cost | 3,635 | ' |
Held to Maturity, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 785 | ' |
Due after five years through ten years | 2,696 | ' |
Due after ten years | 0 | ' |
Fair Value | 3,481 | 0 |
Mortgage-backed Securities GNMA [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 25,773 | ' |
Due after ten years | 0 | ' |
Total amortized cost | 25,773 | 60,056 |
Available for Sale, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 25,477 | ' |
Due after ten years | 0 | ' |
Fair Value | 25,477 | 60,743 |
Held to Maturity, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 51,419 | ' |
Due after five years through ten years | 34,261 | ' |
Due after ten years | 4,212 | ' |
Total amortized cost | 89,892 | ' |
Held to Maturity, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 50,936 | ' |
Due after five years through ten years | 32,920 | ' |
Due after ten years | 4,027 | ' |
Fair Value | 87,883 | 20,668 |
Mortgage-backed Securities FNMA [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 0 | ' |
Total amortized cost | 0 | 5,872 |
Available for Sale, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 0 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 0 | ' |
Fair Value | 0 | 5,880 |
Held to Maturity, Amortized Cost | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 4,486 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 0 | ' |
Total amortized cost | 4,486 | ' |
Held to Maturity, Fair Value | ' | ' |
Due within one year | 0 | ' |
Due after one year through five years | 4,467 | ' |
Due after five years through ten years | 0 | ' |
Due after ten years | 0 | ' |
Fair Value | 4,467 | 0 |
Trust Preferred Securities [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Total amortized cost | 1,175 | 1,175 |
Available for Sale, Fair Value | ' | ' |
Fair Value | 1,025 | 1,006 |
Equity Securities [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Total amortized cost | 98 | 170 |
Available for Sale, Fair Value | ' | ' |
Fair Value | 131 | 180 |
Total Other Securities [Member] | ' | ' |
Available for Sale, Amortized Cost | ' | ' |
Total amortized cost | 1,273 | ' |
Available for Sale, Fair Value | ' | ' |
Fair Value | $1,156 | ' |
INVESTMENT_SECURITIES_Narrativ
INVESTMENT SECURITIES (Narrative) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Other than temporary impairment, credit losses on debt securities | $75,000 | $75,000 | $75,000 |
Investment securities available for sale, at fair value | 32,566,000 | 73,722,000 | ' |
Amortized cost basis | 33,222,000 | 72,732,000 | ' |
Carrying value of securities | 92,800,000 | 93,200,000 | ' |
Proceeds from sales and calls of investment securities available for sale | 20,873,000 | 50,414,000 | ' |
Gross realized gains | 462,460 | 2,000,000 | ' |
Gross realized losses | 0 | 0 | ' |
Collateralized Mortgage Obligations, Issued by GNMA [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Number of positions | 14 | ' | ' |
Number of debt securities held | 16 | ' | ' |
MBS, Pass-through Securities [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Number of positions | 37 | ' | ' |
Number of debt securities held | 45 | ' | ' |
Trust Preferred Securities [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Number of positions | 2 | ' | ' |
Number of debt securities held | 2 | ' | ' |
Trust Preferred Security 1 [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Aggregate unrealized losses | 60,000 | ' | 146,000 |
Basis in investment | 675,000 | ' | 750,000 |
Investment securities available for sale, at fair value | 615,000 | ' | ' |
Available-for-sale Securities [Member] | Trust Preferred Security 1 [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Other than temporary impairment, credit losses on debt securities | ' | ' | 75,000 |
Other than Temporarily Impaired Securities [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Aggregate unrealized losses | 150,000 | 169,000 | ' |
Other than Temporarily Impaired Securities [Member] | Trust Preferred Security 2 [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Aggregate unrealized losses | 90,000 | ' | ' |
Investment securities available for sale, at fair value | 410,000 | ' | ' |
Amortized cost basis | $500,000 | ' | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Loans Outstanding) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||
Loans and Leases Receivable Disclosure [Abstract] | ' | ' | ' |
Commercial loans | $25,858 | $28,377 | ' |
Commercial construction and land development | 66,253 | 90,899 | ' |
Commercial real estate | 194,238 | 181,194 | ' |
Residential construction | 28,697 | 20,445 | ' |
Residential mortgage | 167,221 | 165,009 | ' |
Consumer | 6,750 | 7,399 | ' |
Other | 738 | 1,278 | ' |
Consumer credit cards | 2,339 | 2,265 | ' |
Business credit cards | 1,124 | 1,186 | ' |
Total | 493,218 | 498,052 | ' |
Deferred cost and (fees), net | -506 | -123 | ' |
Allowance for loan losses | -11,590 | -16,549 | -21,141 |
Net loans | 481,122 | 481,380 | ' |
Loans held for sale | $0 | $19,297 | ' |
LOANS_AND_ALLOWANCE_FOR_LOAN_L3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Nonperforming Assets) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Loans and Leases Receivable Disclosure [Abstract] | ' | ' |
Loans past due ninety days or more and still accruing | $23 | $32 |
Nonaccrual loans | 27,227 | 35,970 |
Foreclosed assets | 8,502 | 15,136 |
Total | $35,752 | $51,138 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Related Party Loans) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Loans and Leases Receivable, Related Parties [Roll Forward] | ' | ' |
Balance at beginning of period | $15,009 | $15,825 |
New loans | 2,600 | 937 |
Principal repayments | -7,769 | -1,753 |
Balance at end of period | $9,840 | $15,009 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Credit Quality) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | $25,858 | $28,377 |
Commercial Construction and Land Development | 66,253 | 90,899 |
Commercial Real Estate- Other | 194,238 | 181,194 |
Residential - Construction | 28,697 | 20,445 |
Residential - Mortgage | 167,221 | 165,009 |
Consumer - Other | 6,750 | 7,399 |
Other - Loans | 738 | 1,278 |
Total | 489,755 | 494,601 |
Consumer - Credit Card | 2,339 | 2,265 |
Business- Credit Card | 1,124 | 1,186 |
Credit Card Portfolio Exposure [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Consumer - Credit Card | 2,339 | 2,265 |
Business- Credit Card | 1,124 | 1,186 |
1 - Lowest Risk [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 2,014 | 2,446 |
Commercial Construction and Land Development | 0 | 0 |
Commercial Real Estate- Other | 0 | 0 |
Residential - Construction | 0 | 0 |
Residential - Mortgage | 0 | 51 |
Consumer - Other | 1,365 | 1,372 |
Other - Loans | 8 | 13 |
Total | 3,387 | 3,882 |
2 - Satisfactory Quality [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 646 | 441 |
Commercial Construction and Land Development | 374 | 595 |
Commercial Real Estate- Other | 2,548 | 2,429 |
Residential - Construction | 2 | 109 |
Residential - Mortgage | 12,959 | 10,595 |
Consumer - Other | 412 | 288 |
Other - Loans | 15 | 0 |
Total | 16,956 | 14,457 |
3 - Satisfactory Quality - Merits Attention [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 9,639 | 10,222 |
Commercial Construction and Land Development | 14,296 | 22,278 |
Commercial Real Estate- Other | 71,250 | 51,384 |
Residential - Construction | 3,473 | 1,337 |
Residential - Mortgage | 57,792 | 58,140 |
Consumer - Other | 3,628 | 4,526 |
Other - Loans | 482 | 1,091 |
Total | 160,560 | 148,978 |
4 - Low Satisfactory [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 12,616 | 13,558 |
Commercial Construction and Land Development | 36,723 | 35,502 |
Commercial Real Estate- Other | 106,652 | 104,652 |
Residential - Construction | 23,779 | 17,008 |
Residential - Mortgage | 72,330 | 68,148 |
Consumer - Other | 1,235 | 1,019 |
Other - Loans | 107 | 125 |
Total | 253,442 | 240,012 |
5 - Special Mention [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 137 | 323 |
Commercial Construction and Land Development | 1,922 | 9,064 |
Commercial Real Estate- Other | 2,303 | 6,228 |
Residential - Construction | 262 | 356 |
Residential - Mortgage | 8,705 | 9,720 |
Consumer - Other | 63 | 91 |
Other - Loans | 126 | 49 |
Total | 13,518 | 25,831 |
6 - Substandard or Worse [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Commercial and Industrial | 806 | 1,387 |
Commercial Construction and Land Development | 12,938 | 23,460 |
Commercial Real Estate- Other | 11,485 | 16,501 |
Residential - Construction | 1,181 | 1,635 |
Residential - Mortgage | 15,435 | 18,355 |
Consumer - Other | 47 | 103 |
Other - Loans | 0 | 0 |
Total | 41,892 | 61,441 |
Performing [Member] | Credit Card Portfolio Exposure [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Consumer - Credit Card | 2,316 | 2,233 |
Business- Credit Card | 1,124 | 1,186 |
Non Performing [Member] | Credit Card Portfolio Exposure [Member] | ' | ' |
Financing Receivable, Recorded Investment [Line Items] | ' | ' |
Consumer - Credit Card | 23 | 32 |
Business- Credit Card | $0 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Loans on Nonaccrual Status) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | $27,227 | $35,970 |
Commercial and Industrial [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 651 | 664 |
Commercial Construction and Land Development [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 9,536 | 15,941 |
Commercial Real Estate [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 6,391 | 9,091 |
Residential Construction [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 695 | 833 |
Residential Mortgage [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 9,943 | 9,408 |
Consumer [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | 11 | 33 |
Other [Member] | ' | ' |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' |
Nonaccrual loans | $0 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Age Analysis of Past Due Loans) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | $1,595 | $2,626 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 27,250 | [1] | 36,002 | [2] |
Total Past Due | 28,845 | 38,628 | ||
Current | 464,373 | 459,424 | ||
Total | 493,218 | 498,052 | ||
Greater than 90 days past due | 23 | 32 | ||
Nonaccrual loans | 27,227 | 35,970 | ||
Commercial and Industrial [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 34 | 119 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 651 | 664 | ||
Total Past Due | 685 | 783 | ||
Current | 25,173 | 27,594 | ||
Total | 25,858 | 28,377 | ||
Commercial Construction and Land Development [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 252 | 819 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 9,536 | 15,941 | ||
Total Past Due | 9,788 | 16,760 | ||
Current | 56,465 | 74,139 | ||
Total | 66,253 | 90,899 | ||
Commercial Real Estate [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 749 | 499 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 6,391 | 9,091 | ||
Total Past Due | 7,140 | 9,590 | ||
Current | 187,098 | 171,604 | ||
Total | 194,238 | 181,194 | ||
Residential Construction [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 0 | 0 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 695 | 833 | ||
Total Past Due | 695 | 833 | ||
Current | 28,002 | 19,612 | ||
Total | 28,697 | 20,445 | ||
Residential Mortgage [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 421 | 1,076 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 9,943 | 9,408 | ||
Total Past Due | 10,364 | 10,484 | ||
Current | 156,857 | 154,525 | ||
Total | 167,221 | 165,009 | ||
Consumer [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 11 | 34 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 11 | 33 | ||
Total Past Due | 22 | 67 | ||
Current | 6,728 | 7,332 | ||
Total | 6,750 | 7,399 | ||
Consumer Credit Cards [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 76 | 67 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 23 | 32 | ||
Total Past Due | 99 | 99 | ||
Current | 2,240 | 2,166 | ||
Total | 2,339 | 2,265 | ||
Business Credit Cards [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 52 | 12 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 0 | 0 | ||
Total Past Due | 52 | 12 | ||
Current | 1,072 | 1,174 | ||
Total | 1,124 | 1,186 | ||
Other Loans [Member] | ' | ' | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ' | ' | ||
30-89 Days Past Due | 0 | 0 | ||
Nonaccruals & Greater than 90 Days Past Due (1) | 0 | 0 | ||
Total Past Due | 0 | 0 | ||
Current | 738 | 1,278 | ||
Total | $738 | $1,278 | ||
[1] | Nonaccruals and Greater than 90 Days Past Due is comprised of $23,000 of loans that were past due more than 90 days and still accruing interest, as well as $27.2 million of loans in nonaccrual status | |||
[2] | Nonaccruals and Greater than 90 Days Past Due is comprised of $32,000 of loans that were past due more than 90 days and still accruing interest, as well as $36.0 million of loans in nonaccrual status. |
LOANS_AND_ALLOWANCE_FOR_LOAN_L8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Impaired Loans) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | $31,404 | $35,100 |
With an allowance recorded | 7,772 | 23,760 |
Total | 39,176 | 58,860 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 39,696 | 42,762 |
With an allowance recorded | 9,178 | 30,090 |
Total | 48,874 | 72,852 |
Impaired Loans, Related Allowance | 1,825 | 5,389 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 35,055 | 35,945 |
With an allowance recorded | 8,021 | 24,556 |
Total | 43,076 | 60,501 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 449 | 219 |
With an allowance recorded | 144 | 137 |
Total | 593 | 356 |
Commercial [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
Total | 25,609 | 40,064 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
Total | 32,908 | 51,679 |
Impaired Loans, Related Allowance | 1,232 | 2,969 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
Total | 28,713 | 41,974 |
Impaired Loans, Interest Income Recognized | ' | ' |
Total | 438 | 180 |
Commercial and Industrial [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 380 | 498 |
With an allowance recorded | 309 | 939 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 517 | 686 |
With an allowance recorded | 322 | 956 |
Impaired Loans, Related Allowance | 80 | 636 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 491 | 484 |
With an allowance recorded | 321 | 528 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 2 | 1 |
With an allowance recorded | 0 | 11 |
Commercial Construction and Land Development [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 11,142 | 11,266 |
With an allowance recorded | 1,315 | 9,619 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 15,809 | 15,889 |
With an allowance recorded | 2,033 | 13,033 |
Impaired Loans, Related Allowance | 264 | 1,693 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 13,259 | 13,008 |
With an allowance recorded | 1,348 | 10,003 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 168 | 22 |
With an allowance recorded | 0 | 36 |
Commercial Real Estate [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 8,437 | 12,865 |
With an allowance recorded | 4,026 | 4,877 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 10,131 | 14,263 |
With an allowance recorded | 4,096 | 6,852 |
Impaired Loans, Related Allowance | 888 | 640 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 9,190 | 12,328 |
With an allowance recorded | 4,104 | 5,623 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 132 | 64 |
With an allowance recorded | 136 | 46 |
Residential [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
Total | 13,556 | 18,746 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
Total | 15,944 | 21,097 |
Impaired Loans, Related Allowance | 593 | 2,420 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
Total | 14,346 | 18,476 |
Impaired Loans, Interest Income Recognized | ' | ' |
Total | 155 | 176 |
Residential Construction [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 486 | 340 |
With an allowance recorded | 695 | 833 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 486 | 340 |
With an allowance recorded | 1,134 | 1,134 |
Impaired Loans, Related Allowance | 137 | 86 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 474 | 162 |
With an allowance recorded | 749 | 884 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 26 | 0 |
With an allowance recorded | 0 | 0 |
Residential Mortgage [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 10,948 | 10,106 |
With an allowance recorded | 1,427 | 7,467 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 12,731 | 11,542 |
With an allowance recorded | 1,593 | 8,081 |
Impaired Loans, Related Allowance | 456 | 2,334 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 11,624 | 9,937 |
With an allowance recorded | 1,499 | 7,493 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 121 | 132 |
With an allowance recorded | 8 | 44 |
Consumer [Member] | ' | ' |
Impaired Loans, Recorded Investment | ' | ' |
With no related allowance recorded | 11 | 25 |
With an allowance recorded | 0 | 25 |
Total | 11 | 50 |
Impaired Loans, Unpaid Principal Balance | ' | ' |
With no related allowance recorded | 22 | 42 |
With an allowance recorded | 0 | 34 |
Total | 22 | 76 |
Impaired Loans, Related Allowance | 0 | 0 |
Impaired Loans, YTD Average Recorded Investment | ' | ' |
With no related allowance recorded | 17 | 26 |
With an allowance recorded | 0 | 25 |
Total | 17 | 51 |
Impaired Loans, Interest Income Recognized | ' | ' |
With no related allowance recorded | 0 | 0 |
With an allowance recorded | 0 | 0 |
Total | $0 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Troubled Debt Restructurings by Loan Class) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
loans | loans | |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 3 | 15 |
Pre-Classification Outstanding Recorded Investment | $235 | $1,737 |
Post-Modification Outstanding Recorded Investment | 235 | 1,737 |
Below Market Interest Rate [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 0 | 1 |
Pre-Classification Outstanding Recorded Investment | 0 | 395 |
Post-Modification Outstanding Recorded Investment | 0 | 395 |
Below Market Interest Rate [Member] | Residential Mortgage [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 1 |
Pre-Classification Outstanding Recorded Investment | ' | 395 |
Post-Modification Outstanding Recorded Investment | ' | 395 |
Extended Payment Terms [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 2 | 7 |
Pre-Classification Outstanding Recorded Investment | 202 | 598 |
Post-Modification Outstanding Recorded Investment | 202 | 598 |
Extended Payment Terms [Member] | Residential Mortgage [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 2 | 2 |
Pre-Classification Outstanding Recorded Investment | 202 | 66 |
Post-Modification Outstanding Recorded Investment | 202 | 66 |
Extended Payment Terms [Member] | Commercial Real Estate [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 4 |
Pre-Classification Outstanding Recorded Investment | ' | 513 |
Post-Modification Outstanding Recorded Investment | ' | 513 |
Extended Payment Terms [Member] | Consumer [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 1 |
Pre-Classification Outstanding Recorded Investment | ' | 19 |
Post-Modification Outstanding Recorded Investment | ' | 19 |
Other [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 1 | 7 |
Pre-Classification Outstanding Recorded Investment | 33 | 744 |
Post-Modification Outstanding Recorded Investment | 33 | 744 |
Other [Member] | Commercial Real Estate [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 1 | 5 |
Pre-Classification Outstanding Recorded Investment | 33 | 695 |
Post-Modification Outstanding Recorded Investment | 33 | 695 |
Other [Member] | Consumer [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 2 |
Pre-Classification Outstanding Recorded Investment | ' | 49 |
Post-Modification Outstanding Recorded Investment | ' | $49 |
Recovered_Sheet1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Troubled Debt Restructurings with Subsequent Payment Defaults) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
loans | loans | |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | 0 | 3 |
Recorded investment | ' | $0 |
Other [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 3 |
Recorded investment | ' | 77 |
Other [Member] | Commercial Real Estate [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 1 |
Recorded investment | ' | 28 |
Other [Member] | Consumer [Member] | ' | ' |
Financing Receivable, Modifications [Line Items] | ' | ' |
Number of loans | ' | 2 |
Recorded investment | ' | $49 |
Recovered_Sheet2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Status of Troubled Debt Restructurings) (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2013 |
loans | |
Paid in Full [member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | $0 |
Paying as Restructured [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 1 |
Recorded investment | 146 |
Converted to Non-accrual [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 2 |
Recorded investment | 89 |
Foreclosure/Default [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans foreclosed | 0 |
Recorded investment foreclosed | 0 |
Below Market Interest Rate [Member] | Paid in Full [member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Below Market Interest Rate [Member] | Paying as Restructured [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Below Market Interest Rate [Member] | Converted to Non-accrual [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Below Market Interest Rate [Member] | Foreclosure/Default [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans foreclosed | 0 |
Recorded investment foreclosed | 0 |
Extended Payment Terms [Member] | Paid in Full [member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Extended Payment Terms [Member] | Paying as Restructured [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 1 |
Recorded investment | 146 |
Extended Payment Terms [Member] | Converted to Non-accrual [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 1 |
Recorded investment | 56 |
Extended Payment Terms [Member] | Foreclosure/Default [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans foreclosed | 0 |
Recorded investment foreclosed | 0 |
Forgiveness of Principal [Member] | Paid in Full [member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Forgiveness of Principal [Member] | Paying as Restructured [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Forgiveness of Principal [Member] | Converted to Non-accrual [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Forgiveness of Principal [Member] | Foreclosure/Default [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans foreclosed | 0 |
Recorded investment foreclosed | 0 |
Other [Member] | Paid in Full [member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Other [Member] | Paying as Restructured [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 0 |
Recorded investment | 0 |
Other [Member] | Converted to Non-accrual [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans | 1 |
Recorded investment | 33 |
Other [Member] | Foreclosure/Default [Member] | ' |
Financing Receivable, Modifications [Line Items] | ' |
Number of loans foreclosed | 0 |
Recorded investment foreclosed | $0 |
Recovered_Sheet3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Allowance for Loan Losses by Loan Class) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | $16,549 | $21,141 | |
Provision for loan losses | 35 | 7,381 | |
Loans charged-off | -8,358 | -14,743 | |
Recoveries | 3,364 | 2,770 | |
Net (charge-offs) recoveries | -4,994 | -11,973 | |
Balance, end of period | 11,590 | 16,549 | |
Ending Balance, individually evaluated for impairment | 1,752 | 5,389 | |
Ending Balance, collectively evaluated for impairment | 9,838 | 11,160 | |
Financing Receivables: | ' | ' | |
Total | 493,218 | 498,052 | |
Ending Balance, individually evaluated for impairment | 37,455 | 58,860 | |
Ending Balance, collectively evaluated for impairment | 455,763 | [1] | 439,192 |
Commercial and Industrial [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 1,185 | 2,730 | |
Provision for loan losses | 2 | -1,464 | |
Loans charged-off | -411 | -703 | |
Recoveries | 514 | 622 | |
Net (charge-offs) recoveries | 103 | -81 | |
Balance, end of period | 1,290 | 1,185 | |
Ending Balance, individually evaluated for impairment | 80 | 636 | |
Ending Balance, collectively evaluated for impairment | 1,210 | 549 | |
Financing Receivables: | ' | ' | |
Total | 26,982 | 29,563 | |
Ending Balance, individually evaluated for impairment | 652 | 1,437 | |
Ending Balance, collectively evaluated for impairment | 26,330 | [1] | 28,126 |
Commercial Construction and Land Development [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 7,251 | 8,799 | |
Provision for loan losses | 4 | 5,205 | |
Loans charged-off | -3,759 | -7,929 | |
Recoveries | 587 | 1,176 | |
Net (charge-offs) recoveries | -3,172 | -6,753 | |
Balance, end of period | 4,083 | 7,251 | |
Ending Balance, individually evaluated for impairment | 264 | 1,693 | |
Ending Balance, collectively evaluated for impairment | 3,819 | 5,558 | |
Financing Receivables: | ' | ' | |
Total | 66,253 | 90,899 | |
Ending Balance, individually evaluated for impairment | 12,234 | 20,885 | |
Ending Balance, collectively evaluated for impairment | 54,019 | [1] | 70,014 |
Commercial Real Estate [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 2,961 | 3,800 | |
Provision for loan losses | 15 | 2,486 | |
Loans charged-off | -2,220 | -3,691 | |
Recoveries | 1,506 | 366 | |
Net (charge-offs) recoveries | -714 | -3,325 | |
Balance, end of period | 2,262 | 2,961 | |
Ending Balance, individually evaluated for impairment | 887 | 640 | |
Ending Balance, collectively evaluated for impairment | 1,375 | 2,321 | |
Financing Receivables: | ' | ' | |
Total | 194,238 | 181,194 | |
Ending Balance, individually evaluated for impairment | 12,345 | 17,742 | |
Ending Balance, collectively evaluated for impairment | 181,893 | [1] | 163,452 |
Residential Construction [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 423 | 740 | |
Provision for loan losses | 2 | -214 | |
Loans charged-off | -138 | -103 | |
Recoveries | 0 | 0 | |
Net (charge-offs) recoveries | -138 | -103 | |
Balance, end of period | 287 | 423 | |
Ending Balance, individually evaluated for impairment | 137 | 86 | |
Ending Balance, collectively evaluated for impairment | 150 | 337 | |
Financing Receivables: | ' | ' | |
Total | 28,697 | 20,445 | |
Ending Balance, individually evaluated for impairment | 1,181 | 1,173 | |
Ending Balance, collectively evaluated for impairment | 27,516 | [1] | 19,272 |
Residential Mortgage [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 4,471 | 4,630 | |
Provision for loan losses | 11 | 1,184 | |
Loans charged-off | -1,559 | -1,801 | |
Recoveries | 599 | 458 | |
Net (charge-offs) recoveries | -960 | -1,343 | |
Balance, end of period | 3,522 | 4,471 | |
Ending Balance, individually evaluated for impairment | 384 | 2,334 | |
Ending Balance, collectively evaluated for impairment | 3,138 | 2,137 | |
Financing Receivables: | ' | ' | |
Total | 167,221 | 165,009 | |
Ending Balance, individually evaluated for impairment | 11,043 | 17,573 | |
Ending Balance, collectively evaluated for impairment | 156,178 | [1] | 147,436 |
Consumer [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 188 | 413 | |
Provision for loan losses | 1 | 143 | |
Loans charged-off | -271 | -516 | |
Recoveries | 154 | 148 | |
Net (charge-offs) recoveries | -117 | -368 | |
Balance, end of period | 72 | 188 | |
Ending Balance, individually evaluated for impairment | 0 | 0 | |
Ending Balance, collectively evaluated for impairment | 72 | 188 | |
Financing Receivables: | ' | ' | |
Total | 9,089 | 9,664 | |
Ending Balance, individually evaluated for impairment | 0 | 50 | |
Ending Balance, collectively evaluated for impairment | 9,089 | [1] | 9,614 |
Other [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Balance, beginning of period | 70 | 29 | |
Provision for loan losses | 0 | 41 | |
Loans charged-off | 0 | 0 | |
Recoveries | 4 | 0 | |
Net (charge-offs) recoveries | 4 | 0 | |
Balance, end of period | 74 | 70 | |
Ending Balance, individually evaluated for impairment | 0 | 0 | |
Ending Balance, collectively evaluated for impairment | 74 | 70 | |
Financing Receivables: | ' | ' | |
Total | 738 | 1,278 | |
Ending Balance, individually evaluated for impairment | 0 | 0 | |
Ending Balance, collectively evaluated for impairment | 738 | [1] | 1,278 |
Small Dollar Homogeneous Impaired Loans [Member] | ' | ' | |
Allowance for loan losses: | ' | ' | |
Ending Balance, collectively evaluated for impairment | 73 | ' | |
Financing Receivables: | ' | ' | |
Ending Balance, collectively evaluated for impairment | $1,700 | ' | |
[1] | In 2013, the bank began evaluating small dollar homogeneous impaired loans collectively for impairment and these impaired loans are included in this total. At DecemberB 31, 2013 there were $1.7 million in impaired loans collectively evaluated for impairment with $73,000 in reserves established |
Recovered_Sheet4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
loans | loans | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Number of loans included in the population of purchased impaired loans | 1 | 1 |
Fair value of loans included in the population of purchased impaired loans | $131,000 | $134,000 |
Total loans | 493,218,000 | 498,052,000 |
Impaired loans, recorded investment | 39,176,000 | 58,860,000 |
Carrying value of impaired loans before allocations | 7,772,000 | 23,760,000 |
Impaired loans, allowance | 1,825,000 | 5,389,000 |
Impaired loans, with no related allowance | 31,404,000 | 35,100,000 |
Average recorded investment in impaired loans | 43,076,000 | 60,501,000 |
Interest recognized on impaired loans | 593,000 | 356,000 |
Number of loans modified | 3 | 15 |
Pre-classification outstanding recorded investment | 235,000 | 1,737,000 |
Special Mention and Substandard [Member] | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Total loans | 55,400,000 | 87,300,000 |
Reduction in total loans | -36.50% | ' |
Executive Officers, Directors and Affiliates [Member] | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Line of Credit, pre-approved but unused | $1,100,000 | ' |
BANK_AND_PREMISES_EQUIPMENT_De
BANK AND PREMISES EQUIPMENT (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Property, Plant and Equipment [Line Items] | ' | ' |
Premises and equipment, gross | $27,585,000 | $27,609,000 |
Less accumulated depreciation | -15,014,000 | -14,227,000 |
Premises and equipment, net | 12,571,000 | 13,382,000 |
Depreciation expense | 1,000,000 | 1,100,000 |
Land [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Premises and equipment, gross | 4,394,000 | 4,884,000 |
Buildings and Leasehold Improvements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Premises and equipment, gross | 11,171,000 | 11,139,000 |
Furniture and Equipment [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Premises and equipment, gross | 11,511,000 | 11,586,000 |
Construction in Process [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Premises and equipment, gross | $509,000 | $0 |
OTHER_INTANGIBLES_Other_Intang
OTHER INTANGIBLES (Other Intangibles Net) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' |
Other intangibles b gross | $3 | $494 |
Less accumulated amortization | 2 | 491 |
Other intangibles b net | $1 | $3 |
OTHER_INTANGIBLES_Intangible_A
OTHER INTANGIBLES (Intangible Assets Estimated Amortization Expense) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ' |
Other intangibles amortization expese | $2,000 | $300,000 |
Estimated Amortization, 2013 | $1,115 | ' |
DEPOSITS_Details
DEPOSITS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Less than $100,000 | ' | ' |
2014 | $55,078 | ' |
2015 | 31,686 | ' |
2016 | 9,257 | ' |
2017 | 2,207 | ' |
2018 | 2,402 | ' |
2019 and beyond | 282 | ' |
Total time deposits | 100,912 | 130,210 |
$100,000 or more | ' | ' |
2014 | 84,649 | ' |
2015 | 45,275 | ' |
2016 | 17,817 | ' |
2017 | 7,417 | ' |
2018 | 4,522 | ' |
2019 and beyond | 2,723 | ' |
Total time deposits | 162,403 | 215,984 |
Total | ' | ' |
2014 | 139,727 | ' |
2015 | 76,961 | ' |
2016 | 27,074 | ' |
2017 | 9,624 | ' |
2018 | 6,924 | ' |
2019 and beyond | 3,005 | ' |
Total time deposits | $263,315 | ' |
BORROWINGS_Details
BORROWINGS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
FHLB Advances | $112,000,000 | $112,000,000 |
Additional Disclosure [Abstract] | ' | ' |
FHLB, available lines of credit | 164,000,000 | ' |
FHLB borrowings, weighted average interest rate | 3.58% | 3.58% |
Line of credit, various financial institutions | 16,000,000 | ' |
Federal fund purchases outstanding | 0 | ' |
4.46% Advance Maturing May 25, 2016 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.46% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
4.11% Advance Maturing November 17, 2016 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.11% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
4.09% Advance Maturing November 30, 2016 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.09% | ' |
FHLB Advances | 7,000,000 | 7,000,000 |
4.35% Advance Maturing June 5, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.35% | ' |
FHLB Advances | 10,000,000 | 10,000,000 |
4.36% Advance Maturing July 3, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.36% | ' |
FHLB Advances | 13,000,000 | 13,000,000 |
4.34% Advance Maturing July 24, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.34% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
4.35% Advance Maturing July 31, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.35% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
4.08% Advance Maturing August 14, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 4.08% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
3.94% Advance Maturing August 14, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 3.94% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
3.95% Advance Maturing October 4, 2017 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 3.95% | ' |
FHLB Advances | 7,000,000 | 7,000,000 |
2.06% Advance Maturing February 5, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 2.06% | ' |
FHLB Advances | 10,000,000 | 10,000,000 |
2.25% Advance Maturing June 5, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 2.25% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
2.55% Advance Maturing June 5, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 2.55% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
3.03% Advance Maturing June 5, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 3.03% | ' |
FHLB Advances | 5,000,000 | 5,000,000 |
3.14% Advance Maturing September 10, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 3.14% | ' |
FHLB Advances | 10,000,000 | 10,000,000 |
2.71% Advance Maturing September 18, 2018 [Member] | ' | ' |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ' | ' |
Interest Rate | 2.71% | ' |
FHLB Advances | $10,000,000 | $10,000,000 |
TRUST_PREFERRED_SECURITIES_Det
TRUST PREFERRED SECURITIES (Details) (USD $) | 0 Months Ended | 12 Months Ended | |||
Mar. 30, 2006 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | |
Subordinated Debt [Member] | LIBOR [Member] | ||||
Subordinated Debt [Member] | |||||
Trust Preferred Securities [Member] | |||||
Trust Preferred Securities | ' | ' | ' | ' | ' |
Trust preferred securities | $12,000,000 | ' | ' | ' | ' |
Trust preferred securities, basis spread on variable rate | ' | ' | ' | ' | 1.35% |
Accrued interest payable | ' | $1,642,000 | $1,736,000 | $700,000 | ' |
SUBORDINATED_PROMISSORY_NOTES_
SUBORDINATED PROMISSORY NOTES (Details) (USD $) | 4 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Aug. 31, 2009 | Dec. 31, 2013 |
Subordinated Debt [Abstract] | ' | ' |
Aggregate principal amount of subordinated promissory notes sold | $12 | ' |
Subordinated debt, maturity period | '10 years | ' |
Subordinated debt, interest rate | ' | 8.50% |
INCOME_TAXES_Allocation_of_Inc
INCOME TAXES (Allocation of Income Tax Expense (Benefit)) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Current tax expense: | ' | ' |
Federal | $0 | ($175) |
State | 0 | 0 |
Current tax expense | 0 | -175 |
Deferred tax expense: | ' | ' |
Federal | 279 | -2,617 |
State | -987 | -444 |
Deferred tax expense | -708 | -3,061 |
Provision for income tax expense before adjustment to deferred tax asset | -708 | -3,236 |
Valuation allowance | 708 | 3,061 |
Income tax expense (benefit) | $0 | ($175) |
INCOME_TAXES_Income_Tax_Reconc
INCOME TAXES (Income Tax Reconciliation) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ' | ' |
Statutory federal rate | 34.00% | 34.00% |
Expense computed at statutory rate of 34% | ($119) | ($2,429) |
Effect of state income taxes, net of federal benefit | -28 | -36 |
Tax exempt income | -494 | -293 |
Bank owned life insurance income | -82 | -106 |
Valuation allowance | 708 | 3,061 |
Other, net | 15 | -372 |
Income tax expense (benefit) | $0 | ($175) |
INCOME_TAXES_Deferred_Tax_Asse
INCOME TAXES (Deferred Tax Assets) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Allowance for loan losses | $4,389 | $6,335 |
Non-qualified stock options | 368 | 365 |
OTTI | 602 | 623 |
Net deferred loan fees | 189 | 43 |
Net operating loss | 16,313 | 12,818 |
FMV adjustment on purchased assets | 104 | 136 |
SERP accrual | 179 | 162 |
Other | 1,354 | 2,071 |
Unrealized loss on securities | 166 | 0 |
Total deferred tax assets | 23,664 | 22,553 |
Less valuation allowance | -22,542 | -21,669 |
Net deferred tax assets | 1,122 | 884 |
Deferred tax liabilities: | ' | ' |
Property and equipment | 765 | 528 |
Prepaid expense | 328 | 333 |
Unrealized gain on securities | 0 | -280 |
Other | 29 | 23 |
Total deferred tax liabilities | 1,122 | 604 |
Net deferred tax liability, included in other liabilities | $0 | $280 |
INCOME_TAXES_Narrative_Details
INCOME TAXES (Narrative) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ' | ' |
Deferred tax assets, valuation allowance | ($22,542,000) | ($21,669,000) |
Net deferred tax liability | 0 | 280,000 |
Net operating loss carry forward | $40,500,000 | ' |
REGULATORY_RESTRICTIONS_Detail
REGULATORY RESTRICTIONS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | 31-May-11 | |
Four Oaks Bank & Trust Company (the bBankb) [Member] | ' | ' | ' |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ' | ' | ' |
Dividends paid to the Company by the Bank | $0 | ' | ' |
Minimum individual amount of over 90 days past due loans, relationships, or other assets position to be improved | ' | ' | 750,000 |
Total Capital (to Risk Weighted Assets), Amount | ' | ' | ' |
Total Capital (to Risk Weighted Assets), Amount, Actual | 50,601,000 | 50,044,000 | ' |
Total Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 37,057,000 | 39,246,000 | ' |
Total Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 46,322,000 | 49,057,000 | ' |
Tier I Capital (to Risk Weighted Assets), Amount | ' | ' | ' |
Tier I Capital (to Risk Weighted Assets), Amount, Actual | 44,739,000 | 43,797,000 | ' |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 18,529,000 | 19,623,000 | ' |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 27,793,000 | 29,434,000 | ' |
Tier I Capital (to Average Assets), Amount | ' | ' | ' |
Tier I Capital (to Average Assets), Amount, Actual | 44,739,000 | 43,797,000 | ' |
Tier I Capital (to Average Assets), Amount, Minimum for Capital Adequacy Purposes | 32,529,000 | 34,949,000 | ' |
Tier I Capital (to Average Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | $40,661,000 | $43,687,000 | ' |
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | ' | ' | ' |
Total Capital (to Risk Weighted Assets), Ratio, Actual | 10.90% | 10.20% | ' |
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 | 9.70% | 8.90% | ' |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum for Capital Adequacy Purposes | 4.00% | 4.00% | ' |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 6.00% | 6.00% | ' |
Tier I Capital (to Average Assets), Ratio | ' | ' | ' |
Tier I Capital (to Average Assets), Ratio, Actual | 5.50% | 5.00% | ' |
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 [Member] | ' | ' | ' |
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | ' | ' | ' |
Total Capital (to Risk Weighted Assets), Ratio, Actual | 10.70% | 10.10% | ' |
Total Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 8.00% | ' | ' |
Tier I Capital (to Risk Weighted Assets), Ratio, Actual | 6.30% | 5.90% | ' |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 4.00% | ' | ' |
Tier I Capital (to Average Assets), Ratio | ' | ' | ' |
Tier I Capital (to Average Assets), Ratio, Actual | 3.60% | 3.30% | ' |
Tier I Capital (to Average Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 4.00% | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 08, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Consumer Fraud [Member] | Legally Binding Commitments [Member] | Legally Binding Commitments [Member] | Commitments to Extend Credit [Member] | Commitments to Extend Credit [Member] | Undisbursed Lines of Credit [Member] | Undisbursed Lines of Credit [Member] | Financial Stand-by Letters of Credit [Member] | Financial Stand-by Letters of Credit [Member] | Performance Stand-by Letters of Credit [Member] | Performance Stand-by Letters of Credit [Member] | Credit Card Lines [Member] | Credit Card Lines [Member] | |||
Subsequent Event [Member] | |||||||||||||||
Loan Commitments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loan commitments | $67,332,000 | $74,762,000 | ' | $53,474,000 | $61,610,000 | $35,983,000 | $37,920,000 | $16,500,000 | $20,852,000 | $798,000 | $416,000 | $193,000 | $2,422,000 | $13,858,000 | $13,152,000 |
Settlement amount, civil monetary penalty | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Settlement amount, civil forfeiture | ' | ' | $200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_MEASUREMENT_Assets_
FAIR VALUE MEASUREMENT (Assets Measured at Fair Value on Recurring Basis) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | $32,566 | $73,722 |
Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 5,933 | 5,913 |
Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 25,477 | 60,743 |
Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 5,880 |
Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 131 | 180 |
Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 50 | 56 |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 31,491 | 72,660 |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Total Carrying Amount in the Consolidated Balance Sheet [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 32,566 | 73,722 |
Assets Measured at Fair Value [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 32,566 | 73,722 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 70 | 56 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Trust Preferred Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 70 | 56 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 31,471 | 72,660 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 5,933 | 5,913 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 25,477 | 60,743 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 5,880 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Trust Preferred Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 61 | 124 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Trust Preferred Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 32,566 | 73,722 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 5,933 | 5,913 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 25,477 | 60,743 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 5,880 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Trust Preferred Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 131 | 180 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 32,566 | 73,722 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Taxable Municipal Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 5,933 | 5,913 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Mortgage-backed Securities GNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 25,477 | 60,743 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Mortgage-backed Securities FNMA [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 0 | 5,880 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Trust Preferred Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Equity Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Available for sale securities | $131 | $180 |
FAIR_VALUE_MEASUREMENT_Level_3
FAIR VALUE MEASUREMENT (Level 3 Assets Measured at Fair Value on Recurring Basis) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Level 3 Assets Measured at Fair Value on a Recurring Basis [Roll Forward] | ' | ' |
Beginning Balance | $1,006 | $1,085 |
Total realized and unrealized gains or (losses) included in earnings | 0 | 0 |
Total realized and unrealized gains or (losses) included in other comprehensive income | 19 | -79 |
Purchases, issuances and settlements | 0 | 0 |
Transfers in (out) of Level 3 | 0 | 0 |
Ending Balance | $1,025 | $1,006 |
FAIR_VALUE_MEASUREMENT_Impaire
FAIR VALUE MEASUREMENT (Impaired Loans) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Carrying value of impaired loans before allocations | $7,772 | $23,760 |
Specific valuation allowance allocations | ($1,825) | ($5,389) |
FAIR_VALUE_MEASUREMENT_Assets_1
FAIR VALUE MEASUREMENT (Assets Measured at Fair Value on Nonrecurring Basis) (Details) (Nonrecurring Basis [Member], USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | $0 | $0 |
Foreclosed assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | 0 | 0 |
Foreclosed assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | 18,215 | 31,072 |
Foreclosed assets | 8,502 | 15,136 |
Total Carrying Amount in the Consolidated Balance Sheet [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | 18,215 | 31,072 |
Foreclosed assets | 8,502 | 15,136 |
Assets Measured at Fair Value [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | 18,215 | 31,072 |
Foreclosed assets | $8,502 | $15,136 |
FAIR_VALUE_MEASUREMENT_Level_31
FAIR VALUE MEASUREMENT (Level 3 Nonrecurring and Recurring Fair Value Measurement) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Available for sale securities | $32,566 | $73,722 |
Impaired loans | 39,176 | 58,860 |
Foreclosed assets | 8,502 | 15,136 |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Significant Unobservable Inputs (Level 3) [Member] | Recurring Measurement [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Available for sale securities | 1,025 | 1,006 |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Impaired loans | 18,215 | ' |
Foreclosed assets | 8,502 | ' |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | Minimum [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Collateral discounts | 9.00% | ' |
Discounted appraisals | 10.00% | ' |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | Maximum [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Collateral discounts | 50.00% | ' |
Discounted appraisals | 30.00% | ' |
Significant Unobservable Inputs (Level 3) [Member] | Trust Preferred Securities [Member] | Recurring Measurement [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Available for sale securities | $1,025 | $1,006 |
Loss given default | 100.00% | ' |
Significant Unobservable Inputs (Level 3) [Member] | Trust Preferred Securities [Member] | Recurring Measurement [Member] | Minimum [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Probability of default | 10.00% | ' |
Significant Unobservable Inputs (Level 3) [Member] | Trust Preferred Securities [Member] | Recurring Measurement [Member] | Maximum [Member] | ' | ' |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ' | ' |
Probability of default | 20.00% | ' |
FAIR_VALUE_MEASUREMENT_Range_o
FAIR VALUE MEASUREMENT (Range of Collateral Discounts) (Details) | 12 Months Ended |
Dec. 31, 2013 | |
Commercial Construction and Land Development [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 10.50% |
Commercial Construction and Land Development [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 40.00% |
Commercial Real Estate Other Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 12.50% |
Commercial Real Estate Other Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 50.00% |
Residential Construction [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 9.00% |
Residential Construction [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 30.00% |
Residential Mortgage [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 9.00% |
Residential Mortgage [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 20.00% |
All Other Segments [Member] | Minimum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 9.00% |
All Other Segments [Member] | Maximum [Member] | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Collateral discounts | 20.00% |
FAIR_VALUE_MEASUREMENT_Narrati
FAIR VALUE MEASUREMENT (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | $39,176,000 | $58,860,000 |
With an allowance recorded | 7,772,000 | 23,760,000 |
Specific valuation allowance allocations | -1,825,000 | -5,389,000 |
With no related allowance recorded | 31,404,000 | 35,100,000 |
Foreclosed assets valuation reductions | 1,600,000 | 2,300,000 |
Foreclosed assets | 8,502,000 | 15,136,000 |
Loans Receivable [Member] | Maximum [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Collateral discounts | 40.00% | ' |
Estimated Fair Value [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Impaired loans | 20,000,000 | 36,500,000 |
With an allowance recorded | 7,772,000 | 23,761,000 |
Specific valuation allowance allocations | -1,825,000 | -5,389,000 |
With no related allowance recorded | $12,300,000 | $12,700,000 |
STOCK_OPTION_PLAN_Narrative_De
STOCK OPTION PLAN (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Common stock reserved for future issuance | 131,673 | ' |
Weighted average exercise price, exercisable options (in usd per share) | $8.67 | ' |
Unrecognized compensation cost, non-vested awards | $39,908 | $61,493 |
Weighted average fair value of options granted (in usd per share) | $0.69 | $0.87 |
Stock Options [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Common stock reserved for future issuance | 1,542,773 | ' |
Award vesting rights, percentage | 100.00% | ' |
Award vesting period | ' | '2 years |
Minimum [Member] | Stock Options [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Award vesting period | '1 year | ' |
Maximum [Member] | Stock Options [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Award vesting period | '2 years | ' |
STOCK_OPTION_PLAN_Option_Activ
STOCK OPTION PLAN (Option Activity Rollforward) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Options, Outstanding [Roll Forward] | ' |
Outstanding at beginning of period (in shares) | 253,680 |
Issued (in shares) | 59,300 |
Exercised (in shares) | 0 |
Forfeited (in shares) | 11,275 |
Expired (in shares) | 0 |
Outstanding at end of period (in shares) | 301,705 |
Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ' |
Outstanding at beginning of period (in usd per share) | $7 |
Granted (in usd per share) | $1.15 |
Exercised (in usd per share) | $0 |
Forfeited (in usd per share) | $3.33 |
Expired (in usd per share) | $0 |
Outstanding at end of period (in usd per share) | $5.99 |
Options, Additional Disclosures | ' |
Weighted-Average Remaining Contractual Term | '2 years 3 months 3 days |
Aggregate Intrinsic Value | $25,200 |
Options, Exercisable (in shares) | 190,049 |
Options, Exercisable (in usd per share) | $8.67 |
Options, Exercisable, Weighted Average Remaining Contractual Term | '1 year 5 months 4 days |
Options, Exercisable, Intrinsic Value | $0 |
STOCK_OPTION_PLAN_Nonvested_Op
STOCK OPTION PLAN (Non-vested Options) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Options, Nonvested, Number of Shares [Roll Forward] [Roll Forward] | ' | ' |
Non-vested - beginning of period (in shares) | 112,131 | ' |
Granted (in shares) | 56,000 | ' |
Vested (in shares) | 3,075 | ' |
Forfeited/Expired (in shares) | 53,400 | ' |
Non-vested - end of period (in shares) | 111,656 | 112,131 |
Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ' | ' |
Non-vested - beginning of period (in usd per share) | $1.09 | ' |
Granted (in usd per share) | $0.69 | $0.87 |
Vested (in usd per share) | $0.87 | ' |
Forfeited/Expired (in usd per share) | $1.34 | ' |
Non-vested - end of period (in usd per share) | $0.78 | $1.09 |
STOCK_OPTION_PLAN_Options_by_E
STOCK OPTION PLAN (Options by Exercise Price) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Number Outstanding (in shares) | 301,705,000 |
Contractual Life (Years) | '2 years 3 months 3 days |
Number Exercisable (in shares) | 190,049,000 |
1.15 - 1.69 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 1.15 |
Exercise price range, upper range limit (in usd per share) | 1.69 |
Number Outstanding (in shares) | 56,000,000 |
Contractual Life (Years) | '4 years 2 months 8 days |
Number Exercisable (in shares) | 0 |
1.70 - 2.99 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 1.7 |
Exercise price range, upper range limit (in usd per share) | 2.99 |
Number Outstanding (in shares) | 55,625,000 |
Contractual Life (Years) | '3 years 1 month 27 days |
Number Exercisable (in shares) | 0 |
3.00 - 5.49 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 3 |
Exercise price range, upper range limit (in usd per share) | 5.49 |
Number Outstanding (in shares) | 51,750,000 |
Contractual Life (Years) | '2 years 1 month 27 days |
Number Exercisable (in shares) | 51,746,000 |
5.50 - 8.63 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 5.5 |
Exercise price range, upper range limit (in usd per share) | 8.63 |
Number Outstanding (in shares) | 51,125,000 |
Contractual Life (Years) | '1 year 1 month 24 days |
Number Exercisable (in shares) | 51,102,000 |
8.64 - 10.91 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 8.64 |
Exercise price range, upper range limit (in usd per share) | 10.91 |
Number Outstanding (in shares) | 47,775,000 |
Contractual Life (Years) | '1 month 24 days |
Number Exercisable (in shares) | 47,774,000 |
10.92 - 40.78 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 10.92 |
Exercise price range, upper range limit (in usd per share) | 40.78 |
Number Outstanding (in shares) | 27,125,000 |
Contractual Life (Years) | '1 year 7 months 2 days |
Number Exercisable (in shares) | 27,122,000 |
40.79 [Member] | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' |
Exercise price range, lower range limit (in usd per share) | 40.79 |
Exercise price range, upper range limit (in usd per share) | 40.79 |
Number Outstanding (in shares) | 12,305,000 |
Contractual Life (Years) | '4 years 0 months 25 days |
Number Exercisable (in shares) | 12,305,000 |
STOCK_OPTION_PLAN_Valuation_As
STOCK OPTION PLAN (Valuation Assumptions) (Details) (Stock Options [Member]) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Stock Options [Member] | ' | ' |
Valuation Assumptions [Line Items] | ' | ' |
Dividend yield | 0.00% | 0.00% |
Expected volatility | 73.30% | 60.37% |
Risk free interest rate | 0.90% | 0.84% |
Expected life | '5 years | '5 years |
OTHER_EMPLOYEE_BENEFITS_Detail
OTHER EMPLOYEE BENEFITS (Details) (USD $) | 12 Months Ended | 299 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Maximum annual contribution per employee, amount | $17,500 | ' | ' |
Maximum annual contribution per employee, percent | 25.00% | ' | ' |
Employer matching contribution, percent | 6.00% | ' | ' |
Defined contribution plan, expenses | 138,000 | 145,000 | ' |
ESOP, employee minimum age | '21 years | ' | ' |
ESOP, employee requisite service period | '6 months | ' | ' |
Common stock reserved for future issuance | 131,673 | ' | 131,673 |
Sick Leave Plan [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Maximum contractual term | '60 days | ' | ' |
Requisite service period | '10 years | ' | ' |
Retirement age | '55 years | ' | ' |
Accrued liability, sick leave | 521,000 | 534,000 | 521,000 |
Deferred compensation expenses under the plan | 41,000 | 114,000 | ' |
Cash benefits paid to retiring employees | 54,000 | 15,000 | 54,000 |
Employee Stock Purchase and Bonus Plan [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Maximum employee subscription rate | 5.00% | ' | 5.00% |
Maximum employee subscription amount | 1,000 | ' | 1,000 |
Employer matching percent | 50.00% | ' | ' |
Employer matching amount | 500 | ' | 500 |
Common stock reserved for future issuance | 118,000 | ' | 118,000 |
Shares purchased | 76,000 | 63,058 | 401,000 |
President [Member] | SERP [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Accrued liability | 481,000 | 420,000 | 481,000 |
Retirement plan expense | $61,000 | 55,000 | ' |
LEASES_Details
LEASES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
branch_offices | ||
Leases [Abstract] | ' | ' |
Number of branch facilities | 6 | ' |
2014 | $329 | ' |
2015 | 319 | ' |
2016 | 260 | ' |
2017 | 211 | ' |
2018 | 185 | ' |
2019 and beyond | 627 | ' |
Future minimum lease payments | 1,931 | ' |
Total rental expense | $306 | $367 |
PARENT_COMPANY_FINANCIAL_INFOR2
PARENT COMPANY FINANCIAL INFORMATION (Condensed Balance Sheets) (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||
Assets: | ' | ' | ' |
Cash and cash equivalents | $128,629 | $183,150 | $141,197 |
Investment securities available for sale, at fair value | 32,566 | 73,722 | ' |
Other assets | 6,261 | 8,318 | ' |
TOTAL ASSETS | 821,546 | 865,498 | ' |
Liabilities and Shareholders' Equity: | ' | ' | ' |
Other liabilities | 4,289 | 4,858 | ' |
Subordinated debentures | 12,372 | 12,372 | ' |
Subordinated promissory notes | 12,000 | 12,000 | ' |
Shareholders' equity | 21,623 | 22,676 | 29,692 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 821,546 | 865,498 | ' |
Parent [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | 456 | 784 | 1,427 |
Equity investment in subsidiaries | 44,925 | 45,025 | ' |
Investment securities available for sale, at fair value | 1,156 | 1,186 | ' |
Other assets | 195 | 587 | ' |
TOTAL ASSETS | 46,732 | 47,582 | ' |
Liabilities and Shareholders' Equity: | ' | ' | ' |
Other liabilities | 737 | 534 | ' |
Subordinated debentures | 12,372 | 12,372 | ' |
Subordinated promissory notes | 12,000 | 12,000 | ' |
Shareholders' equity | 21,623 | 22,676 | ' |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $46,732 | $47,582 | ' |
PARENT_COMPANY_FINANCIAL_INFOR3
PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Operations) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Condensed Income Statements, Captions [Line Items] | ' | ' |
Gain on sale of investments, available for sale | $462 | $1,981 |
Impairment loss on investment securities available for sale | 0 | 0 |
Net loss | -350 | -6,969 |
Parent [Member] | ' | ' |
Condensed Income Statements, Captions [Line Items] | ' | ' |
Equity in undistributed loss of subsidiaries | 899 | -5,848 |
Interest income | 2 | 113 |
Gain on sale of investments, available for sale | 0 | 0 |
Impairment loss on investment securities available for sale | 0 | 0 |
Other income | 87 | 154 |
Other expenses | -1,338 | -1,388 |
Net loss | ($350) | ($6,969) |
PARENT_COMPANY_FINANCIAL_INFOR4
PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Cash Flows) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Operating activities: | ' | ' |
Net income (loss) | ($350) | ($6,969) |
Stock based compensation | 20 | 62 |
Decrease in other assets | 2,274 | -1,296 |
Increase in other liabilities | -569 | 1,612 |
Net cash provided by operating activities | 5,239 | 4,680 |
Investing activities: | ' | ' |
Sales and maturities of securities | 20,873 | 50,414 |
Net cash (used in) provided by investing activities | -75,109 | 83,072 |
Financing activities: | ' | ' |
Proceeds from issuance of common stock | 220 | 234 |
Net cash provided by (used in) financing activities | 15,349 | -45,799 |
Change in cash and cash equivalents | -54,521 | 41,953 |
Cash and cash equivalents at beginning of period | 183,150 | 141,197 |
Cash and cash equivalents at end of period | 128,629 | 183,150 |
Parent [Member] | ' | ' |
Operating activities: | ' | ' |
Net income (loss) | -350 | -6,969 |
Equity in undistributed loss of subsidiaries | -899 | 5,848 |
Stock based compensation | 0 | 62 |
Decrease in other assets | 427 | 5 |
Increase in other liabilities | 203 | 217 |
Net cash provided by operating activities | -619 | -837 |
Investing activities: | ' | ' |
Investment in subsidiaries | 0 | -40 |
Sales and maturities of securities | 72 | ' |
Net cash (used in) provided by investing activities | 72 | -40 |
Financing activities: | ' | ' |
Proceeds from issuance of common stock | 219 | 234 |
Net cash provided by (used in) financing activities | 219 | 234 |
Change in cash and cash equivalents | -328 | -643 |
Cash and cash equivalents at beginning of period | 784 | 1,427 |
Cash and cash equivalents at end of period | $456 | $784 |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Level 1 [Member] | Level 1 [Member] | Level 2 [Member] | Level 2 [Member] | Level 3 [Member] | Level 3 [Member] | Carrying Value [Member] | Carrying Value [Member] | Estimated Fair Value [Member] | Estimated Fair Value [Member] | Loans Receivable [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Adjustment for current liquidity and market discount, rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% |
Financial assets: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash and cash equivalents | ' | ' | $128,629 | $183,150 | $0 | $0 | $0 | $0 | $128,629 | $183,150 | $128,629 | $183,150 | ' |
CDs held for investment | 31,850 | 26,460 | 0 | 0 | 31,850 | 26,460 | 0 | 0 | 31,850 | 26,460 | 31,850 | 26,460 | ' |
Securities available for sale | 32,566 | 73,722 | 50 | 56 | 31,491 | 72,660 | 1,025 | 1,006 | 32,566 | 73,722 | 32,566 | 73,722 | ' |
Securities held to maturity | 95,831 | 20,668 | 0 | 0 | 95,831 | 20,668 | 0 | 0 | 98,013 | 20,329 | 95,831 | 20,668 | ' |
Loans held for sale | ' | ' | ' | 0 | ' | 0 | ' | 19,297 | ' | 19,297 | ' | 19,297 | ' |
Loans, net | ' | ' | 0 | 0 | 0 | 0 | 458,254 | 460,422 | 481,122 | 462,083 | 458,254 | 460,422 | ' |
FHLB stock | ' | ' | 0 | 0 | 6,076 | 6,415 | 0 | 0 | 6,076 | 6,415 | 6,076 | 6,415 | ' |
Premises and equipment, held for sale | ' | ' | ' | 0 | ' | 0 | ' | 1,901 | ' | 1,901 | ' | 1,901 | ' |
Accrued interest receivable | ' | ' | 0 | 0 | 1,576 | 1,869 | 0 | 0 | 1,576 | 1,869 | 1,576 | 1,869 | ' |
Financial liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deposits | ' | ' | 0 | 0 | 659,733 | 702,990 | 0 | 0 | 657,620 | 699,856 | 659,733 | 702,990 | ' |
Subordinated debentures and promissory notes | ' | ' | 0 | 0 | 0 | 0 | 24,369 | 15,598 | 24,372 | 24,372 | 24,369 | 15,598 | ' |
Borrowings | ' | ' | 0 | 0 | 121,519 | 126,738 | 0 | 0 | 112,000 | 112,000 | 121,519 | 126,738 | ' |
Accrued interest payable | ' | ' | $0 | $0 | $1,642 | $1,736 | $0 | $0 | $1,642 | $1,736 | $1,642 | $1,736 | ' |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 26, 2014 | Mar. 27, 2014 | Mar. 24, 2014 |
In Millions, except Share data, unless otherwise specified | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | ||
Standby Investor [Member] | Standby Offering [Member] | ||||
Standby Investor [Member] | |||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' |
Sales price (in usd per share) | ' | ' | ' | ' | $1 |
Number of common stock shares | ' | ' | ' | ' | 10,000,000 |
Common stock, par value (in usd per share) | $1 | $1 | ' | ' | $1 |
Number of additional common stock shares for purchase | ' | ' | ' | ' | 6,000,000 |
Number of shares sold at the initial sale | ' | ' | ' | 875,000 | ' |
Percentage of ownership owned by investor | ' | ' | ' | 25.00% | ' |
Rights of offering, maximum amount | ' | ' | $26.60 | ' | ' |
Rights of offering, number of shares called by each non-transferable right | ' | ' | 3 | ' | ' |
Rights of offering, subscription price per share (in usd per share) | ' | ' | $1 | ' | ' |